DraftKings Shares Plunge 22% After Q3 Double Miss and Massive Full-Year Guidance Cut

DraftKings reported third-quarter results after Thursday's close that missed expectations on both earnings and revenue, sending shares down more than 22% in pre-market trading to around $18.29. The company posted an adjusted loss of $0.53 per share, missing the FactSet consensus by $0.12, while revenue rose 16% year-over-year to $1.33 billion but still fell short of estimates. Management cited customer-friendly sports outcomes and the near-term cost of its aggressive expansion into prediction markets as key headwinds.

The most dramatic development was a severe cut to full-year 2026 guidance. DraftKings now expects approximately $225 million in adjusted EBITDA for the fiscal year, down sharply from its prior forecast of roughly $800 million, a reduction of more than $575 million. The revision underscored how heavily the company is investing in its Predictions product, with those costs weighing on profitability in the near term.

The stock was among the worst pre-market performers on November 6, gapping down approximately 23% alongside a wave of analyst downgrades. Options activity was elevated throughout the session, with 132,911 contracts traded in DKNG by late afternoon, flagged as noteworthy among Russell 3000 components. DraftKings held its Q3 earnings conference call at 8:30 AM ET, with CEO Jason Robins and CFO Alan Ellingson fielding questions from analysts at Bank of America, Morgan Stanley, Goldman Sachs, JPMorgan, and other major firms.