Published on: September 30, 2025, at 12:03 PM.
Updated on: September 30, 2025, at 12:18 PM.
- Sports betting shares plummet amid Kalshi volume spike
- Player-friendly results failing to alleviate concerns
On Tuesday, shares of Flutter Entertainment (NYSE: FLUT) and DraftKings (NASDAQ: DKNG), the leading operators of online sportsbooks in the U.S., experienced a significant drop following news of a substantial volume increase on Kalshi.
During midday trading, DraftKings’ shares fell by 10% on a trading volume that exceeded double its daily average, while Flutter was down 9.14% with similar turnover patterns, challenging the notion that these stocks are prime picks for football season. The main factor causing these declines is apparent: the rise of prediction markets, particularly Kalshi.
Kalshi previously set its daily volume record at $245 million on Election Day 2024, but a remarkable new milestone was achieved on Saturday, September 27, when the exchange saw its turnover reach $260 million. This record was quickly surpassed the following day, with volume soaring to $275 million.
Importantly, the Sunday Night NFL game overtime clash between the Green Bay Packers and Dallas Cowboys emerged as the highest-traded game ever on Kalshi, recording a trading volume of $57.2 million,” reports Seeking Alpha.
The publication estimates that Kalshi is drawing 5% to 10% of the handle away from conventional sportsbooks, partly due to its operations in California and Texas, where traditional sports betting is not allowed.
Additional Challenges for DraftKings and Flutter
Beyond the recent surge in Kalshi’s trading volume, DraftKings, Flutter, and their competitors face other challenges linked to prediction markets.
Kalshi’s collaboration with Robinhood Markets (NASDAQ: HOOD) is noteworthy. On Monday, the brokerage firm announced it had processed over four billion event contracts, with more than half occurring in the current quarter. This indicates that their clientele, many of whom are enthusiastic sports bettors, are taking advantage of the ease of investing in sports outcomes through their investing platforms.
Furthermore, Polymarket, a significant player in the prediction market sector, is set to re-enter the U.S. market after gaining approval earlier this month. Notably, it has been largely absent from the U.S. during much of the 2025 football season, suggesting that as Polymarket becomes active, it could draw market share away from well-established brands like DraftKings and FanDuel.
Moreover, Kalshi poses a unique challenge to traditional sportsbooks by introducing same-game parlays, a betting format that has traditionally been dominated by established gaming companies. These parlays, characterized by their high margins and long odds, present increased competition for sportsbooks.
Challenges Extend Beyond Prediction Markets
Concerns regarding customer-friendly outcomes also loom over sports betting stocks, a situation made more complex against the backdrop of rising prediction market activity.
A trend is emerging where shares of the two major sports betting operators, DraftKings and FanDuel, decline on Mondays following an NFL weekend, irrespective of the results of the games played,” notes Jordan Bender, an analyst at Citizens Equity Research. Since Week 12 of last season, DraftKings stock has only increased twice on the Monday following NFL weekends, while Flutter’s shares have risen only four times.
While these stock fluctuations might be merely coincidental, it is evident that the current football season has not favored gaming companies. As a case in point, the NFL’s week one match-up between the Baltimore Ravens and Buffalo Bills marked the lowest single-game performance in DraftKings’ history up to that point.