DraftKings says the first three months of 2026 were sparkling for its online gambling business, which is preparing a major prediction market offensive.
- DraftKings reported strong Q1 2026 results with revenue up 17% to $1.65 billion and quarterly profit improving to $21.1 million from a loss a year earlier.
- CEO Jason Robins said the company plans major investments in prediction markets, including a proprietary exchange and sports prediction parlays.
- DraftKings said prediction market activity is growing rapidly, with annualized consumer volume surpassing $1 billion, while the company emphasized responsible growth and customer protections.
The Boston-based online gambling company reported financial results for the quarter ended March 31 on Thursday, with revenue coming in 17% higher than a year earlier, at $1.65 billion.
DraftKings recorded a profit for the first quarter of $21.1 million, up from a loss of $33.9 million in the first quarter of 2025. The company also generated adjusted EBITDA of approximately $168 million, an increase of 64% compared to a year earlier and better than some Wall Street estimates.
Moreover, the online sportsbook and casino operator maintained its previous financial guidance for 2026 of revenue between $6.5 billion and $6.9 billion, as well as adjusted EBITDA of $700 million to $900 million.
DraftKings CEO Jason Robins says they have launched prediction market market-making, and that it is "already generating a positive return for us." pic.twitter.com/OgizjXHgmF
— Geoff Zochodne (@GeoffZochodne) May 7, 2026
This, DraftKings says, gives it the strong footing it needs to plow further into the opportunity presented by prediction markets and an all-in-one online gambling app.
“Our core business is strong, and profitability is inflecting,” DraftKings CEO Jason Robins said in a statement. “That gives us the firepower to press our advantage in Predictions. With our Super App, market making capabilities, proprietary exchange, and combos coming together, we intend to establish a leadership position in Sports Predictions before year-end.”
Robins wrote in his quarterly business update that “sportsbook led the way” for DraftKings in the quarter, with revenue rising 24% from a year earlier, to $1.1 billion. That revenue growth was more than 20% across almost all major sports, the CEO said, “reflecting continued enhancements to our offering and deeper media integrations.”
What's more, Robins claimed they are still seeing “no discernible impact” from prediction markets on DraftKings' state-regulated online sports betting business, despite the fact that the federally regulated exchanges are available in most states and skirt local tax rates and rules.
“Internal and third-party data suggest Predictions is impacting Sportsbook industry handle only very slightly and primarily among low-margin wagers, resulting in a negligible impact to revenue,” Robins wrote.
DraftKings first launched its prediction market platform in December, and it is now live in the company's “flagship” app, Robins said. This, the CEO wrote, helped drive down related customer acquisition costs more than 80% in April.
“We are planning significant investment in the coming months to improve our [prediction market] offering, build liquidity, and scale customer acquisition,” Robins said. “We intend to execute with urgency.”
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Robins said that annualized prediction market consumer volume topped $1 billion for DraftKings in April, and that total annualized volume was more than $2.3 billion, up 38% and 43%, respectively, over March.
“We have also launched market making, which unlocks access to an additional layer of the value chain,” Robins wrote. “Market making is already generating a positive return for us.”
Citing EKG's research, DraftKings says nearly 70% of sports prediction markets volume comes from states sans legal online sports betting: pic.twitter.com/fktPkaLxrD
— Geoff Zochodne (@GeoffZochodne) May 7, 2026
Robins added that DraftKings expects to launch its proprietary exchange (the company is currently partnered with CME Group on prediction markets) and begin offering prediction market parlays “in the coming weeks.”
With all that said, Robins acknowledged that some third-party data has suggested prediction market customers are losing more quickly than online sportsbook customers, “reinforcing the importance of trust, consumer protections, and operator discipline.”
“We have spent more than a decade building and managing these ecosystems, from Fantasy to Sportsbook and iGaming, and we will apply that same discipline to Predictions,” Robins added. “We will grow Predictions the right way, through data-driven decisions, constructive engagement with industry stakeholders, and a focus on markets that uphold the integrity of sports, strengthen customer trust, and align with our standards for responsible engagement.”
DraftKings will hold an earnings call on Friday to further discuss its results.
