PENN Entertainment, Inc. Stock Price: Quote, Forecast, Splits & News (PENN)

PENN

PENN Entertainment, Inc.

PENN

Overview

Financials

Historical Data

$17.07

-$0.22

1.24%

Jun 20, 1:00:58 PM EDT

Change

-$0.24

1.39%

Financial Profile

Prev Close

$17.28

Market Cap

$2.57B

Day Range

$17.02 - $17.58

Open

$17.50

P/E Ratio

-28.0

52W Range

$13.25 - $23.08

24H Volume

$56.27M

Dividend Yield

0.00%

EPS

-0.61

Key Issues

Latest Price Movement

Jun 20

Recent Transcripts

Penn Entertainment showed resilience in Q1 despite weather headwinds, maintaining guidance and growth projects.

Penn Entertainment guides strong 2025 growth, digital breakeven, and $350M share buyback.

Feb 27

Q4 2024

Retail Revenue

$1.4B Q4, $5.6–$5.75B FY25

Digital EBITDA

+$350M YoY improvement

Financial information provided by Financial Modeling Prep. Options data provided by Unusual Whales. Live transcripts provided by Quartr. Reported revenue and EPS data from Earnings powered by FinChat.io. All data is provided for informational purposes only, and is not intended for trading purposes or financial, investment, tax, legal, accounting or other advice.

Market Cap: $2.6B
IPO Date: 5/26/94
CEO: Mr. Jay A. Snowden
Fulltime Employees: 23K
Sector: Consumer Cyclical
Industry: Gambling, Resorts & Casinos
Country: US
Exchange: NASDAQ Global Select

Peers

$0.00

Watchlist

$0.00

PENN Entertainment, Inc. Stock Price: Quote, Forecast, Splits & News (PENN)

Perplexity Finance

PENN

PENN Entertainment, Inc.

PENN

Overview

Financials

Historical Data

$17.07

-$0.22

1.24%

Jun 20, 1:00:58 PM EDT

Change

-$0.24

1.39%

Financial Profile

Prev Close

$17.28

Market Cap

$2.57B

Day Range

$17.02 - $17.58

Open

$17.50

P/E Ratio

-28.0

52W Range

$13.25 - $23.08

24H Volume

$56.27M

Dividend Yield

0.00%

EPS

-0.61

Key Issues

Latest Price Movement

Jun 20

Earnings

Report Date

May 8, 2025

Reported Revenue

1.7B

Miss -3.58%

Avg 1d Change

4.09%

Report Period

Q1 2025

Reported EPS

-0.25

Beat +13.79%

Implied Move 1d

7.37%

Transcript

12m 14s

Thanks, Emma. Good morning, everyone, and thank you for joining Penn Entertainment's twenty twenty five First Quarter Conference Call. We'll get to management's presentation and comments momentarily as well as your question and answer. During the Q and A session, we ask that everyone please limit themselves to one question and one follow-up. I'll quickly review the Safe Harbor, and then we'll quickly get right into the call. Please note that today's discussion contains forward looking statements. Forward looking statements involve risks, assumptions and uncertainties that could cause actual results to differ materially. For more information, please see our press release for details on specific risk factors. It's now my pleasure to turn the call over to the company's CEO, Jay Snowden. Jay, please go ahead. Thanks, Joe. Good morning, everyone. I'm joined here in Wyoming by our CFO, Felicia Hendrix.

13m

Our Head of Operations, Todd George and our CTO and Head of Interactive, Aaron LeBerge, as well as other members of our senior executive team. As you see in our earnings release and accompanying investor presentation, Penn Properties demonstrated strong resilience in the first quarter following severe weather challenges. While January weather was slightly better year over year, it was still much worse than anticipated. Anticipated. And the weather impacted days in February across the portfolio were up over three times versus last year. Which ultimately impacted our adjusted retail EBITDAR by at least $10,000,000 in the quarter. Also worth noting, we had a $5,000,000 one time accounting benefit in the South Region in Q1 last year that impacts year over year results. Importantly, we saw gaming revenue gaming volumes rebound in March as the weather improved, and that trend continued through April and into May. Worth also noting, this past weekend was the second best weekend of the year for revenue, and number three in terms of overall visitation across the portfolio. You'll hear more about our second quarter trends from Todd in a moment. The capital investments we have been making at our properties over the last several years including our new ESPN Bet retail sports books, combined with continued cross sell from our industry leading customer loyalty program, have been contributing to our performance and the strong engagement this quarter with our VIP and Midworth customer segments.

14m 27s

As highlighted on slide seven, during the quarter, we announced plans for a new land based Hollywood Casino in Council Bluffs, Iowa, to replace our existing three level aging riverboat. The new state of the art facility will nicely complement the existing 160 room hotel, we believe it will significantly improve the customer experience and enhance the property's competitive position in the greater Omaha, Nebraska market. Construction is expected to take approximately eighteen to twenty four months following the design and permitting approval process. Meanwhile, our four previously announced exciting development projects remain both on budget and on schedule. Before turning to our interactive results, I'd like to ask Todd to share a few comments. On the second quarter trends as well as the competitive landscape.

15m 14s

Thanks, Jay. As highlighted on Slide six in our investor presentation, our retail business in April was stable with revenue growth of 2% year over year across all properties and 4% across all properties excluding those impacted by new supply. We're mindful of the uncertain economic environment that our customers are facing, but are encouraged by the trends we have seen, including our rate of play being up in the quarter and continuing into April and now May. Whereas Jay mentioned, we just had one of our top weekends. Unrated play saw a slight decrease in q one compared to prior year, but returned to almost flat in April when compared to prior year. The Q1 and Q2 results to date have been driven by increases in our core segments, through increased spend per visit and our BAI VIP segments, driven by increased visitation and spend per visit. Our database continues to grow to over 32,000,000 members through a combination of online and core operations, all fueling our omnichannel strategy. Our property teams have done a tremendous job navigating the competitive landscape while also picking up market share in 14 of our 17 markets not impacted by meaningful new supply year over year in Q1.

16m 29s

As Jay mentioned, over the last several years, we've made strategic investments in our properties. Enhancing the entertainment and hospitality amenities, improving the guest experience through technology that removes friction and costs, and continuing to focus on our gaming offerings. We remain committed to providing highly competitive gaming offerings in each of our markets. Including new and expanded high lumen areas, Asian themed rooms and the latest and most popular games. This constant focus on improving the guest experience is done with an eye towards efficiency as we continue to deliver highest tax adjusted retail gaming margins among our regional peers. As we think about our margins, we're laser focused on generating returns on all of our spend, particularly in light of headlines around the impact of tariffs. To date, we have not seen a material impact on the cost side. Notwithstanding this, we have a tremendous procurement team that is helping us navigate pricing and supplier options as well as excellent marketers and F and B operators who are adjusting promotions and F and B offerings to mitigate cost increases. Looking ahead, following the opening of new competition this February, in Bossier, Shreveport, we can now focus our attention on our four growth projects opening over the next twelve months which we could not be more excited about.

17m 51s

Back to you, Jay.

