DraftKings Shares Slide After a Weak 2027 Forecast and a Cut to 2026 Earnings Guidance
DraftKings forecast 2027 earnings below the average analyst estimate on November 5, 2026, and its shares plunged, according to Bloomberg. The company also cut its fiscal outlook when it issued that forecast.
The Financial Times reported on November 6 that DraftKings had cut its 2026 adjusted EBITDA outlook to a range of $175 million to $275 million. Adjusted EBITDA is earnings before interest, taxes, depreciation and amortization, with the company's own adjustments layered on top. It is the metric that matters most to the leverage and cash-generation story, meaning how much debt the company carries against its earnings and how much cash the business throws off. A range with a $100 million gap between its ends leaves a lot of room for the second half of the year to move the result. The cut lowers the bottom of that range, which matters for anyone modeling covenant headroom (the cushion before a company breaches the limits in its loan agreements) or free cash flow (the cash left after running and investing in the business).
The stock was already under pressure before the November decline. Yahoo Finance reported in mid-October that DraftKings shares had fallen 44% in 2026 to $19.14. The February guidance followed a similar path. Bloomberg reported in February that the company's 2026 sales and profit forecast fell short of Wall Street estimates, and the shares fell after that announcement.
The growth story the company has been telling runs through its prediction markets business, where users trade contracts on real-world outcomes. DraftKings debuted Predictions as a standalone mobile and web product that lets eligible customers trade on real-world outcomes, a launch the company announced on December 19, 2025. Its rules and settlements page indicates that the product offers markets from multiple exchanges. In August, CEO Jason Robins said the predictions platform had grown to $11 billion from $2.3 billion between April and July, a figure CNBC reported on August 7.
Those two numbers sit awkwardly together. A platform that scaled that quickly in a single quarter would normally be expected to support the forward numbers, yet the guidance investors are pricing is weaker than consensus, and the adjusted EBITDA range has come down. The announcements I have seen do not reconcile the two for an outside reader, and that gap is where skepticism belongs. Growth in a gross volume figure does not translate directly into margin. Prediction markets also raise open questions about regulation, customer acquisition costs (what a company spends to win each new customer), and how much of the activity lasts once the launch cycle passes.
In my view, the February miss matters for a different reason. It shows the 2026 shortfall was not confined to a single forecast cycle, which makes the November reset harder to treat as a one-off timing problem. Investors who had priced in a recovery will now want evidence that the 2027 base is credible, not just a new product line.
For the next several quarters, the useful questions are narrow. Does the adjusted EBITDA range tighten toward the upper or lower end? Does the predictions business keep its reported pace of growth once comparisons get harder? And does the 2027 forecast hold up against the consensus that analysts will now revise? Those answers will come from the earnings calls and filings that follow, and this piece takes no position on how they will resolve.
