FanDuel to enter prediction markets in December
Flutter Entertainment used its third-quarter earnings call to roll out FanDuel Predicts, its vehicle for competing in the event-contracts market that will launch in December.
According to Flutter CEO Peter Jackson, the product will be aimed at states in which online sports betting is not legal. In states where it is, Jackson said, prediction markets have had “negligible impact” in their attempt to offer sports wagers.
“Our investment will be meaningful,” Jackson said, calling event contracts “a hugely exciting opportunity for FanDuel, one we intend to seize.” As part of FanDuel’s pivot toward trading, it surrendered its Nevada gaming license.
Jackson reiterated that Flutter’s goal was to bring about legalization of online sports betting and igaming in those states where they are presently outlawed. State-regulated igaming and online sports betting, he said, “cannot be overstated” in their importance.
Of Flutter’s initial US$200 million-US$300 million investment in prediction markets, Jackson said, “we have to put money behind it. We are going to maintain a very disciplined approach,” although maximization of online sports betting is Flutter’s goal.
Although Jackson allowed that prediction markets “are not in the same ballpark as a fully fledged sportsbook,” he said they are “very exciting for the half of America that can’t have sports betting.”
Chief Financial Officer Rob Coldrake added that Flutter was not updating its 2027 guidance because it needed to see “how the investment plays through. There’s a number of things in the mix,” including recent tax hikes.
Jackson resumed that FanDuel was able to draw upon Betfair’s team to get prediction-market expertise. Combine that with FanDuel’s understanding of what customers want, the CEO said, and “we’re confident we’ll have the leading products on the market.”
One of the things that Jackson liked about event contracts was that they were spared from the vagaries of sports outcomes, being commission-based. But he was elliptical about many aspects of the FanDuel Predicts rollout, saying, “I don’t want to tell my competitors what we’ve got planned.”
Jackson was more explicit about parlay bets. “We are not going to launch parlays next month,” he bluntly told a questioner, “but you can expect us to fast-follow this next year.” He said Flutter’s goal was to have a compelling wagering product in place for the start of the 2026 NFL season.
As for the Nevada pullout, Jackson stressed that he had many conversations in different states but that Nevada was different, in that FanDuel had no retail business there. “Whilst we’re sad to surrender the license, we have to protect our interests.”
“We’ve always said we’d never do anything to damage our existing businesses,” Jackson continued. “Nevada’s a little different.”
The Flutter CEO was asked to comment on the ramifications of the new ESPN/DraftKings alliance and the demise of ESPN Bet. “I don’t think there are many partnerships in the US that we haven’t looked at,” he replied. “ESPN struggled to get their bet product to work. We have the best product in the market.”
Downbeat online sports betting results were minimized by Jackson as “just the normal ebb and flow” of game results. NFL per-game handle, he explained, was five times the amount for an average NBA game, thereby inflating the inherent volatility.
The CEO continued that September saw an “exceptionally high level of competitor generosity” in promotional offers, impairing FanDuel’s results. However, as FanDuel moves into the fourth quarter, Jackson said, it is investing more in player acquisition and the NBA season “is shaping up well,” with half of the games being close right to the end, which was good for FanDuel’s business.
Jackson said the NFL promotional wars were typical of the start of any football season, as online sports betting providers try to re-engage with their player bases. But heavy promotion “doesn’t move the needle,” the CEO maintained, saying he was “very comfortable” with FanDuel’s player volumes and parlay penetration.
Coldrake interjected that FanDuel did lose some handle share and single-game-parlay business early on but “we have seen some moderation of that competitive intensity. We’re quite pleased with our momentum.”
Jackson was queried about the United Kingdom, where igaming was described as slow to gain traction and online sports betting revenue-negative. “We’re pleased with the momentum in the UK,” the CEO replied. He added that the absence of the Euro Cup this year made for difficult online sports betting comparisons.
He added that there was “much speculation” about potential UK tax increases. Jackson took a wait-and-see attitude, professing to be sanguine about their effect.
One area in which FanDuel faced considerable adversity was in India, which recently banned igaming. “The sudden regulatory change was extremely dispiriting,” Jackson said, adding that FanDuel would only be offering free-to-play content in the subcontinent.
“We were very frustrated with the speed with which the bill came into law,” Jackson said of the shutdown. He likened it to Black Friday for US online-poker operators “and you see where we are today.”
David McKee is an award-winning journalist who has three decades of experience covering the gaming industry.
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The Backstory
How we got here
FanDuel’s move into prediction markets lands at the intersection of regulatory ambiguity, product strategy and a shifting competitive map. The company’s parent, Flutter Entertainment, is positioning event contracts as a bridge to customers in states that still block online sports betting. The pivot arrives after a year of courtroom skirmishes over whether markets on discrete outcomes — from elections to sports — fall under commodities rules or state gambling laws. It also comes as operators seek new, lower-volatility revenue streams and distribution in states where sportsbooks are shut out. The bet: a commission model that is less exposed to game-day swings while planting flags in markets where traditional wagering remains off-limits.
