DraftKings Inc.
For the period ended Jun 30, 2026. Filed Aug 7, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2026 · Filed Aug 7, 2026
DKNG$18.51-21.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-03-31; filed 2026-05-08.
0001883685-26-000020
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-06-30; filed 2026-08-07.
0001883685-26-000029
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 99 previous paragraphs and 115 current paragraphs.
58 unchanged; 34 reworded; 19 added; 7 removed; 0 previous and 4 current paragraphs rearranged.
Tables are not compared: 6 previous and 8 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (19)
Current report
Website and Social Media Disclosure
Current report
We disclose information about the Company, our business and other matters using our investor relations website (https://ir.aboutdraftkings.com) and may, from time to time, use our DraftKingsNews X account (@DraftKingsNews) to disclose such information. The information we post through these channels may be deemed material. Accordingly, investors and the public should monitor these channels, in addition to our SEC filings, press releases and public conference calls and webcasts. The contents of our investor relations website and our DraftKingsNews X account are not, however, a part of this Report. Information contained on DraftKings’ website or connected thereto is provided for textual reference only and does not constitute part of, and is not incorporated by reference into, this Report.
Current report
MUPs increased 0.3 million, or 9.1%, and 0.1 million, or 2.6%, in the three and six months ended June 30, 2026, compared to the three and six months ended June 30, 2025, primarily due to unique payer retention and new customer acquisition on our Sportsbook offering, primarily related to engagement on the NBA Finals and FIFA World Cup, and on our Prediction Markets offering, which launched in December 2025.
Current report
ARPMUP decreased by $19, or 12.6%, for the three months ended June 30, 2026, compared to the three months ended June 30, 2025, primarily due to customer-friendly sports outcomes and new customer promotions impacting revenue on our Sportsbook and Prediction Markets offerings. ARPMUP increased $4, or 3%, for the six months ended June 30, 2026, compared to the six months ended June 30, 2025, primarily due to a higher percentage of customers engaging with multiple offerings resulting in higher revenue per customer.
Current report
Sports Consumer Volume. We define Sports Consumer Volume as the total amount of settled customer wagers or trades on our Sportsbook and Prediction Markets offerings. Sports Consumer Volume excludes the volume from market makers on our
Current report
Sports Consumer Volume increased by $1.7 billion, or 14.5%, to $13.1 billion in the three months ended June 30, 2026, from $11.5 billion in the three months ended June 30, 2025, and increased by $2.0 billion, or 7.8%, to $27.3 billion in the six months ended June 30, 2026, from $25.4 billion in the six months ended June 30, 2025. These increases are primarily due to an increase in MUPs due to unique payer retention and acquisition on our Sportsbook offering, primarily related to engagement on the NBA Finals and FIFA World Cup as well as new customer acquisition on our Prediction Markets offering, which launched in December 2025.
Current report
Sports Net Revenue Margin decreased by 1.9 percentage points, to 6.8% in the three months ended June 30, 2026, from 8.7% in the three months ended June 30, 2025, primarily due to customer-friendly sports outcomes and higher promotions associated with new customers on our Sportsbook offering and Prediction Markets offering. Sports Net Revenue Margin remained consistent at 7.3% in the six months ended June 30, 2026, compared to 7.4% in the six months ended June 30, 2025 primarily driven by a higher hold percentage on our Sportsbook offering, offset by higher promotions related to customer acquisition.
Current report
iGaming revenue increased$32.3 million, or 7.5%, to$461.9 million in the three months ended June 30, 2026, from $429.7 million in the three months ended June 30, 2025, and increased by $70.1 million, or 8.2%, to $923.2 million in the six months ended June 30, 2026, from $853.1 million in the six months ended June 30, 2025. The increase is primarily due to improved promotional reinvestment and an increase in MUPs for the iGaming offering.
Current report
Revenue. Revenue decreased by $69.3 million, or 4.6%, to $1,443.2 million in the three months ended June 30, 2026, from $1,512.5 million in the three months ended June 30, 2025. The decrease was primarily attributable to our Sports revenue, which decreased $106.0 million, or 10.6%, due to a reduction in our Sports Net Revenue Margin of 1.9 percentage points primarily due to customer-friendly sports outcomes and higher promotions associated with new customers on our Sportsbook and Prediction Markets offerings. The decrease was partially offset by our iGaming offering, which increased $32.3 million, or 7.5%, due to improved promotional reinvestment.
Current report
Cost of revenue as a percentage of revenue increased by 5.3 percentage pointsto 61.8% in thethree months ended June 30, 2026, as compared to 56.5% in thethree months ended June 30, 2025, primarily attributable to an increase in gaming taxes due to tax rate increases in certain states.
