DraftKings (DKNG) Q1 2026 earnings summary

Executive summary

• First quarter 2026 revenue grew 17% year-over-year to $1.65 billion, driven by strong Sportsbook and iGaming performance and higher net revenue margin.

• Adjusted EBITDA rose 64% to $168 million, with profitability inflecting in the core business and net income of $21.1 million, a turnaround from a $33.9 million loss in the prior year quarter.

• Strategic focus on building a nationwide super app, scaling predictions, and leveraging proprietary exchange, with customer acquisition costs for predictions down over 80% in April.

• Unique customers reached 10.1 million in Q1 2026, continuing a multi-year growth trend.

• Positive net income achieved for the second consecutive quarter, alongside $100 million in share repurchases.

Financial highlights

• Q1 2026 revenue reached $1.65 billion, up 17% year-over-year, with adjusted EBITDA at $168 million, up 64% from the prior year.

• Sportsbook revenue increased 24% to $1.1 billion, with net revenue margin up to 7.8%.

• iGaming revenue grew 8.9% to $461.3 million.

• Adjusted EBITDA margin improved to 10.2% from 7.3% year-over-year.

• Average Revenue per Monthly Unique Payer (ARPMUP) increased 21% to $131.

Outlook and guidance

• Fiscal year 2026 revenue guidance reaffirmed at $6.5–$6.9 billion; adjusted EBITDA guidance at $700–$900 million.

• $200–$300 million planned investment in predictions (Pick6) for 2026, mostly in marketing and product technology.

• Core business expected to deliver $1 billion+ in adjusted EBITDA excluding predictions investment.

• Majority of predictions investment to occur in the back half of the year, especially around the World Cup.

• Management expects continued profitability improvements as revenue and gross profit expand and fixed costs stabilize.