17m 52s

All right. Thanks, Todd. As you'll see on slide nine, are reaping the benefits of our omnichannel strategy. As our pre existing customers in Pennsylvania and Michigan who engaged with our standalone Hollywood iCasino app are increasing their spend across both retail and online channels. In Pennsylvania, for example, in q one, we saw year over year increases of 21% in retail theoretical play and 165% in online theoretical play with the same cohort. Similarly, in Michigan in Q1, we saw year over year increases of 27% in retail theoretical play and 242% in online theoretical play. During the quarter, our Interactive segment had a negative $10,000,000 EBITDA impact from the well publicized customer friendly sports betting outcomes in the quarter during March Madness. Despite this, we generated record gaming revenue and significant year over year improvements in both adjusted revenue and adjusted EBITDA highlighting the improved flow through we are seeing in our business. ESPN Bet and the Score Bet continue to drive strong top of funnel performance, including successful cross sell into our iCasino business, which achieved record NGR and average MAUs in Q1. As highlighted on Slide 13, this momentum is bolstered by the compelling early results of our standalone iCasino app in Pennsylvania and Michigan, and which recently expanded into New Jersey and Ontario.

19m 21s

We're also encouraged to see that 70% of our standalone iCasino theoretical revenue is coming from incremental sources. Including newly acquired customers, digitally re activated players, and players who were previously retail only customers. This stat, along with the omnichannel results we highlighted earlier, suggests that we are seeing minimal cannibalization from our standalone iCasino offering on retail play and on our integrated iCasino in the ESPN Bet and the Score Bet apps. Our standalone iCasino app has also seen 134 basis points higher hold rate versus the integrated iCasino offerings driven by higher slot mix. Turning to slide 14, recently introduced several OSB product enhancements. Including new features leveraging account linking, such as adding ESPN favorites to the app homepage, and creating our new Mint Club rewards program. This program offers players who have linked to their accounts access to special weekly giveaways, including boosts and deposit bonuses, as well as access to free ESPN Bet merchandise. We have plans for even greater benefits for linked customers later this year particularly around fantasy football. Aaron and his team have done a tremendous job building upon our strong technology foundation will be further enhanced by the recent addition of Billy Turgeon, as our new Chief Product Officer.

20m 45s

Billy brings a wealth of experience to PENN, having most recently served as SVP of Product at FanDuel. He will lead the product teams overseeing our digital sports betting, sports media, and iCasino gaming experiences. And with that, I'll turn it over to Felicia.

21m

Thanks, Jay. For the first quarter, we reported retail revenue of $1,400,000,000 and adjusted EBITDAR of $457,000,000 and adjusted EBITDAR margins of 33.1%. As Jay mentioned, our Retail segment showed strong resilience during the quarter despite the impact of new supply in key markets and some severe weather challenges, which impacted adjusted retail EBITDAR by at least $10,000,000 As the weather subsided, retail performance returned to business as usual and that momentum continued into April and May. We are mindful, however, that the consumer and many of our suppliers are facing uncertainty. We have operated in uncertain times before and have experience with mitigating both slowing volumes and cost pressures if we are to face those consumer dynamics again. As we've highlighted in the past, we estimate that approximately 45% revenue declines can be offset through cost reductions, inclusive of being flexible with labor and marketing. Regarding costs, Todd highlighted that our tremendous procurement team is working hard to insulate us from tariff related cost pressures on the COGS side of our business, This is the same team that has saved us tens of millions of dollars in COGS over the past several years despite a sharp increase in inflation due in part to the advantages of our scale.

22m 28s

Moving to interactive. We reported first quarter adjusted revenues excluding the skin tax gross up of $162,000,000 and Interact adjusted EBITDA of a loss of $89,000,000 which is a $107,000,000 improvement year over year. Customer friendly sports betting outcomes impacted interactive EBIT Interactive adjusted revenue by $15,000,000 and adjusted EBITDA by $10,000,000 Corporate expense was higher than expected in quarter given legal and advisory related costs of $7,700,000 We will likely incur incremental legal and advisory costs in the second quarter However, it is difficult to project these nonrecurring expenses at this time. In the quarter, we reported a $2,000,000 pretax gain on a financing arrangement that we entered into in February 2021 with a third party, which provided the company with upfront cash proceeds while permitting us to participate in future proceeds on certain claims. This arrangement, which was booked as debt on our balance sheet, was resolved and resulted in the gain, which includes cash received in 2021 of $72,500,000 and non cash interest accreted since that time of $143,000,000 The table on page eight of our earnings release summarizes our cash expenditures in the quarter, including cash payments to our REIT landlords cash taxes, cash interest and total CapEx.

24m 1s

Of our total $125,000,000 of CapEx in the quarter, dollars 96,000,000 was project CapEx related to our four development projects. We ended the first quarter with total liquidity of $1,500,000,000 inclusive of $592,000,000 in cash and cash equivalents. We delevered in the quarter and expect to continue our deleveraging in 2025 and beyond. Year to date, have repurchased $35,000,000 of shares at an average price of $16.83 As we delever throughout the year, you should expect to see the magnitude of our share repurchases increase, particularly in the back half of this year. You should also expect us to consider combining opportunistic repurchase activity with the programmatic approach to seek to take advantage of market volatility and what we view to be a severely dislocated stock price. Our 2025 retail guidance is unchanged from the ranges and drivers we provided on our fourth quarter earnings call. For Interactive, our 2025 revenue and EBITDA ranges are also unchanged other than the flow through of the customer friendly sports betting outcomes of $15,000,000 to revenues and $10,000,000 to EBITDA. We continue to forecast a skin tax gross up of $520,000,000 for the year. For the second quarter, our interactive revenue guidance range is $280,000,000 to $320,000,000 including a $116,000,000 skin tax gross up our EBITDA guidance range is a loss of $70,000,000 to a loss of $50,000,000 Our second quarter Interactive EBITDA guidance represents a year over year improvement of roughly $43,000,000 at the midpoint midpoint.

25m 54s

As our second quarter interactive guidance demonstrates, we continue to expect each quarter of the year to generate lower interactive EBITDA losses sequentially, culminating in positive EBITDA in the fourth quarter. And we reiterate our outlook for generating positive interactive EBITDA in 2026. Last quarter, we provided you with other segment EBITDA guidance of $121,000,000 which includes corporate expense. Given the current uncertainty regarding our non legal and advisory fees, we are not updating guidance for this segment at this time. As Jay mentioned, our four growth projects are on time and on budget. We continue to forecast total company CapEx for 2025 of $730,000,000 and reiterate our full year project CapEx forecast of $490,000,000 We do not expect to experience any noteworthy tariff related CapEx increases on the four growth projects as they are near completion. With the Joliet opening around the corner, we continue to evaluate drawing on GLPI's balance sheet as a financing for the project. As a reminder, GLPI has committed up to $130,000,000 of Joliet's total $180,000,000 CapEx at a cap rate that is a spread to GLPI's cost of capital at this time. Jay also mentioned our exciting plans for the new Hollywood Casino in Council Bluff Iowa.

