Business Momentum & Growth - The company experienced significant business momentum, aided by favorable sports outcomes in Q2 [1] - The company anticipates strong growth in the latter part of the year, driven by key events like NFL, college sports, World Series [2] - The company reported a 25% year-over-year revenue increase, even when adjusted for sports outcomes [3] - The company achieved 37% year-over-year revenue growth [10] Product & Customer Experience - The company has enhanced its parlay offering and now boasts a best-in-class in-game betting platform, which is a major growth driver [4] - The company believes it is well-positioned due to its product advancements and customer experience [5] AI & Efficiency - The company is leveraging AI to automate manual workflows across the organization, leading to efficiency gains and cost savings [6] - The company is using AI to optimize its trading engine, improving decision-making during live games [7] - Efficiency gains through AI are helping to self-fund expansion and offset cost headwinds [8] Financial Strategy & Outlook - The company is focused on growing its bottom line while maintaining impressive top-line growth [14] - The company is continuously evaluating cost structure for further efficiencies, balancing growth with financial prudence [9][10]

Financial Data and Key Metrics Changes - DraftKings achieved record revenue of $1,513 million in Q2 2025, representing a 37% year-over-year growth [11] - Adjusted EBITDA reached over $300 million, doubling the previous record, with a margin of 20% [11][12] - The company maintained its fiscal year 2025 guidance for revenue between $6,200 million and $6,400 million, with adjusted EBITDA expected between $800 million and $900 million [14][15] Business Line Data and Key Metrics Changes - Sportsbook net revenue increased by 45% year-over-year, with a handle of approximately $11,500 million, and live betting handle up 16% [12][13] - iGaming net revenue grew by 23% year-over-year, driven by a significant increase in active iGaming customers [13] - The adjusted gross margin improved to 48%, an increase of over 400 basis points year-over-year [13] Market Data and Key Metrics Changes - The sportsbook promotional reinvestments as a percentage of gross gaming revenue improved by nearly 600 basis points year-over-year [12] - The company noted that sportsbook outcomes in May and June added $110 million to revenue due to favorable conditions [9] Company Strategy and Development Direction - DraftKings is focused on enhancing its sportsbook product and capitalizing on the upcoming NFL and NBA seasons [8] - The company is exploring federally regulated prediction markets to enhance shareholder value [9] - Capital allocation is directed towards maximizing risk-adjusted returns, with 6.5 million shares repurchased in the first half of the year [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving a 30% adjusted EBITDA margin target over time [8] - The company is optimistic about the upcoming mobile sportsbook launch in Missouri and its potential financial impacts [16] - Management acknowledged the challenges posed by higher tax rates in certain states but remains focused on core business fundamentals [16][17] Other Important Information - The company is leveraging artificial intelligence and new technologies to improve operational efficiency and customer acquisition [14][33] - DraftKings is monitoring legislative developments regarding micro betting and prediction markets, indicating a proactive approach to regulatory changes [108] Q&A Session Summary Question: Insights on prediction markets opportunity - Management indicated that the total addressable market (TAM) for prediction markets is still uncertain and is being evaluated [20][21] Question: Crossover customer analysis and regulatory conversations - Management is in a monitoring phase regarding regulatory discussions and is assessing the crossover customer potential [25][27] Question: Cost optimization opportunities - Management highlighted potential cost reductions in older agreements and payment processing as areas for improvement [31][32] Question: iGaming revenue acceleration - Management noted that iGaming is ramping up but still has room for growth [39][40] Question: Structural hold improvement drivers - The increase in structural hold was attributed to a better bet mix, particularly in parlays [46] Question: Market access deals and partnerships - Management sees opportunities to renegotiate market access deals and is open to partnerships with sports streaming apps [50][51] Question: Customer acquisition strategies for Q3 - Management is optimistic about customer acquisition efficiency during the peak season and the upcoming Missouri launch [96][98]

