Posted on: November 26, 2025, 12:58h.
Last updated on: November 26, 2025, 12:58h.
- Two major sportsbook leaders are at the forefront of AI adoption in the gaming sector.
- According to Morgan Stanley, these companies embody attributes that position them as frontrunners in consumer-centric AI.
- Additional wagering firms are also emerging as key players in AI advancement.
Artificial Intelligence (AI) may still be in its infancy, but its transformative power is capturing the attention of Corporate America, including the gaming sector, which has seen specific players rise to prominence in AI implementation.
A recent analysis from Morgan Stanley highlights DraftKings (NASDAQ: DKNG) and Flutter Entertainment (NYSE: FLUT), the operators behind the two largest sportsbooks in the U.S., as frontrunners in AI deployment within the gaming industry. The investment firm evaluated 114 consumer discretionary and staple organizations based on their current AI usage and future potential, identifying DraftKings and Flutter as key players in this arena.
“An intriguing observation is that the top consumer AI leaders are beginning to transition from basic applications to more complex and strategic applications,” notes Morgan Stanley. “Rather than merely employing AI for simple chatbots or recommendations, these companies are integrating AI into their supply chains, inventory management, pricing strategies, and product innovation.”
DraftKings has consistently been one of the tech-driven companies in the industry, suggesting that increased AI utilization will be a natural progression. This advancement can help DraftKings differentiate itself from competitors while potentially lowering labor expenses.
Strategic AI Implementation for DraftKings and Flutter
For firms like DraftKings and Flutter, enhanced AI adoption could significantly impact several aspects of their businesses. This includes adapting to consumer preferences that prioritize experiences over products, as well as integrating media and streaming services into their betting applications.
These companies have a strong commitment to technology. AI and machine learning play crucial roles in processing data correlations related to the increasingly popular same-game parlays that these operators offer.
The AI capabilities of these gaming companies could also be advantageous as they develop prediction market platforms. Engaging in contract execution in this area is heavily technology-focused, which suggests that AI can have numerous applications, potentially benefiting DraftKings and Flutter as they aim to tap into what analysts project to be a $5 billion total addressable market. Morgan Stanley emphasizes that consumer companies do not need the brand recognition of giants like Amazon or Target to reap the benefits of AI.
“Many people overlook that the true victors could be the less flashy brands that are strategically utilizing AI behind the scenes to run more efficient and effective businesses,” the bank states.
Other AI Innovators in Gaming
The business-to-business segment of the sports betting industry also presents opportunities for AI adoption, with data providers emerging as notable leaders in this domain. Morgan Stanley acknowledged at least one of these entities as a prominent AI implementer within the gaming industry.
Sports betting data providers represent ideal candidates for AI implementation due to their technology-centered business models. In fact, AI is integral to their operations, propelling these firms to the forefront of AI adoption in the gaming sector.
Importantly, these data providers are responsible AI spenders, as investors expect effective returns from costly AI investments, urging companies to make expenditures that deliver tangible results rather than just expenditures to showcase AI involvement.