Current report
Sales and Marketing. Sales and marketing expense increased $89.3 million, or 38.3%, to $322.5 million in the three months ended June 30, 2026, from $233.2 million in the three months ended June 30, 2025, primarily due to higher external marketing costs, including increased customer acquisition costs associated with the FIFA World Cup, the NBA Playoffs, and the launch of our Super App and Prediction Markets offering.
Current report
Product and Technology. Product and technology expense increased $19.2 million, or 17.7%, to $127.6 million in the three months ended June 30, 2026, from $108.4 million in the three months ended June 30, 2025, primarily due to higher software and licensing costs and increased employee compensation, including stock-based compensation, in our product and engineering departments.
Current report
Six Months Ended June 30, 2026 Compared to the Six Months Ended June 30, 2025
Current report
Revenue. Revenue increased by $168.0 million, or 5.8%, to $3,089.3 million in the six months ended June 30, 2026, from $2,921.3 million in the six months ended June 30, 2025. The increase was primarily attributable to our Sports revenue, which increased $106.6 million, or 5.7%, due to higher Sports Consumer Volume, primarily driven by an increase in MUPs due to unique payer retention and acquisition on our Sportsbook offering as well as new customer acquisition on our Prediction Markets offering, which launched in December 2025. Our iGaming offering also increased $70.1 million, or 8.2%, due to improved promotional reinvestment.
Current report
Cost of Revenue. Cost of revenue increased$142.8 million, or 8.4%, to$1,841.2 million in the six months ended June 30, 2026, from$1,698.4 million in thesix months ended June 30, 2025. The increase was primarily due to an increase in our variable expenses, such as gaming taxes and platform costs, which increased $103.8 million and $17.8 million, respectively. The remaining increase was primarily attributable to an increase in amortization of intangible assets of $15.4 million.
Current report
Cost of revenue as a percentage of revenue increased by 1.5 percentage pointsto 59.6% in thesix months ended June 30, 2026, as compared to 58.1% in thesix months ended June 30, 2025, primarily attributable to an increase in promotional reinvestment around new customer acquisition for our Sportsbook and Prediction Markets offerings.
Current report
General and Administrative. General and administrative expense increased by $5.3 million, or 1.6%, to $335.4 million in the six months ended June 30, 2026, from $330.1 million in the six months ended June 30, 2025. The increase was primarily driven by a $46.2 million increase in advocacy and other related legal expenses, partially offset by a $38.0 million decrease in compensation expense, of which $32.0 million related to stock-based compensation.
Current report
Other Gain (Loss), net. We recorded a net gain of $26.6 million in the six months ended June 30, 2026, as compared to a $24.5 million gain in the six months ended June 30, 2025. The increase was primarily attributable to larger gains on the revaluation of contingent consideration for the six months ended June 30, 2026 compared to the six months ended June 30, 2025.
Current report
Net Income (Loss). Net income decreased by $170.6 million to a net loss of $46.5 million in the six months ended June 30, 2026, as compared to a net income of $124.1 million in the six months ended June 30, 2025, for the reasons discussed above.
Removed paragraphs (7)
Previous report
MUPs decreased 3.6% in the three months ended March 31, 2026 compared to the three months ended March 31, 2025, primarily reflecting lower MUPs from Lottery as a result of exiting Texas in 2025. Excluding the impact of our Lottery offering, MUPs increased by 0.1 million or 2.1% in the three months ended March 31, 2026 compared to the three months ended March 31, 2025 due to unique payer retention and acquisition across our Sportsbook and iGaming offerings.
Previous report
ARPMUP increased by $23 or 21.3% for the three months ended March 31, 2026 compared to the three months ended March 31, 2025, primarily due to improvement in our Sportsbook Net Revenue Margin.
Previous report
Sportsbook Handle increased by $0.2 billion, or 1.5%, to $14.1 billion in the three months ended March 31, 2026, from $13.9 billion in the three months ended March 31, 2025, reflecting continued customer acquisition and strength in existing user engagement.
Previous report
Sportsbook Net Revenue Margin increased by 1.4 percentage points, to 7.8% in the three months ended March 31, 2026, from 6.4% in the three months ended March 31, 2025, primarily driven by an increase in hold percentage and improved promotional reinvestment.
Previous report
iGaming revenue increased$37.8 million, or 8.9%, to$461.3 million in the three months ended March 31, 2026, from $423.5 million in the three months ended March 31, 2025. The increase is primarily due to improved promotional reinvestment.
Previous report
Revenue. Revenue increased by $237.3 million, or 16.8%, to $1,646.1 million in the three months ended March 31, 2026, from $1,408.8 million in the three months ended March 31, 2025. The increase was primarily attributable to our Sportsbook offering, which increased$212.9 million, or 24.1%, due toan increase in Sportsbook Net Revenue Margin to 7.8% from 6.4%. Our iGaming offering also increased $37.8 million, or 8.9%, due to improved promotional reinvestment. The increase in revenue was partially offset by our other offerings which decreased$13.5 million, or 13.0%, primarily due to a decline in Fantasy entries and lower Lottery revenue following our exit from Texas in 2025.
