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DraftKings runs a sports betting and online casino app where people wager real money on games and casino-style games.
DraftKings is a gambling company that lives in your phone. Its main business is sports betting: you open the app, put money on the Chiefs to win, and if you're right, you get paid. It also runs online casino games like slots and blackjack in states where that's legal, plus a smaller piece that sells software and services to other gambling operators. Regular people are the customers — they're the ones handing over money — and the company makes its cut by keeping a slice of every bet, a slice known as the "hold." That slice is small per bet, often around 8 to 12 cents on the dollar for sports, but it adds up fast when millions of people bet every week.
The business has two main engines. Sportsbook is the bigger one, pulling in roughly two-thirds of revenue, and it's driven by big events like the NFL season, March Madness, and the Super Bowl. Online casino, sometimes called iGaming, is the smaller but higher-margin piece — Think of it as the difference between selling tickets to a game and owning the slot machines in the lobby. The company also runs a smaller segment called DraftKings Marketplace and a few media and tech products, but the betting and casino apps are what pay the bills. It spends heavily on marketing, promotions, and partnerships — including deals with sports leagues and teams — to keep existing bettors coming back and to grab new ones when a state legalizes betting.
DraftKings started in 2012 as a daily fantasy sports site, a way to play fantasy football for one week instead of a whole season. When the Supreme Court opened the door to state-by-state sports betting in 2018, the company pivoted hard into real-money wagering and grew fast as one of the first big apps to launch in new states. It went public in 2020 through a merger with a special-purpose acquisition company. The company has been chasing profitability after years of heavy losses, and in recent quarters it has started reporting positive earnings, helped by cost cuts and a focus on keeping customers rather than just buying them. It also bought Golden Nugget Online Gaming in 2022 to build out its casino business. Free cash flow is mostly plowed back into new state launches, product development, and marketing rather than dividends, though the company has used some cash to pay down debt and buy back a small amount of stock.
Saved answer · last researched 15 Oct 2026