Prediction markets took an unexpectedly prominent role in the latest round of quarterly earnings reports, as companies ranging from sports betting operators to cryptocurrency exchanges detailed their investments in the rapidly expanding sector.
DraftKings reported particularly strong momentum for its prediction market platform, which launched in December 2025. CEO Jason Robins told CNBC that more than 600,000 customers have engaged with the company’s predictions offering to date, a number he expects to reach millions during the upcoming NFL season.
During the company’s earnings call Friday morning, Robins disclosed that annualized total volume for DraftKings’ predictions platform surged to $11 billion from $2.3 billion between April and July. The platform appears to be attracting a distinct user base, with internal data showing only about 1% customer overlap between DraftKings’ sportsbook and the largest prediction market operator in sportsbook states.
According to Robins, professional traders dominate the space, with DraftKings estimating that 80% to 90% of prediction market consumer volume comes from betting syndicates and institutional traders. The company believes owning three key layers of the prediction markets infrastructure—brokerage, exchange, and market maker—gives it a competitive advantage.
Despite the predictions platform’s growth, DraftKings’ overall second quarter results disappointed investors. The company posted adjusted EBITDA of $114.6 million and revenue of $1.44 billion, both falling short of FactSet consensus estimates of $156.1 million in EBITDA and $1.51 billion in revenue.
Flutter Makes Strategic Moves
Flutter Entertainment, the parent company of FanDuel, faced a challenging week. Shares closed down more than 11% on Wednesday following a leadership change announcement and weaker-than-expected quarterly results. The company reported second quarter adjusted earnings of 49 cents per share on revenue of $4.33 billion, compared to analyst expectations of 54 cents per share and $4.23 billion in revenue.
Flutter also announced a significant operational change to its FanDuel Predicts platform. The company said it would move its sports and novelty contracts from CME to Crypto.com, while CME will continue to provide financial market contracts. Outgoing CEO Peter Jackson described the move as ensuring “we can deliver new products at pace ahead of the NFL season start.”
The company expects to generate approximately $50 million in market-making revenue this year from its prediction markets business. Jackson emphasized that FanDuel Predicts offers a regulatory advantage, allowing the company to acquire customers ahead of sports betting regulation in new states.
Regulatory Scrutiny Intensifies
The regulatory landscape remains a critical concern for prediction market operators. More than 40 state attorneys general have challenged the Commodity Futures Trading Commission’s assertion that it serves as the exclusive regulator of sports-related event contracts. Platforms like Kalshi and Polymarket have faced scrutiny from state regulators who argue they operate illegal gambling platforms.
Mixed Results Elsewhere
Coinbase reported in late July that its prediction markets revenue grew 106% quarter over quarter, with annualized revenue from the business surpassing $100 million in the second quarter. However, some analysts remained underwhelmed. KeyBanc noted that the prediction markets run rate “was below our estimate.”
The cryptocurrency exchange posted disappointing overall results, with a wider-than-anticipated loss of $1.36 per share versus the 17-cent loss analysts expected. Revenue of $1.2 billion also missed the $1.3 billion forecast.
Robinhood, which launched its CFTC-licensed exchange Rothera in June through a joint venture with Susquehanna International Group, reported that over 3.5 billion contracts had been traded to date. Event contracts revenue reached $156 million in the second quarter.
According to Rothera’s founders in a LinkedIn post, the platform captured approximately 7-8% of total market share among CFTC-regulated venues and roughly 30% average market share in specific contracts it listed, all within less than two months of launch.
Joel Shulman, CEO of investment firm Entrepreneur Shares, noted that a growing number of companies are introducing their own prediction market platforms or launching partnerships within the space as competition continues to intensify.
Source: www.cnbc.com — https://www.cnbc.com/2026/08/07/prediction-markets-take-center-stage-in-latest-quarterly-earnings.html
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