The three ways Flutter wants to turn predictive markets into its next big business
Flutter is accelerating investment in its FanDuel Predicts platform, which already moves $119 million quarterly, although its revenues do not yet have a material weight in the group's accounts.
The three ways Flutter wants to turn predictive markets into its next big business
Flutter is accelerating investment in its FanDuel Predicts platform, which already moves $119 million quarterly, although its revenues do not yet have a material weight in the group's accounts.
Flutter has drawn up three lines of action to take advantage of the boom in predictive markets and turn them into a new business lever. The first involves improving the product; the second, attracting customers in territories where it does not have a bookmaker; and the third, to make its ability to set prices and create a market in sporting events profitable.
The company has presented these priorities along with its third-quarter results, in which FanDuel Predicts reached 66,000 monthly active players, 39% more than in the previous quarter. The platform moved $119 million, up 102%, and October volume was 271% higher than in July.
The product enhancement has begun with the national launch of the FanDuel One App and the move of all sports contracts to Crypto.com. Since the start of the football season, the offering has incorporated more sports markets, variable commissions, fractional contracts, sub-cent contracts and new promotions, including a recommendation mechanism between users.
Flutter wants to leverage FanDuel's recognition to build a customer base in states where it does not have a sports betting operation. The group says new users resemble regular sportsbook customers, but come at a lower cost of ownership. The company believes that initial growth confirms that product improvements are connecting with audiences.
The third leg is market making. Flutter intends to apply its experience in pricing sporting events, especially correlated events, to expand this business. It is confident that the revenue associated with this activity will help fund user acquisition for predictive markets over time.
The bet comes at a cost. FanDuel Predicts' revenue was not yet material during the quarter, but U.S. sales and marketing expenses grew 16% year-over-year, driven in part by investment in this platform. Items for technology, development, regulation, and predictive markets also increased.
Flutter expects the marketing component of the adjusted EBITDA losses of its predictive markets business to be around $200 million in 2026. And it advances that it will maintain or increase that investment in 2027, although it recognizes that the regulatory framework is still open.
The group maintains that, for now, these platforms have a limited impact on the bets of its current customers. However, it already detects an effect on advertising costs, given the increase in commercial investment by operators of predictive markets.
