Financial Data and Key Metrics Changes - In Q4 2025, revenue grew 43% year-over-year to nearly $2 billion, with Adjusted EBITDA reaching $343 million, four times the prior year period [5][14] - Adjusted EBITDA margin expanded by over 1,000 basis points year-over-year to 17% [5][14] - For the fiscal year 2025, revenue increased 27% year-over-year to above $6 billion, and Adjusted EBITDA more than tripled to over $600 million [7][17] - The company reported positive net income for the first time in fiscal year 2025 and repurchased 16 million shares during the year [7][17] Business Line Data and Key Metrics Changes - Fantasy revenue increased as the Pick Six product began to scale [14] - Sportsbook revenue increased over 30% year-over-year, with Q4 revenue rising 64% year-over-year to $1.4 billion [15] - iGaming revenue grew by 20% due to expanded offerings [15] - Lottery revenue benefited from a stronger jackpot environment and the rollout of new games [15] Market Data and Key Metrics Changes - Sportsbook handle increased 11% year-over-year to $54 billion, with a total potential payout across all open wagers of $2.5 trillion [16] - In January, Sportsbook handle increased 4% year-over-year, despite sportsbook-friendly outcomes in previous months [8][16] Company Strategy and Development Direction - The company is focusing on the predictions market as a significant growth opportunity, targeting hundreds of millions in annual revenue in the coming years [6][10] - DraftKings plans to integrate Railbird and launch a market-making division to enhance customer experience and liquidity [12][13] - The company aims to lead the predictions category and is supportive of regulatory frameworks that facilitate market growth [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the business model's efficiency and sustainability, expecting continued revenue and Adjusted EBITDA growth [7][8] - The regulatory environment for predictions has improved, providing a stable backdrop for growth [22][23] - Management anticipates that predictions will not cannibalize existing sportsbook revenue, as initial adoption rates have been strong [8][9] Other Important Information - The company repurchased 8 million shares in Q4 2025 and plans to remain active in share repurchases as Adjusted EBITDA grows [5][14] - The predictions market is expected to represent a $10 billion annual gross revenue opportunity in the future [10] Q&A Session All Questions and Answers Question: Why is the company more aggressively leaning into prediction markets now? - Management noted that the regulatory environment has stabilized, allowing for more confident investment in predictions, which is seen as a significant growth opportunity [22][23] Question: Can you provide insights on the revenue guidance for 2026? - Management indicated that the guidance reflects expected investments in predictions and disciplined planning, with a revenue range of $6.5 billion to $6.9 billion [18][19] Question: What could drive revenue higher in 2026? - Predictions are seen as an upside opportunity, with no revenue included in the guidance for 2026, as the focus will be on customer acquisition [33][34] Question: How is the competitive environment characterized? - Management described the current promotional environment as rational, with no significant uptick in promotional intensity from smaller operators [71][86] Question: What are the expectations for prediction markets influencing state legislation? - Management noted that there is traction in discussions around legalization and that states are considering the implications of predictions on existing sports betting frameworks [74]

Core Insights - DraftKings reported a record revenue of $1,989 million for Q4 2025, a 43% increase from $1,393 million in Q4 2024, driven by strong customer engagement and higher Sportsbook net revenue margin [2][3] - The company achieved positive net income for fiscal year 2025, with total revenue exceeding $6 billion, marking a 27% increase from the previous year [3] - DraftKings plans to invest in its DraftKings Predictions product to enhance customer experience and acquire new users [3] Financial Performance - Q4 2025 revenue was $1,989 million, up $596 million or 43% year-over-year [2] - Fiscal year 2025 revenue reached over $6 billion, a 27% increase compared to fiscal year 2024 [3] - Adjusted EBITDA for Q4 2025 was $343,202 thousand, compared to $89,454 thousand in Q4 2024 [17] Customer Metrics - Monthly Unique Payers (MUPs) remained stable at 4.8 million in Q4 2025, with a 5% increase when excluding Jackpocket [7] - Average Revenue per MUP (ARPMUP) was $139 in Q4 2025, reflecting a 43% increase from the same period in 2024 [7] Future Guidance - DraftKings provided fiscal year 2026 revenue guidance of $6.5 billion to $6.9 billion and Adjusted EBITDA guidance of $700 million to $900 million [7] - The guidance reflects expected investments in DraftKings Predictions and new jurisdiction launches [7] Market Presence - DraftKings operates mobile sports betting in 26 states and Washington, D.C., covering approximately 52% of the U.S. population [7] - The company is also active in iGaming in 5 states, representing about 11% of the U.S. population [7]