Financial Performance - DraftKings' Q2 2025 revenue reached a record $1.513 billion, a 37% year-over-year increase[7, 9] - Adjusted EBITDA for Q2 2025 also hit a record of $301 million, compared to $128 million in Q2 2024[7, 9] - The company is maintaining its FY 2025 revenue guidance of $6.2 billion to $6.4 billion and Adjusted EBITDA guidance of $800 million to $900 million[7] - Sportsbook net revenue increased 45% year-over-year[11] - iGaming net revenue increased 23% year-over-year[11] Key Metrics - Sportsbook handle increased 6% year-over-year[11] - Structural Sportsbook hold percentage increased by 100 basis points year-over-year[11] - Sportsbook promotional reinvestment improved nearly 600 basis points year-over-year as a percentage of Gross Gaming Revenue (GGR)[11] - Average Revenue per Monthly Unique Payer (ARPMUP) increased to $151 in Q2 2025 from $117 in Q2 2024[46] - Average Monthly Unique Payers (MUPs) reached 3.3 million in Q2 2025, compared to 3.1 million in Q2 2024[46] Product Innovation and Social Engagement - Over 1.5 million customers have engaged with the Live Bet Tracking tool in 2025[15] - Handle on the social platform increased 180% year-over-year in the first two quarters of 2025[15] - Engagement across social media handles increased over 200% year-over-year in Q2 2025, and Discord community membership grew over 400% year-over-year[15]

```markdown Part I. Financial Information [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) DraftKings Inc.'s unaudited condensed consolidated financial statements as of June 30, 2025, covering balance sheets, operations, cash flows, and detailed notes [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets increased to $4.47 billion, liabilities grew to $3.46 billion, and equity remained stable at $1.01 billion Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 (Unaudited) | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $1,261,969 | $788,287 | | Total current assets | $1,786,699 | $1,533,761 | | Goodwill | $1,555,116 | $1,555,116 | | **Total assets** | **$4,474,302** | **$4,283,725** | | **Liabilities & Equity** | | | | Liabilities to users | $724,969 | $979,453 | | Term B Loan, net | $578,499 | $— | | Convertible notes, net | $1,257,751 | $1,256,429 | | **Total liabilities** | **$3,464,674** | **$3,273,099** | | **Total stockholders' equity** | **$1,009,628** | **$1,010,626** | [Condensed Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For Q2 2025, net income significantly improved to $157.9 million on $1.51 billion revenue, a turnaround from prior-year operating loss Statement of Operations Summary (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :--- | :--- | :--- | :--- | :--- | | **Revenue** | **$1,512,507** | **$1,104,441** | **$2,921,313** | **$2,279,437** | | Income (loss) from operations | $150,644 | $(32,388) | $104,313 | $(171,226) | | **Net income (loss)** | **$157,936** | **$63,822** | **$124,072** | **$(78,746)** | | Diluted EPS | $0.30 | $0.10 | $0.23 | $(0.17) | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operating activities was $54.9 million for H1 2025, a significant improvement, with financing providing $253.1 million Six Months Ended June 30 Cash Flow Summary (in thousands) | Cash Flow Category | 2025 | 2024 | | :--- | :--- | :--- | | Net cash from Operating Activities | $54,905 | $(41,006) | | Net cash from Investing Activities | $(74,278) | $(456,534) | | Net cash from Financing Activities | $253,134 | $(52,469) | | **Net change in cash** | **$233,761** | **$(550,009)** | | Cash at end of period | $1,563,954 | $1,073,484 | [Notes to the Condensed Consolidated Financial Statements](index=8&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) Notes detail business operations, accounting policies, recent acquisitions, debt structure, and numerous legal proceedings - DraftKings operates online sports betting (Sportsbook) in **26 of 32 live U.S. jurisdictions** and iGaming in **6 U.S. jurisdictions** as of June 30, 2025[27](index=27&type=chunk)[28](index=28&type=chunk) - The company acquired Jackpocket, a digital lottery courier, on May 22, 2024, for **total consideration of $773.1 million**, **comprising $452.3 million in cash** and **$320.8 million in equity**. This **resulted in $550.4 