Allwyn, one of the world's largest lottery operators and parent company of the U.S. fantasy sports platform PrizePicks, saw its shares slip Thursday despite a strong second-quarter earnings report.
Net revenue came in at 1.25 billion euros ($1.46 billion), up 27% year-over-year and in line with expectations of analysts surveyed by FactSet. Adjusted earnings per share were 24 euro cents (28 cents U.S.), just below analyst forecasts.
In a joint interview with Barron's, Chief Executive Officer Robert Chvátal and Chief Financial Officer Kenneth Morton sounded a bullish note on the company's future, noting strong growth in the European business despite the mature markets there and opportunities to differentiate themselves from other players in the U.S. sports betting space.
Even with its dominant position in European lottery and quarterly revenue on par with that of DraftKings, Allwyn is relatively unknown in the U.S. gambling space. The company became publicly traded this March through a reverse-merger with a publicly-listed subsidiary. It's listed on the Athens Stock Exchange (ATHEX: ALWN), though it has ambitions for a stateside listing.
Allwyn runs lotteries in Austria, Greece, Cyprus, and the Czech Republic; in the U.K., Allwyn runs the only international version of Powerball. It also operates the Illinois state lottery.
Many of those national lotteries are operated through a monopoly license, insulating Allwyn from competition. That protection, combined with a base of players who routinely buy tickets, makes lotteries among the most stable of gambling businesses.
"You never-if you're playing lottery for 15 years-want to miss the draw, because you're dreading that's the week when your numbers come up finally," says Morton. "In some of our markets the volatility is zero; extremely cash-flow generative; very, very profitable. Just from a financial perspective it's by far the best part of the gaming sector."
Allwyn is leaning on that solid base to make growth-minded moves, like its acquisition of PrizePicks in January.
PrizePicks is a popular daily fantasy sports app where users put money on multiple individual player statistics, like rushing yards or points, and win greater sums if all their picks are correct. Regulations around daily fantasy sports prevent operators from offering straightforward bets like whether a team will win a game.
But those bets are now possible on PrizePicks through its prediction market offering, launched in November 2025 through a partnership with Kalshi. The PrizePicks product is now a blended experience of fantasy sports and prediction markets.
The underlying asset on a prediction market is a financial contract, regulated at the federal level by the Commodity Futures Trading Commission. Contracts tied to whether a sports team wins a game are legal for anyone over the age of 18 and not subject to state gambling regulations or taxes-effectively making sports wagering possible in all 50 states, even those like Texas and California that haven't legalized traditional online sports betting.
Dozens of state attorneys general and local gambling regulators have sued prediction markets over the regulatory framework, which they say treads on states' rights to police and tax gambling within their borders. The lawsuits are working their way through the judicial system, with courts siding with states over prediction markets more often than not so far. The debate seems destined for the Supreme Court, where it's anyone's guess how the justices will rule.
"I don't know how it will evolve; my personal opinion is that it will have to be regulated because the individual states will lose a lot of money in their income if they just tolerate the prediction markets unregulated," Chvátal says. "But before that comes, we will combo and bundle a product of team picks and player picks and prediction markets together-because the consumer, they don't differentiate what is predictions. They just like sports."