DKNG.NASDAQDraftkings INC
DEF: DraftKings Sets 2026 Annual Meeting Agenda, Details Executive Pay
Sentiment:
Definitive Proxy Statement
DraftKings Inc. announces its 2026 Annual Meeting of Shareholders to be held virtually on May 12, 2026, outlining proposals for director elections, auditor ratification, and executive compensation, alongside a review of 2025 financial performance and executive transitions.
Worse than expectedNamed Executive Officers (NEOs) did not receive annual bonuses for 2025 because the company failed to meet the minimum thresholds for both Revenue ($6.055 billion actual vs. $6.2 billion threshold) and Adjusted EBITDA ($619 million actual vs. $860 million threshold).While revenue grew 27% year-over-year, it fell short of the internal target set for bonus eligibility.
Summary
- The 2026 Annual Meeting of Shareholders will be held virtually on May 12, 2026, at 11:30 a.m., Eastern Time.
- Shareholders will vote on electing eleven directors, ratifying BDO USA, P.C. as the independent registered public accounting firm for fiscal year 2026, and a non-binding advisory vote on executive compensation.
- Jason D. Robins, Chief Executive Officer and Chairman of the Board, possesses approximately 88% of the total voting power and intends to vote in favor of all proposals, assuring their approval.
- Matthew Kalish will transition out of his role as President, DraftKings North America, effective March 31, 2026, but will remain a director on the Board.
- In 2025, revenue increased 27% year-over-year to $6.1 billion, up from $4.8 billion in 2024.
- Adjusted EBITDA significantly improved in 2025 compared to 2024.
- Launched DraftKings Predictions, a new standalone mobile app and web product, in December 2025.
- Secured the top position in the Eilers & Krejcik U.S. Casino App 2H25 report for the fourth consecutive cycle and the top spot in the Eilers & Krejcik U.S. Sportsbook App 2H25 report for the third consecutive cycle.
- As of December 31, 2025, the company had approximately $1.1 billion in cash and access to a $500.0 million revolving credit facility.
- Contributed over $3.5 million to responsible engagement initiatives and over $3.0 million to non-profit organizations in 2025.
- No annual bonuses were paid to Named Executive Officers (NEOs) for 2025 as both the Revenue ($6.055 billion actual vs. $6.2 billion threshold) and Adjusted EBITDA ($619 million actual vs. $860 million threshold) minimum thresholds were not met.
- Founders (Jason Robins, Matthew Kalish, Paul Liberman) voluntarily agreed to $1 base salaries for fiscal year 2025.
Sentiment
Score: 6
Explanation: StockSavvy.ai views this as a moderately positive filing. While the company demonstrated strong revenue growth and market leadership, the failure to meet internal bonus thresholds for both revenue and Adjusted EBITDA indicates a miss on internal financial targets, tempering overall enthusiasm. The executive transition and related equity award treatment for Mr. Kalish are notable but managed.
Positives
- Achieved strong revenue growth, increasing 27% year-over-year to $6.1 billion in 2025.
- Reported significant improvement in Adjusted EBITDA in 2025 compared to 2024.
- Successfully launched DraftKings Predictions in December 2025, expanding product offerings into a new vertical.
- Maintained market leadership by securing the top position in the Eilers & Krejcik U.S. Casino App 2H25 report for the fourth consecutive cycle and the U.S. Sportsbook App 2H25 report for the third consecutive cycle.
- Maintained substantial capital resources with approximately $1.1 billion in cash and access to a $500.0 million revolving credit facility as of December 31, 2025.
- Demonstrated strong corporate responsibility by contributing over $3.5 million to responsible engagement initiatives and over $3.0 million to non-profit organizations in 2025.
- Recognized as a 'Top Workplace' by the Boston Globe for the sixth consecutive year and by USA Today for the third time, also earning 'Great Place to Work U.S. Certification' in 2025.
- Achieved 100% of the 2025 Normalized Net Revenue performance goals for the 2024 PSUs.
Negatives
- No annual bonuses were paid to Named Executive Officers (NEOs) for 2025 because the company did not meet the minimum thresholds for both Revenue ($6.055 billion actual vs. $6.2 billion threshold) and Adjusted EBITDA ($619 million actual vs. $860 million threshold).
- Matthew Kalish's PSUs granted in February 2024 with respect to performance in calendar year 2027 were forfeited and cancelled as of November 6, 2025, due to his transition out of an executive role.
- Certain Section 16(a) reports (Form 4s) for Erik Bradbury, R. Stanton Dodge, and Jason Robins were not filed on a timely basis during fiscal year 2025 due to administrative oversight.
