DraftKings (NASDAQ:DKNG) Issues Earnings Results

DraftKings (NASDAQ:DKNG) announced its quarterly earnings data on Friday. The company reported $0.09 earnings per share for the quarter, beating analysts’ consensus estimates of $0.02 by $0.07, Briefing.com reports. The company had revenue of $1.44 billion for the quarter, compared to analyst estimates of $1.51 billion. DraftKings had a negative return on equity of 10.88% and a negative net margin of 2.68%.The firm’s revenue for the quarter was down 4.6% compared to the same quarter last year. During the same quarter in the previous year, the company earned $0.30 EPS.

Here are the key takeaways from DraftKings’ conference call:

• Core business momentum strengthened, with sportsbook handle up 11% year over year, sports consumer volume up 15%, and monthly unique payers growing 9%. Management said the core business is on track to generate approximately $1 billion in Adjusted EBITDA in 2026.
• DraftKings reported $115 million of second-quarter Adjusted EBITDA and maintained its 2026 revenue guidance of $6.5 billion-$6.9 billion and Adjusted EBITDA guidance of $700 million-$900 million, despite continued investment in predictions.
• The predictions offering exceeded expectations, attracting more than 600,000 customers year to date and growing annualized traded volume nearly fivefold from April to July. DraftKings expects its vertically integrated brokerage, exchange, and market-making model to improve long-term customer economics.
• Customer acquisition increased nearly 75% year over year, prompting DraftKings to spend about 10% more than planned, although underlying acquisition costs were approximately 25% better than expected. Management may increase or reallocate spending if customer-acquisition returns remain attractive.
• iGaming showed early signs of recovery, supported by the Lightning Link launch and Flex Spins feature, with customer acquisition stronger than expected and market share stabilizing after several quarters of declines.

DraftKings Price Performance

NASDAQ DKNG traded up $1.86 during mid-day trading on Friday, hitting $24.03. The stock had a trading volume of 37,754,843 shares, compared to its average volume of 12,578,895. The company has a 50 day simple moving average of $25.37 and a 200 day simple moving average of $24.97. The company has a market cap of $11.92 billion, a price-to-earnings ratio of -63.24 and a beta of 1.66. DraftKings has a 52-week low of $20.46 and a 52-week high of $48.78. The company has a quick ratio of 1.02, a current ratio of 1.02 and a debt-to-equity ratio of 3.03.

Trending Headlines about DraftKings

Here are the key news stories impacting DraftKings this week:

• Positive Sentiment: DraftKings’ Predictions platform is expanding rapidly ahead of football season. CEO Jason Robins said annualized volume increased to approximately $11 billion in July from $2.3 billion in April, reinforcing the company’s strategy to become a broader nationwide sports-commerce platform. Prediction markets take center stage in latest round of quarterly earnings reports
• Positive Sentiment: Management said the core business remains positioned to generate roughly $1 billion in adjusted profit this year, providing flexibility to invest in Predictions. DraftKings also reaffirmed its full-year revenue outlook of $6.5 billion to $6.9 billion. DKNG Stock Slips After-Hours As Q2 Earnings Disappoint
• Positive Sentiment: Benchmark raised its DraftKings price target to $30 from $29 and maintained a Buy rating, citing potential upside from the Predictions rollout and the upcoming NFL season. DraftKings price target raised by Benchmark
• Neutral Sentiment: Second-quarter results were mixed: DraftKings reported $1.44 billion in revenue versus approximately $1.51 billion expected, while earnings per share of $0.09 exceeded the consensus estimate cited by some data providers. Full-year guidance was unchanged. DraftKings Reports Second Quarter Results
• Negative Sentiment: Revenue declined 4.6% year over year, and the company swung to a $67.6 million net loss from $157.9 million of profit a year earlier. Heavy promotional activity, along with unfavorable sports outcomes including the Knicks’ title run and World Cup results, pressured quarterly results. DraftKings Second-Quarter Revenue Falls, Hurt by Promotions