million of goodwill**[34](index=34&type=chunk)[36](index=36&type=chunk)[37](index=37&type=chunk) - The company acquired Simplebet, a sports betting provider, on December 3, 2024, for **total consideration of $134.6 million**, including cash, equity, and contingent consideration[41](index=41&type=chunk)[42](index=42&type=chunk)[44](index=44&type=chunk) - In March 2025, the company entered into a **$600.0 million Term B Loan facility**, maturing in March 2032[55](index=55&type=chunk) - The company is involved in **numerous legal proceedings**, including patent infringement cases (Winview, Arrow Gaming, Colossus), class action lawsuits regarding promotions and marketplace NFTs, and an IRS audit concerning excise taxation of fantasy sports[102](index=102&type=chunk)[109](index=109&type=chunk)[204](index=204&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=37&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q2 2025 financial performance, highlighting a 36.9% revenue increase to $1.5 billion, improved net income, and strong KPI growth [Financial Highlights and Trends](index=38&type=section&id=Financial%20Highlights%20and%20Trends) The company reported strong financial growth for Q2 2025, with revenue up 36.9% to $1.51 billion, net income of $157.9 million, and Adjusted EBITDA more than doubled Financial Highlights (in thousands) | Metric | Q2 2025 | Q2 2024 | YTD 2025 | YTD 2024 | | :--- | :--- | :--- | :--- | :--- | | Revenue | $1,512,507 | $1,104,441 | $2,921,313 | $2,279,437 | | Net Income (Loss) | $157,936 | $63,822 | $124,072 | $(78,746) | | Adjusted EBITDA | $300,644 | $127,967 | $403,273 | $150,357 | - Revenue growth was driven by **continued healthy customer engagement**, **efficient acquisition of new customers**, **expansion of Sportsbook into new jurisdictions**, **higher structural Sportsbook hold percentage**, and the **impact of the Jackpocket acquisition**[217](index=217&type=chunk) [Key Performance Indicators](index=39&type=section&id=Key%20Performance%20Indicators) Key metrics showed positive trends in Q2 2025, with MUPs growing 6.5% to 3.3 million, ARPMUP increasing 29.1% to $151, and Sportsbook Net Revenue Margin improving - Average Monthly Unique Payers (MUPs) increased by **6.5%** to **3.3 million** in Q2 2025, primarily due to **strong retention and acquisition**, along with the **impact of the Jackpocket acquisition**[220](index=220&type=chunk)[227](index=227&type=chunk) - Average Revenue per MUP (ARPMUP) increased by **29.1%** to **$151** in Q2 2025, driven by **improved Sportsbook hold percentage** and **more efficient promotional reinvestment**[225](index=225&type=chunk)[228](index=228&type=chunk) Sportsbook Performance (Q2 2025 vs Q2 2024) | Metric | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Sportsbook Handle | $11,474,841 | $10,793,014 | 6.3% | | Sportsbook Revenue | $997,872 | $686,889 | 45.3% | | Sportsbook Net Revenue Margin | 8.7% | 6.4% | N/A | [Results of Operations](index=45&type=section&id=Results%20of%20Operations) Q2 2025 revenue grew 36.9% to $1.51 billion, outpacing cost of revenue, leading to improved gross margin and a shift to $150.6 million operating income - Q2 2025 revenue **increased by $408.1 million (36.9%) YoY**, primarily driven by **a $390.1 million increase** in Sportsbook and iGaming revenue[245](index=245&type=chunk) - Cost of revenue as a percentage of revenue **decreased by 3.6 percentage points** to **56.5%** in Q2 2025, reflecting **improved Sportsbook hold rate and promotional efficiency**[247](index=247&type=chunk) - The company achieved **income from operations of $150.6 million** in Q2 2025, a **significant turnaround** from a **loss of $32.4 million** in Q2 2024[245](index=245&type=chunk) [Liquidity and Capital Resources](index=48&type=section&id=Liquidity%20and%20Capital%20Resources) As of June 30, 2025, DraftKings held $1.26 billion in cash, supported by convertible notes and a new $600 million Term B Loan, with an active stock repurchase program - The company had **$1.26 billion in cash and cash equivalents** as of June 30, 2025, which is believed to be **sufficient for at least the next twelve months**[268](index=268&type=chunk) - In March 2025, the company secured a **new $600 million Term B Loan facility**[271](index=271&type=chunk) - Under its **$1.0 billion stock repurchase program**, the company **repurchased 6.5 million shares for $242.7 million** in the first six months of 2025[273](index=273&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=49&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) No