Risks
- Forward-looking statements involve substantial risks and uncertainties that could cause actual results or outcomes to differ materially from those discussed.
- The Board has ultimate responsibility for oversight of the company's risk management processes, including operational, financial, legal and regulatory, and strategic risks.
- Cybersecurity risks are regularly monitored by the compliance and risk committee, which receives reports from the Chief Information Security Officer.
- Compensation programs are assessed to ensure they do not encourage executives or employees to take excessive or inappropriate risks that could have a material adverse effect on the company.
Future Outlook
The company expects continued strong revenue growth, an increase in gross margin, and scale benefits across its marketing expense and fixed cost base in fiscal year 2026. Executives have positioned DraftKings to generate increasingly positive Adjusted EBITDA in fiscal year 2026. The company will continue to monitor its stock-based compensation expense and burn rate to remain consistent with its peer group. A new one-year Aircraft Dry Lease for $0.6 million is intended to be entered into, effective March 30, 2026.
Management Comments
- Jason D. Robins: "It is a pleasure for me to extend to you an invitation to attend the 2026 Annual Meeting of Shareholders of DraftKings Inc." and "I look forward to seeing you at the Annual Meeting."
- The Board believes Mr. Robins' in-depth knowledge of the Company and his extensive executive and management experience make him uniquely well positioned to lead the Board.
- The Compensation Committee determined that the Company's achievement of the contemplated performance levels for calendar year 2026 was probable, leading to the acceleration and vesting of Matthew Kalish's PSUs.
Industry Context
StockSavvy.ai notes that DraftKings' continued strong revenue growth and market leadership in online sports betting and casino apps (as evidenced by Eilers & Krejcik reports) demonstrate its robust position in the rapidly expanding U.S. real-money gaming landscape. The launch of 'Prediction Markets' indicates a strategic move to diversify offerings and capture new segments, aligning with broader industry trends of innovation and platform expansion. The focus on efficient growth and improved Adjusted EBITDA suggests a maturing industry where profitability is becoming a key driver alongside market share.
Comparison to Industry Standards
- DraftKings secured the top position in the Eilers & Krejcik U.S. Casino App 2H25 report for the fourth consecutive cycle, indicating strong performance relative to competitors in the online casino sector.
- The company also held the top spot in the Eilers & Krejcik U.S. Sportsbook App 2H25 report for the third consecutive cycle, demonstrating sustained leadership in the highly competitive U.S. sports betting market.
Management Changes
| Role | Previous Person | New Person | Effective Date | Reason |
|---|---|---|---|---|
| President, Global Technology and Product | Paul Liberman | N/A | November 2025 | Paul Liberman appointed President, Operations. |
| President, Operations | N/A | Paul Liberman | November 2025 | Appointment to new role. |
| President, DraftKings North America | Matthew Kalish | N/A | March 31, 2026 | Mutual agreement to transition out of executive role; Mr. Kalish will remain a director. |
| Chief Financial Officer | N/A | Alan Ellingson | May 2024 | Appointment to CFO role. |
| Chief Accounting Officer | Erik Bradbury (initial tenure) | N/A | September 2023 | Departure from role. |
| Chief Accounting Officer | N/A | Erik Bradbury | August 2024 | Rejoined the company in the same capacity. |
| Managing Partner, Revolution Growth III, LP | Steven J. Murray | N/A | October 2024 | Transitioned to Advisor role. |
| Partner, Capital Group Companies | Gregory W. Wendt | N/A | July 1, 2025 | Retirement. |
| Director | N/A | Gregory W. Wendt | November 2025 | Joined the Board. |
Corporate Governance
| Change Type | Description | Effective Date | Impact Assessment |
|---|---|---|---|
| Board Leadership Structure | The company combines the positions of Chief Executive Officer and Chairman of the Board, with Jason D. Robins holding both roles. There is no lead independent director. | N/A | Centralizes leadership, leveraging the CEO's in-depth company knowledge, but may reduce independent oversight without a lead independent director. |
| Risk Oversight | The Board has ultimate responsibility for risk management, with committees (Audit, Compliance and Risk) overseeing specific areas like operational, financial, legal, regulatory, strategic, and cybersecurity risks. | N/A | Provides a structured approach to identifying, managing, and controlling risks across various business functions. |
| Committee Composition | The Audit, Compensation, and Nominating and Corporate Governance Committees are comprised solely of independent directors, despite the company qualifying as a 'controlled company' under NASDAQ listing standards. | N/A | Enhances independent oversight and aligns with best practices, even though not strictly required by NASDAQ for a controlled company. |
| Clawback Policy | Adopted a clawback policy on October 31, 2023, in accordance with NASDAQ listing requirements, for the recovery of erroneously awarded incentive-based compensation. | December 1, 2023 | Strengthens accountability for executive compensation and aligns with regulatory best practices, protecting shareholder interests. |
| Stock Ownership Guidelines | Adopted stock ownership guidelines for executive officers and non-employee directors to align their interests with shareholders, with targets to be achieved over five years. | N/A | Encourages long-term focus and commitment from key personnel by linking their personal wealth to company performance. |
| Insider Trading Policy | Prohibits hedging, short sales, and pledging of company common stock as collateral for margin loans without prior Chief Legal Officer approval. | N/A | Mitigates potential conflicts of interest and promotes confidence in the integrity of company stock transactions. |
| Director Stock Deferral Plan | Adopted in November 2025 to allow non-employee directors to defer receipt of stock awards, receiving deferred stock units (DSUs) instead. | November 2025 | Provides flexibility for directors in managing their equity compensation and may enhance retention by aligning long-term interests. |
Related Party Transactions
- **Stockholders Agreement**: Entered into on April 23, 2020, with the DEAC Stockholder Group, DK Stockholder Group, and SBT Stockholder Group, providing registration rights for certain securities and acknowledging 'unsuitable persons' provisions in the Articles of Incorporation.
