KEY TAKEAWAYS
CONTENTS
Summary: more wagered, less kept
DraftKings Inc. reported second-quarter 2026 revenue of $1,443 million, down 4.6% from $1,513 million a year earlier, even though its Sports Consumer Volume rose 14.5% to $13.1 billion. Its Adjusted EBITDA, a non-GAAP measure the company defines itself, fell to $114.6 million from $300.6 million, and it reported a net loss of $67.6 million, according to its August 6, 2026 earnings release for the three months ended June 30, 2026.
The gap between volume and revenue is the story of the quarter. The company attributed the revenue decline primarily to customer-friendly sport outcomes and increased promotional reinvestment tied to new customer acquisition on its Sportsbook and Predictions offerings. Sports net revenue margin fell to 6.8% from 8.7%, while iGaming revenue grew 7.5%.
This article explains each figure, shows the arithmetic and keeps reported results, company guidance and analysis apart. The company maintained its fiscal 2026 guidance, which is a statement of its own expectations. Nothing here is investment advice, and the latest period covered ends June 30, 2026.
Background: how DraftKings reports its business
DraftKings reports revenue in three lines. Sports Revenue is the total of online sportsbook, retail sportsbook and Prediction Markets revenue; iGaming Revenue is the company’s iGaming line; Other Revenue is the remainder. Per the release, the company is live with mobile sports betting in 27 states, Washington, D.C. and Puerto Rico, representing about 53% of the U.S. population, and with iGaming in five states, about 11% of the population, as of the release date.
Two measures anchor the sports line. The company defines Sports Consumer Volume as the total amount of settled customer wagers or trades on its Sportsbook and Prediction Markets offerings, and Sports Net Revenue Margin as Sports Revenue as a percentage of that volume. The margin is the company’s counterpart to hold, the concept explained in our guide to how sportsbooks make money, but it is the company’s own definition, and the release says promotions affect reported revenue.
Customer measures are also the company’s own. Monthly Unique Payers (MUPs) is its measure of paying customers, and Average Revenue per MUP (ARPMUP) is its revenue-per-payer measure. The Predictions offering, which the company says launched in December 2025, offers event contracts through a subsidiary the company describes as operating under federal oversight by the Commodity Futures Trading Commission (CFTC).
Adjusted EBITDA is a non-GAAP measure. DraftKings defines it as net income (loss) before interest, income taxes and depreciation and amortization, further adjusted for stock-based compensation, transaction-related costs, litigation and settlement costs, advocacy and related legal expenses, warrant remeasurement and other non-recurring or non-operating items.
The numbers: second quarter 2026
DraftKings Inc. results for the three months ended June 30, 2026 and 2025, $ millions unless stated. Source: August 6, 2026 earnings release. Percent changes as reported or calculated from the release.
| Measure | Q2 2026 | Q2 2025 | Change |
|---|---|---|---|
| Sports Consumer Volume | $13,140 | $11,475 | +14.5% |
| Sports Revenue | $892 | $998 | −10.6% |
| iGaming Revenue | $462 | $430 | +7.5% |
| Other Revenue | $89 | $85 | +5.2% |
| Total revenue | $1,443 | $1,513 | −4.6% |
| Sports net revenue margin | 6.8% | 8.7% | −1.9 points (calculated) |
| Adjusted EBITDA (non-GAAP) | $115 | $301 | −61.9% (calculated) |
| Net income (loss) | −$67.6 | $157.9 | n/m |
| Monthly Unique Payers | 3.6 million | about 3.3 million (calculated) | about +9% |
| ARPMUP | $132 | $151 (calculated) | about −13% |
where: Sports Revenue is $891.9 million for Q2 2026; Sports Consumer Volume is $13,140.4 million; the prior-year figure is $997.9M ÷ $11,474.8M × 100 ≈ 8.7%.
The margin moved by 1.9 percentage points, from 8.7% to 6.8%, which is a relative decline of about 22% in the share of volume kept. Volume grew faster than revenue shrank because revenue per dollar wagered fell.
where: the prior-year margin was $300.6M ÷ $1,512.5M × 100 ≈ 19.9%.
Operating costs rose as well. Sales and marketing, product and technology, and general and administrative expenses together were $619.6 million against $507.3 million, up 22.1%. The company’s Q2 2026 net loss of $67.6 million compares with net income of $157.9 million in Q2 2025, and diluted loss per share was $0.14 against earnings of $0.30. Adjusted diluted earnings per share was $0.09, against $0.38 a year earlier, on the company’s own definition.
What the results show about the business
Customers and volume grew while the revenue kept per dollar wagered shrank. If Q2 2026 volume of $13,140 million had earned the prior-year margin of 8.7%, Sports Revenue would have been about $1,143 million instead of $892 million, a gap of about $251 million. This is an illustration, not a company estimate: the release does not split the margin decline between sport outcomes, promotional spending and the growing Predictions offering.
where: figures are the company’s reported Q2 volumes and Sports Revenue; the result is arithmetic, not a forecast.
