DraftKings Q2 Earnings Preview: Revenue Growth and Earnings Expectations

DraftKings is set to announce Q2 earnings on Wednesday after market close. Analysts expect a 29.4% YoY revenue growth to $1.43 billion and adjusted earnings of $0.41 per share. The company has missed Wall Street's revenue estimates six times in the last two years. Its peers, such as Rush Street Interactive and Churchill Downs, have reported positive Q2 results, with Rush Street Interactive's stock up 25.7% and Churchill Downs up 4.1%. DraftKings' stock is up 11.1% in the last month.

DraftKings Inc. (DKNG) is set to announce its second-quarter 2025 earnings results on Wednesday after the market close. Analysts expect the company to report a 29.4% year-over-year (YoY) revenue growth, reaching $1.43 billion, and adjusted earnings of $0.41 per share [1]. This marks a significant increase from the previous quarter, where DraftKings missed Wall Street's revenue estimates by 3.1% [2].

The company has a history of missing revenue estimates, having done so six times in the past two years. However, the recent performance of its peers in the gaming solutions segment offers a glimmer of hope. Rush Street Interactive, for instance, reported a 22.2% YoY revenue growth, beating analysts' expectations by 7.6%, and Churchill Downs reported revenues up 4.9%, topping estimates by 1.4% [2]. These positive results have driven investor sentiment, with share prices in the segment up by an average of 2.5% over the last month. DraftKings' stock has also seen a 11.1% increase in the same period.

DraftKings' revenue growth is expected to be driven by a surge in new online sportsbook and iGaming users, as well as the integration of acquisitions like SimpleBet and Sports IQ. The company anticipates revenues to increase by approximately 25% YoY and expects adjusted EBITDA to exceed $200 million. However, elevated marketing expenses and customer-friendly sports outcomes may put pressure on adjusted EBITDA [3].

Despite the positive outlook, the Zacks model does not conclusively predict an earnings beat for DraftKings this time around. The company carries a Zacks Rank of #3, and its Earnings Surprise Prediction (ESP) is -10.30% [3]. This indicates that while the company is expected to perform well, it may not meet analysts' expectations.

Investors should closely monitor DraftKings' earnings announcement for any updates on its revenue growth, EBITDA performance, and the impact of recent regulatory changes. The company's ability to navigate these challenges will be crucial in determining its future performance.

References:
[1] https://finance.yahoo.com/news/draftkings-dkng-q2-earnings-expect-030842526.html
[2] https://finance.yahoo.com/news/draftkings-gears-post-q2-earnings-165600017.html
[3] https://www.nasdaq.com/articles/draftkings-gears-post-q2-earnings-whats-cards