DraftKings Cuts 2026 Revenue Guidance After Q3 Miss; Shares Tumble

DraftKings lowered its revenue forecast for 2026 after reporting third-quarter results that fell short of Wall Street’s expectations on November 5, 2026. Revenue rose 16.2% to $1.33 billion but missed analyst estimates, and the company’s loss was wider than expected as it spends heavily on its new Predictions business. The shares dropped about 23% in after-hours trading.

What did DraftKings report?

For the third quarter of 2026, DraftKings reported revenue of $1.33 billion, up 16.2% from a year earlier. Analysts had expected about $1.39 billion, according to StockStory, writing on Yahoo Finance.

The company lost $0.53 per share. That was well below the consensus forecast of a $0.25 loss and wider than the $0.26 loss a year earlier. Adjusted EBITDA, a measure of operating profit, was negative $316.9 million, compared with negative $126.5 million in the same quarter of 2025.

Within the business, the two main product lines moved in different directions:

• Sports betting revenue: up 31.5%.
• iGaming (online casino) revenue: up 2.1%.

The sports net revenue margin, which measures how much DraftKings keeps from each dollar wagered, improved to 5.6% from 5.2% a year earlier. Monthly unique payers, the number of customers placing paid bets in a typical month, were 4.1 million.

How did DraftKings change its guidance?

DraftKings cut its full-year 2026 revenue forecast to a range of $6.35 billion to $6.55 billion. Yahoo Finance reported that the midpoint of the previous range was $6.7 billion. The new range is also below the $6.65 billion analysts had expected.

The company now expects 2026 adjusted EBITDA of $175 million to $275 million.

DraftKings said the lower profit outlook reflects a bigger investment in Predictions. It plans to put $650 million to $700 million of adjusted EBITDA into that product in 2026. The sources reviewed did not give a specific reason for the lower revenue forecast.

What is DraftKings Predictions?

Predictions is a newer DraftKings product that the company is building alongside its sportsbook and online casino. Chief executive Jason Robins pointed to early uptake, saying, as reported by Casino.org, that “More than 1.6 million customers have engaged with Predictions year-to-date.”

DraftKings expects Predictions to bring in $650 million to $750 million of revenue in 2027. It plans a further $250 million to $350 million of adjusted EBITDA investment in Predictions next year.

What is the outlook for 2027?

DraftKings gave a first look at 2027, forecasting revenue of $7.35 billion to $7.75 billion. That would represent continued growth from the 2026 range, with Predictions making up a meaningful part of the increase.

Key numbers

• Q3 revenue: $1.33 billion, up 16.2%, versus $1.39 billion expected.
• Q3 loss per share: $0.53, versus a $0.25 loss expected.
• 2026 revenue guidance: $6.35 billion to $6.55 billion.
• 2026 adjusted EBITDA guidance: $175 million to $275 million.
• 2027 revenue outlook: $7.35 billion to $7.75 billion.

Why it matters

DraftKings is one of the largest US sports betting companies, so its results are closely watched as a guide to the health of the industry. The quarter showed sports betting still growing strongly, but online casino growth slowed sharply and the company is spending heavily to build a new product line.

Investors reacted badly to the combination of a revenue miss, a lower forecast and a bigger loss. A fall of about 23% after hours suggests the market is unsure whether the heavy spending on Predictions will pay off.

What happens next?

DraftKings scheduled its earnings call for November 6, 2026, where management is expected to give more detail on the guidance cut and its plans for Predictions. Investors will be looking for evidence that the new product can grow quickly enough to justify the investment, and for signs that online casino growth can recover.