DraftKings’ (NASDAQ: DKNG) prediction market efforts are starting to bear some fruit, potentially positioning the operator for significant volume expansion in 2027.
In a new report to clients, Macquarie analyst Chad Beynon notes that DraftKings Predictions, which isn’t yet a year old, participated in industry-wide volume expansion last month and is poised to see its taker volume surge next year.
“DraftKings Predictions generated approximately $842 million of October consumer volume, which we believe sets them up for $15 billion of consumer volume in 2027E,” observes the analyst.
In prediction market parlance, consumer or taker volume refers to turnover generated by smaller retail traders who are absorbing or taking liquidity provided by market makers and large, well-heeled traders. Last month, Beynon forecast that 2026 taker volume could reach $187 billion.
Room for PM Upstarts to Make Strides
Recent mobile application download data suggest retail traders continue embracing the largest prediction market operator in a big way, but there is also momentum for upstarts such as DraftKings Predictions.
As Beynon notes, over the trailing seven days, DraftKings Predictions garnered 12% of prediction market app downloads, up from 11% the week prior. That progress, though incremental, arrives as the company’s DKeX, its in-house exchange, is rapidly growing, putting its net revenue margins close to those of DraftKings Sportsbook.
“Trends suggest some incumbent operators are beginning to gain a bit of traction. We continue to believe sportsbooks remain under-monetized within the event-contract category and could gain share as geographic availability expands, product awareness improves, and prediction market offerings become more integrated,” adds Beynon.
Including DraftKings, some of the major sportsbook operators that also have prediction markets don’t offer sports event contracts in the states in which they book traditional sports wagers.
DraftKings PM Growth Might Calm Investor Nerves
DraftKings forecast an adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) investment of $650 million to $700 million in DraftKings Predictions, sparking concern among leery shareholders who believe the company is spending too much on its event contracts business.
However, the net revenue margin growth and Macquarie’s 2027 taker volume forecast may be signs that DraftKings’ expenditures are validated. Some experts view the industry’s October volume growth as a sign that there’s room for multiple credible competitors in the space and that traders are embracing more than just sports derivatives.
“Overall, October data reinforces that prediction markets are evolving from a single-platform phenomenon into a broader ecosystem in which sportsbooks, exchanges, brokers, market makers, leagues, and infrastructure providers are all increasingly participating,” says Beynon.
For its part, DraftKings has flagged opportunity in some non-sports event contract segments while management highlighted high levels of prediction market trader engagement and attractive payback periods with those clients.
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