DraftKings and FanDuel announced that they are relinquishing their memberships in the American Gaming Association (AGA) effective November 17, 2025, after discussions at the AGA’s Public Policy Committee. The companies said the AGA’s stance on prediction markets is incompatible with their evolving business models.
The decision follows DraftKings’ October 21 acquisition of Railbird, a firm that holds a federal license to offer event‑contract betting. The acquisition gives DraftKings a regulatory foothold in prediction markets, which the AGA opposes as gambling. The move signals a strategic pivot toward a new growth area that the AGA’s traditional casino‑focused membership does not support.
DraftKings and FanDuel have also surrendered their Nevada gaming licenses in response to regulatory conflicts over prediction‑market operations, underscoring the broader regulatory friction surrounding the new product line.
DraftKings reported Q3 2025 revenue of $1.14 billion, missing analyst expectations of $1.40 billion, and an earnings per share of $‑0.26 versus a consensus of $0.01. The miss reflects weaker demand in core sportsbook segments and the impact of “customer‑friendly” outcomes that reduce betting volume. The company cut its fiscal 2025 revenue guidance to $5.9‑$6.1 billion from $6.2‑$6.4 billion and adjusted EBITDA to $450‑$550 million from $800‑$900 million, signaling concerns about near‑term profitability.
Flutter Entertainment, FanDuel’s parent, also missed revenue expectations in Q3 2025, reporting $3.79 billion versus $3.90 billion expected, though its earnings per share beat at $1.64. The guidance cut has weighed on investor sentiment, but the company remains focused on expanding prediction markets.
DraftKings spokesperson said the company’s strategy no longer aligns with the AGA’s direction. CEO Jason Robins highlighted the opportunity presented by Railbird’s platform and the broader potential of prediction markets to drive growth beyond traditional sportsbooks.
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