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The parent company of FanDuel, Flutter Entertainment, reported a 94% year-over-year plunge in U.S. EBITDA in the third quarter as it spent heavily on prediction markets and a new Canadian launch.
Company-wide adjusted EBITDA fell 25% to $360 million, and Flutter posted a total operating loss of $1.191 billion.
In the U.S. division, third-quarter adjusted EBITDA dropped from $51 million a year ago to $3 million, while U.S. revenue rose 6% to $1.455 billion.
Due to unfavorable fourth-quarter sports results, Flutter cut its full-year U.S. adjusted EBITDA midpoint forecast by $45 million to $715 million and lowered its U.S. revenue midpoint target by $60 million to $7.34 billion.
FanDuel Sportsbook grows handle, revenue on higher promotions
In the U.S., FanDuel’s sportsbook revenue grew 4% in the third quarter to $817 million. Total money wagered increased 13% to $12.023 billion, and average monthly players climbed 9% to 2.969 million.
FanDuel is the market leader in sports revenue with a 36% share of the market. The sportsbook boosted its promotional spending to 6% of total bets placed and opened its FanDuel Rewards program to all sportsbook users ahead of the NFL season.
“The U.S. market is highly competitive, but our decisive actions to increase share of wallet by returning more to customer and to accelerate our product road map are beginning to pay off, delivering market share gains in August and September,” CEO Dan Taylor said during the earnings call.
Prediction markets advertising up
In the competitive prediction markets sector, rivals drove industry advertising spending up, according to Taylor.
“The duration of this trend will depend in part on how the regulatory landscape develops, but at this early stage, we expect our marketing intensity to continue in 2027 at levels similar to this year,” Taylor said in the earnings release.
“We need to continue investing behind the FanDuel brand in a disciplined way, maintaining competitive levels of marketing intensity,” he added during the earnings call.
Customers traded $119 million on FanDuel Predicts during the third quarter across 66,000 average monthly players. Active users grew to 140,000 in October as monthly trading volume nearly tripled compared to July.
Flutter also revamped its FanDuel Predicts platform through a partnership with Crypto.com. The app lets users trade sports event contracts in 18 states without legal sportsbooks, including California, Georgia and Texas.
iGaming growth and Canadian expansion
FanDuel leads the U.S. online casino market with a 27% revenue share. However, Taylor noted growth slowed down “as the U.S. iGaming states move through the maturity curve.”
FanDuel’s U.S. online casino revenue rose 8% in the third quarter to $572 million, while average monthly players grew 24% to 1.158 million.
In Canada, FanDuel launched in Alberta in July and quickly captured 23% of the province’s online gaming revenue during the third quarter, outperforming its earlier rollout in Ontario. Taylor said that the company’s “success in Alberta gives us real confidence and conviction about the opportunity for iGaming as we expand the [total addressable market].”
This week’s earnings call was the first under Taylor, who took over on Oct. 1 from former CEO Peter Jackson.