Insiders Place Their Bets

In other news, insider R Stanton Dodge sold 62,500 shares of the firm’s stock in a transaction on Thursday, June 11th. The stock was sold at an average price of $29.68, for a total value of $1,855,000.00. Following the completion of the transaction, the insider owned 556,258 shares in the company, valued at $16,509,737.44. This trade represents a 10.10% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which is available through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Woodrow Levin sold 34,234 shares of DraftKings stock in a transaction on Monday, May 18th. The stock was sold at an average price of $25.71, for a total value of $880,156.14. Following the transaction, the director directly owned 29,820 shares of the company’s stock, valued at $766,672.20. This trade represents a 53.45% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Over the last quarter, insiders have sold 97,596 shares of company stock worth $2,756,991. 47.18% of the stock is owned by company insiders.

Hedge Funds Weigh In On DraftKings

Several hedge funds have recently added to or reduced their stakes in the business. Viking Global Investors LP lifted its holdings in shares of DraftKings by 27.4% in the fourth quarter. Viking Global Investors LP now owns 19,119,912 shares of the company’s stock valued at $658,872,000 after purchasing an additional 4,116,561 shares in the last quarter. AQR Capital Management LLC increased its stake in shares of DraftKings by 41.0% during the 4th quarter. AQR Capital Management LLC now owns 16,474,009 shares of the company’s stock worth $567,694,000 after purchasing an additional 4,788,337 shares in the last quarter. Cadian Capital Management LP raised its position in shares of DraftKings by 297.8% during the 4th quarter. Cadian Capital Management LP now owns 5,524,221 shares of the company’s stock worth $190,365,000 after purchasing an additional 4,135,461 shares during the last quarter. ARK Investment Management LLC raised its position in shares of DraftKings by 32.0% during the 4th quarter. ARK Investment Management LLC now owns 4,540,766 shares of the company’s stock worth $156,475,000 after purchasing an additional 1,101,850 shares during the last quarter. Finally, Spruce House Investment Management LLC lifted its stake in DraftKings by 1,301.3% in the 4th quarter. Spruce House Investment Management LLC now owns 4,203,834 shares of the company’s stock valued at $144,864,000 after buying an additional 3,903,834 shares in the last quarter. 37.70% of the stock is currently owned by hedge funds and other institutional investors.

Analyst Upgrades and Downgrades

DKNG has been the topic of a number of recent analyst reports. Freedom Capital raised DraftKings to a “strong-buy” rating in a report on Wednesday, May 20th. Wells Fargo & Company reduced their target price on DraftKings from $32.00 to $29.00 and set an “overweight” rating for the company in a report on Monday, July 20th. Scotiabank upgraded shares of DraftKings to an “outperform” rating in a research report on Friday, April 24th. Jefferies Financial Group reaffirmed a “buy” rating on shares of DraftKings in a research note on Wednesday, June 10th. Finally, Deutsche Bank Aktiengesellschaft increased their price target on shares of DraftKings from $26.00 to $28.00 and gave the company a “hold” rating in a report on Thursday, July 9th. One research analyst has rated the stock with a Strong Buy rating, twenty-nine have assigned a Buy rating, eight have given a Hold rating and two have assigned a Sell rating to the stock. According to MarketBeat.com, DraftKings has an average rating of “Moderate Buy” and a consensus target price of $34.14.

About DraftKings

DraftKings Inc is a leading digital sports entertainment and gaming company specializing in daily fantasy sports, sports betting and iGaming products. The company provides an integrated platform where users can participate in daily fantasy contests, place wagers on professional sports events, and enjoy a range of online casino-style games. DraftKings’ proprietary technology supports real-time odds, live scoring and advanced analytics to enhance the user experience across mobile and desktop applications.

Founded in 2012 by co-founders Jason Robins, Matthew Kalish and Paul Liberman, DraftKings began as a daily fantasy sports provider and rapidly expanded into regulated sports betting following legislative changes in the United States.