DraftKings, Flutter Slump as Kalshi Volume Spikes

• Sports betting stocks dive on news of Kalshi volume surge
• Customer-friendly outcomes aren’t helping matters

Shares of Flutter Entertainment (NYSE: FLUT) and DraftKings (NASDAQ: DKNG), the operators of the two largest domestic online sportsbooks, tumbled Tuesday on reports of soaring volume on Kalshi.

In midday trading, shares of DraftKings were off 10% on volume that already surpassed double the daily average, while FanDuel owner Flutter was lower by 9.14% on turnover that was also ahead of the daily average, dealing blows to the thesis that those are the gaming stocks to own during football season. The culprit behind those declines is easy to spot: it’s prediction markets, namely Kalshi.

The prediction market operator’s prior daily volume record was $245 million set on Election Day 2024, but a new all-time high was notched on Saturday, September 27, when turnover on the exchange reached $260 million. That record didn’t last long because it was beaten the next day when volume jumped to $275 million.

Notably, the Sunday Night NFL football overtime game between the Green Bay Packers and Dallas Cowboys became the top-traded game of all time on Kalshi, with $57.2 million in trading volume,” reports Seeking Alpha.

The publication estimates Kalshi is pulling 5% to 10%, likely in handle terms, away from traditional sportsbook operators due in part to its ability to operate in California and Texas, where sports betting isn’t permitted.

More Prediction Market Issues for DraftKings, Flutter

DraftKings, Flutter, and other sportsbook companies have other prediction market-related issues to worry about beyond one weekend of strong volume on Kalshi.

Then there’s the specter of Polymarket, which like Kalshi, is one of the largest prediction market firms. Earlier this month, Polymarket landed approval to reenter the US market, but it hasn’t been live in this country for much of the 2025 football season, indicating that as the company ramps up here, it could pilfer share from the likes of DraftKings and FanDuel.

Kalshi is a thorn in the side of traditional sportsbook operators in another way, as well. The derivatives exchange launched same-game football parlays, further encroaching on territory long dominated by gaming companies. Parlays are long odds, high-margin wagers for sportsbooks.

It’s Not Just Prediction Markets

The theme of customer-friendly outcomes is also weighing on sports betting equities, and it’s amplified because it’s materializing against the backdrop of soaring prediction market volume.

There appears to be a theme developing with trading on Monday after an NFL weekend, whereby stocks of the two major sports betting companies, DraftKings and FanDuel, sell off regardless of game outcomes over the weekend,” notes Citizens Equity Research analyst Jordan Bender. DraftKings stock has only increased twice since Week 12 of last season on the Monday following the NFL weeks, with Flutter up four times.”

Those stock dips may be a coincidence, but it’s clear football season hasn’t yet been kind to gaming companies. For example, the NFL week one tilt between the Baltimore Ravens and Buffalo Bills was, to that point, the worst single-game outcome in DraftKings history.