27m 21s

The estimated project budget is approximately 180,000,000 to $200,000,000 and GLPI has agreed to provide funding of up to $150,000,000 at cap rate of 7.1%, which may be at PENN's option as either rent or a five year term loan. Given the potential for construction costs to rise to due to increased tariffs, particularly on steel, we are currently evaluating opportunities to lock in costs now and exploring other ways to minimize our exposure to potential cost increases. For 2025, net cash interest expense we continue to forecast $150,000,000 Net cash taxes, are expected to be roughly $70,000,000 That's $70,000,000 We continue to expect to be free cash flow positive in 2025 and beyond, and our basic share count at the end of the quarter was 151,000,000 shares. And as I always mentioned, we typically have 15,000,000 of dilutive shares annually, inclusive of the 14,000,000 share dilution from the converts. And I'll turn it back to Jay.

28m 30s

All right. Thanks, Felicia. In closing, I want to reiterate that our core retail business remains strong and is growing. We have four exciting retail development projects under construction, all being delivered on or ahead of schedule and on budget. Along with our planned land side relocation of Ameristar Council Bluff, these projects will collectively enhance our portfolio, grow our free cash flow profile, and serve as a catalyst for PENN's retail segment. Despite the current market concerns around consumer discretionary behavior, our core business is trending in the right direction. Solid employment numbers and low gas prices always bode well for regional gaming as you know. Meanwhile, our digital business is continuing to evolve supported by our well known brands differentiated IP a fully owned technology stack and newly recruited industry leading talent. We are nearing an inflection point and we anticipate each quarter of '25 to deliver a lower loss sequentially throughout the year and our Interactive division to be profitable in the fourth quarter of twenty twenty five, and the full year of 2026 and beyond. We have strong conviction in our ability to deliver profitability in 2026 and beyond in this segment. As mentioned on our last earnings call and in our shareholder letter in this year's proxy, we have fully committed partners in ESPN are continuing to work with us to deepen the integration of ESPN Bet into ESPN's overall ecosystem.

29m 51s

We have continued momentum in our iCasino business And importantly, we maintain strategic optionality and control over our future we head into 2026. Our focus for the balance of this year remains on operational execution, order to transform our strategic investments into consistent long term results and value for our shareholders. As we also stated in our recent letter to shareholders, we are confident that PENN's best days are ahead and we are moving with speed, discipline and determination to realize the full potential of this company for all of our shareholders. And with that, we can please open the line for our first question, Emma.

30m 40s

Take our first question from Brandt Montour with Barclays. Please go ahead.

30m 44s

Good morning, everybody. Thanks for taking my questions. So first off, maybe just starting with digital, the outlook for that segment doesn't seem like it's changed all that much. But you had some serious emphasis on iGaming in the deck and market share for the OSD side. It's been trending a little bit below, I believe, plan. So when you think about those different pieces, how would you describe what's changed under the surface for the rest of the year within digital within your guidance?

31m 18s

Yes. Brian, I would say that generally, our assumptions that we put out last quarter for the year haven't changed. If OSB comes in a little light of the share projection and online casino comes in a little bit ahead, we think that's those offsets are fine if that does happen. We're optimistic that we're going to continue to grow share in both online sports betting and online gaming. Between now and the end of the year, one may out the other and that would be perfectly fine with us long as we have momentum in both aspects of the business, then we feel comfortable with the guide that we put out for the full Okay. Thanks for that, Jay. And then just a follow-up on iGaming. I know it's early. Clearly, seems like a you're pretty happy with the launch so far. How far away is that segment from being contribution positive? And And maybe qualify the answer with how much you're currently spending in your OSB promo budget to drive the cross sell that's driving that momentum in iGaming today?

32m 30s

Yes. I'll attempt to answer it. Aaron, others can jump in here. I would say that we are pleased so far with the launch of our standalone Hollywood iCasino apps particularly in Pennsylvania and Michigan, where we have land based properties with the same same brand name. We have healthy retail businesses there. As I mentioned at the beginning, these standalone iCasino apps have been really good for us in that they're 70% incremental So very little cannibalization from the Hollywood offering that was within the ESPN Vet app. And you should expect as you would hear from not just us, but our competitors that our margin profile within iCasino is obviously stronger than it is within online sports betting. And the promotional spend within sports betting just by nature of the business and the competitive side of it is higher than it is within iCasino as well. So that dynamic, I think, will continue. I would expect that the iCasino momentum will you'll see more of that in the quarters ahead. We have I think, some really good plans to continue to cross sell I would say we're pleased with cross sell, but there's still a lot of opportunity there.

33m 42s

If you compare the online sports betting audience within our ecosystem and how much is cross sold into iGaming compared to others in the space, there's still opportunities for us to be more effective in that area. So I think overall at a high level, that's where we're at. I think you should expect us to share more detail in terms of contribution margin profit within these segments in future quarters. We haven't really offered that previously. But we're happy with the progress so far. Yes. I'll just reinforce cross sell is continuing to ramp up. Just last week, we saw all time highs in our average weekly DAUs. Across LA casino. And in terms of the promotional dollars, we're seeing really effective promotion from our land based databases to drive people into iCasino. Which has been very nice to see. And obviously, we will then moderate that with strategic reallocation from OSB into iCasino in states where we think it matters. So we're really happy with the trajectory so far.

34m 43s

Yeah, would just add to what Jay and Aaron shared. You know, really tremendous progress where we've got our VIP team, whether you're working at a property or online. So they're they're driving people regardless of if they drive them to a property or online. That's been, really well executed. And then [indiscernible] you know, the key, it's not really the promotional dollars as Jay mentioned, it's that rebranding to Hollywood. So it's just ease of finding that online product. So it's going from Hollywood to Hollywood. That's been a help.

35m 18s

Excellent. Thanks, everybody.

35m 22s

We'll take our next question from Carlos Antalya of Deutsche Bank.

35m 27s

Hey guys, thanks.

35m 29s

So Jay, Todd, don't know whoever wants to take this one. If you think about normal cadence over the course of a year of seasonality, we come to a couple of conclusions. But I think important in kind of understanding yours is more or less recognizing the anniversary of some of the competitions that are coming off. So if you guys kind of maybe walk us through the next twelve to eighteen months of where you'll start to lap some of the things that are maybe hurting you a little bit more pronounced than others.

35m 58s

I'll let you at that time. Yeah, thanks, Jay. So Carlo, last big one was obviously the live project in in Bossier City. So, you know, we'll lap that in February of next year, but, it it will be a little bit noisy for the the next twelve months at least, just because of our project starting to open. I I feel very comfortable that know, within the next twelve to to fourteen months, say, twelve to thirteen months, I guess, we're in in May, we will have all of our our properties open. So, you know, the year over year comparisons are going to be a little bit little bit fuzzy just because of that. But for the most part, we started to lap everything. We just did have an expansion in Nebraska. The last, I think, three, four weeks. We are just out there to kinda look around at that market. So those are the those are the two competitive impacts that we'll see over the next year. But then we'll be offsetting that with with our new openings.