Previous report
Cost of revenue as a percentage of revenue decreased by 2.2 percentage pointsto 57.7% in thethree months ended March 31, 2026, as compared to 59.9% in thethree months ended March 31, 2025, primarily attributable to economies of scale as a result of higher Sportsbook Net Revenue Margin.
Reworded paragraphs (34)
Previous wording
This Report contains forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 that reflect future plans, estimates, beliefs and expected performance. The forward-looking statements depend upon events, risks and uncertainties that may be outside of our control. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intends,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “will,” “would,” “forecast,” “propose” and similar expressions or the negative of these words, or statements of vision, strategy or outlook, may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Our historical results are not necessarily indicative of the results that may be expected for any events in the future as our business and operations are subject to a variety of risks and uncertainties, many of which are beyond our control, and, consequently, our actual results may differ materially from those projected.
Current wording
This Report contains forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 that reflect future plans, estimates, beliefs and expected performance. The forward-looking statements depend upon events, risks and uncertainties that may be outside of our control. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “will,” “would,” “forecast,” “propose” and similar expressions or the negative of these words, or statements of vision, strategy or outlook, may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. Our historical results are not necessarily indicative of the results that may be expected for any events in the future as our business and operations are subject to a variety of risks and uncertainties, many of which are beyond our control, and, consequently, our actual results may differ materially from those projected.
Previous wording
Our priorities are to (a) continue to invest in our offerings, (b) launch our offerings in new jurisdictions, (c) create replicable and predictable jurisdiction-level unit economics in Sportsbook and iGaming and (d) expand our offerings. When we launch our Sportsbook and iGaming offerings in a new jurisdiction, we invest heavily in customer acquisition, user retention and cross-selling until the new jurisdiction provides a critical mass of users engaged across our offerings.
Current wording
Our priorities are to (a) continue to invest in our offerings, (b) launch our offerings in new jurisdictions, (c) create replicable and predictable jurisdiction-level unit economics in Sportsbook and iGaming and (d) expand our offerings. When we launch our offerings in a new jurisdiction, we invest heavily in customer acquisition, user retention and cross-selling until the new jurisdiction provides a critical mass of users engaged across our offerings.
Previous wording
Revenue increased by$237.3 million in thethree months ended March 31, 2026, compared to thethree months ended March 31, 2025, primarily due to the strong performance of our Sportsbook andiGaming offerings as a result of continued healthy user engagement, efficient acquisition of new customers and higher net revenue margin.
Current wording
Revenue decreased by$69.3 million in the three months ended June 30, 2026, compared to the three months ended June 30, 2025, primarily due to lower revenue from our Sportsbook and Prediction Markets offerings (together, “Sports”), driven by customer-friendly sports outcomes and increased promotional reinvestment associated with new customer acquisition on our Sports offering. Revenue increased by $168.0 million in thesix months ended June 30, 2026, compared to thesix months ended June 30, 2025, primarily due to the strong performance of our Sports and iGaming offerings as a result of continued healthy user engagement and efficient acquisition of new customers.
Previous wording
The charts below present our average MUPs for the three months ended March 31, 2025 and 2026:
Current wording
The charts below present our average MUPs for the three and six months ended June 30, 2025 and 2026:
Previous wording
Average Revenue per MUP (“ARPMUP”). We define and calculate ARPMUP as the average monthly revenue for a reporting period divided by the average number of MUPs for the same period. ARPMUP is a key indicator of our ability to drive usage and monetization of our offerings. The charts below present our ARPMUP for the three months ended March 31, 2025 and 2026:
Current wording
Average Revenue per MUP (“ARPMUP”). We define and calculate ARPMUP as the average monthly revenue for a reporting period divided by the average number of MUPs for the same period. ARPMUP is a key indicator of our ability to drive usage and monetization of our offerings. The charts below present our ARPMUP for the three and six months ended June 30, 2025 and 2026:
Previous wording
Sportsbook Handle. We define Sportsbook Handle as the total amount of settled customer wagers on our Sportsbook offering. Sportsbook Handle provides useful information to investors and management as it is a key indicator of volume and customer engagement on our Sportsbook offering that is not impacted by variability of sport outcomes and provides important insight into underlying growth trends. We do not utilize handle information to track performance of our iGaming offering because iGaming is generally not subject to the same variability in outcomes.
Current wording
Prediction Markets offering. Sports Consumer Volume provides useful information to investors and management as it is a key indicator of customer engagement that is not impacted by variability of sports outcomes and provides important insight into underlying growth trends. We do not utilize volume information to track performance of our iGaming offering because iGaming is generally not subject to the same variability in outcomes.
