Flutter Entertainment had a rough end to 2025 and Wall Street didn’t take it well. Shares in the Paddy Power and FanDuel parent dropped nearly 10% in extended trading after the group missed revenue forecasts and issued guidance that underwhelmed investors. With prediction markets circling and competition intensifying, the question is: can Flutter get its act together in 2026?
The Numbers That Spooked Investors
Flutter reported Q4 2025 revenue of $4.74bn — short of the $4.97bn consensus forecast, despite headline growth of 25% for the quarter.
For the full year, revenue hit $16.4bn, up 17% year-on-year but below the group’s own guidance of $16.7bn — which had already been trimmed from $17.3bn back in November.
Looking ahead, Flutter expects 2026 revenue of $18.4bn. Analysts had pencilled in $19.3bn. That’s a meaningful gap, and investors noticed.
What Went Wrong in the US?
The US is Flutter’s crown jewel — home to FanDuel, the country’s leading sportsbook. So a US sportsbook handle growth figure of just 3% raised serious eyebrows.
CEO Peter Jackson pinned the blame on sports results going against the house: “Our standard generosity playbook proved less effective in Q4… we saw higher churn within our customer base and a resultant loss of market share.”
In plain English: customers won more than expected, Flutter’s promotions didn’t land, and punters drifted elsewhere. That said, US revenue still climbed 33% to $2.14bn, propped up by strength in Canada and iGaming — so it’s not all bad news.
The Prediction Market Problem
Flutter’s wobble hasn’t happened in isolation. Investor sentiment across the sector has soured sharply, partly driven by fears that prediction markets — think Kalshi and Polymarket — are eating into the estimated $14bn US sports gambling market.
Jackson’s take? He’s not scared — he’s bullish. Rather than treating prediction markets as a threat, he called them “the most valuable long-term opportunity in the US,” arguing they’ll grow the total addressable market and extend sports betting’s reach into states where it isn’t yet legal. Flutter has already launched FanDuel Predicts, and expects to invest up to $300m in the space in 2026.
On cannibalisation specifically, an internal review found only a “low single digit” percentage impact on sportsbook handle growth from prediction markets — though sceptical investors aren’t entirely convinced. Jackson also announced plans to ramp up personalisation to “distinguish our product from prediction markets, where it’s very difficult to offer promotions.”
Analyst Reaction: Reset or Rout?
The analyst community was largely unimpressed, though not without nuance.
Citizens analyst Jordan Bender called it “one of its worst quarters in recent memory” — but argued the reset could lay the groundwork for a stronger 2027 once restructuring and tech integration are complete.
Regulus Partners flagged concerns about Flutter’s EDGE technology platform, warning it isn’t yet delivering a product that can outcompete rivals, with market share at risk of continuing to slip.
Truist analysts said they were surprised by “the overall scale of the miss”, adding there’s now a scenario in which DraftKings could out-earn FanDuel — a thought that would have seemed far-fetched just 12 months ago.
International: Silver Linings
It wasn’t all doom and gloom beyond the US. Flutter’s €1.91bn acquisition of Sisal bolstered revenue across Southern Europe and Africa, while strong growth in Brazil and Central and Eastern Europe helped offset a 10% revenue hit in Asia Pacific — the result of India’s online gambling ban.
International diversification is quietly becoming one of Flutter’s most important hedges as the US market grows more competitive.
Key Takeaways
Flutter Entertainment’s Q4 miss is a reminder that even market leaders can stumble when sports results, customer churn, and competitive pressures align against them. The 2026 guidance gap versus consensus is the bigger concern — but with meaningful international growth and a tech and loyalty overhaul in progress, the story isn’t over yet.
If you’re tracking the US sports betting sector, keep an eye on how FanDuel’s loyalty push lands — and whether prediction markets continue to gain ground.
FAQ
Q1: Why did Flutter Entertainment’s shares fall?
A: Flutter’s shares dropped nearly 10% after Q4 revenue of $4.74bn missed the $4.97bn consensus forecast. The group also issued 2026 revenue guidance of $18.4bn — well below the $19.3bn analysts expected.
Q2: What is Flutter Entertainment?
A: Flutter Entertainment is one of the world’s largest online gambling groups, owning brands including FanDuel, Paddy Power, Betfair, and PokerStars. It is listed on the New York Stock Exchange.
Q3: How are prediction markets affecting US sports betting?
A: Platforms like Kalshi and Polymarket have raised concerns that they’re drawing users away from traditional sportsbooks. Flutter’s own review found only a “low single digit” percentage impact on handle growth — and CEO Peter Jackson actually views prediction markets as a major growth opportunity, having launched FanDuel Predicts and pledging up to $300m investment in the space for 2026.
Q4: How did Flutter perform outside the US?
A: International performance was more encouraging. The Sisal acquisition drove growth in Southern Europe and Africa, while Brazil and Central and Eastern Europe also contributed positively. A 10% revenue decline in Asia Pacific — linked to India’s gambling ban — was the main drag.
Q5: Could DraftKings overtake FanDuel in earnings?
A: Truist analysts flagged this as a genuine possibility following Flutter’s miss. FanDuel has long been considered the US market leader, but narrowing margins and market share concerns have made the competitive landscape far less clear-cut.
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Effective Date: 15th July 2025
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