Platforms · Software · Providers · Markets
On 6 November 2026, DraftKings raised its expected 2026 Adjusted EBITDA investment in Predictions to between $650 million and $700 million. The larger outlay leaves less of the earnings from its established businesses available at group level.
Third-quarter revenue increased 16% year over year to $1.33 billion, while the Adjusted EBITDA loss widened to $316.9 million from $126.5 million. DraftKings now forecasts full-year Adjusted EBITDA of $175 million to $275 million, compared with its earlier range of $700 million to $900 million.
The company expects its established sportsbook and iGaming operations to contribute $875 million to $925 million. Predictions will use $175 million to $225 million of Adjusted EBITDA in the fourth quarter. For 2026, DraftKings expects the unit's net revenue to be immaterial because customer promotions will offset most gross revenue.
DKeX revenue spans three functions
DraftKings gave its first detailed account of DKeX trading economics. Across September and October, trades produced an average gross take rate of approximately 11.1%, combining revenue from market making, exchange activity and brokerage. DraftKings retained about two-thirds of that gross revenue; external market makers took the rest.
The company runs the client-facing app, DKeX and its own market-making operation. That gives it revenue opportunities at multiple points in a trade, although promotions currently return much of the income to customers.
More than 1.6 million customers had used Predictions since the start of 2026. At October's rate, customer trading volume would annualise to $10.1 billion, almost three times July's pace. Total volume, including market-maker activity, would annualise to $56.8 billion. That figure is not a measure of customer turnover alone.
Forecasts depend on sports access
DraftKings said its 2026 customer cohort was generating approximately $350 million in annualised Adjusted Gross Profit, with acquisition costs expected to be recouped in about 20 months. The estimate extrapolates recent performance; the payback remains projected.
The company's third-quarter business update, which Finance Magnates reported on, also sets out a 2027 Predictions revenue range of $650 million to $750 million and an Adjusted EBITDA investment of $250 million to $350 million. DraftKings expects positive free cash flow from Predictions in 2028 and higher group Adjusted EBITDA that year.
The outlook includes a scenario in which sports event contracts end in July 2028 amid disputes about whether such markets require state gambling licences. Management estimates the 2026 cohort would repay its acquisition costs before then. The 2027 cohort would have covered more than half its costs by July 2028 and might recoup them within roughly four years without sports contracts. DraftKings says it will change its Predictions investment as the regulatory position develops.
What this changes for operators
Trading and finance teams should keep customer turnover distinct from total venue activity. October's $10.1 billion annualised customer-volume pace and $56.8 billion total-volume pace measure different flows. Operators should also establish how brokerage, exchange and market-making revenue, alongside promotions, appear in transaction records and management reporting.
The forecasts depend on both customer payback and the continued availability of sports contracts. Teams assessing similar products should ask how changes in permitted markets would affect product controls, customer reporting and spending plans. DraftKings has not specified the operational changes or costs involved, so those remain points for operators to test rather than assume.
