DraftKings Shares Rise as Prediction Market Volume Hits $3.1B

DraftKings shares moved higher on Tuesday after the company reported stronger-than-expected activity on its prediction market platform, DraftKings Predictions, giving investors a new reason to reassess the stock following a difficult stretch. 

The update, disclosed in an SEC filing, showed annualized consumer volume on its prediction platform rising 24% from April to $1.3 billion in May. Annualized total trading volume rose 34% over the same period to $3.1 billion.  

DraftKings stock also jumped as much as 11% on Tuesday. If sustained, that move would mark its strongest one-day percentage gain in more than three and a half years. The rally came even though the stock remained down more than 21% for the year and 25% over 12 months, trailing the S&P 500. 

The broader setting has helped explain the market interest. Prediction market operators Kalshi and Polymarket have drawn users to event contracts linked to finance, sport, and geopolitics. DraftKings already operates sports betting, online casino games, and daily fantasy sports, giving it existing customer traffic and brand reach. 

Despite its growth, DraftKings remains relatively small compared to the likes of Kalshi, which, according to analytics firm Dune, recorded $10.4 billion in sports trading volume alone in May. Yet industry analysts, like TD Cowen, see the long-term potential of prediction market apps, and with the FIFA World Cup right around the corner, DraftKings is sure to capitalize.  

Since the news, TD Cowen has maintained a buy rating on DraftKings with a $30 price target.  

Super App plans put DraftKings' next move in focus 

That market response also provided fresh context for DraftKings' broader app strategy, which the company outlined during its Investors' Day presentation. DraftKings presented a single mobile product that would bring sports betting, prediction markets, casino, and lottery gaming into one customer experience. 

The company said the rollout would happen in phases, with the first stage launching before the NCAA Tournament in March. Its existing green app, which carries sportsbook and casino activity, already accounts for more than 80% of DraftKings customers. Adding prediction markets to that same environment would let the company keep users in a single wallet and interface, the group explained.  

“We will now have a sports product everywhere for customers across the entire country,” DraftKings CEO Jason Robins said during the presentation. “Number two, it allows us to leverage our huge scale with our brand and our marketing footprint. All of our national marketing now will be working across the entire country instead of across a subset of states where we have sports betting.” 

The model also brings unresolved questions. The legal status of sports contracts on prediction markets remains contested and could be shaped by courts or Congress. DraftKings also faces the risk of tension with lawmakers and stakeholders in states that have not legalized sports betting. 

The company said it plans to apply the same responsible-gaming standards across prediction markets, including limits, cool-off periods, self-exclusion, and education resources.