DraftKings goes on offence against Kalshi and Polymarket after mixed Q2

DraftKings stock jumped 8% on Friday despite a second-quarter earnings miss, as investors focused on the operator’s aggressive push into prediction markets and its public war of words with rivals Kalshi and Polymarket.

The company posted total revenue of $1.44 billion for the quarter, down $69.3 million year-on-year, and adjusted diluted earnings per share of $0.09, well below the consensus estimate of $0.22. The decline was attributed to customer-friendly sports results and higher promotional reinvestment.

But the real story played out on CNBC and the earnings call. CEO Jason Robins used the platform to fire at Kalshi and Polymarket, two prediction-only operators now valued at over $20 billion each. He accused them of perpetuating a narrative that could cause “long-term harm to the trust of the industry.”

Robins disputed the claim that these companies have no incentive to see customers win or lose. He said that recreational customers often act as counterparties to institutional market makers with sophisticated quantitative tools, making the narrative misleading. “Some of the companies out there are spinning narratives that just aren’t true,” he told CNBC.

DraftKings launched its own prediction exchange, DKeX, weeks before the earnings call and has integrated predictions into its broader sports offerings. Approximately 600,000 customers have used the platform since the start of the year. The operator is now preparing for the NFL season with an updated “super app” that includes new prediction features.

Kalshi, by contrast, has recorded $39.7 billion in annualised trading volume in 2026. Its CEO Tarek Mansour did not respond to Robins’ comments. Both executives sit on the US Commodity Futures Trading Commission’s Innovation Advisory Committee, adding a regulatory dimension to the rivalry.

For Malta’s iGaming sector, the developments are a clear signal that prediction markets are becoming a central competitive battleground. Operators with traditional sportsbook exposure must now decide whether to build their own exchanges, partner with existing players, or risk being left behind.

The contrast with Flutter’s FanDuel highlights the urgency. Flutter made just $6 million from its predictions segment in Q2, and analysts say FanDuel is nine to twelve months behind DraftKings. Flutter, which has not decided whether to launch its own market-making exchange, saw its stock fall 9% after CEO Peter Jackson’s departure.

DraftKings CFO Alan Ellingson said the company is “focused on improving the efficiency of our cost structure while continuing to invest behind the opportunities that we believe will create the most long-term value.” DraftKings is on track to produce annualised adjusted EBITDA of $1 billion.

Investors downplayed the earnings miss, pushing the stock to $24.03. Analysts at Citizens and Truist rated the stock a buy, with price targets of $36 and $29 respectively. Both DraftKings and Flutter are down more than 20% year-to-date, but Robins appears undeterred. “We are on offence, the core business is firing,” he said.