Previous wording
Sportsbook Net Revenue Margin. We define Sportsbook Net Revenue Margin as Sportsbook revenue as a percentage of Sportsbook Handle. This provides useful information to investors and management as it is a key indicator in measuring the combined impact of our overall margin on our Sportsbook offering and promotional reinvestment.
Current wording
Sports Net Revenue Margin. We define Sports Net Revenue Margin as Sports revenue as a percentage of Sports Consumer Volume. Sports revenue includes revenue from our Sportsbook and Prediction Markets offerings. This provides useful information to investors and management as it is a key indicator in measuring the combined impact of our overall margin on our Sports offering and promotional reinvestment.
Previous wording
The chart below presents our Sportsbook Handle, Sportsbook Net Revenue Margin, and revenue disaggregation for the three months ended March 31, 2026 and 2025:
Current wording
The tables below presents our Sports Consumer Volume, Sports Net Revenue Margin, and revenue disaggregation for the three and six months ended June 30, 2026 and 2025:
Previous wording
Other revenue decreased$13.5 million, or 13.0%, to$89.9 million in the three months ended March 31, 2026, from $103.4 million in the three months ended March 31, 2025, primarily due to a reduction in Fantasy entry fees and lower Lottery revenue following our exit from the Texas market.
Current wording
Other revenue increased$4.4 million, or 5.2%, to$89.4 million in the three months ended June 30, 2026, from $85.0 million in the three months ended June 30, 2025, primarily due to the increased revenues from the new Keno offering within the Lottery offering. Other revenue decreased $8.7 million, or 4.6%, to $179.6 million in the six months ended June 30, 2026, from $188.4 million in the six months ended June 30, 2025, primarily due to a reduction in Fantasy entry fees and lower Lottery revenue following our exit from the Texas market.
Previous wording
We define and calculate Adjusted Diluted Earnings (Loss) Per Share as diluted earnings (loss) per share attributable to common stockholders adjusted for the impact of amortization of acquired intangible assets; discrete tax benefits attributed to acquisitions; stock-based compensation; transaction-related costs; litigation, settlement and related costs; advocacy and other related legal expenses; gain or loss on remeasurement of warrant liabilities; other non-recurring and non-operating costs or income; and the tax impact of adjusting items, as described in the reconciliation below.
Current wording
We define and calculate Adjusted Diluted Earnings (Loss) Per Share as diluted earnings (loss) per share attributable to common stockholders adjusted for the impact of amortization of acquired intangible assets; discrete tax benefits attributed to acquisitions; stock-based compensation; transaction-related costs; litigation, settlement and related costs; advocacy and other related legal expenses; gain or loss on remeasurement of warrant liabilities; other non-recurring and non-operating costs or income; and the tax impact of adjusting items, as described in the reconciliation below. The weighted-average shares outstanding used in the calculation of diluted earnings (loss) per share are the GAAP weighted-average diluted shares reported in the consolidated financial statements and are not adjusted.
Previous wording
(1)The amounts include the amortization of acquired intangible assets of $37.6 million and $42.7 million for the three months ended March 31, 2026 and 2025, respectively.
Current wording
(1)The amounts include the amortization of acquired intangible assets of $37.6 million and $36.4 million for the three months ended June 30, 2026 and 2025, respectively, and $75.1 million and $79.1 million for the six months ended June 30, 2026 and 2025, respectively.
Previous wording
(5)Reflects non-recurring and non-ordinary course costs relating to advocacy efforts primarily in pursuit of legalization of DraftKings offerings. For the three months ended March 31, 2026, this spend primarily relates to legislative efforts for legalizing iGaming, supporting a ballot measure for legalizing Sportsbook, and other advocacy activities related to certain states. Advocacy and legal expenses incurred in the ordinary course of business have not been adjusted in this measure.
Current wording
(5)Reflects non-recurring and non-ordinary course costs relating to advocacy efforts primarily in pursuit of legalization of DraftKings offerings. For the three and six months ended June 30, 2026, this spend primarily relates to legislative efforts for legalizing iGaming, supporting a ballot measure for legalizing Sportsbook, and other advocacy activities related to certain states. Advocacy and legal expenses incurred in the ordinary course of business have not been adjusted in this measure.
Previous wording
*Weighted average diluted number of shares used to calculate Adjusted Diluted Earnings (Loss) Per Share for the three months ended March 31, 2026 and 2025 was 510.6 million and 493.3 million, respectively; totals may not add due to rounding.
Current wording
*Weighted average diluted number of shares used to calculate Adjusted Diluted Earnings (Loss) Per Share for the three months ended June 30, 2026 and 2025 was 496.1 million and 529.5 million, respectively, and for the six months ended June 30, 2026 and 2025 was 495.2 million and 529.6 million, respectively; totals may not add due to rounding.