Spending moved the other way. Sales and marketing rose 38.3% to $322.5 million, or 22.3% of revenue against 15.4% a year earlier, and product and technology rose 17.7% to $127.6 million. Cost of revenue was $891.8 million, 61.8% of revenue against 56.5%.
On guidance, the company said its core business remains on track for about $1 billion of Adjusted EBITDA this year and that it is maintaining its fiscal 2026 range. Chief Financial Officer Alan Ellingson said in the August 6, 2026 release: “Our core business remains on track to generate approximately $1 billion of Adjusted EBITDA this year”. Guidance is the company’s view, not a result, and the CFO tied the maintained $700 million to $900 million range to investment in Predictions.
Comparison: second quarter, first half and prior year
The second quarter looks weaker when set against the first. Subtracting the second quarter from the six-month figures in the release gives first-quarter 2026 revenue of about $1,646 million against $1,409 million, up 16.8%, so the first half still grew 5.8% to $3,089 million. First-quarter Adjusted EBITDA calculated the same way was about $168 million, against $103 million.
DraftKings Inc. first-half and quarterly comparison, $ millions unless stated. Source: August 6, 2026 earnings release; first-quarter figures calculated as six months minus second quarter.
| Measure | Q2 2026 | Q2 2025 | H1 2026 | H1 2025 |
|---|---|---|---|---|
| Revenue | $1,443 | $1,513 | $3,089 | $2,921 |
| Revenue change | −4.6% | n/a | +5.8% | n/a |
| Sports Consumer Volume | $13,140 | $11,475 | $27,342 | $25,355 |
| Sports net revenue margin | 6.8% | 8.7% | 7.3% | 7.4% |
| Adjusted EBITDA | $115 | $301 | $282 | $403 |
| Adjusted EBITDA margin (calculated) | 7.9% | 19.9% | 9.1% | 13.8% |
| Net income (loss) | −$67.6 | $157.9 | −$46.5 | $124.1 |
Over six months the sports margin was 7.3% against 7.4%, almost level, which suggests the quarter-level swing was concentrated in the second quarter. Six-month Adjusted EBITDA fell 30.0%, from $403.3 million to $282.5 million. Sales and marketing for the six months was $724.3 million against $576.9 million, up 25.6%.
Risks, limits and misreadings
One quarter is a small sample. Sportsbook margins swing with game results, which is why the company points to outcomes; a quarter of favorable results can reverse. The release does not quantify the outcome effect separately from promotions, so no split should be assumed.
Adjusted figures differ from GAAP. In Q2 2026 the Adjusted EBITDA reconciliation added back $82.6 million of stock-based compensation and $19.9 million of advocacy and related legal expenses for legalization efforts, and the company notes its measure may not be comparable with other companies’. A positive Adjusted EBITDA sits beside a GAAP net loss, and both belong in any reading.
The release also lists, among factors that could change results, growth in the emerging prediction markets category and changes in laws and regulations, particularly the regulatory status of prediction markets and event contracts. Guidance is not reconciled to GAAP: the company did not reconcile guidance to GAAP, saying it is unavailable without unreasonable effort. Cash and cash equivalents were $983.9 million at June 30, 2026, against $1,127.5 million at December 31, 2025.
Key figures and definitions
Key figures with periods and sources. Calculated figures are marked.
| Metric | Value | Period | Source |
|---|---|---|---|
| Revenue | $1,443M (−4.6%) | Q2 2026 | Earnings release |
| Sports Consumer Volume | $13.1B (+14.5%) | Q2 2026 | Earnings release |
| Sports net revenue margin | 6.8% vs 8.7% | Q2 2026 vs Q2 2025 | Earnings release |
| Adjusted EBITDA | $114.6M vs $300.6M | Q2 2026 vs Q2 2025 | Earnings release |
| Net loss | $67.6M | Q2 2026 | Earnings release |
| MUPs / ARPMUP | 3.6M / $132 | Q2 2026 | Earnings release |
| Guidance (maintained) | Revenue $6.5B–$6.9B; Adjusted EBITDA $700M–$900M | Fiscal 2026 | Earnings release |
Each metric here is the company’s own definition. Sports Consumer Volume is settled wagers or trades; Sports Revenue includes sportsbook and Prediction Markets revenue; Adjusted EBITDA is non-GAAP. Competitors define comparable measures differently, so do not place these figures beside another company’s without checking its definitions.
Related analysis and next steps
To see how wagers become revenue, read how sportsbooks make money, which explains hold, the vig and promotions. For how another large operator describes its segments and costs, see Flutter Entertainment’s business model. The next logical reads are the company’s third-quarter results when reported, and a profile of how it earns money by segment. When comparing it with other operators, check each company’s own definitions of volume, revenue and adjusted earnings first, because the same label can cover different items. The primary documents behind every figure here, including the reconciliation of Adjusted EBITDA to net income, are listed below.
Frequently Asked Questions