37m 5s

And we feel, I think, really good about the timing of when we'll be going landside in Council Bluffs because the rest of the competition will have sort of settled in. And so, the construction timeframe will be coming into the market with a really new updated products, easier access to the casino, one level versus three levels, much more efficient. So both on the cost side as well as revenue opportunities to the upside. And that was all part of our license renewal in the state of Iowa with our QSO there. But feel good about what we have front of us is largely in our control. We're going to be the one the company that's opening up new projects as opposed to trying to fight off new supply in key markets, which for the first time in a long time, we'll be able to say that.

37m 51s

Great. Thank you. And then just along those lines, two part question related to the pipeline. Obviously, of the financing stuff is in place, but there's also some called upon financing that you guys could pursue. Could you comment a little bit about how you're thinking about the timing of that? And also how we should think about disruptions as we get closer to the openings, closure periods, things like that with some of the land based conversions?

38m 19s

I'll let Felicia hit the financing question. And Todd, you can speak a little bit about the description on opening Yes. Carlo, our view really hasn't changed. We've really been trying to think about the financing as matching it to the openings. If we took financing today, for example, we'd be paying rent on a property that's not open yet. So I would think about that in terms of of matching. Obviously, we're also [indiscernible] committed to the GLPI's balance sheet for Aurora. The other three projects, Joliet, M and Columbus, are at our discretion. And in addition to looking at the timing, we're also looking at GLPIs the cap rates that GLPI would be offering us, versus what we could get in the open market versus using our balance sheet. So we have a lot of optionality around that. But I would say the first thing thing that we're mainly focused on is that matching of timing.

39m 21s

And one last point that was covered in our release is that Council Bluff is a little bit of a different potential structure. And so, that can be either in the form of rents or as a five year term loan. So, if we decide that it's rents, then obviously, again, you'd wait until matching taking the financing around openings. So you're paying rent once you open the doors. But with a five year term loan, obviously, we could be starting to take the funding and financing in advance. Well advance of the opening.

39m 48s

And then Carlo, to your question on disruption, so I would look at it this way. The Columbus Hotel as well as the, additional tower and meeting space at the end, minimal to zero disruption. I mean, it's it's simply adding a product so no real disruption there. Even the council bluffs property, it's minimal downtime as we approach that. And then the only thing with Aurora and Joliet please keep in mind, is not just moving from a riverboat to land based This is moving from a riverboat to a far better location with 10 to 12 x the the traffic counts that that we currently see. So that downtime, if you look at what the other operators have been able to do in Illinois, You know, it's looking at that two to three week period. We just had a a very, very productive meeting with the Illinois gaming board, and really appreciate all their efforts with us. And the leadership teams out there with Ruben and Greg. We think we can get that time at the lower end of the range. So think you can start thinking about maybe a a two week downtime. But more to come on that as we finalize the opening date.

41m 6s

Great.

41m 7s

Thanks, everybody.

41m 9s

We'll take our next question from Shaun Kelley with Bank of America.

41m 15s

Hi, good morning everybody. Thank you for taking my questions. For whoever wants to take it, maybe we could just start with kind of the digital promotional landscape. Just kind of curious on, first of all, for the standalone iCasino app, did you all sort of lean in on the promotional level there just as you're trying to get that product up and rolling? Or is that a little more organic? And then just sequentially, as we think about sort what you were offering in market 4Q and sort of what your expectation were? How did promos come in across both OSB and digital in this first quarter? Thanks.

41m 48s

Yes. I would say promo is a come in where we anticipated them to be, both in sports betting and iGaming. And I would say both for the industry as well as what we intended to do in the first quarter as it relates to what was going on in the fourth quarter of of last year. And specifically the iGaming, we really have focused in the early days of these standalone Hollywood iCasino app launches on organic cross sellable from sports betting as well as from our retail database, and that's been really effective. We're just now starting to get into more of the performance based marketing spends. And so that's why we're confident you'll continue to see improved results as we move forward through the remainder of the year.

42m 30s

Great. Thanks, Jay. And then just as a follow-up and maybe switching over to the land based side. Just big picture, what's it take right now to kind of get some cost leverage on the revenue side? What What's the sort of OpEx or run rate operating expense pressure you all are facing? Is it sort of in the low single digit range, just kind of you're feeling it? Obviously, you made some comments on tariffs. It doesn't sound like you're feeling much incrementally, but obviously this has usually been something you've been really disciplined on and probably better than peers it's largely labor is the one that's continuing to be a bit of a creep. Nowhere near the levels on a year over year basis percentage wise that we were seeing last year and the year before. But that's the primary driver. I think we have a good handle on marketing's within our control. Our procurement team is noted by both Todd and Felicia, who does an excellent job in there's some we're seeing a little bit of noise from a COGS perspective, but the teams are really creative and you find alternative options to keep your pricing where it needs to be and make sure you're not having to raise prices on consumers.

43m 33s

It's one of the real benefits, I think, during times like now of regional gaming is you can walk in and our prices haven't changed from last year or five years ago or ten years ago, whether you're a gaming customer or non gaming customer. Todd, anything to add?

43m 45s

Yes. The only thing I would add, Sean, Jay and I and Felicia were talking about this yesterday. Keep in mind that our revenue mix when it when we do more in the Northeast and Midwest than we do in the South and West, We have higher tax rates there, so there was a bit of a shift in in revenues in Q1. So that did lead to a little bit of margin erosion. But we think as we work through the weather I think eight of the last ten weeks, we've seen year over year improvement in volumes and rated play. So and that's been across the board. So as that kind of revenue mix comes back, we be able to pick up the benefit there. That's right. And I did note in the prepared remarks, but might as well hit it here again, we had a $5,000,000 accounting good guy in Q1 last year. So as you're looking at the comparisons, year over year, keep that in mind both in terms of EBITDA as well as margins. In the South Region.

44m 41s

Thank you.

44m 43s

Thanks, Sean.

44m 44s

We'll take our next question from Barry Jonas at Truist Securities. Please go ahead.

44m 50s

Hey guys, good morning. I wanted to start with that I think the new ESPN DTC product should be out soon. Should we be thinking of this as a potentially meaningful catalyst for you guys? I think any color here would be helpful. Thanks. Well, think I think the world will hear about that very soon. So I don't want to comment too much on the product.

45m 13s

But I will tell you, think it's a first in market integration and we're incredibly excited about it. It's very cool. And we think it will have a difference in terms of driving users and exposure to our So we're very excited about it and can't wait for you guys to see it.

45m 33s

Got it, got it. And then either for Jay or Todd, I think another Pennsylvania land based casino operators talk about potentially exiting. In response to skill based gaming. Can you maybe just talk about the risks you see around skill based in the state and beyond? Thanks.

45m 50s

Yeah, happy to. We've spoken about this on previous earnings calls. And it's it's a complicated issue, skill based gaming. We view skill based games as largely they're look alike slot machines. And they really, they're going to be competitive with us, they really need to be regulated and taxed like us as well. We feel very strongly about that. And so it's sort of an ongoing discussion. At the legislative level in the state of Pennsylvania. I know others have commented on the impact to their business. It obviously impacts all of us. On the land based side. There's tens of thousands of these things sprinkled across the state. And we'll see where it goes, but we feel like there's hopefully some potential outcome that's going to be good for the industry. As well. So I'm cautiously optimistic on that topic currently.

