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Daily fantasy sports operator Underdog reduced its workforce as part of a broader change in strategy. The company confirmed that 125 employees lost their jobs while leadership redirects attention toward prediction market style products across the United States.
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Underdog founder and chief executive Jeremy Levine confirmed the strategic shift in comments shared with Front Office Sports. Workforce reductions came shortly before the statement, with employees reportedly informed of the layoffs during an online company meeting held Friday.
Several departments saw staff reductions. Reports indicate cuts affected teams working in marketing, customer support, graphics, and fantasy draft operations covering both daily and season long contests. A large portion of the fraud department also lost positions.
Levine explained that the internal restructuring connects directly to the new direction of the business.
“We transitioned our business this year,” Levine said in a statement to FOS. “We went from a focus on a state-by-state framework to a national prediction markets platform with seamless offerings across the country. It’s simply a different operation, and the changes we made are a part of that transition.”
Underdog launched in 2020 and quickly expanded across the fantasy sports market. The company now operates fantasy contests in 40 U.S. states and previously experimented with traditional sports betting products as well.
A sportsbook opened in North Carolina in 2024, giving the company its first entry into regulated wagering. That effort proved short lived as leadership reconsidered the long term strategy.
The company began adjusting direction during the second half of 2025, placing more focus on prediction market style products rather than traditional sportsbook operations.
Shortly before sports betting launched in Missouri in December, Underdog informed regulators that the company would not participate in the new market.
Another step followed days later. The company shut down its North Carolina sportsbook on December 16, leaving daily fantasy sports as the primary product while the transition continued.
Prediction market style products now sit at the center of the Underdog platform. The company partnered with Crypto.com in September to allow fantasy users to include sports related event contracts inside contests.
Those contracts allow participants to trade outcomes tied to sports events in a format that resembles prediction markets rather than standard wagers.
Prediction markets operate under a different regulatory framework compared with traditional sports betting. Oversight typically falls under the Commodity Futures Trading Commission, which regulates event contract exchanges at the federal level.
Sports betting, by contrast, operates under state regulation. That difference allows prediction market products to reach states where sportsbooks remain unavailable.
Underdog currently offers sports event contracts in more than 30 U.S. states, including California, Texas, and Georgia. None of those states currently operate regulated sports betting markets despite large populations and strong demand for sports wagering.
Interest in prediction market platforms has grown across the fantasy sports sector. Rival operator PrizePicks also launched a prediction market style product through a partnership with federally regulated exchange Kalshi.
Competition between fantasy operators now increasingly centers on event contracts and prediction markets rather than traditional sportsbook products.