DraftKings Prediction Market Exchange Revenue Margins Flirting with Sportsbook Levels

DraftKings’ (NASDAQ: DKNG) DKeX, the company’s prediction market exchange, is about six months old, but its net revenue margins are rapidly growing.

In a new report, Eilers & Krejcik Gaming (EKG) analyst Brad Allen notes that while volume is swelling on DKeX, net revenue margins generated by the exchange are getting close to those found on DraftKings Sportsbook — one of the company’s core segments.

He adds that DKeX’s current net revenue margin compares with 7.3% for the operator’s broader sports unit in the first half of 2026 and 6.7% over the first nine months of this year.

Why DKeX Margins Matter

At a prediction market industry event last month, DraftKings CEO and co-founder Jason Robins noted that DKeX, which is an in-house exchange, has rapidly ascended to the third spot among prediction market exchanges.

That fast rise coupled with the aforementioned net revenue margin bullishness could assuage skittish investors who have been fretting about DraftKings’ prediction market spending. When the sportsbook giant reported third-quarter results last week, it told investors it expects an adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) investment of $650 million to $700 million in DraftKings Predictions. The stock slid on that news, but has since clawed back some of those losses.

While shareholders weren’t initially keen on DraftKings’ prediction market spending plans, the rising revenue margins coupled with market-making revenue may be indications that the company will realize long-term top- and bottom-line contributions from its event contracts business.

“Prediction markets may be producing revenue per dollar of customer activity that is not far off traditional sportsbook levels,” adds Allen.

DraftKings Has Cards to Play

While DraftKings stock has been battered over the past year, it’s possible that things will be better, particularly if the Supreme Court delivers clarity on the fate of sports event contracts. The worst-case scenario is that the high court will strike down sports derivatives, but that’s the worst-case for pure-play prediction market companies, not operators such as DraftKings that are already entrenched in sports wagering.

There’s also some hope or belief that following last week’s midterm election results, states, such as Georgia and Texas, long coveted by the sports betting industry could be amenable to approving that form of wagering.