Core Viewpoint - DraftKings Inc. is set to release its fourth quarter 2025 results on February 12, 2026, followed by a conference call on February 13, 2026, to discuss the results and business performance [1][2] Group 1: Earnings Announcement - The fourth quarter 2025 results will be announced after market close on February 12, 2026 [1] - A conference call and audio webcast will take place on February 13, 2026, at 8:30 a.m. ET for management to discuss the results [2] Group 2: Investor Day - DraftKings will host a virtual Investor Day on March 2, 2026, at 9:00 a.m. ET to share insights on future opportunities and financial strategies [3] - The event will include a live webcast and on-demand replay available on the investor relations website [3] Group 3: Company Overview - DraftKings Inc. is a digital sports entertainment and gaming company founded in 2012, headquartered in Boston [4] - The company operates in 30 states, Washington, D.C., Ontario, Canada, and Puerto Rico, offering mobile and retail sports betting [4] - DraftKings also provides iGaming in five states and Ontario, and owns Jackpocket, a leading digital lottery courier app in the U.S. [4] - The company is an official partner of major sports leagues including the NFL, NHL, PGA TOUR, WNBA, UFC, NBA, and MLB [4]

Company Performance - DraftKings (DKNG) stock has shown negative returns of 8% for 2025, attributed to missed earnings estimates in Q2 and revenue estimates in Q3 [1] - The company has lowered its revenue outlook for 2025, indicating ongoing financial challenges [1] - For Q3 2025, DraftKings reported revenue of $1.1 billion and an adjusted EBITDA loss of $126.5 million, with a unique customer count of 10.8 million, the highest in its history [4] Market Opportunities - Prediction markets are expected to be a key growth catalyst, with potential trading volumes reaching one trillion dollars by the end of the decade [2] - DraftKings has launched its prediction market app in 38 states, expanding its product offerings [1][3] - The company acquired Jackpocket for $750 million in May 2025, allowing entry into the digital lottery market, which has an annual market size of $100 billion [6] Future Outlook - Despite current financial struggles, there is optimism for earnings acceleration in the coming years as the company taps into high-growth opportunities [5] - The acquisition of Jackpocket is expected to generate incremental revenue of $260 to $340 million and incremental EBITDA of $100 to $150 million by FY 2026 [6]

Core Insights - DraftKings Inc. (DKNG) is making significant progress in enhancing the economics of its Sportsbook business, which has been a focal point of investor discussions due to earnings volatility linked to sports outcomes [1] Group 1: Business Performance - The company reported a notable increase in parlay penetration, with NFL parlay mix rising by approximately 800 basis points and NBA parlay mix increasing by roughly 1,000 basis points, marking one of the strongest year-over-year gains [2] - DraftKings' Sportsbook net revenue margin is projected to expand by over 400 basis points compared to four years ago, indicating a structural improvement in bet mix that may lead to more consistent margin outcomes [2] - Sportsbook handle grew by 10% year over year in Q3 to $11.4 billion, with early Q4 trends showing a further 17% year-over-year increase in October [4] Group 2: Market Conditions - Unfavorable sports outcomes in September and October resulted in a revenue reduction of over $300 million, impacting Q3 results and leading to a lower full-year outlook [3] - Despite this volatility, management emphasized that it is temporary and does not affect the long-term earnings potential of the business [3] Group 3: Future Outlook - Management expressed confidence that ongoing gains in parlay mix and promotional discipline will support improving margin consistency over time, despite quarter-to-quarter results being sensitive to sports outcomes [5] - The shift towards higher-value bet types suggests that DraftKings' Sportsbook economics are becoming structurally more resilient as the business scales [5] Group 4: Stock Performance and Valuation - DraftKings' shares have declined by 21% over the past three months, compared to a 10.3% decline in the industry [6] - The stock is currently trading at a forward 12-month price-to-sales (P/S) multiple of 2.35, below the industry average of 2.67 [9] - The Zacks Consensus Estimate for DraftKings' 2026 earnings per share has decreased in the past 60 days, but projections indicate a 100.4% surge in 2026 earnings [10]

