DraftKings Job Cuts: Why the Boston-Based Sportsbook Leader is Expected to Save $30M Annually
Posted on: February 24, 2026, 11:24h.
Last updated on: February 24, 2026, 11:30h.
- DraftKings is restructuring some roles, resulting in layoffs
- An analyst estimates the moves, potentially prompted by AI, could save the company approximately $30 million per year
- It’s the second round of layoffs at the gaming company, with the first occurring in 2023
LinkedIn posts suggest DraftKings (NASDAQ: DKNG) is altering the size of its workforce in cost-saving measures general and administrative (G&A) costs — moves one analyst estimates could result in as much as 5% of staff being laid off.
In a new report to clients, Citizens Equity Research analyst Jordan Bender said DraftKings confirmed it is undergoing a reorganization and some employees are affected by those changes. The analyst added the sportsbook operator didn’t elaborate further. He adds that with news of the reduced headcount arriving soon after the company delivered fourth-quarter results and 2026 earnings before interest, taxes, depreciation, and amortization (EBITDA) guidance, that forecast likely included the effects of reduced staff count.
We estimate the headcount reduction, if close to 5% of employees, will result in annual cost savings of ~$30M, based on the median DraftKings employee making ~$100k per year,” says Bender, citing company filings. “That said, the timing of the staff reduction, a week and a half following earnings and guidance, suggests the cost savings were most likely contemplated in the 2026 EBITDA guidance of $700 million to $900 million EBITDA.”
DraftKings’ move to pare expenses arrives as costs rose from 2023 to 2025. During those three years, the operator’s G&A expenses jumped 6%, 13%, and 22%, respectively, while its product and technology costs surged an average of 20%.
Did AI Have Something to Do with DraftKings Layoffs?
Amid a seemingly daily stream of news of new artificial intelligence (AI) functions potentially replacing white-collar roles across an array of industries, there’s some speculation that the technology may be behind the DraftKings layoffs.
DraftKings has long been one of the most tech-focused gaming enterprises and it’s considered one of the industry’s AI implementation leaders, but the extent to which AI drove the latest restructuring is debatable. However, as Bender notes, DraftKings is making use of AI across a variety of functions that could have previously been performed by humans.
“Internally, the company has adopted AI functions to help write RFPs, help engineers to write code, add in chatbots, and draft legal opinions, all which can save on outsourced labor over time,” says the analyst. “Externally, AI is improving its ability to serve content in a personalized manner. For example, 70% of promotional spending is determined by AI, which should increase over time. Overall, we could expect more cost structure rationalization in the coming quarters to years as the business continues to benefit from AI and maturing markets.”
The analyst also points out that the headcount reduction could have been larger if not for DraftKings’ recent push into the prediction markets space.
Not DraftKings’ First Round of Layoffs
This isn’t the first time DraftKings has reduced headcount. In February 2023, the company announced layoffs of 140 workers, or what amounted to 3.5% of staff count at the time.
The company is far from alone when it comes to trimming employment expenses in the digital wagering space. In recent years, Bally’s and Penn Entertainment (NASDAQ: PENN), among others, have also cut jobs in their interactive divisions.
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