Previous wording
(1)The amounts include the amortization of acquired intangible assets of $37.6 million and $42.7 million for the three months ended March 31, 2026 and 2025, respectively.
Current wording
(1)The amounts include the amortization of acquired intangible assets of $37.6 million and $36.4 million for the three months ended June 30, 2026 and 2025, respectively, and $75.1 million and $79.1 million for the six months ended June 30, 2026 and 2025, respectively.
Previous wording
(5)Reflects non-recurring and non-ordinary course costs relating to advocacy efforts primarily in pursuit of legalization of DraftKings offerings. For the three months ended March 31, 2026, this spend primarily relates to legislative efforts for legalizing iGaming, supporting a ballot measure for legalizing Sportsbook, and other advocacy activities related to certain states. Advocacy and legal expenses incurred in the ordinary course of business have not been adjusted in this measure.
Current wording
(5)Reflects non-recurring and non-ordinary course costs relating to advocacy efforts primarily in pursuit of legalization of DraftKings offerings. For the three and six months ended June 30, 2026, this spend primarily relates to legislative efforts for legalizing iGaming, supporting a ballot measure for legalizing Sportsbook, and other advocacy activities related to certain states. Advocacy and legal expenses incurred in the ordinary course of business have not been adjusted in this measure.
Previous wording
(6)Beginning in the first quarter of 2025, the Company began applying an estimated non-GAAP effective tax rate, which was 23% in 2025 and is 25% as of the first quarter of 2026. The non-GAAP effective tax rate reflects the non-GAAP tax provision commensurate with the Company’s level of non-GAAP profitability, which was determined after adjusting for the non-GAAP adjustments presented above and excluding the impact of changes in the valuation allowance.
Current wording
(6)Beginning in the first quarter of 2025, the Company began applying an estimated non-GAAP effective tax rate, which was 23% in 2025 and is 28% as of the second quarter of 2026. The non-GAAP effective tax rate reflects the non-GAAP tax provision commensurate with the Company’s level of non-GAAP profitability, which was determined after adjusting for the non-GAAP adjustments presented above and excluding the impact of changes in the valuation allowance.
Previous wording
Cost of Revenue. Cost of revenue increased$105.6 million, or 12.5%, to$949.4 million in the three months ended March 31, 2026, from$843.8 million in thethree months ended March 31, 2025. The increase was primarily due to our revenue growth and a resulting increase in our variable expenses, such as gaming taxes and platform fees, which increased $86.1 million and $14.4 million, respectively.
Current wording
Cost of Revenue. Cost of revenue increased$37.2 million, or 4.4%, to$891.8 million in the three months ended June 30, 2026, from$854.6 million in thethree months ended June 30, 2025. The increase was primarily due to an increase in our variable expenses, such as gaming taxes and payment processing fees, which increased $17.7 million and $4.1 million, respectively. The remaining increase was primarily attributable to an increase in amortization of intangible assets of $14.5 million.
Previous wording
General and Administrative. General and administrative expense increased by $1.5 million, or 0.9%, to $165.9 million in the three months ended March 31, 2026, from $164.4 million in the three months ended March 31, 2025. The increase was primarily driven by a $26.4 million increase in advocacy and other related legal expenses recognized in the three months ended March 31, 2026, partially offset by lower stock-based compensation expense of $22.5 million.
Current wording
General and Administrative. General and administrative expense increased by $3.7 million, or 2.3%, to $169.4 million in the three months ended June 30, 2026, from $165.7 million in the three months ended June 30, 2025. The increase was primarily driven by a $19.9 million increase in advocacy and other related legal expenses recognized in the three months ended June 30, 2026, partially offset by lower stock-based compensation expense of $9.5 million.
Previous wording
Gain (Loss) on Remeasurement of Warrant Liabilities. As all warrants were exercised or expired as of December 31, 2025, there was no remeasurement of warrant liabilities in the three months ended March 31, 2026, compared to a $2.5 million gain in the three months ended March 31, 2025.
Current wording
Gain (Loss) on Remeasurement of Warrant Liabilities. As all warrants were exercised or expired as of December 31, 2025, there was no remeasurement of warrant liabilities in the three months ended June 30, 2026, compared to a $5.9 million loss in the three months ended June 30, 2025.
Previous wording
Other Gain (Loss), net. We recorded a net gain of $22.8 million in the three months ended March 31, 2026, as compared to a nominal gain in the three months ended March 31, 2025. The gain was primarily attributable to the revaluation of contingent consideration for the three months ended March 31, 2026.
