Still lagging FanDuel, DraftKings reports better-than-expected Q2 revenue
Despite all that marketing, profitability has been patchy.
Sports betting app DraftKings reported Q2 earnings Wednesday after the close, beating revenue expectations and sending shares up over 4% in after-hours trading.
The sportsbook, the second-biggest in terms of US market share, reported:
Non-GAAP earnings per share of $0.38 vs. Wall Street expectations for $0.39.
Revenue of $1.51 billion vs. the $1.42 billion expected by analysts.
It kept full-year 2025 revenue guidance stable at the midpoint of $6.3 billion, which it offered last quarter.
DraftKings has lagged Flutter Entertainment, parent company of archrival FanDuel, for much of the year. But the two are, essentially, the well-entrenched big dogs of the online sports betting business.
As such, they both face headwinds from a recent push from state governments to lift taxes on sports bets to offset rising fiscal strain.
States like Illinois, Maryland, Louisiana, and New Jersey — the third-largest state for commercial sports betting revenue, according to Fitch Ratings — all lifted taxes on the sector recently.
Analysts will be eagerly awaiting any color from DraftKings execs on how they plan to pass tax increases along to gamblers and how those plans may be impacting betting activity.
Another key question for sports betting stocks is whether their run of bad luck has ended. A string of bettor-friendly results (essentially favorites winning big games) had suppressed the “hold” these companies have reported — that is, the amount of the total cash they keep after paying out winnings to those who bet right.
