Sports Betting Update: FanDuel Still Dominant But DraftKings Is Charging

FanDuel appears to have weathered yet another summer rivalry challenge from its longtime competitor and closest adversary, DraftKings.

While the US sports betting leader briefly slipped to second place this summer, it reclaimed the top position as the fall betting calendar progressed. Despite some promising developments earlier in the year, DraftKings finds itself in the runner-up spot again after an impressive summer performance.

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FanDuel vs. DraftKings

The battle for sports betting supremacy

Examining the head-to-head volume in common states offers a fascinating perspective on the ongoing battle between DraftKings and FanDuel. The tug of war, illustrated in the chart depicting handle share from 2021 to 2023, shows a recurring pattern, with DraftKings' performance typically peaking in September.

The control shifting with the seasons sets the stage for this narrative between the big two US sports betting sites. While it wasn't surprising to witness DraftKings gaining ground during the summer of 2023, there were indications that this year might unfold differently. DraftKings narrowed the gap early in 2023 and achieved a notably higher late-summer peak compared to 2022.

The fierce competition for dominance in New York, a market accounting for nearly 20% of the country's total online betting volume, was particularly intense. DraftKings temporarily surpassed FanDuel's share in June, marking the start of a dynamic back-and-forth struggle throughout the summer.

In the crucial market of New York, DraftKings secured a 54% to 46% victory in June, overturning a prior lead held by FanDuel. Although DraftKings slipped to second place in July, it reclaimed the top spot in August and September, emphasizing the significant impact a New York shift can have on the national race.

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DraftKings' influence extends to other states as well. It leads in states like Iowa and Kansas and is making headway in Indiana, where its share has consistently exceeded 40% in the last six months, compared to FanDuel's just under 34%. Illinois and Connecticut remain highly competitive battlegrounds, with DraftKings showing recent gains in both.

While historically under FanDuel's control, DraftKings managed to outperform its rival in Arizona in August and September. The competition in Ohio is still evolving, with DraftKings overtaking FanDuel in the third quarter. Massachusetts remains firmly in DraftKings' grasp, with a commanding lead in total betting volume.

Online Sports Betting Outlook: Who Reigns in 2024?

It's a battle royale when it comes to the big two

Despite DraftKings' summer surge, FanDuel reclaimed the overall lead in the last two months, particularly in head-to-head battles in New York. FanDuel's dominance extends to other states like Maryland, Michigan, and Pennsylvania, where it maintains a substantial lead.

In terms of revenue, FanDuel maintains a significant advantage, generating $2.24 billion in gross revenue in the first three quarters of 2023. While DraftKings handled a comparable volume, its gross revenue was $1.55 billion during the same period.

FanDuel's superior margins have positioned it as the first major US sports betting brand to achieve profitability. DraftKings investors, however, seem optimistic about its path to profitability in 2024, with shares trading around $36 this week, marking a more than 200% increase since the beginning of the year.