- **DKFS, LLC (Joint Venture)**: DraftKings, Accomplice Fund II, L.P. (formerly affiliated with director Ryan Moore), and Jason Robins acquired equity interests in DKFS, LLC, a joint venture investing in early-stage sports entertainment companies. Jason Robins is a manager of DKFS. As of December 31, 2025, DraftKings owned 49.9% of DKFS.
- **DBDK Venture Funds**: DraftKings committed to invest up to $17.5 million in DBDK Venture Fund I, L.P. (invested $12.8 million as of Dec 31, 2025) and up to $21 million in DBDK Venture Fund II, L.P. (none invested as of Dec 31, 2025). Jason Robins, Matthew Kalish, and Paul Liberman also committed personal investments. Matthew Kalish and Paul Liberman received 0.5% carried interest in DBDK Fund I and Fund II's general partner for advisory services.
- **Services Agreement with DBDK**: DraftKings provides administrative and other services (office space, IT) to DBDK. In fiscal year 2025, DraftKings received approximately $0.2 million from DBDK for services, paid in services-in-kind (consulting services related to strategic planning and industry insights).
- **Aircraft Dry Lease**: Since March 2022, the Company has leased an aircraft from an entity controlled by Jason D. Robins. In fiscal year 2025, the Company incurred $0.6 million in lease expense. A new one-year lease for $0.6 million is intended for March 30, 2026. The arrangement includes a 'Recoupment Mechanism' for capital improvement costs ($2.9 million in 2025, $0.9 million in 2024) if the lease terminates early.
- **FaZe Media, Inc. (dba Hardscope) Arrangements**: Matthew Kalish, an executive officer and director, is a board member and CEO of Hardscope and owns 100% of its equity. The audit committee approved these arrangements.
- **Marketing Arrangement with Hardscope (June 13, 2025)**: Company secured personal services and name, image and likeness rights of certain individuals for promotional campaigns. Aggregate payable not to exceed $600,000. Incurred $150,000 in fiscal year 2025.
- **Consulting Services Agreement with Hardscope (February 17, 2026)**: Company has the right to engage talent through Hardscope for promotional campaigns. Aggregate service fees payable by the Company may not exceed $30.0 million during the three-year term, with Hardscope's commission not exceeding 14% of the related service fee.
Stakeholder Impact
- **Shareholders**: Direct impact through voting on directors, auditor, and executive compensation. Jason D. Robins' 88% voting power assures approval of all proposals. Stock ownership guidelines align executive and director interests with shareholders. Dilution and share management are monitored.
- **Employees**: Benefit from participation in the 401(k) plan with company match, group health, disability, and life insurance. The company was recognized as a 'Top Workplace,' indicating a positive work environment.
- **Customers**: Benefit from enhanced product offerings (Sportsbook, Casino, Fantasy, Prediction Markets), improved content delivery, and the launch of a Spanish-language Sportsbook, driving engagement and loyalty.
- **Regulators/Policy Makers**: The company actively works with policy makers and regulators to pass fantasy sports, sports betting, and online casino legislation, demonstrating a commitment to regulatory compliance and consumer protection.
- **Community/Non-profits**: The company made significant contributions of over $3.5 million to responsible engagement research and initiatives, and over $3.0 million to various non-profit organizations in 2025, demonstrating corporate social responsibility.