significant changes in market risk exposure occurred during the six months ended June 30, 2025, as referenced in the 2024 Annual Report - There have been **no significant changes** in the company's exposure to market risk during the first six months of 2025[281](index=281&type=chunk) [Item 4. Controls and Procedures](index=49&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting - The CEO and CFO concluded that the company's disclosure controls and procedures were **effective** as of June 30, 2025[282](index=282&type=chunk) - **No changes in internal control over financial reporting** occurred during the quarter that materially affected, or are reasonably likely to materially affect, internal controls[283](index=283&type=chunk) Part II. Other Information [Item 1. Legal Proceedings](index=50&type=section&id=Item%201.%20Legal%20Proceedings) Information on legal proceedings is detailed in Note 13 of the condensed consolidated financial statements, covering patent disputes, class actions, and regulatory inquiries - Information on legal proceedings is detailed in **"Note 13 — Commitments and Contingencies"** of the financial statements[285](index=285&type=chunk) [Item 1A. Risk Factors](index=50&type=section&id=Item%201A.%20Risk%20Factors) No material changes from the risk factors previously disclosed in the 2024 Annual Report on Form 10-K - The company refers to the risk factors described in the 2024 Annual Report, indicating **no material changes**[286](index=286&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=50&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Details on the $1.0 billion stock repurchase program, with approximately 2.9 million shares repurchased during Q2 2025 Share Repurchases (Q2 2025) | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | April 2025 | 539,815 | $33.04 | | May 2025 | 190,947 | $35.18 | | June 2025 | 2,141,058 | $35.43 | | **Total Q2** | **2,871,820** | **N/A** | - As of June 30, 2025, approximately **$709.3 million remained available** for future repurchases under the authorized **$1.0 billion program**[288](index=288&type=chunk) [Item 5. Other Information](index=50&type=section&id=Item%205.%20Other%20Information) This section discloses securities trading plans established by directors and executive officers, including CEO Jason Robins' prepaid variable forward sale contract - On May 13, 2025, CEO Jason Robins entered into a **prepaid variable forward sale contract** obligating him to deliver up to **306,997 shares** of Class A common stock after the May 13, 2030 maturity date[294](index=294&type=chunk) - On May 14, 2025, Director Jocelyn Moore entered into a **Rule 10b5-1 trading plan** for the sale of up to **4,861 shares**, terminating on August 29, 2025[295](index=295&type=chunk) ```

[Financial Highlights and Business Outlook](index=1&type=section&id=Financial%20Highlights%20and%20Business%20Outlook) [Q2 2025 Performance Summary](index=1&type=section&id=Q2%202025%20Performance%20Summary) DraftKings achieved record financial results in the second quarter of 2025, with revenue growing 37% year-over-year to $1.513 billion, and new records for Net Income at $158 million and Adjusted EBITDA at $301 million Q2 2025 Financial Performance | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | **Revenue** | $1,513 million | $1,104 million | +37% | | **Net Income** | $158 million | $64 million | +147% | | **Adjusted EBITDA** | $301 million | $128 million | +135% | - Revenue growth was attributed to healthy customer engagement, efficient customer acquisition, a higher structural Sportsbook hold percentage, and sportsbook-friendly outcomes[2](index=2&type=chunk) - The company repurchased **6.5 million shares** through its stock repurchase program in the first half of 2025[3](index=3&type=chunk) [Key Operating Metrics](index=1&type=section&id=Key%20Operating%20Metrics) The company demonstrated continued growth in its user base and monetization, with Monthly Unique Payers (MUPs) increasing by 6% to 3.3 million and Average Revenue per MUP (ARPMUP) rising 29% to $151 Q2 2025 Operating Metrics | Metric | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | **Monthly Unique Payers (MUPs)** | 3.3 million | N/A | +6% | | **Average Revenue per MUP (ARPMUP)** | $151 | N/A | +29% | - The acquisition of Jackpocket contributed to user growth; excluding its impact, MUPs increased by **5%** and ARPMUP increased by **30%** compared to Q2 2024[6](index=6&type=chunk) [Fiscal Year 