46m 44s

Great. All right. Thank you, Jay.

46m 46s

Thanks, Barry. We'll take our next question from Joe Staph with Susquehanna.

46m 53s

Thank you.

46m 54s

Good morning.

46m 55s

I wanted to go back and maybe ask another question about just the ramp that you have with the iCasino standalone product. I think you said is 70% of the new customers [indiscernible] iCasino standalone are incremental. Did you mean say, independent of what is whether it be ESPN bet channel customer and or a retail customer Could you just clarify that 70% incremental [indiscernible] Yeah, happy to. 70% incremental to our iCasino business. Meaning that the 30% came over from the Hollywood offering within ESPN Bet. The other 70% is a combination of retail who had never engaged with us in our digital iCasino products, reactivated customers, so customers who have been dormant within our database or just brand new to the entire ecosystem.

47m 57s

Gotcha.

48m 1s

And, you know, a follow-up, maybe also to clarify on on the new app coming out. From ESPN Aaron, does this require you guys, you know, a a lot of work in terms of say, integrations that you have to do above and beyond what you're doing in terms of the core product that ESPN Bet and Hollywood stand alone?

48m 26s

Well, we certainly I don't know if I would say a lot of work, but it's certainly a bespoke integration that's going to be linked and associated with the content that you watch. So we have created different types of markets and processes for sharing that in real time. With ESPN, which will manifest itself in the product. So we we think it's the the best in class and first of its experience as it relates to watching live live events as it relates to bed integration. So we're excited about the work we've done And I think the world will too. And obviously, the experience will be best for customers who have linked their ES ESPN account with ESPN Bet. And so Aaron, maybe comment on just sort of the progress continuing to see on linked as a percentage of total users.

49m 14s

Yes. So actually in the quarter, we've instead of talking about linked users, we've created rewards club called ESPN Mint Club. So when you think about Mint Club users, a very high percentage of those of our MAUs are Mint Club users.

49m 30s

They're logging in 2.7 times more to our product They're placing 60% more weekly bets They're generating more handle.

49m 39s

They're holding better. These are really our best customers, not just for ESPN bed, but for ESPN as well. And so we think with flagship, and the continued integrations that Jay talked about as it relates to the Fantasy work we're doing for football is going to be a big accelerant to us continuing to deliver against our guidance.

50m

I see. Thank you. [indiscernible] We'll take our next question from Chad Binan with Macquarie.

50m 9s

Hi, good morning. Thanks for taking my question. On the interactive side, wondering if if you could chime in on your view of the predictive markets and if you think you're customers would be interested in that product and kind of how you view it from a regulatory standpoint? Thank you. Yeah. I would say you've heard from others probably similar from us. We're staying very close. There's a lot going on right now in prediction markets. As it relates to federal regulations versus state level regulations. It is interesting. It does exist, you guys know, and has for a long time over Europe. I think it is definitely more of a niche market for a variety of reasons. I think it's largely incremental. Especially if it's something that's being offered in states where online sports betting is not currently legal.

51m

So I think more to come on that. It's obviously not priority one for us. We got a lot in front of us right now in terms of execution. And delivering on guidance for the remainder of the year and continuing to improve on all the areas that Aaron and Todd mentioned, both in interactive and retail. But we're staying close to it. If this ends up being an opportunity for the industry, you should expect us to be participating.

51m 23s

Thank you.

51m 24s

And then Jay, separately, just kind of looking at bricks and mortar portfolio, you have one of the fresher fleets in the industry and you're upgrading some of the assets that that need to be. Are there assets in portfolio that maybe are viewed as non core, maybe lower EBITDA performing properties, ones where maybe don't move the needle as much that you could potentially explore, divest to deleverage the balance sheet?

51m 57s

We would never say no to that question. It really depends on the situation. It depends on if you've an offer, if it's an inbound. I would just remind you that our assets are largely tied up as part of our master leases. And so it's not as simple as just, oh, if you were interested in potentially divesting an asset or two that you just make calls and transact. To the highest bidder. There's landlord implications and involvement. And so it's not as clean to sort of think about it, maybe if you were a whole co company and you could make those calls and kind of go through a process like that. I would say, maybe a better way to think about it is that some of the assets we have that are a little bit more challenged from an infrastructure and just how old they are, quite frankly, We have more riverboats in Mississippi. We do in Louisiana. We have another one in Illinois. And there's some really interesting potential opportunities some of those markets to do things along the lines of what we've already announced in Aurora, and Joliet, Illinois, as well as Council Bluffs You should expect to hear more from us on some of those other opportunities that we think will really strong return profiles based on what we're seeing throughout the industry right now on those that have gone from old river boats onto land.

53m 15s

Great, thank you very much.

53m 18s

Thanks Chad.

53m 20s

We'll go next to Ben Chalker with Mizuho.

53m 24s

Hey, good morning. Thanks for taking my questions. The iCasino side, it sounds like both from the data that we get and also the commentary in prepared remarks that you're having some success on the market share side, especially for the standalone iGaming app. Seeing anything that makes you want to lean into marketing or investments in that product? And one follow-up. Thanks.

53m 45s

We're seeing really nice retention results. We have a great product there. We knew we did going in. And so I would say, we're just getting started on some of the new performance based marketing spends. Let's see how strong the top of funnel is.

54m 2s

In those efforts and what the CPAs look like. Let's see what retention like for those newer users versus those that came over Maybe they were reactivated or came over from our retail database. But you should expect for as long as we're seeing encouraging results and attractive CPAs and strong retention, we're going to continue to lean in. Push on iGaming. We think it's a real big opportunity for us as a company. And we have a great product. We have a great team overseeing that, that's continuing to get better every day. So I would say, yes, overall to that. And as our cross sell continues to improve, which it's doing really well at the moment, as we grow our sports book, that's just to going to continue to drive our casino business as well, obviously.

54m 44s

Got it. And then switching gears a little bit to Bluffs. You have the option of term loan versus rent. I guess from my seat, seems like the obvious choice would be term loan, but maybe I'm missing something. Maybe talk about the the thought process deciding between term loan and rent. And then I think Jay, you were suggesting that a few other projects on the horizon, do you think you'll have flexible financing options there as well?

55m 7s

I'll hit the last one first, and then Felicia, you can hit the Council Bluffs question. Yes, we think we'll have flexible financing, because we do have options. We can always finance these projects on our own balance sheet. We have landlord relationships that are very healthy, and it's great to have those relationships and have that optionality when you're thinking about these projects. And much is going to depend on what are the credit market look like at the time that you're needing to fund these projects. There's times where it might be more obvious that you want to do this on your own balance sheet versus work with a landlord or other financing sources. Please, I'll hand it over to you on Council Bluffs.