Current wording
Other Gain (Loss), net. We recorded a net gain of $3.8 million in the three months ended June 30, 2026, as compared to a $24.5 million gain in the three months ended June 30, 2025. The decrease was primarily attributable to larger gains on the revaluation of contingent consideration for the three months ended June 30, 2025 compared to the three months ended June 30, 2026.
Previous wording
Income Tax Provision (Benefit). We recorded an income tax expense of$6.4 million in thethree months ended March 31, 2026, as compared to an income tax benefit of$5.6 million in thethree months ended March 31, 2025. Although we have a cumulative three year loss position, based on our recent financial performance and our future projections, we could record a reversal of all, or a portion of the valuation allowance associated with U.S. deferred tax assets in future periods. However, any such change is subject to actual performance and other considerations that may present positive or negative evidence at the time of the assessment.
Current wording
Income Tax Provision (Benefit). We recorded an income tax benefit of$1.8 million in thethree months ended June 30, 2026, as compared to an income tax expense of$11.8 million in thethree months ended June 30, 2025. Although we have a cumulative three year loss position, based on our recent financial performance and our future projections, we could record a reversal of all, or a portion of, the valuation allowance associated with U.S. deferred tax assets in future periods. However, any such change is subject to actual performance and other considerations that may present positive or negative evidence at the time of the assessment.
Previous wording
Net Income (Loss). Net income increased by $54.9 million to $21.1 million in the three months ended March 31, 2026, as compared to a net loss of $33.9 million in the three months ended March 31, 2025, for the reasons discussed above.
Current wording
Net Income (Loss). Net income decreased by $225.5 million to a net loss of $67.6 million in the three months ended June 30, 2026, as compared to a net income of $157.9 million in the three months ended June 30, 2025, for the reasons discussed above.
Previous wording
Sales and Marketing. Sales and marketing expense increased $58.1 million, or 16.9%, to $401.7 million in the three months ended March 31, 2026, from $343.7 million in the three months ended March 31, 2025, primarily attributable to higher external marketing costs, including increased customer acquisition costs in connection with recent state launches in Missouri and Arkansas and the recent launch of our Prediction Markets offering.
Current wording
Sales and Marketing. Sales and marketing expense increased $147.4 million, or 25.6%, to $724.3 million in the six months ended June 30, 2026, from $576.9 million in the six months ended June 30, 2025, primarily due to higher external marketing costs, including increased customer acquisition costs associated with the Super Bowl, FIFA World Cup, the NBA Playoffs, the recent launches in Missouri and Arkansas, and the recent launch of our Prediction Markets offering.
Previous wording
Product and Technology. Product and technology expense increased $19.9 million, or 19.3%, to $123.2 million in the three months ended March 31, 2026, from $103.3 million in the three months ended March 31, 2025, due to increased compensation, including stock-based compensation, for employees in our product and engineering departments.
Current wording
Product and Technology. Product and technology expense increased $39.1 million, or 18.5%, to $250.8 million in the six months ended June 30, 2026, from $211.7 million in the six months ended June 30, 2025, due to increased compensation, including stock-based compensation, for employees in our product and engineering departments.
Previous wording
Interest Income (Expense), net. We recorded net interest expense of $5.7 million in the three months ended March 31, 2026, compared to $4.4 million of net interest income in the three months ended March 31, 2025. This fluctuation was primarily due to increased interest expense as a result of the Term B Loan that was entered into in March 2025 and the inclusion of interest income on customer deposits in revenue in the three months ended March 31, 2026 rather than in interest income in the three months ended March 31, 2025.
Current wording
Interest Income (Expense), net. We recorded net interest expense of $13.2 million in the six months ended June 30, 2026, compared to $5.1 million of net interest income in the six months ended June 30, 2025. This fluctuation was primarily due to increased interest expense as a result of the Term B Loan that was entered into in March 2025 and the inclusion of interest income on customer deposits in revenue in the six months ended June 30, 2026 rather than in interest income in the six months ended June 30, 2025.
Previous wording
We had $999.4 million in cash and cash equivalents as of March 31, 2026 (excluding restricted cash and cash reserved for users, which we segregate on behalf of our paid users for all jurisdictions and offerings). We believe our cash on hand is sufficient to meet our current working capital and capital expenditure requirements for a period of at least twelve months. We will continue to evaluate our long-term operating performance and cash needs and believe we are well positioned to continue to fund the operations of our business long-term.
Current wording
We had $983.9 million in cash and cash equivalents as of June 30, 2026 (excluding restricted cash and cash reserved for users, which we segregate on behalf of our paid users for all jurisdictions and offerings). We believe our cash on hand is sufficient to meet our current working capital and capital expenditure requirements for a period of at least twelve months. We will continue to evaluate our long-term operating performance and cash needs and believe we are well positioned to continue to fund the operations of our business long-term.