Next Steps
- Hold the 2026 Annual Meeting of Shareholders virtually on May 12, 2026.
- Elect eleven directors to the Board of Directors.
- Ratify the appointment of BDO USA, P.C. as the independent registered public accounting firm for fiscal year ending December 31, 2026.
- Conduct a non-binding advisory vote on executive compensation.
- Matthew Kalish will transition out of his role as President, DraftKings North America, effective March 31, 2026, but will remain a director.
- Company expects continued strong revenue growth, increased gross margin, and scale benefits in fiscal year 2026.
- Company expects to generate increasingly positive Adjusted EBITDA in fiscal year 2026.
- Company intends to enter into a new one-year Aircraft Dry Lease for $0.6 million, effective March 30, 2026.
- Shareholder proposals for the 2027 proxy statement must be submitted by November 26, 2026.
- Advance notice shareholder proposals for the 2027 Annual Meeting (not for proxy statement inclusion) must be delivered between January 12, 2027, and February 11, 2027.
- Shareholders intending to solicit proxies for director nominees must provide notice by March 13, 2027.
- Final voting results for the 2026 Annual Meeting will be published in a Current Report on Form 8-K within four business days.
- Payout for half of the 2025 PSUs (subject to 2026 performance) in early 2027.
- Payout for half of the 2024 PSUs (subject to 2027 performance) in early 2028.
- Payout for half of the 2025 PSUs (subject to 2028 performance) in early 2029.
Key Dates
| Date | Description |
|---|---|
| March 13, 2012 | 2012 Stock Option & Restricted Stock Incentive Plan (2012 Plan) adopted. |
| September 28, 2017 | 2017 Equity Incentive Plan (2017 Plan) adopted. |
| November 2017 | R. Stanton Dodge joined DraftKings as Chief Legal Officer and Secretary. |
| November 2018 | Woodrow H. Levin founded Extend. |
| August 27, 2019 | DraftKings and other investors, including Accomplice Fund II, L.P., acquired equity interests of DKFS, LLC. |
| December 2019 | Paul Liberman appointed President, Global Technology and Product (until November 2025); Matthew Kalish appointed President, DraftKings North America. |
| December 22, 2019 | Business combination agreement dated. |
| April 7, 2020 | Business combination agreement amended. |
| April 2020 | Jason D. Robins became Chief Executive Officer and Chairman of the Board; Harry E. Sloan, Paul Liberman, Matthew Kalish, Woodrow H. Levin, Ryan R. Moore, Steven J. Murray, Marni M. Walden joined the Board. BDO USA, P.C. engaged as independent registered public accounting firm. |
| September 2020 | Jocelyn Moore and Valerie Mosley joined the Board. Erik Bradbury initially served as Chief Accounting Officer (until September 2023). |
| September 2020 | Jason D. Robins served on the board of directors of FirstMark Horizon Acquisition Corp. (until March 2022). |
| October 2020 | Jason D. Robins served as a director of Horizon Acquisition Corporation II (until April 2023). |
| July 20, 2021 | SBTech (Global) Limited 2011 Global Share Option Plan (Option Plan) expired. |
| August 5, 2021 | Amended executive employment agreement with R. Stanton Dodge. |
| October 2021 | Jocelyn Moore appointed to serve on the board of directors of the First Responder Network (FirstNet) Authority. |
| January 2022 | Harry E. Sloan and partners launched Screaming Eagle Acquisition Corp. (Mr. Sloan served as Chairman until May 2024). |
| March 13, 2022 | 2012 Plan expired. |
| March 2022 | Company began leasing an aircraft from an entity controlled by Mr. Robins. |
| May 2022 | Audit Committee charter most recently amended. |
| June 2022 | Jocelyn Moore served on the board of directors and audit committee of Games & Esports Experience Acquisition Corp. (until April 2023). Steven J. Murray joined the board of directors of Orchard Technologies, Inc. |
| November 2022 | PSUs granted to NEOs and certain top leaders of the Company pursuant to the 2022 Long-Term Equity Program. |
| October 31, 2023 | Company adopted a clawback policy. |
| December 9, 2023 | Accomplice Fund II, L.P. ceased to be an affiliate of Ryan Moore. |
| December 2023 | Steven J. Murray joined the board of directors of ZephyrAI, Inc. |
| March 17, 2024 | Executive employment agreement with Alan Ellingson. |
| May 2024 | Alan Ellingson appointed Chief Financial Officer. Harry E. Sloan's Screaming Eagle concluded its $4.6 billion business combination with Lions Gate Entertainment Corp. |
