DraftKings Touts ESPN, Prediction Deals After Ugly NFL Losses

The NFL season isn’t treating DraftKings well, but that isn’t bothering CEO Jason Robins. 

The sports betting executive participated in an earnings call this week. The company reported losses of around $300 million for this NFL season. Still, Robins told investors that its recent deals with ESPN and Railbird Exchange would more than offset the disappointing run. 

While the company’s EBITDA guidance was lowered, he believes the industry-leading operator is about to reach a whole new level.

Robins Bullish on DraftKings’ Future

Jsaon Robin's words obviously come with some bias, but there is plenty of reason to believe big things are coming for DraftKings.

The operator announced last month that they reached an agreement to purchase the newly licensed prediction market, Railbird Exchange. While many of the details remain unknown, we know the deal will allow DraftKings to launch its own prediction platform. 

As massive a win as the deal was, it was soon matched when ESPN announced it would be making DraftKings its official sports betting partner. The sports media giant terminated its agreement with Penn Entertainment to operate ESPN Bet and now plans to integrate DraftKings odds and services into its apps, websites, and broadcasts.  

“This is the most bullish I’ve ever felt about the future of DraftKings,” Robins said during the earnings call. “That may sound surprising given we are revising our fiscal year 2025 guidance ranges,” by 5% for revenue and 41% for EBITDA at the midpoints.

DraftKings Prepares for Missouri Launch

On top of their new deals, DraftKings is also preparing to add a new sports betting market in Missouri. That means an influx of new customers in a market with one of the country’s lowest tax rates. Sportsbooks believe the market will grow quickly, with DraftKings and FanDuel expected to capture a majority of the market share.

DraftKings picked up another win over the summer when the Missouri Gaming Commission awarded it a non-tethered sports betting license. Only two of these high-demand licenses were available, allowing sportsbooks to operate without an in-state partner and pocket more profits. Top rival FanDuel saw its application for one of the licenses rejected, handing DraftKings a significant edge.

Robins Downplays Significant Threats

While Robins gave investors plenty of reasons to be excited about DraftKings' future, he failed to share a significant threat looming ahead.

DraftKings likely paid a heavy price to acquire Railbird Exchange in pursuit of a prediction market platform. The growing industry was considered a surefire hit, but its legality remains under fire. A recent court ruling forced Crypto.com to shutter its prediction platform in Nevada at the request of a state regulator. That ended the operator’s ability to operate in all 50 states and set a precedent for similar lawsuits that are popping up across the country. 

Even if the industry survives its legal woes, there is no guarantee DraftKings will succeed. Not only is FanDuel entering the space, but well-established operators like Kalshi also have valuable experience and existing user bases, giving them a massive edge. Those operators also don’t have to worry about losing state DFS or sports betting licenses, which several regulators have promised to do if a sportsbook offers sports prediction markets.