BOSTON, September 2, 2026, 05:32 EDT — Shares of DraftKings Inc. NASDAQ:DKNG ended Tuesday at $23.44, shedding 3.5%. The stock was last seen at $23.37 as of 05:06 EDT Wednesday Yahoo Finance.
- DraftKings will launch customer promotions across the country on September 2, featuring its Predictions product.
- Sports volume increased by 14.5% in the second quarter, but sports revenue dropped by 10.6%.
- A class action in California demands compensation and aims to halt sales of the product within the state.
Investors are now focused less on Predictions’ ability to draw users and more on whether its growth can offset marketing expenses and legal challenges.
DraftKings recorded $13.14 billion in sports consumer volume for the second quarter, up 14.5% from a year earlier. However, sports revenue declined by 10.6% to $891.9 million company results filed with the SEC.
Predictions are counted under sports revenue and volume by the company. Product revenue figures are not disclosed individually. As a result, margin remains the most transparent public measure.
DraftKings shares: six-session slide
Daily closes through September 1, followed by the latest September 2 premarket trade. U.S. dollars.
DraftKings rolled out its “Gameday” promotion on Wednesday, unveiling national deals for Sportsbook, Predictions, and Casino. The company is also offering a free-fuel activation in Los Angeles DraftKings announcement.
The firm refers to Predictions as event-contract trading. According to the company, the division operates as a CFTC-registered introducing broker and holds NFA membership. Availability depends on region DraftKings Predictions.
A California plaintiff initiated a proposed class action on August 13, claiming that Predictions operates as an unlicensed sportsbook. The suit requests an injunction along with more than $5 million in damages iGamingWorld. There has been no finding of liability against DraftKings.
More activity produced less sports revenue
Quarter ended June 30, 2026. Sports includes Sportsbook and Predictions. Source: DraftKings Q2 results.
DraftKings attributed its drop in quarterly revenue to favorable outcomes for customers and an increase in promotional spending, which included expenses for both Sportsbook and Predictions. The company said the announcement puts Wednesday’s campaign under scrutiny for its impact on margins.
Chief Executive Jason Robins stated that Predictions was “already growing faster than we anticipated.” The number of monthly unique payers increased by 9% to 3.6 million. Average revenue per payer declined 13% to $132.
User growth did not carry through to earnings
Adjusted EBITDA fell to $114.6 million from $300.6 million. Quarter ended June 30, 2026. Bars show direction and relative change, not a shared unit scale. Source: DraftKings Q2 results.
Chief Financial Officer Alan Ellingson maintained the 2026 forecast without changes. DraftKings projects revenue between $6.5 billion and $6.9 billion. Guidance for adjusted EBITDA stays at $700 million to $900 million.
The balance sheet allows for some flexibility, though it is not unlimited. As of June 30, cash totaled $983.9 million. The company posted a net loss of $67.6 million for the quarter DraftKings Form 10-Q.
Rivalry is heating up. FanDuel, a subsidiary of Flutter Entertainment plc NYSE:FLUT, and Fanatics have launched their own prediction market offerings Card Player. Gaining access to California may become significant ahead of the legalization of conventional sports betting in the state.
Risks: The lawsuit presents allegations, not established findings. Improved sports results may rapidly boost revenue as well. Product availability could shift suddenly due to federal or state court decisions.
Wednesday’s promotion serves as the next operational test. Investors are set to observe initial NFL user activity and the 09:30 EDT market open. The critical figure is the revenue kept from every new transaction.
Related articles: NASDAQ:DKNG
