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Sports betting platform DraftKings reports third-quarter 2026 results, net loss widens to $469 million

Sports betting platform DraftKings reported third-quarter 2026 results, with revenue up 16% year over year to $1.329 billion, net loss widening from $257 million in the same period last year to $469 million, and basic and diluted loss per share of 94 cents. The company lowered its 2026 revenue guidance to $6.35 billion to $6.55 billion, and lowered adjusted EBITDA guidance from a previous $700 million to $900 million to $175 million to $275 million.

The downward revision to guidance mainly reflects increased adjusted EBITDA investment in the Predictions business from a lower level to $650 million to $700 million, with the fourth quarter expected to account for $175 million to $225 million of that. Because new-user promotions will offset most gross transaction revenue, the company expects Predictions to contribute only limited revenue this year. Expected 2026 adjusted EBITDA for the core business is $875 million to $925 million.

The company also provided 2027 guidance for the first time: revenue of $7.35 billion to $7.75 billion, and adjusted EBITDA of $800 million to $1 billion (with the midpoint including about $300 million of Predictions investment). Expected 2027 revenue for the core business is $6.7 billion to $7 billion, with adjusted EBITDA of $1.15 billion to $1.25 billion; expected Predictions revenue is $650 million to $750 million, corresponding to adjusted EBITDA investment of $250 million to $350 million.

Original source:

  1. Title: DraftKings Reports Third Quarter Revenue Growth of 16% Publisher: DraftKings Inc. Publication date: November 5, 2026 URL: https://s21.q4cdn.com/869500724/files/doc_news/DraftKings-Reports-Third-Quarter-Revenue-Growth-of-16-2026.pdf Nature of source: company official press release Verification status: The full original text has been read, and the core figures (revenue, net loss, loss per share, both guidance ranges, Predictions investment scale and revenue expectations, 2027 guidance) all directly correspond to the original wording Supporting content: third-quarter financial results, the reasons for and specific ranges of the updated 2026 guidance, the Predictions business investment and revenue framing, and the preliminary 2027 guidance with core business breakdown

ABAB AI Insight

DraftKings is directing the free cash flow generated by its core sportsbook and iGaming businesses toward user acquisition and trading incentives for the Predictions business on a large scale. In 2026, adjusted EBITDA investment in that business reaches $650 million to $700 million, accounting for the vast majority of the midpoint of the overall guidance, causing a sharp downward revision to overall guidance, while guidance for the core business remains in the $875 million to $925 million range.

The company clearly stated that 2026 Predictions revenue will remain limited because new-user promotions offset gross revenue. This framing indicates that, at the current stage, capital investment is mainly being converted into customer scale and trading volume rather than immediately being reflected in net revenue, and that the capital path is to use core business cash flow to subsidize customer acquisition costs for the emerging business.

The 2027 guidance shows Predictions revenue expected to rise to $650 million to $750 million, while adjusted EBITDA investment declines to $250 million to $350 million. This comparison suggests that the company assumes acquisition spending will have peaked in 2026 and can enter a relatively reduced-spending phase in 2027, converting users into existing traders who can contribute net revenue.

In a landscape where sports betting and prediction markets coexist, DraftKings is choosing to use core-business profit to cover the early losses of the prediction market rather than compressing investment on both sides at the same time. Capital allocation priority is therefore shifting toward the new business, with core-business free cash flow becoming the main source supporting overall expansion.

ABAB News · Cognitive Law

  1. Core-business free cash flow is used to cover acquisition promotions for the prediction market rather than being converted into net revenue in the same year.

  2. The scale of the guidance downgrade mainly comes from the expansion of investment in a single new business, rather than from deterioration in the core business’s profitability itself.