DraftKings — Second Quarter 2026 Earnings Summary

Financial Performance

• Reported revenue of $1,443 million for the three months ended June 30, 2026, a 5% decrease ($69 million) compared to $1,513 million in the same period in 2025.
• Sports Consumer Volume reached $13.1 billion, an increase of 15% ($1.7 billion) year-over-year.
• Adjusted EBITDA was $114.6 million for the quarter, down from $300.6 million in the prior year period.
• GAAP net loss attributable to common stockholders was $67.6 million for the quarter, compared to net income of $157.9 million in the prior year.
• Diluted loss per share was $(0.14) for the quarter, versus diluted earnings of $0.30 in the prior year.
• Adjusted Diluted Earnings Per Share was $0.09 for the quarter, down from $0.38 in the prior year.
• Average Revenue per Monthly Unique Payer (ARPMUP) decreased 13% to $132, down from $151 in the prior year.
• Total assets were $4.28 billion as of June 30, 2026, compared to $4.53 billion as of December 31, 2025.
• Cash and cash equivalents stood at $983.9 million as of June 30, 2026, down from $1.13 billion at year-end 2025.
• Total liabilities were $3.71 billion as of June 30, 2026, compared to $3.90 billion at December 31, 2025.
• Convertible notes, net of issuance costs, were $1.26 billion as of June 30, 2026.
• Term B Loan, net of issuance costs, was $574.6 million as of June 30, 2026.
• Net cash flows provided by operating activities were $63.0 million for the six months ended June 30, 2026, compared to $54.9 million in the prior year period.
• Net cash flows used in investing activities were $93.4 million for the six months ended June 30, 2026, compared to $74.3 million in the prior year period.
• Net cash flows used in financing activities were $186.6 million for the six months ended June 30, 2026, compared to net cash provided of $253.1 million in the prior year period.
• Stock-based compensation was $82.6 million for the quarter and $147.8 million for the six months ended June 30, 2026.

Guidance and Future Outlook

• Maintained fiscal year 2026 revenue guidance range of $6.5 billion to $6.9 billion.
• Maintained fiscal year 2026 Adjusted EBITDA guidance range of $700 million to $900 million.
• Management expects to generate approximately $1 billion of Adjusted EBITDA for the full year 2026.
• Expressed confidence in winning the Predictions category during the upcoming NFL season and beyond.
• Noted that Predictions is growing faster than anticipated and exhibits customer metrics similar to the Sportsbook.

Business Segments and Product Lines

• Sports Revenue was $891.9 million for the quarter, a 10.6% decrease from $997.9 million in the prior year.
• Sports Net Revenue Margin was 6.8% for the quarter, down from 8.7% in the prior year.
• iGaming Revenue was $461.9 million for the quarter, an increase of 7.5% from $429.7 million in the prior year.
• Other Revenue was $89.4 million for the quarter, an increase of 5.2% from $85.0 million in the prior year.
• Monthly Unique Payers (MUPs) increased approximately 9% to 3.6 million in the quarter.
• The Super App is now live nationwide.
• DraftKings Predictions launched in December 2025 and is currently growing.
• Mobile sports betting is live in 27 states, Washington, D.C., and Puerto Rico, representing approximately 53% of the U.S. population.
• iGaming is live in 5 states, representing approximately 11% of the U.S. population.
• Sportsbook and iGaming offerings are live in Canadian provinces representing approximately 51% of the Canadian population.

Market and Competitive Landscape

• Strong customer acquisition and engagement drove the increase in Sports Consumer Volume.
• The company operates as the only U.S.-based vertically integrated sports betting operator.
• DraftKings owns Jackpocket, the leading digital lottery courier app in the United States.
• DraftKings is an official partner of the NHL, PGA TOUR, WNBA, NASCAR, NBA, and MLB.

Risks and Challenges

• Revenue decline was driven by customer-friendly sport outcomes and increased promotional reinvestment for new customer acquisition.
• Forward-looking statements involve risks including the ability to manage growth, execute business plans, and meet projections in the emerging prediction markets category.
• Potential risks include litigation, changes in applicable laws or regulations regarding gaming and prediction markets, and general economic conditions.
• Risks related to tariffs, import/export restrictions, inflation, rising interest rates, and banking system instability are noted.

Management Commentary and Tone

• CEO Jason Robins stated the company delivered a strong second quarter and entered the back half of the year with real momentum.
• CFO Alan Ellingson highlighted financial flexibility to invest behind the significant opportunity in Predictions.
• Management expressed confidence in the company's ability to win the Predictions category.
• The tone was confident regarding the core business growth across handle, users, and engagement.

Other Key Points

• The company purchased treasury stock under its Stock Repurchase Program for $154.2 million during the six months ended June 30, 2026.
• Purchase of treasury stock for RSU withholding totaled $43.5 million for the six months ended June 30, 2026.
• Cash paid for internally developed software costs was $75.1 million for the six months ended June 30, 2026.
• Depreciation and amortization was $152.0 million for the six months ended June 30, 2026.
• Advocacy and other related legal expenses were $19.9 million for the quarter and $46.2 million for the six months, primarily relating to legislative efforts for legalizing iGaming and Sportsbook.
• A conference call and audio webcast were scheduled for August 7, 2026, to discuss results.