The outlook for iGaming legislation in 2025 appears limited, according to Deutsche Bank analyst Carlo Santarelli in his recent DraftKings (NASDAQ: DKNG) report. Despite the potential for expansion, significant hurdles remain for online casino gaming across U.S. states.

Currently, only seven states permit online casinos: Connecticut, Delaware, Michigan, New Jersey, Pennsylvania, Rhode Island, and West Virginia. While six states might consider iGaming legislation in 2025 - New York, Ohio, Illinois, Indiana, Maine, and Maryland - only Ohio and Maryland show promising prospects for approval.

New York and Illinois, despite being the largest potential markets among considering states, face the lowest probability of success. Wyoming, which recently filed iGaming legislation, would have minimal impact on the industry due to its small population.

For DraftKings, meeting 2025 earnings and revenue targets becomes crucial given the limited legislative expansion opportunities. The company's ability to achieve its $1.4 billion adjusted EBITDA target for 2026 could face scrutiny, particularly considering current market valuations.

Sports betting faces its own challenges. Texas represents a critical opportunity, but failure to approve wagering in 2025 could delay implementation until 2027. California and Florida present additional complications, requiring potentially unfavorable partnerships with tribal gaming entities.

DraftKings may turn to acquisitions to drive growth, leveraging its strong cash position and low debt. The company has already demonstrated this strategy through recent acquisitions of Simplebet Inc. and Jackpocket, suggesting further M&A activity could be likely if organic growth targets become challenging to achieve.

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