DraftKings Inc. DKNG is sharpening its focus on artificial intelligence (AI) as one of the few areas where incremental investment will increase heading into 2026. In the third quarter of 2025, management emphasized that while most of the company’s core OSB and iGaming footprint will require little to no additional spending next year, AI stands out as a meaningful exception. DraftKings positioned AI as a strategic priority that can both reduce near-term costs and unlock longer-term efficiency and revenue benefits.
The company stated that AI is expected to begin generating cost reductions as early as next year. Some benefits are anticipated to contribute directly to 2026, while others will take longer to materialize, forming what DKNG described as a “longer tail” of operational and commercial improvements.
This renewed technology focus comes at a time when DraftKings is taking a more disciplined approach to spending in its established business lines. Management noted that in more mature OSB and iGaming states, incremental investment may even decline in 2026, allowing resources to shift toward initiatives such as AI that can drive structural efficiency gains. While the company will continue investing in newer state launches and in building its predictions offering, AI remains a distinct category with multiyear importance to the operating model.
DraftKings also framed AI as a potential contributor to its long-term profitability trajectory. Although the financial impact has not been quantified, management highlighted AI’s ability to reshape cost dynamics over time and improve operating leverage as the business scales. With more measured spending across the rest of the organization, DraftKings’ increasing emphasis on automation and data-driven systems signals that AI could form the foundation of the company’s next margin cycle.
DraftKings’ shares have declined 30.8% in the past three months compared with the industry’s fall of 10.4%. In the same time frame, other industry players like Accel Entertainment, Inc. ACEL, Melco Resorts & Entertainment Limited MLCO and Boyd Gaming Corporation BYD have declined 10.2%, 8.9% and 2.7%, respectively.
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DKNG stock is currently trading at a discount. It is currently trading at a forward 12-month price-to-sales (P/S) multiple of 2.30, below the industry average of 2.71. Conversely, industry players, such as Accel Entertainment, Melco Resorts and Boyd Gaming, have P/S ratios of 0.62X, 0.72X and 1.69X, respectively.
