Underdog has delivered a sharp rise in quarterly revenue ahead of its planned acquisition by IG Group, contrasting with weaker trading results at the London-listed financial technology company.
The US daily fantasy sports and prediction markets operator generated approximately $105 million in net revenue during the third quarter of 2026, representing growth of more than 100% compared with the same period last year. The performance comes ahead of the fourth quarter, traditionally Underdog’s strongest part of the year and responsible for more than one-third of its 2025 revenue.
IG Group agreed in July to acquire Underdog Sports Holdings for total consideration of up to approximately $1.3 billion. The transaction remains subject to regulatory approvals, with completion expected after those conditions are satisfied.
Underdog’s rapid growth provided a positive element in an otherwise weaker Q3 update from IG. The group expects revenue of approximately £240 million for the three months ended 30 September, around 14% below the £280 million recorded in the comparable period.
IG attributed the decline partly to weaker revenue retention from its over-the-counter derivatives business. Retention fell to around 70%, compared with a longer-term average of roughly 80%, despite an increase in customer trading activity.
The weaker quarter prompted IG to reduce its 2026 revenue outlook. The company now expects mid-single-digit percentage growth for the year, down from its previous forecast of 10% to 15%. The update triggered a steep fall in IG shares, with the stock losing more than 20% during trading on 2 October.
The contrasting performances place greater attention on Underdog’s role in IG’s expansion strategy. The US operator has been developing both daily fantasy sports and prediction markets, although regulatory disputes have complicated its operations in several states.
Underdog has withdrawn its fantasy sports products from a number of jurisdictions where regulators have objected to companies offering state-regulated DFS alongside federally regulated event contracts. It has also challenged enforcement measures in court as the legal status of prediction markets continues to be disputed across the US.
IG is expected to provide investors with more detail on the business on 8 October, when Underdog co-founder and CEO Jeremy Levine will join IG CEO Breon Corcoran and CFO Clifford Abrahams for a dedicated investor seminar covering Underdog’s products, operations and strategy.
The company is also scheduled to hold a broader strategy update on 22 October, when management is expected to outline its plans for the enlarged group and its capital allocation framework.