Previous wording
Convertible Debt. In March 2021, we issued zero-coupon convertible senior notes in an aggregate principal amount of $1,265.0 million (the “Convertible Notes”). The Convertible Notes mature on March 15, 2028, subject to earlier conversion, redemption or repurchase. In connection with the pricing of the Convertible Notes and the exercise of the option to purchase additional Convertible Notes, we entered into privately negotiated capped call transactions (the “Capped Call Transactions”). The Capped Call Transactions are expected generally to reduce potential dilution to DraftKings Inc.’s Class A common stock upon any conversion of the Convertible Notes. The net cost of $124.0 million incurred to enter into the Capped Call Transactions was recorded as a reduction to additional paid-in capital on the Company’s condensed consolidated balance sheets. As of March 31, 2026, the Convertible Notes, net of issuance costs, balance was $1,259.8 million.
Current wording
Convertible Debt. In March 2021, we issued zero-coupon convertible senior notes in an aggregate principal amount of $1,265.0 million (the “Convertible Notes”). The Convertible Notes mature on March 15, 2028, subject to earlier conversion, redemption or repurchase. In connection with the pricing of the Convertible Notes and the exercise of the option to purchase additional Convertible Notes, we entered into privately negotiated capped call transactions (the “Capped Call Transactions”). The Capped Call Transactions are expected generally to reduce potential dilution to DraftKings Inc.’s Class A common stock upon any conversion of the Convertible Notes. The net cost of $124.0 million incurred to enter into the Capped Call Transactions was recorded as a reduction to additional paid-in capital on the Company’s condensed consolidated balance sheets. As of June 30, 2026, the Convertible Notes, net of issuance costs, balance was $1,260.4 million.
Previous wording
Term B Loan. In March 2025, we and certain of our subsidiaries entered into a first amendment to the Credit Agreement, which provides for a new class of incremental term loans under the Credit Agreement in an aggregate principal amount of $600.0 million (the “Term B Facility” and, such term loans, the “Term B Loan”). The Term B Facility requires principal payments in the amount of 1.00% per annum of the original aggregate principal amount of the Term B Loan payable in quarterly installments. The Term B Loan bears interest at the Company’s election at either (i) in the case of Term SOFR Loans, Term SOFR plus an applicable margin of 1.75% per annum, or (ii) in the case of ABR Term Loans, ABR plus an applicable margin of 0.75% per annum (with each of the capitalized terms used in clauses (i) and (ii) as defined in the Credit Agreement). As of March 31, 2026, there was $594.0 million in aggregate principal amount of Term B Loan outstanding.
Current wording
Term B Loan. In March 2025, we and certain of our subsidiaries entered into a first amendment to the Credit Agreement, which provides for a new class of incremental term loans under the Credit Agreement in an aggregate principal amount of $600.0 million (the “Term B Facility” and, such term loans, the “Term B Loan”). The Term B Facility requires principal payments in the amount of 1.00% per annum of the original aggregate principal amount of the Term B Loan payable in quarterly installments. The Term B Loan bears interest at the Company’s election at either (i) in the case of Term SOFR Loans, Term SOFR plus an applicable margin of 1.75% per annum, or (ii) in the case of ABR Term Loans, ABR plus an applicable margin of 0.75% per annum (with each of the capitalized terms used in clauses (i) and (ii) as defined in the Credit Agreement). As of June 30, 2026, there was $592.5 million in aggregate principal amount of Term B Loan outstanding.
Previous wording
Other Purchase Obligations. We have certain non-cancelable contracts with vendors, licensors and others requiring us to make future cash payments. As of March 31, 2026, these purchase obligations were $2.1 billion, with $0.4 billion payable in the remainder of 2026.
Current wording
Other Purchase Obligations. We have certain non-cancelable contracts with vendors, licensors and others requiring us to make future cash payments. As of June 30, 2026, these purchase obligations were $2.0 billion, with $0.3 billion payable in the remainder of 2026.
Previous wording
Stock Repurchase Program. On July 30, 2024, our Board of Directors authorized the repurchase of an aggregate of up to $1.0 billion of our Class A common stock through open market purchases, privately negotiated transactions or other transactions in accordance with applicable securities laws. On November 6, 2025, our Board of Directors approved a $1.0 billion increase to our existing stock repurchase authorization, which brings the aggregate share repurchase authorization to $2.0 billion of our Class A common stock. We repurchased 3.3 million shares and 3.7 million shares for$98.6 million and $142.3 million during the three months ended March 31, 2026 and 2025, respectively. As of March 31, 2026, we have purchased 20.4 million shares of Class A common stock for $718.2 million since the inception of the stock repurchase program.