FanDuel signaled that intent by surrendering its Nevada license, a symbolic tradeoff that underscored a national focus on product and policy rather than a retail foothold in Las Vegas. The company is leaning on Betfair’s trading expertise and has teed up a phased feature set, saying parlays will follow next year. Management framed the launch as additive to long-term goals to legalize online sports betting and igaming in more states. But the backdrop is not straightforward. Courts are still sorting out where event contracts fit, and rivals are already probing gray areas.
Legal fog shapes the runway
The immediate constraint is legal uncertainty. A recent legal briefing by Daniel Wallach, summarized by Jefferies, casts traditional sportsbooks as “on the sidelines” while federal and state cases involving Kalshi work through early stages. The dispute turns on whether certain event contracts qualify as “swaps” with a commercial economic purpose under the Commodity Exchange Act or are wagers subject to state control. Early rulings have tilted toward Kalshi’s interpretation in places, but the record is mixed. Wallach outlined three paths: congressional clarification that excludes sports, a Supreme Court ruling, or a harmonized definition from lower courts — a timeline of at least a year by his estimate.
That limbo matters for FanDuel. If sports-related event contracts are deemed permissible swaps, incumbents like Flutter and DraftKings could enter with scale and brand recognition. If prohibited, business continues on the sportsbook track without a prediction-market detour. For now, firms such as Kalshi can operate in states that bar sportsbooks, widening their lead in customer acquisition and regulatory narrative. Wallach also flagged a tactical risk: sportsbooks pressing too hard could complicate future legalization efforts in key states or run afoul of tribal interests, which have largely opposed prediction markets. That dynamic explains why major operators are signaling ambition but pacing capital deployment until the rules congeal.
Payments and platforms push deeper into Brazil
While U.S. event contracts await clarity, the industry’s center of gravity is drifting to high-growth international markets, especially Brazil. Payments rails are being laid at speed. Paysafe secured a Central Bank license to operate as a Payment Institution, unlocking services across igaming and e-commerce. The move extends its Latin American footprint and gives Brazilian operators access to Skrill, Neteller and SafetyPay options, including Pix instant transfers. With Brazil’s sports betting turnover projected to swell by 2028, payments specialists are jockeying to become default wallets and gateways for player deposits and payouts.
Operators are following. DigiPlus plans a Brazil launch on Sept. 22, soft-opening with GamePlus and a catalog of more than 150 titles in free-to-play and real-money formats. The company is promising local content and guardrails on responsible play, with a second brand, BingoPlus, targeted for 2026. Brazil’s first six months of regulated operations generated an estimated $3.2 billion in gross gaming revenue, a signal that the market can support multiple entrants across casino, casual games and betting. For FanDuel and peers, the Brazil story shows how quickly scale can emerge once payments, licensing and content lock together — and how costly it can be to miss the opening innings.
Digital lottery gains momentum at home
Back in the United States, growth is edging toward digital lottery rather than sportsbooks in many jurisdictions. SEGG Media’s plan to reintroduce Lottery.com underscores the shift. The company will relaunch with a nationwide rewards program and affiliate partnerships with state ilottery sites, starting with Pennsylvania, Virginia and Michigan. SEGG cited a Gallup survey highlighting ilottery as the fastest-growing segment in the regulated market and pointed to the Kentucky Lottery’s $671 million in fiscal 2024 online revenue, with growth of up to 26% projected in 2025.
Lottery is a politically palatable on-ramp to digital wagering because proceeds fund state programs and retailers can be woven into rewards and affiliate networks. For FanDuel, the trend says two things. First, there is consumer appetite for lower-stakes, high-frequency digital games, which rhyme with the commission-based event contracts it plans to offer. Second, the policy path for sportsbook expansion is still uneven, and adjacent products that avoid tax fights and tribal conflicts can scale faster. Aligning with state programs or carving out products that do not look like traditional bets may be the nearer-term growth lever in non-OSB states.
Compliance and credibility in emerging markets
Market entry strategies are coalescing around compliance-first acquisitions and content localization. In New Zealand, CasinoRIX’s acquisition of Innovate Change gives the affiliate site local editorial credibility, responsible gambling resources and a platform to expand coverage of licensing, payments and promotions. That integration-focused approach — keeping local teams while upgrading distribution and tooling — mirrors moves needed in Brazil and other regulated markets where cultural fit, payments choice and responsible play are increasingly gatekeepers to growth.
These shifts matter for FanDuel’s prediction-market rollout. Event contracts will live or die on user trust, frictionless payments and compliance in fragmented jurisdictions. As Brazil shows, payments licenses can be strategic moats. As New Zealand demonstrates, local knowledge can determine customer acquisition costs and regulator relationships. And as the U.S. lottery pivot indicates, products that meet policymakers where they are can scale faster than those that force a fight.
The stakes are straightforward. If courts or Congress clear a lane for sports-related event contracts, FanDuel can leverage brand and liquidity to consolidate share, likely fast-following features like parlays next year. If the lane narrows, the company’s emphasis on sports betting and igaming legalization remains intact, with prediction markets acting as a bridge product in half the country that still lacks sportsbook options. Either way, the playbook now includes payments depth, compliance partnerships and localized content — the same ingredients powering growth from São Paulo to Wellington.
