DraftKings’ Strong Financial Performance Driven by Expanding Sports Betting and iGaming Offerings

DraftKings, a leading digital sports entertainment and gaming company, has reported impressive financial results for the first quarter of 2025. The company’s revenue increased by 19.9% to $1.41 billion compared to the same period in 2024, driven by continued growth in its Sportsbook and iGaming product offerings.

The company’s Sportsbook Handle, which represents the total amount of settled customer wagers, grew by 15.7% to $13.88 billion in the first quarter of 2025. This increase was primarily due to a 26.5% rise in Monthly Unique Payers (MUPs), a key metric that measures the number of unique paid users per month. The company’s Sportsbook Net Revenue Margin, which reflects the combined impact of its overall margin and promotional reinvestment, also improved by 0.3 percentage points to 6.4%.

DraftKings’ iGaming revenue, which includes its online casino offerings, grew by 14.5% to $423.5 million in the first quarter of 2025, also driven by the increase in MUPs. The company’s “Other Revenue,” which includes its digital lottery courier business, increased by 45.7% to $103.4 million, primarily due to the acquisition of Jackpocket Inc. in May 2024.

Table: DraftKings’ Financial Highlights

The company’s net loss decreased significantly from $142.6 million in the first quarter of 2024 to $33.9 million in the first quarter of 2025, a 76.2% improvement. This was driven by the strong revenue growth, as well as a decrease in general and administrative expenses, which were down 5.7% year-over-year.

DraftKings also reported a significant improvement in Adjusted EBITDA, a non-GAAP metric that excludes the impact of certain expenses, from $22.4 million in the first quarter of 2024 to $102.6 million in the first quarter of 2025, a 358.3% increase. This reflects the company’s focus on improving profitability as its revenue and gross profit expand.

The company’s path to profitability is based on the acceleration of positive contribution profit growth, driven by increased revenue and gross profit generation from ongoing efficient customer acquisition, strong customer retention, improved monetization, and scale benefits from investments in its product offerings and technology.

DraftKings’ management remains focused on several key priorities, including continuing to invest in its product offerings, launching its products in new jurisdictions, creating replicable and predictable jurisdiction-level unit economics in sports betting and iGaming, and expanding its product offerings. The company’s current technology is highly scalable, with relatively minimal incremental spend required to launch its product offerings in new jurisdictions.

The company’s balance sheet remains strong, with $1.12 billion in cash and cash equivalents as of March 31, 2025. DraftKings has also taken steps to strengthen its financial position, including issuing $1.27 billion in convertible senior notes in 2021 and entering into a $600 million term loan facility in 2025.

One potential area of concern is the company’s stock repurchase program, which has seen it purchase 4.8 million shares of its Class A common stock for $142.3 million as of March 31, 2025. While share buybacks can be a useful tool to return capital to shareholders, it will be important for DraftKings to balance this with continued investment in its core business to drive long-term growth.

Overall, DraftKings’ strong financial performance in the first quarter of 2025, driven by its expanding sports betting and iGaming offerings, is a positive sign for the company’s future. The company’s focus on improving profitability, while continuing to invest in its product and technology, positions it well to capitalize on the growing demand for online gaming and sports betting.