2025 Guidance](index=1&type=section&id=Fiscal%20Year%202025%20Guidance) DraftKings maintained its full-year 2025 guidance for both revenue and Adjusted EBITDA, anticipating revenue closer to the high end and Adjusted EBITDA near the midpoint, incorporating Missouri launch and higher tax rates FY 2025 Guidance | Guidance Metric | FY 2025 Range | | :--- | :--- | | **Revenue** | $6.2 billion to $6.4 billion | | **Adjusted EBITDA** | $800 million to $900 million | - The company is on track to deliver revenue closer to the high end of the guidance range, equating to approximately **32% year-over-year growth** at the midpoint[5](index=5&type=chunk) - Guidance now incorporates the anticipated launch of mobile sports betting in Missouri and the impact of higher tax rates in New Jersey, Louisiana, and Illinois[10](index=10&type=chunk) [Market Footprint](index=2&type=section&id=Market%20Footprint) DraftKings continues to expand its operational presence, with mobile sports betting live in 25 states and Washington D.C. (49% U.S. population) and iGaming in 5 states (11% U.S. population), with Missouri launch pending - Mobile sports betting is live in **25 states** and Washington, D.C., representing approximately **49% of the U.S. population**[10](index=10&type=chunk) - iGaming is live in **5 states**, representing approximately **11% of the U.S. population**[10](index=10&type=chunk) - The company expects to launch its Sportsbook product in Missouri, pending necessary approvals[10](index=10&type=chunk) [Financial Statements](index=3&type=section&id=Financial%20Statements) [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, DraftKings reported total assets of $4.47 billion, a slight increase from $4.28 billion, with total liabilities rising to $3.46 billion due to a new Term B Loan, and cash increasing to $1.26 billion Condensed Consolidated Balance Sheets (in thousands) | Balance Sheet Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Cash and cash equivalents** | $1,261,969 | $788,287 | | **Total current assets** | $1,786,699 | $1,533,761 | | **Total assets** | $4,474,302 | $4,283,725 | | **Total current liabilities** | $1,334,553 | $1,654,991 | | **Total liabilities** | $3,464,674 | $3,273,099 | | **Total stockholders' equity** | $1,009,628 | $1,010,626 | [Condensed Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) The company reported a significant turnaround in profitability for Q2 2025, posting a net income of $157.9 million, driven by a 37% revenue increase to $1.51 billion, leading to an income from operations of $150.6 million Condensed Consolidated Statements of Operations (in thousands) | Income Statement | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | **Revenue** | $1,512,507 | $1,104,441 | | **Income (loss) from operations** | $150,644 | $(32,388) | | **Net income attributable to common stockholders** | $157,936 | $63,822 | | **Diluted Earnings Per Share** | $0.30 | $0.10 | [Revenue Disaggregation](index=5&type=section&id=Revenue%20Disaggregation) In Q2 2025, Sportsbook revenue grew by 45.3% to $997.9 million, driven by a 6.3% increase in handle and improved net revenue margin, while iGaming revenue increased by 22.6% to $429.7 million Revenue by Source (in thousands) | Revenue Source | Q2 2025 | Q2 2024 | YoY Change | | :--- | :--- | :--- | :--- | | **Sportsbook Revenue** | $997,872 | $686,889 | +45.3% | | **iGaming Revenue** | $429,660 | $350,552 | +22.6% | | **Other Revenue** | $84,975 | $67,000 | +26.8% | | **Total Revenue** | $1,512,507 | $1,104,441 | +36.9% | - The Sportsbook Net Revenue Margin increased to **8.7%** in Q2 2025 from **6.4%** in Q2 2024[18](index=18&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the first six months of 2025, DraftKings generated $54.9 million in cash from operating activities, a significant improvement, with financing activities providing a net inflow of $253.1 million, ending with $1.56 billion in combined cash Condensed Consolidated Statements of Cash Flows (in thousands) | Cash Flow | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | **Net cash from operating activities** | $54,905 | $(41,006) | | **Net cash used in investing activities** | $(74,278) | $(456,534) | | **Net cash from financing activities** | $253,134 | $(52,469) | - Financing activities included **$588.1 million** in proceeds from a Term B Loan and **$242.7 million** used for stock repurchases under the company's program[20](index=20&type=chunk) [Supplemental Information](index=7&type=section&id=Supplemental%20Information) [Non-GAAP