Core Points - DraftKings Inc. plans to launch its mobile sportsbook in Missouri on December 1, 2025, following the receipt of a temporary direct mobile sports wagering license from the Missouri Gaming Commission [1][2] - Missouri will be the 29th U.S. state where DraftKings offers sports wagering, expanding its presence in the market [2] - The launch will provide eligible customers access to a variety of betting options, including same-game parlays and in-game wagering, along with responsible gaming tools [3][4] Company Overview - DraftKings is a digital sports entertainment and gaming company founded in 2012, headquartered in Boston, and offers products across daily fantasy, regulated gaming, and digital media [8] - The company operates in 28 states, Washington D.C., Ontario, Canada, and Puerto Rico, with a commitment to responsible gaming [8] - DraftKings is an official partner of major sports leagues, including the NFL, NHL, and NBA, and owns the leading digital lottery courier app, Jackpocket [8] Community Engagement - To celebrate the launch in Missouri, DraftKings will host a ceremonial first bet event featuring local sports legends and will donate $50,000 to the Veterans Community Project to support veteran homelessness initiatives [5][6]

Financial Data and Key Metrics Changes - In Q3 2025, the company generated $1,144 million in revenue, representing a 4% year-over-year growth [16] - Adjusted EBITDA for Q3 was negative $127 million, impacted by customer-friendly sports outcomes that affected revenue by over $300 million [16][10] - The company revised its fiscal year 2025 revenue guidance to $5.9 billion-$6.1 billion and adjusted EBITDA guidance to $450 million-$550 million, reflecting a growth of 24%-28% compared to fiscal year 2024 [18] Business Line Data and Key Metrics Changes - Sportsbook handle increased by 10% year-over-year to $11.4 billion, with strong engagement driven by promotions [17] - iGaming net revenue growth accelerated to 25% year-over-year, marking the fastest growth since Q1 2024 [8] - The parlay handle mix surged, with year-over-year gains of 800 basis points for NFL and 1,000 basis points for NBA season to date [8] Market Data and Key Metrics Changes - NFL handle grew 13% season to date, while NBA handle increased by 19% season to date, indicating an acceleration in growth compared to previous quarters [7] - Total sportsbook handle increased by 17% year-over-year in October [8] Company Strategy and Development Direction - The company is optimistic about future growth, driven by exclusive marketing agreements with ESPN and NBCUniversal, and the upcoming launch of DraftKings Predictions [5][12] - The focus will be on states without existing online sports betting, aiming to capture a new customer base and revenue stream [12][41] - The share repurchase program has been increased from $1 billion to $2 billion, indicating confidence in future cash flow [14] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the impact of sports outcomes on financial results but emphasized that over time, these variances typically normalize [10][24] - The company remains confident in its long-term financial potential, citing strong customer retention rates and product enhancements driving engagement [5][7] - Management expressed excitement about the potential of DraftKings Predictions to expand the total addressable market [12] Other Important Information - The company is developing a Spanish-language app to cater to a growing demographic ahead of the 2026 World Cup [9][93] - The company has made significant progress in growing its sportsbook hold percentage and net revenue margin, primarily due to an increasing parlay handle mix [9] Q&A Session Summary Question: OSB hold percentage and confidence in future swings - Management acknowledged the frustration with recent outcomes but noted that over time, results tend to normalize, and the business model remains strong [21][24] Question: Value addition of new board member Greg Went - Management expressed excitement about Greg Went's expertise in gaming investment and his potential contributions to the company's strategy [25] Question: Volatility of hold due to parlay increases - Management indicated that while parlay betting can increase volatility, the focus remains on maximizing long-term value while managing risk appropriately [29][30] Question: Profitability of prediction markets - Management plans to adopt a conservative approach to investment in prediction markets, focusing on data-driven decisions and shorter payback periods [32][33] Question: Conversations with regulators regarding prediction markets - Management emphasized the importance of relationships with regulators and the strategic focus on states without existing online sports betting [38][41] Question: Significance of ESPN deal - Management highlighted the long-standing relationship with ESPN and the potential for significant customer engagement through integrated marketing efforts [51][52] Question: Breakdown of the $300 million impact on guidance - Management indicated that most of the impact was due to sports outcomes, with some additional considerations for prediction market spending [62] Question: Investment strategy for next year - Management stated that there would be minimal incremental investment in core business areas, with a focus on new states and AI technology [70] Question: Customer acquisition through Spanish-language app - Management expressed optimism about the potential for the Spanish-language app to capture a significant share of the growing Hispanic demographic [93][95] Question: Attribution of growth in parlay mix - Management attributed the growth in parlay mix to product innovation and effective promotional strategies [98][100]