55m 44s

Yeah, so just on the and to key off of what Jay just said, I mean, we really owe that optionality on Council Bluffs to our great relationship with GLPI. And it's fantastic to be able to have that ahead of us. And you're right. On the surface, structuring it more as a loan is more attractive than rent. As you know, our rent will escalate. Every year. And so having that that loan could ultimately be the better decision. But we'll have time and we'll make that then. I don't want to kind of predetermine what we're going to do. But having that optionality is very favorable.

56m 31s

Okay, helpful. Thank you.

56m 37s

We'll take our next question from Bernie McTowne with Needham.

56m 41s

Great. Good morning. Thanks for taking the question. Big focus for investors on the OSB marketplace is just U. S. Handle growth. So just interested in terms of what you guys are seeing there. Would love any color Thank you.

56m 55s

Yeah, I would say, you've heard others talk about this. We don't have any new state launches happening in 2025. Other than potentially Missouri later very late in the year. Alberta, there's continued progress there. We're quite excited about Alberta given our success in Ontario. And there was good news there yesterday. It continues to move along through the process. So we're cautiously optimistic that will happen sometime in the next couple of quarters as well or hopefully before the end of the year. And obviously, state launches or new province launches are part of what's been driving those higher handle results on a year over year basis for the last several years. This is a slower year in terms of state launches. So I think you should expect to see handle growth for the industry, but it's probably going to be less significant this year because of that dynamic than it has been the last several until you get to those state launches. And you're probably going to see a little bit more muted just generally from a seasonality standpoint. When you get to Q2 and Q3, there's just less big event things going on, and it will probably start to inflect to stronger growth results when you get to September through the remainder of the year.

58m 8s

Understood. Thanks, Jay.

58m 11s

Thanks, Bernie.

58m 13s

Our next question comes from Jordan Bender with Syndesen.

58m 17s

Good morning, everyone. For sports betting, you talked you talked about what's ahead of you, some initiatives might be easier to than others. But Jay, for sports betting as your relationship continues with ESPN, can you maybe expand on some of the low hanging fruit between the two businesses that might help customer growth and retention through the end of the year? Thank you.

58m 40s

Yes, I think I'll let Aaron answer most of that. We hit it at a high level, and maybe Aaron will double click on some of those opportunities. Obviously, the streaming direct to consumer launch [indiscernible] late summer, early fall. That's going to be a big opportunity for us to drive top of funnel as well as strong retention. And we're finally getting to a point after being live with ES Bet for one point years where the real deep integration that we all were excited about when we did the deal and shook hands Those are all starting to happen now, having that linkage between ESPN and ESPN bed and now you go into our betting app, and your favorite teams are all right on the top of the home screen. And so you can through and see if you want to place bets with your favorite teams because we have that information. And then you get to football season with fan We're finally going to be able to do the things that we were hoping to do It just took a little bit of time. But Aaron, maybe you can spend some Yes. No. Look, I would say, in addition to the Mint Club, which is sort of special offers for link users, with that one click link, your favorites pulled over into ESP embed, You can go and embed the markets for your favorite teams.

59m 51s

What we're already finding too is those users love to bet parlays more. In those favorite placements, which is actually very good.

But your favorites don't just appear in ESPN Bet. They follow you through the ESPN ecosystem experience too, including their new flagship product, which means you'll have a personalized bedding experience not just within ESPN Bet. But within ESPN. And we've been working towards that over the past year. You're going now start to really see the benefits of that, especially moving into football.

1h 25s

This year, if you're a fantasy player and ESPN has the biggest fantasy platform in The US, There is no better place to come play fantasy and bet your team than ESPN and ESPN Bet. It will be no question. And the product is going to be native. It's going to be integrated not only into the ESP embed experience, but there will be a derivative version of that within the ESP and experience. And you'll seamlessly move across the two. So we are super excited not only about flagship coming up, but also the NFL season. It's going to be really special as it relates to fancy and betting. That's a level of differentiation and personalization that is an app happening today. It should be effective. We're not going get ahead of ourselves of like how much better and what's but that's why we are confident that market share will continue to grow between now and the end of the year. Both in sports betting as well as in iGaming again for different reasons, but we see continued growth in both of those areas.

1h 1m 23s

Really helpful color. And then the fall follow-up Felicia, taking the comments about stock dislocation in your prepared remarks, understanding there's a price for anything and you spoke to the brick and mortar side of the business already. But could you look to do something strategically before the opt out cause next year if you're not getting credit within your valuation? And that's on the online side, sorry.

1h 1m 48s

Yeah. I mean, there's really nothing to say on that topic in terms of next year. I hit that on our last earnings call. That's in the contracts. Sides have the option at the third anniversary if we haven't hit a threshold level of of revenue market share.

1h 2m 7s

To decide if they want to rework the deal or continue on or exit, and that hasn't changed. So look, we're focused. Our partners are focused. We're excited about what's ahead of us. Let's see where we are as we trend through the next couple of quarters. I think it'll probably be not just obvious to but obvious to others as well. What path is going to make the most sense. But we're staying focused and our teams are staying focused on working together to deliver a really great and differentiated experience. And we're confident that it's going to deliver solid results. And through football season going into 2026, we've got an opportunity to really show why we did this deal in the first place. And for whatever reason, if if those things aren't working, then you've got optionality as you head into 2020 So I would say nothing's really changed there, but we're excited about what's in the queue.

1h 3m 1s

Great. Thank you very much.

1h 3m 4s

We'll take our next question from Ryan Zugdahl with Craig Hallum.

1h 3m 9s

Hey, good morning, guys.

1h 3m 10s

Jay, you mentioned, I think it's in response to a question, maybe prepared remarks, but turning Performance Marketing back on, was that in context of the Hollywood iCasino standalone or also [indiscernible] Because I believe it's been turned off since December of twenty twenty three. So just how you think about, leveraging that channel and and maybe accelerating the acquisition and getting them into the funnel to experience the user experience that you're building Yeah. I I it's all a balance, as you can appreciate, Ryan, in terms of how much you're doing there outside as it relates to sports betting outside of what spending with ESPN. So we've been doing performance marketing and online sports betting. Outside of ESPN, not as much obviously in the last six months as the previous six months, but I think we're getting smarter and more surgical around what's working, what's not. Where to invest and where not to. But my comments were more specific to since the launch of Hollywood iCasino, our initial first few months were really focused on organic cross sell and obviously activating, reactivate reactivating customers that had been dormant. Now it's an opportunity for us to get a little bit more aggressive on the performance based marketing.

1h 4m 25s

And see what type of customer profiles come in, how much quality do we have there, what are the CPAs What's the retention? And we just got started recently, but we're seeing some nice top of funnel results. Makes sense. And then just a quick follow-up.

1h 4m 40s

Timeline for launch in West Virginia?

1h 4m 45s

Do we have the latest on the Hollywood standalone for West Virginia?

1h 4m 55s

I don't have it from me. Yeah, it's sometime in the next couple of quarters. I don't have the date in front of me, Ryan. We're working with the regulators there. But we are live, as you know, Pennsylvania, Michigan, New Jersey. We just launched the Score Casino in Ontario, and so West Virginia. Is the last state, at least currently for us to launch a standalone Hollywood iCasino app, which should be good for us because we have a Hollywood branded casino there. It's the largest casino in the state of West Virginia. So I would say sometime in the next couple of quarters. Very good. Thanks, guys. Good luck.

