Customer activity on FanDuel appeared to taper off at the end of 2025, but the CEO of parent company Flutter says it’s not because of prediction markets, and is instead because the house won too often on NFL bets.
Flutter CEO Peter Jackson was speaking on Flutter’s earnings call late Thursday afternoon following fourth-quarter results in which FanDuel’s revenue grew significantly but handle was close to flat.
Revenue for FanDuel in 2025 came to $6.97 billion, up 20% against 2024. In the fourth quarter of the year, revenue jumped by 33% year-on-year to $2.14 billion.
However, that increase was almost entirely due to sports results, which were more favorable to FanDuel in 2025 than in 2024. Handle only rose by 3% year-on-year, which Flutter said was “behind expectations.” The business added that this slow handle growth is continuing into 2026.
Jackson said that a major reason for the lower level of betting activity was the fact that FanDuel’s margins on NFL bets were so consistently high in the back half of the season that it started to discourage bettors.
The business held 19.2% of handle during the NFL season, one percentage point ahead of expectations, and had an above-average margin on the NFL for 10 of the last 11 weeks of the fourth quarter. That, Jackson said, started to impact customer sentiment. Margin at FanDuel late in the NFL regular season was also well ahead of competitors’ margins, which may have contributed to the impact on handle.
“We’ve not changed our vig or anything like that, we just saw a set of very positive sports results,” Jackson said. “There were a number of weeks above 30%, and that has a real impact on customer sentiment when you get above those levels.
“I suspect there were some customers who, to use another sporting analogy, put their cues back in the rack and stopped betting. We’re going to have to reactivate those customers.”
That run of sportsbook-friendly results had followed an unusually bettor-friendly set of results for most of the year, including the start of the fourth quarter.
FanDuel’s overall margin during the quarter was still lower than expected at 14.7%, resulting in $140 million less in revenue than expected.
However, the concentration of sportsbook-friendly results in the NFL specifically, as well as the comparison to a particularly bettor-friendly end to 2024, meant that it was enough to have an impact on handle.
Little playoff star power among other factors
Jackson said that a lack of star power in the playoffs and in the biggest late regular-season games also contributed to the lower handle, as it led to less props and parlays.
“When I think about the NFL season this year, when you look at the quality of the teams that got into the latter stages of the competition, there were less of the key marquee players involved, and that had an impact on us because we do so well with the parlay market,” he said.
Jackson added that football season can naturally create periods of unusually high or low hold, due to the smaller number of games.
“It’s worth acknowledging that the period of time we’re discussing, in the U.S. in Q4, is in the football season, and I’ve talked before about the high levels of volatility we get around football in the U.S.,” he said. “In other markets, with football [soccer] in the UK or racing in Australia, we get less volatility.”
Jackson said that FanDuel failed to execute its bonus strategy the way it should have while results were going the book’s way. Instead, he said, the company was unpredictable with bonuses, and this made it harder for customers to stay engaged.
“We saw this very sustained high margin period, including a number of weeks above 30%. We should have pushed harder on generosity and we didn’t, and that’s something that we’ll keep in mind for the future,” he said. “There was a bit of a whipsaw. Generosity was on, it was off, it was on, it was off. We were not deploying it effectively.”
Jackson: Don’t blame prediction markets
But despite handle coming in lower than expected, Jackson insisted that prediction markets were not the culprit. In his written statement accompanying the results, the Flutter CEO said FanDuel conducted an investigation into the impact of prediction markets on sportsbook spend, and found that it was minimal, despite investor fears of cannibalization.
“The review combined industry channel checks, third party data analysis of deposits, actives, and app download trends, and detailed analysis of FanDuel customer trends,” reads the statement. “Based on this robust analysis, we estimate the potential handle growth impact to be in the low single digits percentage points and we are confident that the prediction markets have not been a significant driver of the moderating customer and handle trends we have observed.
“This finding is reinforced by our Missouri launch, where customer acquisition trends were well ahead of expectations, reaching 5% of the population within the first 30 days, making Missouri one of our best state launches to date. We do, however, believe prediction market operators may be attracting some new, incremental entertainment-first recreational customer cohorts.”
Jackson added that FanDuel was exploring the idea of becoming a market maker that trades on its own prediction market. Earlier this month, DraftKings began building out a team to direct its sportsbook traders to make markets on its prediction market.
Flutter now expects spending on prediction markets in 2026 to be at the “upper end” of the $200-$250 million range it guided toward in November. Jackson says the company “reserves the right” to spend even more than that if the product seems to be delivering results.
Jackson added that he believed prediction markets will also play a role in accelerating legalization of sportsbooks and online casino gaming in states where they are not currently available. In the written statement, he said that legalization of online sports betting and casino remained, “the most valuable long-term opportunity in the U.S.”
“We have a team that is focused on [legalization] and we’ve had some good conversations lately,” Jackson said on the earnings call. “We had some good news in Arkansas, who knows where the next shoe will drop.”
Flutter shares fall
For Flutter as a whole, revenue came to $16.38 billion for the year. The business reported a $407 million net loss, mostly due to the write-down of much of its business in India because of regulatory changes there.
Flutter shares plunged in after-hours trading as the market reacted to the figures. Shares fell as low as $111.30, down 10% from their Thursday close.
Jefferies analysts James Wheatcroft and Matthew Copeland wrote in a note to clients that the share price reaction was driven less by the fourth-quarter handle, which could pick up again with March Madness and the FIFA World Cup coming up, and more by disappointing full-year guidance. Flutter expects adjusted earnings before interest, tax, depreciation, and amortization (EBITDA) of $2.23 billion for the year, including $1.05 billion from FanDuel.
If shares open at that level Friday, it would be their lowest price since October 2022, and leave them down 63% in just six months.