Core Insights - DraftKings reported a revenue of $1,144 million for Q3 2025, marking a 4% increase from $1,095 million in Q3 2024, driven by strong customer engagement and higher Sportsbook hold percentage [2][3] - The company anticipates a fiscal year 2025 revenue guidance of $5.9 billion to $6.1 billion, reflecting a year-over-year growth of 24% to 28% [7][5] - DraftKings plans to launch its new product, DraftKings Predictions, which is expected to provide significant incremental opportunities [3] Financial Performance - Revenue for Q3 2025 was $1,144 million, up $49 million from the previous year, with Sportsbook Handle increasing by 17% year-over-year in October [2][19] - Monthly Unique Payers (MUPs) rose by approximately 2% to 3.6 million in Q3 2025, with Average Revenue per MUP (ARPMUP) increasing to $106, a 3% rise compared to Q3 2024 [7][19] - Adjusted EBITDA for Q3 2025 was reported at $(126,488) thousand, compared to $(58,504) thousand in Q3 2024 [29] Strategic Developments - The company is live with mobile sports betting in 25 states and Washington, D.C., covering about 49% of the U.S. population, and plans to launch in Missouri pending regulatory approvals [6][12] - DraftKings has increased its share repurchase program from $1 billion to $2 billion, indicating a focus on maximizing shareholder returns [3][5] - The company is also expanding its iGaming footprint, currently operational in five states, representing approximately 11% of the U.S. population [12][6] Operational Metrics - Sportsbook Handle for Q3 2025 was $11.4 billion, a 10% increase from $10.4 billion in Q3 2024, while Sportsbook revenue decreased by 9.3% to $596 million [19][15] - iGaming revenue increased by 24.9% to $451 million, reflecting strong growth in this segment [19][15] - The total assets of DraftKings as of September 30, 2025, were $4.62 billion, up from $4.28 billion at the end of 2024 [11][10]

Core Insights - DraftKings Inc. has appointed Gregory W. Wendt as an independent director on its Board, effective October 24, 2025, following a recommendation from the Nominating and Corporate Governance Committee [1] - Wendt brings extensive experience in investment management and a strong understanding of the gaming sector, having recently retired as a Partner at Capital Group Companies after a 37-year career [2] - Wendt expressed enthusiasm about joining DraftKings at a pivotal time, highlighting the company's innovative approach to fan engagement and sustainable growth [3] Company Overview - DraftKings Inc. is a digital sports entertainment and gaming company, founded in 2012, with a mission to create engaging real-money games and betting experiences [4] - The company operates in 28 states, Washington, D.C., and Ontario, Canada, offering mobile and retail sports betting, iGaming, and daily fantasy sports [4] - DraftKings is an official partner of major sports leagues, including the NFL, NHL, PGA TOUR, WNBA, UFC, NBA, and MLB, and also owns Jackpocket, a leading digital lottery courier app in the U.S. [4]

Group 1 - DraftKings Inc. will release its third quarter 2025 results after market close on November 6, 2025 [1] - A conference call and audio webcast will be held on November 7, 2025, at 8:30 a.m. ET to discuss the results and business performance [2] - The audio webcast will be available on the investor relations website until December 31, 2025 [2] Group 2 - DraftKings is a digital sports entertainment and gaming company founded in 2012, headquartered in Boston [3] - The company offers products in daily fantasy, regulated gaming, and digital media, operating in 28 states, Washington, D.C., and Ontario, Canada for sports betting [3] - DraftKings also operates iGaming in five states and Ontario, and owns Jackpocket, a leading digital lottery courier app in the U.S. [3] - The company is an official partner of major sports leagues including the NFL, NHL, PGA TOUR, WNBA, UFC, NBA, and MLB [3] - DraftKings is committed to responsible gaming and provides educational resources for players [3]