FanDuel Q2 Profitability Jumps 54% as iGaming Revenue Soars 42%

iGaming Becomes a Powerhouse

The standout story from the quarter was the performance of FanDuel’s iGaming division. Revenue from online casino games surged 42% to $507 million.

This growth was driven by a 32% increase in average monthly players dedicated to casino games, a segment the company identified as its fastest-growing.

This performance helped solidify FanDuel’s leading position in the iGaming market, with its share of gross gaming revenue hitting a record 27%.

The company attributed this success to product enhancements, including the launch of a FanDuel Rewards Club and a record number of new game titles added in the quarter.

Sportsbook Growth Driven by Product Innovation

While iGaming saw the most dramatic growth, the sportsbook division also posted solid results. Sports betting revenue increased 11% to $1.22 billion on a 7% rise in total wagers, or handle.

FanDuel credited this growth to product innovation, particularly in its parlay offerings and live betting. The company noted that in-play, or live, betting now accounts for more than half of its total sportsbook handle.

The expansion of its Same Game Parlay+ (SGP+) feature to tennis contributed to a record-breaking Wimbledon for the platform. These product enhancements also helped improve the company’s structural gross revenue margin by 70 basis points to 13.6%.

A Clearer Picture of Profitability

Beyond top-line growth, FanDuel demonstrated significant progress in its operational efficiency. The company’s Adjusted EBITDA margin expanded by 5.3 percentage points to 22.3%.

This was achieved through disciplined cost management. Sales and marketing costs were 13% lower than the previous year, partly due to heavy investment in the North Carolina launch in 2024.

Additionally, the cost of sales as a percentage of revenue decreased, driven by optimizations in payment processing costs.

Navigating a Complex Landscape

The strong quarter comes as FanDuel and its parent company, Flutter, navigate a complex regulatory and corporate environment. In July, Flutter moved to acquire the remaining 5% of FanDuel it did not own, consolidating its ownership to 100%.

At the state level, the company is responding to a new tax structure in Illinois. Peter Jackson, CEO of Flutter, stated that the approach taken by Illinois is an “outlier.” In response, FanDuel plans to introduce a 50-cent fee on each bet placed in the state starting September 1 to help offset the higher operating costs.

“Looking ahead to the remainder of the year, our strong performance in the first half of 2025 underlines the strength of Flutter’s fundamentals,” said Jackson. “I feel confident as I consider our positioning heading into the second half of 2025.”