1h 5m 29s

Thanks, Ryan.

1h 5m 31s

We'll take our next question from John DeCree with CRB.

1h 5m 36s

Hi, good morning everyone. Thanks for taking all the questions.

1h 5m 40s

Jay or Todd, you guys have as good of a pulse of as anyone on kind of the regulatory and legislative process. I think Ohio considering iGaming was probably not on our bingo card.

1h 5m 52s

For this year and it's a big state for you guys in the retail network. Maybe two part question. What are you guys seeing on legislative front? And then how do you like your position? Or how do you think about your position in a state like Ohio where you kind of get start maybe from the starting line with everyone else? And then to where you have a big retail presence in terms of quickly launching versus maybe where you started before playing catch up?

1h 6m 19s

Yeah. Happy to obviously very involved and engaged in Ohio. A bill has not been put forward yet. I know there's articles being written about a bill being worked on right now.

1h 6m 33s

I would say, look, we now have a much more competitive iGaming products and we have a standalone app in addition to what we offer. Within ESPN that we know is competitive. And we're better operators in that space. We were even six months ago or nine months ago. Every state is a bit different. We're not going to necessarily be on the same page with every other company, because some markets we have no casino, some markets we have small casino, in some markets we've got like the state of Colorado, gaming laws were passed there where the casinos only in the mining towns in the mountains, an hour and a half away from the population. So that's not a good scenario for us, if we have one of those large casinos, which we do in Black Hawk, Colorado. So it really does depend. We're obviously very focused on doing what's in the best interest of our shareholders. And so, Ohio will stay close as we would in any other state. But I don't want to comment too because I know that bill is still being worked on currently.

1h 7m 34s

Alright. Thanks, Jake. Appreciate it.

1h 7m 36s

All right. We'll take one more question, Emma.

1h 7m 39s

We'll take our final question from Jeff Zuni with Stifel. Please go ahead.

1h 7m 44s

Great. Good morning, everyone. Thanks for squeezing me in. I wanted to touch on on the iCasino side of Interactive. Jay, you shared a lot of detail on the momentum that you're seeing following the standalone app launch. And improvement in the product, which is just quite noticeable? Anecdotally. I'm curious if you look at your competitor that holds that number one spot for product and maybe even some of the other players that round out the top three top four, just what are some key areas that you've identified you think there is still room to close any gaps that you still see out there on product? 2025 and 2026 and beyond? Thanks.

1h 8m 18s

I'll take a stab, and Aaron, obviously, jump in there. I'd say, look, I'll also hit sports betting. I think biggest opportunity for us right now beyond sort of the more organic things that we're working on with our partners at ESPN around integration and personalization is around live betting. I think where our product offering today is is good, but it needs to be better than good. So we're working hard on that. We just launched some streaming offerings, and so live betting is getting the experience is improving every day right now. And we more work to do there in terms of live betting with same game parlays, and just live betting generally and reducing latency and things of that nature. So on the sports betting side, I would say mostly around live. As it relates to online gaming, I don't it's not a product mix issue at all. I think we have great products variety. We have our own games that we've developed that perform quite well, especially in the areas of digital blackjack. And in some slot cases as well, slot themes. But I would say overall for us, it's probably more around CRM and promotional engine and just that same level of personalization.

1h 9m 26s

And you want people to feel they're being treated different and better within the experience and the ecosystem that you provide than anyone else. And so we're still working on that. The product team is hard at work to make sure that we're creating some points of differentiation that are improved versus anyone else.

1h 9m 43s

Yeah, I would just add, just build on personalization, I think, is one of the things we're really focusing on in iCasino, just reducing the friction elevating and putting the games you care about in front of you, getting you into them faster, The same exact approaches we're taking with the sports book as well, but we think that's going to be just make it easier and more fun for you to get into what you want as quickly as you can. As Jay said, we've got a nice product mix. Our UI is world class. Our games are world class. So just getting you into what you want as quickly as possible, I think is going to make a difference. We're working hard on Great. That's helpful. Thanks for that. And then just following up on something Felicia said earlier in the remarks. I think Felicia talked to some exposure to tariffs on the steel side with the Council Bluffs project and some strategies or some exploration in place of some ways to try to mitigate or get around that. I was hoping to just expand on that a little bit further based on your discussions right now, that your expectation that you could fully fix these in any sort of GMPs or Or is the understanding that tariffs will be carved out kind of from here onward And then with respect to steel specifically, are there opportunities to resource domestically?

1h 10m 58s

Or is it more about sort of leaning on your suppliers and things of that nature? Thanks.

1h 11m 4s

I can take that one. So know, we're not looking at a at a high rise there. So the the need for steel is not as high as if we were building a hotel tower. It's It's a one level casino that Jay had touched on. But also, we 're in a really good position from a timing standpoint. So we can kinda spot the market and and look to lock in. We have a great procurement team as both Felicia and I have mentioned as well as a great D and C team that that can work through this. And then work those changes into the design Since this is very much a known issue, d n c our design construction and procurement team are working together on that already. So again, as this tariff noise kind of plays out over the the upcoming months, we feel good about the ability to lock in when the time is right It is I'll just underscore, we did provide a budget range Council Bluffs just because of what's going on in the marketplace right now around tariffs. So the four other growth projects that we're getting close to opening, we were a lot more precise of what those budgets were going to be in the early days because we didn't have that as a factor.

1h 12m 11s

So that's why the range is there.

1h 12m 14s

Great. Thanks very much. All right. Thanks, Jeff. Thanks everybody for joining us this morning. Look forward to speaking with all of you again on our Q2 earnings call in August. Have a great day.

1h 12m 25s

This does conclude today's program. Thank you for your participation. You may disconnect at any time.

Key Insights

PENN demonstrated strong resilience in Q1 2025 despite severe weather challenges, with gaming revenue and volumes rebounding in March and continuing positive trends into April and May; Q1 retail revenue was $1.4B, adjusted EBITDAR was $457M, and adjusted EBITDAR margin was 33.1%.
The company is advancing four major development projects on time and on budget, including a new land-based Hollywood Casino in Council Bluffs, Iowa, with construction expected to take 18-24 months; total 2025 CapEx is forecast at $730M, with $490M for project CapEx.
The Interactive segment reported Q1 adjusted revenue (ex-skin tax gross up) of $162M and an adjusted EBITDA loss of $89M, a $107M YoY improvement; customer-friendly sports betting outcomes negatively impacted revenue by $15M and EBITDA by $10M.
PENN reiterated its 2025 guidance: retail and interactive revenue/EBITDA ranges are unchanged except for the flow-through of the $15M revenue and $10M EBITDA impact from sports betting outcomes; Q2 interactive revenue guidance is $280M-$320M (including $116M skin tax gross up), with EBITDA loss guidance of $70M-$50M, and expects sequentially lower interactive EBITDA losses each quarter, reaching positive EBITDA in Q4 2025 and full-year profitability in 2026.
The company continues to see strong momentum in its omnichannel strategy, with 70% of standalone iCasino theoretical revenue coming from incremental sources; cross-sell between retail and digital channels is increasing, and new ESPN Bet integrations and the Mint Club rewards program are expected to further drive engagement and retention.

