$DKNG · DraftKings Inc.
DraftKings filed its Q3 FY2026 10-Q. Revenue rose 16.2% YoY to $1.33B, driven by a 31.5% jump in Sports revenue to $783.6M, while iGaming grew just 2.1% to $460.9M. Net loss attributable to common stockholders widened to $468.7M from $256.8M a year earlier, with GAAP EPS of -$0.94 versus -$0.52. Sales and marketing expense surged 68% to $605.7M, and operating margin fell to -37.1%.
- Revenue rose 16.2% YoY to $1.33B in Q3 FY2026.
- Net loss widened to $468.7M from $256.8M a year earlier.
- Sales and marketing expense jumped 68% YoY to $605.7M.
- Sports revenue grew 31.5% to $783.6M; iGaming grew only 2.1% to $460.9M.
- Operating margin fell to -37.1% from a narrower loss a year ago.
Extended-hours trading shows DKNG at $18.45, down 21.56% versus the $23.52 regular close, signaling a sharp negative reaction to the widening loss and marketing-spend surge.
DraftKings' widening losses despite double-digit revenue growth show the cost of defending market share is escalating, spooking investors.
The 68% marketing-spend increase reflects intensifying customer-acquisition competition in U.S. online sports betting, particularly around the new prediction-markets offering launched in December 2025.
Rising promotional investment tied to prediction-markets customer acquisition is compressing margins, and iGaming growth has slowed to 2.1% YoY, raising questions about the diversification story.