PENN Entertainment, Inc. (Nasdaq: PENN) has released its financial results for the third quarter ending September 30, 2024. In a challenging market environment, the company reported stable consumer demand across its property-level operations and interactive segment.
For the quarter, PENN achieved revenues of $1.4 billion and an Adjusted EBITDAR of $471.7 million, maintaining an EBITDAR margin of 33.8%. While the interactive segment generated $244.6 million in revenue, it posted an Adjusted EBITDA loss of $90.9 million due to tax-related adjustments and other operational factors.
The company’s liquidity remains strong with $1.8 billion as of September 30, including $834 million in cash and cash equivalents, with a traditional net debt of $1.8 billion.
For Q3, PENN’s revenue increased slightly to $1.64 billion, compared to $1.62 billion in the same quarter of 2023. The net loss stood at $37.5 million, reflecting continued strategic investments and expenses related to REIT agreements. The adjusted EBITDAR for Q3 2024 reached $348.4 million, compared to $445.1 million in Q3 2023.
PENN’s operations span five primary segments: Northeast, South, West, Midwest, and Interactive. The Northeast segment recorded revenues of $684.8 million, while the South, West, and Midwest segments posted revenues of $288.1 million, $131.8 million, and $292.2 million, respectively. The Interactive segment, though posting strong revenue growth, showed an Adjusted EBITDA loss due to high investment costs and scaling initiatives.
PENN Entertainment’s focus on both land-based and interactive operations reflects its commitment to sustaining growth and adapting to evolving market dynamics. As the company continues its strategic initiatives, including managing partnerships and expanding digital offerings, it remains well-positioned to address upcoming opportunities and challenges in the iGaming industry.
Jay Snowden, Chief Executive Officer and President, said: “PENN’s third quarter results were consistent with the preliminary estimates we disclosed last month in connection with our investor event in Las Vegas. Stable consumer demand in our retail business was offset by unfavorable hold in our Northeast segment and volume declines in our South segment associated with severe weather disruptions and accelerated hotel remodeling. The fourth quarter is off to a stronger start, led by several markets including Michigan, Ohio, and St. Louis. In the third quarter, our Interactive segment benefited from better-than-expected hold, driven by a higher parlay mix from our improving product and lower promotional expenses. Additionally, on October 30th, we launched account linking between ESPN BET and ESPN, which is foundational for creating a personalized sports betting experience across the ESPN ecosystem.”
“Core business trends were stable through October, supported by our enhanced offerings and best-in-class retail sportsbooks,” said Mr. Snowden. “We are mitigating ongoing pressures from known new supply in Nebraska, Louisiana, and Chicagoland by continuing to reimagine our properties to improve the customer experience and drive loyalty. During the quarter, we rebranded seven ESPN BET retail sportsbooks and accelerated our planned hotel room renovations at L’Auberge Casino Lake Charles. We are seeing higher value per customer from guests staying in the renovated rooms to-date, with the remainder expected to be completed through January of 2025. As disclosed last month during our investor event, our four development projects remain on budget and on schedule, with Hollywood Joliet expected to open ahead of schedule during the second half of 2025.”
“Prior to the start of football season, we released several product enhancements and ESPN integrations to our ESPN BET offering. These product improvements helped contribute to a higher parlay mix and sportsbook hold during the third quarter. The September launch of ESPN BET in New York expanded our online sports betting footprint to 19 U.S. states, providing greater scale as we leverage ESPN’s vast media reach for efficient customer acquisition. Our progress continued through October with encouraging year-over-year performance across our online sports betting and iCasino operations. We remain excited for additional product enhancements coming soon as we deliver on our product roadmap. This includes our standalone iCasino app launch planned for Pennsylvania early in the first quarter of 2025 (pending final regulatory approval), with additional jurisdictions to follow.”
“Our efforts to ensure diversity of backgrounds and perspectives within our Corporate boardroom have been recognized for the fourth straight year by the Forum of Executive Women, who named us as one of their ‘Champions of Board Diversity.’ In addition, we were named one of the ‘Best of the Best 2024 Top Diverse Employers’ by DiversityComm Magazine. On the environmental front, we were pleased to submit our inaugural CDP climate disclosure response.”
