\n Posted on: November 24, 2025, 08:10h.\u00a0\n <\/p>\n
\n Last updated on: November 24, 2025, 08:10h.\n <\/p>\n
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- Two sportsbook giants could see $5 billion total addressable in US prediction markets, says analyst<\/strong><\/li>\n
- Forecast is based on $4.4 billion in sports-only contracts<\/strong><\/li>\n
- It\u2019s also based on 40% of US betting age population without access to legal sports betting<\/strong><\/li>\n<\/ul>\n
Flutter Entertainment\u2019s (NYSE: FLUT) FanDuel and DraftKings (NASDAQ: DKNG) could see $5 billion in total addressable market in US prediction markets, says a sell-side analyst.<\/p>\n
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DraftKings and FanDuel could see a $5 billion prediction markets opportunity. (Image: Shutterstock)<\/figcaption><\/figure>\n In a new report to clients. Macquarie analyst Chad Beynon made that projection based on $4.4 billion in sports-only event contracts and $600 million in non-sports yes\/no derivatives. Both DraftKings and FanDuel are expected to launch their own prediction markets<\/a> in the coming months. Beynon points out that the sports-only total addressable market (TAM) for US prediction markets will be 25% below online sports betting handle, citing less extensive wagering menus and reduced promotional intensity<\/a>.<\/p>\n
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Another way to think about potential sports Prediction volumes over the next few years is to take the current weekly volume estimate of $1.3 billion (mostly from non-legal OSB states), multiply it by 1.38x, and then annualize this figure, keeping in mind that weekly volumes are now occurring during a seasonally high NFL period, thus capturing more growth when annualized,\u201d notes the analyst.<\/p>\n<\/blockquote>\n
He adds non-sports prediction markets run by DraftKings and FanDuel are likely to generate volumes that are 70% below the operators\u2019 sports-only offerings, implying a better balance than Kalshi (estimated 90% sports) and weaker diversification than Polymarket (33% sports).<\/p>\n
DraftKings, FanDuel to Be Part of \u2018Big Five\u2019<\/h2>\n
While FanDuel and DraftKings are the two largest US sportsbook operators, they\u2019re late entrants to the sports event contracts arena, indicating it could be difficult for those to companies to immediately pilfer market share from Kalshi and Polymarket. Still, the duo are likely to ascend to the pantheon of sports prediction markets<\/a>.<\/p>\n
\u201cFor US sports-only Prediction markets, we conservatively assume slightly higher market shares for Kalshi\/Robinhood\/Polymarket given first mover advantage,\u201d adds Beynon. \u201cWe believe the \u2018big Five\u2019 Prediction platforms will be: DraftKings, FanDuel, Kalshi, Polymarket, and Robinhood. Assuming a 4.7% take rate on volumes, we arrive at a near-term TAM of nearly $4.4 billion (only non-legal OSB states).<\/strong><\/p>\n
\nSports, especially the NFL, have stoked surging volumes on Kalshi and other prediction markets, but there\u2019s more to the event contracts business. After all, it was electoral politics that brought yes\/no exchanges into the mainstream and participants have shown a willingness to embrace everything from cryptocurrency contracts to mention markets<\/a> and there\u2019s revenue-generating opportunity there for DraftKings and FanDuel, though far less than the $700 million Beynon forecast in sports-only derivatives.<\/p>\n<\/div>\n
\u201cFor the US non-sports Prediction market, we assume volumes will be ~30% of sports betting contracts,\u201d according to the analyst. \u201cWe think this is appropriate given that this TAM only includes non-legal OSB states, resulting in a much higher percentage of sports volumes as the \u201cgo to\u201d sports betting product in the state. Assuming a 2% take rate on volumes, we arrive at a near-term total addressable market of nearly $600 million (only non-legal OSB states). At 8\/%12% respective market shares for DKNG\/ FLUT, we arrive at roughly $45 million\/67 million of revenue.\u201d<\/p>\n
\u2018Multiform\u2019 Answer Highlights DraftKings, FanDuel PM Benefits<\/h2>\n
Echoing sentiment that the prediction market slides endured by shares of DraftKings and Flutter were too harsh<\/a>, Beynon notes there are other reasons the stocks have struggled, including well-documented low hold on NFL games. He also points out some investors have simply grown frustrated by the stocks\u2019 weak 2025 showings and that some market participants are pricing in the gloomiest of prediction markets scenarios for the two sportsbook giants.<\/p>\n
\u201cUnder this scenario, one would have to assume that 100% of US states legalize OSB and DKNG\/FLUT are not permitted to offer Prediction markets in any US state given state regulators,\u201d concludes the analyst. \u201cFurther, one would have to assume a cannibalization rate of ~40% to justify the ~$10bn of market value destruction for DKNG and a much higher rate for FLUT in order to warrant the $20bn loss of market cap.\u201d<\/strong><\/p>\n<\/div>\n
- Forecast is based on $4.4 billion in sports-only contracts<\/strong><\/li>\n