Current wording
Stock Repurchase Program. On July 30, 2024, our Board of Directors authorized the repurchase of an aggregate of up to $1.0 billion of our Class A common stock through open market purchases, privately negotiated transactions or other transactions in accordance with applicable securities laws. On November 6, 2025, our Board of Directors approved a $1.0 billion increase to our existing stock repurchase authorization, which brings the aggregate share repurchase authorization to $2.0 billion of our Class A common stock. We repurchased 2.3 million shares and 2.9 million shares for $55.6 million and $100.5 million during the three months ended June 30, 2026 and 2025. We repurchased 5.5 million shares and 6.5 million shares for $154.2 million and $242.7 million during the six months ended June 30, 2026 and 2025, respectively. As of June 30, 2026, we have purchased 22.7 million shares of Class A common stock for $773.8 million since the inception of the stock repurchase program.
Previous wording
Operating Activities. Net cash used in operating activities in the three months ended March 31, 2026 was $48.4 million, compared to $119.0 million in the three months ended March 31, 2025, primarily from an improvement in net income (loss), net of non-cash items, of$15.6 million for reasons discussed in Results of Operations above, in addition to $55.0 million less of cash used from changes in operating assets and liabilities, primarily related to timing of player activity, impacting liabilities to users, as well as timing of vendor payments.
Current wording
Operating Activities. Net cash provided by operating activities in the six months ended June 30, 2026 was $63.0 million, compared to $54.9 million in the six months ended June 30, 2025, primarily from a decline in net income (loss), net of non-cash items, of$189.0 million for reasons discussed in Results of Operations above, offset by $197.1 million decrease in cash used from changes in operating assets and liabilities, primarily related to timing of player activity, impacting liabilities to users, as well as timing of vendor payments.
Previous wording
Investing Activities. Net cash used in investing activities during the three months ended March 31, 2026 increased by $9.2 million to $48.2 million, compared to $39.0 million in the three months ended March 31, 2025, primarily due to an increase of $5.8 million in cash paid for internally developed software costs and an increase of $4.4 million in cash paid for purchases of property plant and equipment.
Current wording
Investing Activities. Net cash used in investing activities during the six months ended June 30, 2026 increased by $19.2 million to $93.4 million, compared to $74.3 million in the six months ended June 30, 2025, primarily due to an increase of $14.7 million in cash paid for internally developed software costs and an increase of $4.7 million in cash paid for purchases of property and equipment.
Previous wording
Financing Activities. Net cash used in financing activities during the three months ended March 31, 2026 was $121.1 million compared to $372.8 million net cash provided by financing activities in the three months ended March 31, 2025, primarily driven by a reduction of $588.1 million of cash received from borrowing under the Term B Facility, partially offset by a reduction of$43.6 million in treasury stock purchases under the Stock Repurchase Program, and a reduction of$50.0 million in cash paid for purchases of treasury stock for RSU withhol ding.
Current wording
Financing Activities. Net cash used in financing activities during the six months ended June 30, 2026 was $186.6 million compared to $253.1 million net cash provided by financing activities in the six months ended June 30, 2025, primarily driven by a reduction of $588.1 million of cash received from borrowing under the Term B Facility, partially offset by a reduction of
Previous wording
During the three months ended March 31, 2026, there were no changes to the critical accounting estimates discussed in the 2025 Annual Report.
Current wording
During the six months ended June 30, 2026, there were no changes to the critical accounting estimates discussed in the 2025 Annual Report.
Rearranged current paragraphs (4)
Current report — wording carried from elsewhere
Interest Income (Expense), net. We recorded net interest expense of $7.4 million in the three months ended June 30, 2026, compared to $0.7 million of net interest income in the three months ended June 30, 2025. This fluctuation was primarily due to decreased interest income as a result of the inclusion of interest income on customer deposits in revenue in the three months ended June 30, 2026 rather than in interest income in the three months ended June 30, 2025.
Current report — wording carried from elsewhere
Gain (Loss) on Remeasurement of Warrant Liabilities. As all warrants were exercised or expired as of December 31, 2025, there was no remeasurement of warrant liabilities in the six months ended June 30, 2026, compared to a $3.4 million loss in the six months ended June 30, 2025.
Current report — wording carried from elsewhere
Income Tax Provision (Benefit). We recorded an income tax expense of$4.6 million in thesix months ended June 30, 2026, as compared to an income tax expense of$6.2 million in thesix months ended June 30, 2025. Although we have a cumulative three year loss position, based on our recent financial performance and our future projections, we could record a reversal of all, or a portion of, the valuation allowance associated with U.S. deferred tax assets in future periods. However, any such change is subject to actual performance and other considerations that may present positive or negative evidence at the time of the assessment.
Current report — wording carried from elsewhere
$88.5 million in treasury stock purchases under the Stock Repurchase Program, and a reduction of$58.4 million in cash paid for purchases of treasury stock for RSU withhol ding.