For DraftKings, the stakes have never been higher.

Its fourth-quarter earnings call today comes directly in the wake of a Super Bowl that saw prediction market platforms such as Kalshi and Polymarket eat into the sports-betting turf typically owned by traditional sportsbooks. The shift was hardly unpredictable. In December, DraftKings launched a predictions market platform of its own, turning the insurgent disruptors into direct competitors and setting up 2026 as possibly the most important year ever for the company. To put it in the parlance of your average Joe Sixpack, DraftKings is officially hedging its bets.

Picking Horses

While the final tally isn’t quite ready yet, the American Gaming Association (AGA) estimated ahead of the Super Bowl that Americans would place a record $1.76 billion worth of wagers on the game with traditional sportsbooks, both in-person and digitally. That’s nice, but hardly dwarfs the action that occurred on prediction markets. Kalshi alone booked about $1 billion in Super Bowl-related bets. Conversely, sports books in Nevada booked just under $134 million in Super Bowl bets, marking a 10-year low according to the state’s gaming regulator body.

The profound rise of prediction markets has not gone unnoticed on Wall Street; shares of DraftKings and rival FanDuel-owner Flutter Entertainment have plummeted around 40% and 45% in the past twelve months, respectively. Where traditional sportsbooks serve as “the house” taking bets with each individual player, prediction markets simply take fees while serving as peer-to-peer platforms (a distinction that places them under the regulatory umbrella of the presently-friendly Commodity Futures Trading Commission rather than state gambling commissions). “Our experts say the model is lower risk and potentially less volatile,” Alex Smith, consumer analyst at investment research firm Third Bridge, told The Daily Upside.

Of course, the rise hasn’t gone unnoticed by traditional gaming players either — and they’re betting they can stop prediction markets in their tracks:

• Last month, the AGA sent a letter to Congress urging a ban on sports contracts on prediction markets, and has claimed that states have lost some $400 million in tax revenue as bets divert from sportsbooks to prediction markets. Nevada’s gambling commission, meanwhile, recently won a lawsuit against Kalshi, blocking it from taking sports bets in the state (Kalshi is appealing); similar cases are playing out in Massachusetts and Ohio.
• If successful, the AGA would effectively kneecap prediction markets (note: DraftKings recently left the AGA). According to Kalshi data seen by the Financial Times, roughly 90% of all trading volume on the platform is on sports outcomes.

Risky Business: Smith called DraftKing’s prediction market foray both “a defensive and offensive strategy.” Most experts see traditional sportsbooks as having two distinct advantages over their new rivals: parlays and power users. Parlays are the betting style that allows gamers to score big by predicating multiple bets upon another, a risky wager that’s proven massively profitable for sportsbooks and structurally difficult for peer-to-peer platforms. Power users would be, say, your Cousin Billy, who may or may not have a gambling problem.

The latest jobs report from the Bureau of Labor Statistics swung in like a spider web: at once stronger than steel and softer than silk.

The strength was on display in January, when a reported 130,000 jobs were added to the US economy, more than double the Wall Street consensus estimate of 55,000. This resilience helped lower the unemployment rate by a tenth of a percentage point to 4.3%. But revisions to 2025 data showed the labor market has a soft side, too: the BLS now says the economy added a mere 181,000 jobs last year, way down from the previously estimated 584,000 and amounting to one of the worst non-recession years for job creation on record.

Jitters are for Quitters

In terms of challenges, the song remains the same. The number of jobs available, which hit a five-year low in December, is well below the number of people looking for work. Employers remain skittish about the economy, with AI and geopolitics top of mind, and more than half don’t plan to hire this quarter. The so-called “no-hire, no-fire” approach has taken hold. What job gains are being made are heavily concentrated in healthcare and social assistance, which added 125,000 jobs last month, accounting for the lion’s share of new gigs.

As a result, wages have begun to soften, given the balance of labor demand has tipped in favor of employers. Layoffs in January — up 118% year over year and more than 108,000 — were the most to kick off a year since 2009, according to a Challenger, Gray and Christmas report. It’s a pain if you’re circulating your resume, but analysts said the show of resilience amid tightening could be good for investors:

• “If the recent jitters in the stock market are due to concerns of a weakening labor market and/or economy that is headed toward a recession, this report should alleviate those concerns in the short run,” said Northlight Asset Management chief investment officer Chris Zaccarelli.
• He added: “Until we see significant weakness in the labor market, the economy or corporate profits, we believe this is still a market where dips can be bought.”

The Rate Cut Wait: As for Federal Reserve policymakers, they have wiggle room. “The addition of 130,000 jobs shows the labor market is stabilizing, yet the downward revisions to 2025 confirm growth slowed meaningfully last year,” said Bolvin Wealth Management president Gina Bolvin. “With unemployment still elevated, the Fed has room to stay patient and keep rate cuts on the table.” President Trump, in a social media post, touted January’s “GREAT JOBS NUMBERS,” but given his strong preference that the Fed take a pair of scissors to its benchmark rate he may not be pleased with the consequences: the report “pours cold water on the idea the Fed could cut rates again before mid-year,” said Evercore ISI analysts.

In the battle for the toy chest, “all ages” means different things to the world’s two biggest toy companies.

Shares of Barbie-maker Mattel plunged 25% on Wednesday following a massively disappointing after-the-bell earnings call the day before that showed slow holiday toy sales. Rival Hasbro, on the other hand, saw shares climb to a six-year high following its own earnings call highlighted by robust sales for Magic: The Gathering, its more adult-oriented card-game-turned-ultra-popular-video-game.

Toy Story

Winning over adults as much as kids has been a sound strategy for toy companies for a while now, much to the chagrin of anyone worried about widespread arrested development. Lego for instance has rebuilt its business, tiny plastic brick by brick, into a formidable machine by increasingly catering to adult customers.

Hasbro has successfully chased the older crowd straight into the digital realm, a strategy that Mattel is belatedly copying:

• In its earnings call, Hasbro reported full-year revenue growth of 14%, driven by 45% revenue growth in its Wizards of the Coast and Digital Gaming segment, which includes Magic: The Gathering and Dungeons & Dragons. Sales of the former game leapt nearly 60% year-over-year in 2025; sales of consumer products (i.e., actual toys) fell 4%.
• On top of a revenue miss, Mattel announced a lower-than-expected guidance for 2026, due in part to the cost of a $159 million strategic investment to take full control of Mattel163, the mobile game studio it operated as a joint venture with NetEase.

“We think the investment in digital games should pay off longer-term, but adds more questions in the near-term as we thought the setup for 2026 would be more focused on growth in toys from normalized order patterns,” D.A. Davidson analyst Keegan Cox wrote in a note.

It’s Showtime: While Mattel is just starting to catch up to Hasbro’s video game ambitions, both companies remain steadfastly committed to Hollywood. Hasbro, which has spent most of the century milking its Transformers franchise, is gearing up for a Voltron movie to be released by Amazon MGM Studios later this year. Meanwhile Mattel, still riding the high from its 2023 “Barbie” blockbuster, is releasing a Masters of the Universe movie with Amazon MGM in June, followed by a Matchbox flick starring John Cena to be released on Apple TV in October. Next up? A Barney movie produced by every Film Bro’s favorite studio, A24. Seriously.