RESOLVING THE LEDGER
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Flutter shares faltered Wednesday after the company slashed its full-year U.S. profit guidance by 22% and announced the departure of CEO Peter Jackson at the end of the quarter. The current CEO of Flutter's international business, Dan Taylor, will take the reins, effective Oct. 1.
The company reported earnings per share of 49 cents for its second quarter, falling below Wall Street expectations of 60 cents per share, according to LSEG. Revenue narrowly beat analysts' estimates, at $4.33 billion versus the $4.26 billion expected by LSEG.
For its full-year, Flutter now expects adjusted earnings before interest, taxes, depreciation and amortization for its U.S. business of $760 million, a 22% reduction from previous guidance.
Over the past year, FanDuel, Flutter's most important business, began losing its market share dominance in the United States. Now, the parent company is prepared to spend heavily to fix it.
"We didn't execute very well last year," Jackson said in an interview following the company's earnings report.
The NFL schedule was not especially compelling last season, and its player narratives were lacking, he said. But Jackson also acknowledged Flutter mishandled its own customer proposition, particularly pulling back on promotions and generosity. As a result, FanDuel entered 2026 with a smaller sportsbook business than it should have.
Now Flutter is leaning the other way. The company is putting roughly $270 million of additional EBITDA investment into its U.S. business in the second half of 2026, focusing on better rewards, promotions and customer protections. The company said promotional spending will move closer to 6% of handle — higher than previously planned, though not the 7% that some analysts feared.
Flutter believes the repair work is already gaining traction.
FanDuel's loyalty program reached 70% of customers during the quarter and will be available nationally by football season, the company said. Bet Protect Plus — which refunds a bet when a selected player is injured — is addressing what Jackson called a major customer pain point.
The company is seeing momentum across pro sports: NBA Finals actives increased 26% per game; roughly one third of FanDuel's 2.3 million World Cup customers were reactivated; and the sportsbook recently posted its biggest-ever MLB week.
"We could've spent a lot less this year and hit our guide," Jackson said. "But it's not the right thing to do."
The goal is to enter 2027 with more customers, stronger market share and better momentum — even at the expense of near-term profit, he said.
Jefferies gaming analyst James Wheatcroft wrote on Wednesday that he's taking a constructive stance on the stock, despite the "messy reading" from an earnings miss, guidance cut and a new CEO.
Flutter is also widening FanDuel's reach through prediction markets. The company's sports and novelty contracts are moving from CME to Crypto.com, while CME will continue to provide financial market contracts, the company announced.
Jackson said CME proved challenging on sports, while Crypto.com gives FanDuel a broader catalog and the ability to launch products faster before football season.
Combined with FanDuel's new unified app experience, putting traditional sports better and events contracts on the same platform, prediction markets let the company compete nationally, including in states where conventional sports wagering remains unavailable.
Flutter expects about $50 million in market-making revenue this year.
Jackson spent nine years leading Flutter, overseeing its acquisition of FanDuel and the expansion of its international business. He called leading Flutter "an enormous privilege" but said the time was right to hand the business to Taylor.
In May, Taylor was tasked with oversight of FanDuel after that business's CEO, Amy Howe, was ousted.
Jackson gave Taylor credit for helping to shape the existing strategy. His new mission will be to restore FanDuel's execution and turn renewed customer activity into durable growth.
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