Flutter Entertainment has lowered its full-year profit outlook for the third consecutive quarter, as its U.S. business FanDuel reported a sharp drop in adjusted EBITDA for the third quarter of 2026. The group also paused its share buyback program to focus on reducing debt, underscoring ongoing challenges in both its U.S. and international operations.
FanDuel's EBITDA Drops, Market Share Slips
FanDuel, Flutter's U.S. arm, posted just $3 million in adjusted EBITDA for the quarter, down from $119 million in the previous period. The sportsbook's gross gaming revenue share also fell to 36% from 39%. The company attributed the decline partly to higher promotional spending, which rose to 6% of handle. While this increased spend was intended to boost market share, it coincided with customer-friendly sports results that reduced revenue by about $38 million.
Profit Guidance Lowered Amid International Headwinds
Flutter cut the midpoint of its 2026 group adjusted EBITDA guidance by $160 million to $2.495 billion and trimmed revenue expectations by $300 million to $17.61 billion. This marks a $370 million drop in profit guidance since May. The international segment was hit especially hard, with EBITDA guidance down $115 million, following the closure of the Brazilian market and a rise in UK remote gaming duty. The company has announced about 1,400 job cuts in its UK and Ireland business in response to these pressures.
Media Costs and Prediction Markets Add Pressure
Flutter is also contending with rising media spending, driven in part by the launch of FanDuel Predicts and increased competition from rival prediction markets. U.S. sales and marketing expenses rose 16% to $357 million. While FanDuel Predicts saw growth in player numbers and volume, revenue remains minimal, and the business segment is expected to post a significant adjusted EBITDA loss for 2026.
Why This Matters for Industry Stakeholders
The results highlight the challenges operators face in balancing promotional spending with profitability, especially in competitive and evolving regulatory environments. For affiliates and suppliers, the shift in marketing intensity and the impact of new products like prediction markets could influence partnership terms and acquisition costs. Regulators will note the market's volatility and the effect of policy changes, such as tax increases and market closures, on operator strategies and employment.
Key takeaways
- Flutter cut profit guidance for 2026 for the third consecutive quarter.
- FanDuel's adjusted EBITDA fell sharply, with market share also declining.
- International challenges include Brazil's closure and higher UK gaming duty.
- Rising media costs and prediction market investments are weighing on margins.