Fanatics is gearing up to invest between $800 million and $1 billion in marketing for its betting and gaming operations by 2027. This move, spearheaded by CEO Michael Rubin, aims to close the competitive gap with established players like FanDuel and DraftKings, as well as emerging prediction market platforms such as Kalshi and Polymarket.
The anticipated marketing expenditure marks a significant increase from the $350 million budget set for this year. Fanatics is projecting approximately $2 billion in free cash flow by 2026, alongside a robust net cash position of around $1 billion and no debt. Notably, a $1 billion marketing budget would represent half of the projected free cash flow for this year.
Rubin emphasized the company's commitment to ramping up marketing efforts, stating, “We’re going to spend a lot more money on marketing next year than we had thought we were going to spend because we’re saying, how do we close the gap, and how do we really grow our market share,” as reported by Bloomberg.
For 2026, Fanatics anticipates total revenue to reach around $14 billion, reflecting a 40% growth from the previous year, with approximately $2 billion expected from sports betting. Since entering the betting market in 2023, the company has captured about 10% of the sector.
Currently, Fanatics Sportsbook operates in 23 states, while Fanatics Casino is available in four. Legal sports betting is permitted in 39 states and Washington, D.C., with seven states having legalized online casinos, and Maine poised to become the eighth.
Rubin noted that growth in established regulated markets has begun to plateau. “Revenue on a per-state basis has hit a wall in fully regulated states like Pennsylvania, New Jersey, or New York,” he remarked. He also pointed out that the pace of new state regulations has slowed unexpectedly, and the emergence of prediction markets has added another layer of complexity.
Launched in December 2025, Fanatics Markets provides access to lucrative markets such as California, Florida, Georgia, and Texas. Unlike traditional betting, sports event contracts here are regulated by the Commodity Futures Trading Commission rather than state gambling authorities. Notably, California, Georgia, and Texas have yet to legalize sports betting, while Florida's market is dominated by Hard Rock Bet.
Reflecting on the rapid changes in the landscape, Rubin stated, “If we would have sat here a year ago and said what’s the chance of sports betting in California, Texas, Florida, and Georgia, you’d say no chance. And here we are a year later, and we have it.”
In Georgia, lawmakers considered H.R. 450 this year, but the proposal fell short with a 63-98 vote in the House in March, lacking the necessary 120 votes. Rubin, who owns 31% of Fanatics and holds a supermajority, believes that the company’s private ownership allows for greater flexibility in its operations. Additionally, Fanatics has secured $4 billion in funding from investors including Clearlake Capital, SoftBank, and Silver Lake.
Rubin concluded by highlighting the complexities that will arise in the betting and gaming industry by 2027, stating, “The betting and gaming business will be more complicated in 2027 because you not only have the addition of Kalshi and Polymarket, but now you have the addition of Fanatics spending at the same level as FanDuel and DraftKings.”