Recent Transcripts

Penn Entertainment showed resilience in Q1 despite weather headwinds, maintaining guidance and growth projects.

Penn Entertainment guides strong 2025 growth, digital breakeven, and $350M share buyback.

Feb 27

Q4 2024

Retail Revenue

$1.4B Q4, $5.6–$5.75B FY25

Digital EBITDA

+$350M YoY improvement

Market Cap: $2.6B
IPO Date: 5/26/94
CEO: Mr. Jay A. Snowden
Fulltime Employees: 23K
Sector: Consumer Cyclical
Industry: Gambling, Resorts & Casinos
Country: US
Exchange: NASDAQ Global Select

Peers

$0.00

Watchlist

$0.00

Earnings

Report Date

May 8, 2025

Reported Revenue

1.7B

Miss -3.58%

Avg 1d Change

4.09%

Report Period

Q1 2025

Reported EPS

-0.25

Beat +13.79%

Implied Move 1d

7.37%

Transcript

12m 14s

13m

14m 27s

15m 14s

16m 29s

17m 51s

Back to you, Jay.

17m 52s

19m 21s

20m 45s

21m

22m 28s

24m 1s

25m 54s

27m 21s

28m 30s

29m 51s

30m 40s

Take our first question from Brandt Montour with Barclays. Please go ahead.

30m 44s

31m 18s

32m 30s

33m 42s

34m 43s

35m 18s

Excellent. Thanks, everybody.

35m 22s

We'll take our next question from Carlos Antalya of Deutsche Bank.

35m 27s

Hey guys, thanks.

35m 29s

35m 58s

37m 5s

37m 51s

38m 19s

39m 21s

39m 48s

41m 6s

Great.

41m 7s

Thanks, everybody.

41m 9s

We'll take our next question from Shaun Kelley with Bank of America.

41m 15s

41m 48s

42m 30s

43m 33s

43m 45s

44m 41s

Thank you.

44m 43s

Thanks, Sean.

44m 44s

We'll take our next question from Barry Jonas at Truist Securities. Please go ahead.

44m 50s

45m 13s

45m 33s

45m 50s

46m 44s

Great. All right. Thank you, Jay.

46m 46s

Thanks, Barry. We'll take our next question from Joe Staph with Susquehanna.

46m 53s

Thank you.

46m 54s

Good morning.

46m 55s

47m 57s

Gotcha.

48m 1s

48m 26s

49m 14s

49m 30s

They're logging in 2.7 times more to our product They're placing 60% more weekly bets They're generating more handle.

49m 39s

50m

I see. Thank you. [indiscernible] We'll take our next question from Chad Binan with Macquarie.

50m 9s

51m

51m 23s

Thank you.

51m 24s

51m 57s

53m 15s

Great, thank you very much.

53m 18s

Thanks Chad.

53m 20s

We'll go next to Ben Chalker with Mizuho.

53m 24s

53m 45s

54m 2s

54m 44s

55m 7s

55m 44s

56m 31s

Okay, helpful. Thank you.

56m 37s

We'll take our next question from Bernie McTowne with Needham.

56m 41s

56m 55s

58m 8s

Understood. Thanks, Jay.

58m 11s

Thanks, Bernie.

58m 13s

Our next question comes from Jordan Bender with Syndesen.

58m 17s

58m 40s

59m 51s

What we're already finding too is those users love to bet parlays more. In those favorite placements, which is actually very good.

1h 25s

1h 1m 23s

1h 1m 48s

1h 2m 7s

1h 3m 1s

Great. Thank you very much.

1h 3m 4s

We'll take our next question from Ryan Zugdahl with Craig Hallum.

1h 3m 9s

Hey, good morning, guys.

1h 3m 10s

1h 4m 25s

1h 4m 40s

Timeline for launch in West Virginia?

1h 4m 45s

Do we have the latest on the Hollywood standalone for West Virginia?

1h 4m 55s

1h 5m 29s

Thanks, Ryan.

1h 5m 31s

We'll take our next question from John DeCree with CRB.

1h 5m 36s

Hi, good morning everyone. Thanks for taking all the questions.

1h 5m 40s

Jay or Todd, you guys have as good of a pulse of as anyone on kind of the regulatory and legislative process. I think Ohio considering iGaming was probably not on our bingo card.

1h 5m 52s

1h 6m 19s

Yeah. Happy to obviously very involved and engaged in Ohio. A bill has not been put forward yet. I know there's articles being written about a bill being worked on right now.

1h 6m 33s

1h 7m 34s

Alright. Thanks, Jake. Appreciate it.

1h 7m 36s

All right. We'll take one more question, Emma.

1h 7m 39s

We'll take our final question from Jeff Zuni with Stifel. Please go ahead.

1h 7m 44s

1h 8m 18s

1h 9m 26s

1h 9m 43s

1h 10m 58s

Or is it more about sort of leaning on your suppliers and things of that nature? Thanks.

1h 11m 4s

1h 12m 11s

So that's why the range is there.

1h 12m 14s

Great. Thanks very much. All right. Thanks, Jeff. Thanks everybody for joining us this morning. Look forward to speaking with all of you again on our Q2 earnings call in August. Have a great day.

1h 12m 25s

This does conclude today's program. Thank you for your participation. You may disconnect at any time.

Key Insights

PENN demonstrated strong resilience in Q1 2025 despite severe weather challenges, with gaming revenue and volumes rebounding in March and continuing positive trends into April and May; Q1 retail revenue was $1.4B, adjusted EBITDAR was $457M, and adjusted EBITDAR margin was 33.1%.
The company is advancing four major development projects on time and on budget, including a new land-based Hollywood Casino in Council Bluffs, Iowa, with construction expected to take 18-24 months; total 2025 CapEx is forecast at $730M, with $490M for project CapEx.
The Interactive segment reported Q1 adjusted revenue (ex-skin tax gross up) of $162M and an adjusted EBITDA loss of $89M, a $107M YoY improvement; customer-friendly sports betting outcomes negatively impacted revenue by $15M and EBITDA by $10M.
PENN reiterated its 2025 guidance: retail and interactive revenue/EBITDA ranges are unchanged except for the flow-through of the $15M revenue and $10M EBITDA impact from sports betting outcomes; Q2 interactive revenue guidance is $280M-$320M (including $116M skin tax gross up), with EBITDA loss guidance of $70M-$50M, and expects sequentially lower interactive EBITDA losses each quarter, reaching positive EBITDA in Q4 2025 and full-year profitability in 2026.
The company continues to see strong momentum in its omnichannel strategy, with 70% of standalone iCasino theoretical revenue coming from incremental sources; cross-sell between retail and digital channels is increasing, and new ESPN Bet integrations and the Mint Club rewards program are expected to further drive engagement and retention.