DraftKings Reports Positive Start to 2026, Continued Focus on Prediction Markets

• DraftKings reported $1.6 billion in revenue for Q1 2026 during its earnings call
• The company reported its second consecutive quarter of positive net income
• CEO and Co-Founder Jason Robins said predictions markets, specifically sports event contracts, is a strategic priority moving forward

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DraftKings reported a strong start to 2026 with yet another quarter of positive net income, despite significant investments in its prediction market product and a new state sports betting launch in Q1.

DraftKings CEO and Co-Founder Jason Robins reported $1.6 billion in revenue for Q1 2026 during today’s earnings call, a 17% increase year-over-year compared with Q1 2025. While sportsbook revenue did lead the way, Robins said DraftKings is expecting a big future for its prediction market offerings, specifically sports event contracts.

“At our Investor Day in March, we laid out a clear strategy: one nationwide Super App to win in sports. Already, we are delivering on our plan. Predictions is now live in our flagship app, and as a result, our predictions customer acquisition cost declined more than 80% in April. Within predictions, we have more than doubled markets available to trade, which is driving predictions volume per customer above sportsbook handle per customer,” he said.

Big Future for DraftKings Predictions

The excitement for DraftKings Predictions is growing, as Robins said the company will likely invest $200 million to $300 million on its predictions offerings in 2026.

In April, Robins reported DraftKings Predictions consumer volume exceeding $1 billion, with the annualized total volume traded exceeding $2.3 billion, an increase of 38% and 43% month-over-month.

“We have also launched market making, which unlocks access to an additional layer of the value chain. Market making is already generating a positive return for us. In the coming weeks, we expect to launch our proprietary exchange and to begin offering combos. Together, these moves will accelerate innovation, improve the customer experience, and strengthen our economics,” he said.

The company is expected to launch its DraftKings Predictions combos offering sometime in Q2 2026.

DraftKings Predictions will play a big role in moving the company forward on its path to $55 billion to $80 billion gross revenue opportunity by 2030, Robins said, as well as at least a 30% long-term adjusted EBITDA margin.

“We are off to a fantastic start to the year as our first quarter results exceeded our expectations,” Robins said in a prepared statement. “Our core business is strong, and profitability is inflecting. 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.”

Good For Potential Legalization

The presence of prediction markets are having a positive impact on the potential for sports betting and iGaming legalization, Robins said.

State lawmakers are beginning to realize that they have to contend with prediction markets within their borders, he noted, and may want to more seriously consider sports betting and iGaming legalization to have control over the markets.

Robins said he is not expecting any states in 2026 to legalize sports betting, but momentum may continue into 2027 for a reinvigorated push. Additionally, iGaming momentum seems to be increasing, as more states are considering the new form of gaming.

Both Virginia legislative chambers approved iGaming legislation earlier this year before the bill fell apart at the finish line, he said, and will likely be considered again next year. Maryland and Washington, D.C., are both currently taking a serious look at iGaming bills and could potentially legalize this year.

As for 2027, Robins said Ohio is a likely candidate to consider iGaming legalization, as well as Illinois.

Two Consecutive Net Positive Quarters

DraftKings reported its second consecutive positive net income quarter. The company expects fiscal year 2026 revenue of $6.5 billion to $6.9 billion and adjusted EBITDA of $700 million to $900 million.

For Q1 2026, adjusted EBITDA increased 64% year-over-year to $168 million. Robins said if not for the significant investments in DraftKings Predictions and its sportsbook launch in Arkansas, adjusted EBITDA likely would have exceeded $200 million.

Sportsbook revenue increased 24% year-over-year to $1.1 billion as handle grew and net revenue margin increased 140 basis points to 7.8%. Revenue growth exceeded 20% across nearly all major sports, including NBA and NCAA men’s basketball.