DraftKings (DKNG) 54th Nasdaq London Investor Conference summary

Industry trends and market dynamics

• Handle growth in sports betting has slowed, but net revenue and margins have increased due to improved hold and more efficient promotions.

• Prediction markets are not materially cannibalizing revenue but are impacting handle, especially among professional and institutional bettors.

• The upcoming World Cup is expected to drive significant engagement and serve as a testing ground for new marketing and product strategies.

• Expansion of a unified super app will allow access to all U.S. customers, improving marketing efficiency and reach.

• Sportsbook handle is expected to grow at single digits, but revenue growth should outpace handle due to higher margins.

Product innovation and technology

• Prediction market product has rapidly evolved since its MVP launch, with ongoing improvements and the rollout of an internal exchange and market-making capabilities.

• AI and machine learning are deeply integrated across the business, enhancing engineering velocity, customer service, and internal processes.

• A central AI team allocates resources to high-impact projects, driving efficiency and quality across all departments.

• Product focus has shifted to better target casino-first and slots-first customers, with early signs of improved acquisition and engagement.

• Parlay product mix continues to grow, supporting higher net win margins and aligning with trends in mature markets.

Regulatory and legal landscape

• Supreme Court involvement in prediction markets is anticipated, with a potential ruling expected late next year or early the following year.

• Positive regulatory momentum is seen as a catalyst for broader online sports betting and iGaming legalization, especially in large states like California and Georgia.

• The emergence of prediction markets is prompting some tribal stakeholders in California to reconsider their stance on online sports betting.

• iGaming legalization is progressing slowly but is viewed as inevitable due to state budget pressures and consumer demand.