On Wednesday, Flutter Entertainment revised its profit forecast for the year as long-term favorable betting outcomes for customers negatively affected its margins. At the same time, Flutter’s U.S. division, FanDuel, along with its competitor DraftKings, has decided to halt their licensing pursuits in Nevada, choosing instead to concentrate on establishing prediction markets nationwide.
The leading global online betting platform has adjusted its core profit expectations for 2025 to $2.9 billion, reduced from $3.3 billion, due to rising payouts caused by an extended successful streak for gamblers. In its third quarter, the company reported an adjusted EBITDA of $478 million, reflecting a 6% increase from the previous year and surpassing the consensus estimate of $459 million. Nonetheless, its full-year projection for earnings growth of 24% falls short of analysts’ expectations of about $3.2 billion.
Peter Jackson, the CEO, stated that Flutter maintains “full confidence” in its odds calculations despite the unfavorable sports outcomes that heightened during the first six weeks of the current quarter.
Additionally, Flutter announced its intention to launch the federally regulated prediction markets segment next month with the introduction of FanDuel Predicts, which has been developed in collaboration with CME Group. This innovative application will enable users to trade event contracts linked to results in sports, entertainment, politics, and finance. Flutter indicated that the capital required for expanding this venture would “significantly” diminish profits by $40–50 million in Q4 and between $200–300 million the following year.
Contracts related to sports events will only be available in states where online sports betting is not permitted, with Flutter positing that such prediction markets will drive the legalization of sports betting as states explore new tax revenues. The company has labeled this sector as a “major growth opportunity.”
On a related note, both FanDuel and DraftKings have agreed to relinquish their licensing approvals in Nevada and retract pending applications following state regulators’ ruling that prediction markets are “incompatible” with Nevada’s gaming framework.
Nevada Gaming Control Board Chairman Mike Dreitzer indicated that regulators had recognized that Flutter’s FanDuel and DraftKings aimed to partake in “unlawful activities around sports event contracts.”
FanDuel, which previously operated under a limited Nevada license through a partnership with Boyd Gaming, ceased operations once Boyd divested its 5% stake back to the firm for $1.76 billion, stating that its business objectives no longer aligned with the state’s priorities.
“Our perspective on the current potential for prediction markets outside regulated states unfortunately conflicts directly with Nevada’s goals for its licensed operators. This prompts us to reluctantly choose to voluntarily surrender our license, ” remarked spokesperson Alex Pitcocchelli.
Meanwhile, DraftKings is in the process of developing its own national prediction markets platform. The company is seeking membership in the National Futures Association and has acquired Railbird, which it intends to rebrand as DraftKings Predictions.
“In a move toward regulatory compliance, we have withdrawn our inactive Nevada application,” explained Jen Aguiar, Chief Compliance Officer. “Our commitment remains in collaborating with regulators to meet the highest operational integrity standards.”
DraftKings CEO Jason Robins expressed that the demand for prediction markets has surged because “large states such as Texas and California have yet to legalize sports betting.” The company assured that its Las Vegas office, employing over 1,000 individuals, would remain unaffected by the licensing withdrawal.
Flutter’s Jackson remarked that the partnership with CME positions the group “exceptionally well regardless of which direction we follow” as regulations concerning event contracts continue to evolve.