Financial Measures](index=7&type=section&id=Non-GAAP%20Financial%20Measures) The company provides non-GAAP measures, Adjusted EBITDA and Adjusted Earnings Per Share, to supplement GAAP results by excluding items like stock-based compensation and amortization of acquired intangibles for clearer core performance - DraftKings uses Adjusted EBITDA and Adjusted Earnings (Loss) Per Share to evaluate its core operating performance and trends, as these measures exclude certain non-recurring, non-cash, or non-operating items[21](index=21&type=chunk)[24](index=24&type=chunk) [Reconciliation of Net Income (Loss) to Adjusted EBITDA](index=8&type=section&id=Reconciliation%20of%20Net%20Income%20(Loss)%20to%20Adjusted%20EBITDA) For Q2 2025, Adjusted EBITDA was $300.6 million, reconciled from a net income of $157.9 million, primarily by adding back stock-based compensation and depreciation & amortization Reconciliation of Net Income (Loss) to Adjusted EBITDA (in thousands) | Reconciliation | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | **Net income (loss)** | $157,936 | $63,822 | | **Adjustments** | $142,708 | $64,145 | | **Adjusted EBITDA** | $300,644 | $127,967 | [Reconciliation of Diluted EPS to Adjusted EPS](index=8&type=section&id=Reconciliation%20of%20Diluted%20EPS%20to%20Adjusted%20EPS) Adjusted Earnings Per Share for Q2 2025 was $0.38, reconciled from a GAAP diluted EPS of $0.30, with primary adjustments for stock-based compensation and amortization of acquired intangible assets Reconciliation of Diluted EPS to Adjusted EPS (per share) | Reconciliation | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | **Diluted earnings (loss) per share** | $0.30 | $0.10 | | **Adjustments** | $0.08 | $0.12 | | **Adjusted Earnings Per Share** | $0.38 | $0.22 | [About DraftKings & Forward-Looking Statements](index=9&type=section&id=About%20DraftKings%20%26%20Forward-Looking%20Statements) DraftKings is a U.S.-based digital sports entertainment and gaming company offering daily fantasy, sports betting, and iGaming, with the report containing forward-looking statements subject to risks and uncertainties - DraftKings is a U.S.-based vertically integrated sports betting operator with products in daily fantasy, regulated gaming, and digital media[31](index=31&type=chunk) - The report includes forward-looking statements regarding guidance, future results, and strategic plans, which are not guarantees of future performance and are subject to risks[33](index=33&type=chunk)[34](index=34&type=chunk)

Group 1 - DraftKings reported $1.51 billion in revenue for the quarter ended June 2025, a year-over-year increase of 37% [1] - The EPS for the same period was $0.38, compared to $0.12 a year ago, indicating significant growth [1] - The reported revenue exceeded the Zacks Consensus Estimate of $1.43 billion by 5.99%, while the EPS fell short of the consensus estimate of $0.41 by 7.32% [1] Group 2 - Key metrics indicate that DraftKings has an Average Revenue per Monthly Unique Payer (ARPMUP) of $151.00, surpassing the average estimate of $121.53 [4] - Monthly Unique Payers (MUPs) reached 3.3 million, exceeding the average estimate of 2.56 million [4] - Revenue from Sportsbook was $997.87 million, compared to the average estimate of $925.23 million, while revenue from iGaming was $429.66 million, slightly below the average estimate of $440.91 million [4] Group 3 - DraftKings shares have returned +6.1% over the past month, outperforming the Zacks S&P 500 composite's +0.5% change [3] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3]

Financial Performance - DraftKings reports an impressive quarter with revenue growth accelerating to 37% and better-than-expected earnings [1] - The company achieved a record adjusted EBITDA quarter, more than double its previous highest [4] - DraftKings sees revenue near the high end of its guidance range [2] - The company's revenue exceeded $300 million for the first time [5] Business Growth & Strategy - DraftKings is experiencing growth and is starting to make real profit [6] - The company has an increase in year-over-year players and spend per player [7] - DraftKings views daily fantasy as clearly legal under California law and will work with regulators [15] - DraftKings is working with congressional members to address gambling tax implications [17] Market Dynamics & Future Outlook - The Eagles are the second most bet-on team, just behind the Lions [8] - Someone placed a $25,000 bet on the Raiders to win the Super Bowl with a $25 million payout [9] - The industry anticipates that most states will eventually legalize sports betting [19][21]

