Top 3 tailwinds that will drive growth for DraftKings in 2025

DraftKings Inc (NASDAQ: DKNG) is inching up this morning after recording a surprise profit for its fiscal fourth quarter as revenue jumped 13% on a year-over-year basis.

But the company’s chief executive, Jason Robins, continues to see further growth ahead in the wake of several tailwinds going into 2025.

He raised the full-year revenue guidance this morning to a minimum of $6.3 billion versus his previous guidance of $6.2 billion at least.

DraftKings stock is now up more than 50% versus August of 2024.

DraftKings acquisitions to drive future growth

Jason Robins touted the company’s acquisition strategy in a post-earnings interview with CNBC, adding the acquired brands are already contributing meaningfully to the top line.

More importantly, he expects the likes of Mustard Systems, Jackpocket, and Sports IQ which DraftKings bought last year to continue to drive upside in customer acquisition in 2025.

The sports betting giant now expects its adjusted EBITDA to hit up to $1.0 billion this year.

DraftKings’ upbeat forecast reaffirms the Street’s consensus “buy” rating on its stock. Analysts currently see an upside in DKNG to over $52 at writing which indicates potential for about a 15% gain from current levels.

DKNG to benefit as more states legalize sports betting

CEO Robins agreed that the company will see higher costs this year as some states execute their plans to raise taxes.

However, he’s not too concerned about it since several states are expected to pass legislation to legalize sports betting in 2025 – and that will likely be a huge tailwind for DraftKings.

The chief executive is convinced there’s pent-up demand in terms of passing legislation this year since “last year was tough, it was an election year. It’s typically tough to get legislation done in an election year.”

DraftKings stock has been a lucrative investment in the trailing 12 months. Still, it remains unattractive for income investors as it does not pay a dividend in writing.

DraftKings to focus on big games like Super Bowl

DraftKings did a $436 million handle on the Super Bowl this year – “a huge year-on-year increase across virtually every metric.”

Speaking with CNBC on Friday, the company’s chief executive Jason Robins signaled a commitment to building similar momentum across other big games like the NBA to drive further growth in 2025.

In the fourth financial quarter, the Nasdaq-listed firm increased its monthly unique payers by a whopping 36% to 4.8 million in total.

On the downside, however, a decline in the actual sportsbook hold rate and the Jackpocket acquisition resulted in a 16% year-on-year decline in average revenue per MUP to $97 in the fiscal Q4.

DraftKings started “executing on our inaugural share repurchase authorization” to further boost shareholder value in 2024.

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