DraftKings Inc. reported second-quarter results that fell short of analyst expectations, signaling a new challenge for the sportsbetting industry from prediction-market players. The company's revenue for the period was $835 million, missing the $852.8 million consensus estimate. Net losses widened to $347 million, compared to a loss of $152 million in the same quarter last year.

Despite the miss, DraftKings' adjusted EBITDA improved significantly, reaching $127 million, a substantial jump from $18.7 million a year prior. This improvement was driven by strong performance in its B2B segment and increased monetization in its B2C operations. The company also announced a new agreement with The Walt Disney Company's ESPN to become its exclusive fantasy sports content, gaming, and co-branded sports betting content provider.

This partnership, set to begin in the fall of 2025, is expected to integrate DraftKings' offerings into ESPN's platforms, potentially driving significant customer acquisition. The company reaffirmed its full-year guidance, anticipating revenue between $3.67 billion and $3.85 billion and adjusted EBITDA between $340 million and $410 million. The market reacted negatively to the earnings miss, with shares dropping in pre-market trading.