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Daily Fantasy Margins Continue To Decline

The steady decline in daily fantasy sports continues as DFS operators DraftKings and FanDuel recorded their seventh consecutive week of declining participation. The reasons for the decline in DFS activity are obvious for anyone following mainstream media. The legal battle on New York headed by Attorney General Eric Schneiderman has had an impact particularly on FanDuel who have adhered to Schneiderman’s call to cease and desist from taking players from New York.

According to DFS data specialists both DraftKings and FanDuel dropped around 7% from the previous week in week 12 of the NFL season. FanDuel reported a 7% drop prom the previous week with guaranteed prize pools (GPP) reaching $21.8m from total entry fees. Their withdrawal from New York gave them a margin of around 10.04%. DraftKings also saw a 7% drop in GPP fees from the previous week. However their margins dropped by 1.6 points on a week-by-week basis.

The lower revenues resulted in DraftKings lowering its guarantee of its marquee football contest by $1m. Not much movement for Yahoo with their DFS offering as their GPP fees remained almost the same as the previous week with $860,955. Margins for Yahoo were positive at 2.6%. With a decision expected soon on New York, it remains to be seen if DraftKings and Yahoo‘s decision to continue operating in New York despite legal questions will payoff.

Author: Victor

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