| August 2024 | Erik Bradbury rejoined DraftKings as Chief Accounting Officer. DraftKings committed to invest up to $21 million into DBDK Venture Fund II, L.P. |
| October 2024 | Harry E. Sloan and partners launched Bold Eagle Acquisition Corp. |
| November 14, 2024 | Matthew Kalish pledged 785,000 Class A Shares. |
| December 9, 2024 | R. Stanton Dodge pledged 500,000 Class A Shares. |
| February 10, 2025 | Final adjusted 2025 Annual Bonus Plan Payout Goals approved. |
| February 11, 2025 | Founders agreed to voluntary base salary reductions to $1. Erik Bradbury received an RSU grant. |
| March 14, 2025 | Jason D. Robins pledged 715,551 Class A Shares. |
| May 13, 2025 | Jason D. Robins pledged 306,997 Class A Shares. |
| June 13, 2025 | Marketing arrangement with Hardscope entered into. |
| July 1, 2025 | Gregory W. Wendt retired from the Capital Group Companies. |
| August 2025 | Compensation Committee re-evaluated the 2025 Peer Group. |
| November 6, 2025 | Matthew Kalish and the Company mutually agreed on his transition out of the President, DraftKings North America role, effective March 31, 2026. PSUs granted in November 2022 and February 2023 for 2026 performance were accelerated and vested at 200%. |
| November 2025 | Gregory W. Wendt joined the Board. Company adopted the Director Stock Deferral Plan. Paul Liberman appointed President, Operations. |
| November 24, 2025 | Matthew Kalish pledged 1,391,574 Class A Shares. |
| December 5, 2025 | Jason Robins made a bona fide gift of Class A Shares. |
| December 10, 2025 | Matthew Kalish's 2022 and 2023 PSUs accelerated and vested. |
| December 2025 | Launched DraftKings Predictions. |
| December 31, 2025 | Fiscal year end. Closing price of a Class A Share on NASDAQ was $34.46. |
| January 1, 2026 | All NEOs subject to the stock ownership policy met these requirements. |
| February 2026 | Board certified 100% achievement of 2025 Normalized Net Revenue performance goals for 2024 PSUs. |
| February 17, 2026 | Consulting Services Agreement with Hardscope entered into. |
| March 4, 2026 | Jason D. Robins pledged 2,131,004 Class A Shares. |
| March 6, 2026 | Jason D. Robins' pledged shares contract matures. |
| March 26, 2026 | Proxy Statement and proxy card made available to shareholders. |
| March 30, 2026 | Existing Aircraft Dry Lease scheduled to expire. |
| March 31, 2026 | Matthew Kalish's transition out of President, DraftKings North America role effective. |
| May 11, 2026 | Deadline for online, telephone, or mail votes for the Annual Meeting. |
| May 12, 2026 | 2026 Annual Meeting of Shareholders. |
| December 31, 2026 | Fiscal year end for which BDO USA, P.C. is proposed as independent registered public accounting firm. |
| November 26, 2026 | Deadline for shareholder proposals for the 2027 proxy statement under Rule 14a-8. |
| January 12, 2027 | Earliest date for advance notice shareholder proposals for the 2027 Annual Meeting (not for proxy statement inclusion). |
| February 11, 2027 | Latest date for advance notice shareholder proposals for the 2027 Annual Meeting (not for proxy statement inclusion). |
| March 13, 2027 | Deadline for universal proxy rule notice for the 2027 Annual Meeting. |
| March 31, 2027 | Matthew Kalish to receive continued security services and COBRA premiums until this date. |
Recommendation
holdDraftKings demonstrates strong revenue growth and market leadership in key segments, indicating a robust business model. However, the failure to meet internal financial targets for executive bonuses in 2025, despite overall revenue growth, suggests challenges in achieving profitability goals. The assured approval of all proposals due to the CEO's significant voting power reduces shareholder influence on governance matters. The executive transition of Matthew Kalish, while managed, adds a layer of uncertainty. Given these mixed signals, a 'hold' recommendation is appropriate, advising investors to monitor the company's progress on profitability targets and the impact of executive changes.
Keywords
DraftKings, DKNG, Proxy Statement, Annual Meeting, Executive Compensation, Corporate Governance, Financial Performance, Revenue Growth, Adjusted EBITDA, Online Gaming, Sports Betting, Online Casino, Daily Fantasy Sports, Prediction Markets, Board of Directors, Director Election, Auditor Ratification, Risk Management, Related Party Transactions, Stock Ownership Guidelines
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