BetMGM trims outlook as prediction markets bite
- BetMGM posted Q1 2026 net revenue of $696m, a 6% year-on-year increase, missing analyst expectations.
- The operator cut its full-year 2026 revenue guidance to $2.9bn–$3.1bn, down from $3.1bn–$3.2bn previously.
- CEO Adam Greenblatt said competitors calling themselves prediction markets are driving up its customer acquisition costs.
BetMGM has reported a softer-than-expected start to 2026, posting $696m in Q1 net revenue and cutting its full-year revenue guidance, as the operator pointed to rising customer acquisition costs driven by competitors it characterises as disguised sportsbooks.
Q1 figures fall short
The operator’s Q1 result represented a 6% year-on-year increase but fell short of analyst expectations.
Citizens JMP Securities analyst Jordan Bender estimated consensus at $767m, putting the miss at roughly 9%, though the official BetMGM release did not reference a consensus figure. Adjusted EBITDA for the quarter came in at $25m, an 11% improvement on the same period in 2025.
iGaming net revenue of $481m was up 9% year-on-year, providing the stronger performance across BetMGM’s two main verticals. Online sports betting revenue of $203m reflected a 4% increase, weighed down by what the company described as player-friendly sporting outcomes during the quarter.
Gary Deutsch, CFO at BetMGM, said:
“Bad results for the house.”
That was Deutsch’s summary of the sports performance on the company’s 14 April earnings call, adding that the impact was “sort of evenly distributed” between Q1 and the remainder of the year.
For the full year, BetMGM now expects net revenue of $2.9bn–$3.1bn, down from its prior range of $3.1bn–$3.2bn. The company maintained its adjusted EBITDA guidance of $300m–$350m, now expected towards the lower end of that range, and reiterated a path to $500m in adjusted EBITDA by 2027.
Prediction markets in the crosshairs
CEO Adam Greenblatt used the earnings call to make a direct attack on prediction market platforms, arguing they are materially raising BetMGM’s own cost of acquiring new players.
Greenblatt, Chief Executive Officer at BetMGM, said:
“This jump is largely driven by new sports betting companies buying media in the category. They call themselves prediction markets. They are buying sports betting keywords as well as throwing money at any sports media property that will take it. They are targeting sports bettors directly in their marketing, thereby bidding up the cost of acquiring new players. Some of these companies even have ‘sportsbook mode’ in their product in an attempt to offer as close an experience as possible to sports betting.”
He described that spending pattern as “irrational” and unsustainable, adding:
“We’re assuming the current CPA environment prevails for the rest of the year, and our plan for the rest of the year and our guidance for the rest of the year takes that into account. So I’m not assuming that what we believe to be irrational current spend suddenly becomes rational. I’m expecting that the land grab that is currently the reality continues, and we are positioning ourselves for when that position changes.”
Greenblatt also said BetMGM was “better-insulated than most from the ever-increasing noise of prediction markets,” pointing to the operator’s iGaming strength and premium sports player base as buffers.
Legal and market outlook
The remarks come as the legal contest over prediction market regulation intensifies across the US.
A federal appeals court recently backed Kalshi on the question of CFTC jurisdiction over sports event contracts in New Jersey, though the broader regulatory outcome remains legally unsettled. Greenblatt said he expects the matter to ultimately reach the Supreme Court.
The competitive scale is sharpening. One estimate, based on applying Kalshi’s published fee formula to inferred Q1 trading volume, put the platform’s sports contract fees at approximately $304.9m for the quarter, compared to BetMGM’s reported $203m in online sports revenue for the same period.
That figure is derived, not directly reported by Kalshi, but it points to the growing commercial footprint of prediction market operators in territory BetMGM views as its own.
BetMGM plans to cut marketing in broader sports-betting-only states and reallocate spend toward iGaming, multi-product states, and its Nevada omnichannel operation.
The Alberta regulated iGaming market, confirmed by the provincial government to open on 13 July, represents another near-term growth lever for the operator, which is among the brands expected to enter the province at launch.
BetMGM’s Q1 update frames prediction markets as a live commercial force reshaping customer acquisition economics in regulated US sports betting. Whether the current spending wave proves as unsustainable as Greenblatt believes, and how quickly rivals recalibrate, will be among the defining questions for the remainder of 2026.
Keep reading
Do you have a story worth sharing?
Send it over to our editors!
