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Underdog has moved forward with a significant round of layoffs only months after closing its limited online sports betting operations to concentrate on prediction markets.
The New York‑based company, which employs just over 500 people, reduced its workforce by more than 20% in recent days. Reports from Front Office Sports indicate that as many as 125 employees were let go, marking one of the largest staff cuts in the firm’s history.
The layoffs affected multiple divisions, including compliance, product development, human resources, payments, and fraud. More than half of the fraud department was eliminated, showing the scale of restructuring across the business.
Speaking on the layoffs, Underdog CEO and founder Jeremy Levine stated, “We transitioned our business this year. 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. We take pride in hiring people who are passionate, good human beings and who really care about their work, so if you’re hiring and come across an ex-Underdog person you’d be lucky to have them and call me for a reference.”
A focus on prediction markets
Underdog’s recent layoffs are tied directly to its decision to leave sports betting behind and commit fully to prediction markets. The company had briefly entered North Carolina’s online betting scene after securing a license there, but that was the only state where it operated.
Plans to expand into Missouri were dropped before the market opened in late 2025, and by December of that year, Underdog shut down its betting business altogether.
The pivot began with a partnership with Crypto.com, which allowed Underdog to introduce event contracts on its own platform. That move made it the first gaming operator to offer such products directly.
It stepped up a notch in January when an affiliate entity received approval from the National Futures Association to register as both a futures commission merchant and a swap firm. This step is crucial, as it positions Underdog to launch a full prediction market platform backed by the Commodity Futures Trading Commission.
FanDuel Predicts, PrizePicks, and Robinhood have also registered as FCMs, while platforms such as Kalshi, Polymarket, CME Group, and Crypto.com operate as designated contract markets.
Major layoffs continue to sweep the gaming industry
Underdog’s workforce reduction comes at a time when other major operators are also trimming staff. DraftKings recently announced its own restructuring plan, aimed at lowering general and administrative costs.
According to Citizens Capital Markets and Advisory Managing Director Jordan Bender, the move could cut about 5% of DraftKings’ global workforce of roughly 5,500 employees, translating into annual savings of around $30 million.
While DraftKings has not yet specified which roles will be affected, the company has a history of similar moves. In 2023, it reduced its headcount by 3.5%, letting go of around 140 employees, most of them in regions outside North America, such as Europe.
Source: SBC Americas