Core Insights - DraftKings achieved record revenue, net income, and Adjusted EBITDA in Q2 2025, with a revenue increase of 37% year-over-year to $1,513 million [2][3] - The company maintains its fiscal year 2025 revenue guidance of $6.2 billion to $6.4 billion, expecting to be closer to the high end of this range [6][12] Financial Performance - Revenue for Q2 2025 was $1,513 million, up from $1,104 million in Q2 2024, marking a $408 million increase [2][15] - Net income for Q2 2025 was $158 million, compared to $64 million in Q2 2024, reflecting a significant improvement [15][18] - Adjusted EBITDA reached $301 million in Q2 2025, compared to $128 million in Q2 2024 [18][30] Customer Metrics - Monthly Unique Payers (MUPs) increased to 3.3 million in Q2 2025, a 6% rise from Q2 2024 [6][12] - Average Revenue per MUP (ARPMUP) rose to $151, representing a 29% increase year-over-year [6][12] Strategic Initiatives - The company repurchased 6.5 million shares in the first two quarters of 2025 as part of its stock repurchase program [3] - DraftKings is preparing for the launch of mobile sports betting in Missouri, which is expected to contribute positively to future revenue [12][39] Market Presence - DraftKings operates mobile sports betting in 25 states and Washington, D.C., covering approximately 49% of the U.S. population [12] - The company is also live with iGaming in 5 states, representing about 11% of the U.S. population [12]

Core Viewpoint - Growth stocks are currently expensive, but several smaller companies still present great value for new investors, particularly in the context of the S&P 500's strong performance driven by growth stocks [1][2]. Group 1: Marvell Technology - Marvell Technology specializes in chips for data centers, collaborating with major companies like Amazon and Microsoft [4][5]. - The company designs networking chips and custom AI accelerators, with significant growth potential in AI chip markets [6][7]. - Marvell is pursuing up to $75 billion in potential revenue from over 10 customers for its custom AI accelerators, with shares trading at a forward P/E of less than 27, making it an attractive investment opportunity [7]. Group 2: DraftKings - DraftKings is a leading online sportsbook in the U.S., leveraging its brand strength since the legalization of sports betting in 2018 [8][9]. - The company utilizes extensive customer data to enhance its betting systems and has made strategic acquisitions to improve its product offerings [10]. - Despite challenges from emerging prediction markets and new tax laws affecting bettors, DraftKings shares are considered attractive, trading at an enterprise value to forward EBITDA of around 27, with expected earnings growth from $181 million to $850 million [11][13]. Group 3: Pinterest - Pinterest operates as a discovery engine in social media, primarily attracting a female user base, which is valuable for advertisers [14]. - The platform has seen a 10% year-over-year increase in monthly active users and a 5% rise in average revenue per user, indicating strong growth [16]. - With a share price around $38 and a forward P/E of just 21, Pinterest is viewed as a great value for growth investors, benefiting from strong margin expansion and consistent revenue growth [18].

Core Viewpoint - Defiance ETFs has launched the Defiance Daily Target 2X Long DKNG ETF (Ticker: DKNX), which offers investors 2X daily leveraged exposure to DraftKings Inc. (DKNG), targeting high-growth opportunities in the sports betting and gaming industry [1][3]. Company Overview - DraftKings Inc. is a leading digital sports entertainment and gaming company, providing sports betting, daily fantasy sports, and online gaming across regulated markets in the U.S. and internationally [3]. - The company is positioned to benefit from the expansion of legalized sports betting and increasing consumer engagement, leveraging technology-driven platforms and data analytics [3]. ETF Details - DKNX aims to deliver daily investment results of 200% of the daily performance of DraftKings Inc. through the use of derivatives such as swaps and options [2]. - The fund is designed for knowledgeable investors who understand the implications of seeking daily leveraged investment results [5]. - DKNX represents Defiance's commitment to innovative leveraged ETFs, allowing active investors to pursue targeted growth strategies [3][6].