PENN Entertainment, Inc. recently released its financial results for the third quarter of 2024, showing steady revenue in both its retail and interactive segments despite challenges. Chief Executive Officer Jay Snowden commented on the results, which aligned with the preliminary figures shared at an investor event in Las Vegas. He highlighted that while consumer demand in retail was steady, issues such as an unfavorable hold in the Northeast and disruptions in the Southern region impacted overall performance. Notably, PENN’s ongoing advancements in its digital platform and the integration with ESPN are expected to drive growth into the fourth quarter.
The third-quarter numbers reveal PENN Entertainment’s continued strength in its retail operations. The company reported total revenues of $1.4 billion for its retail segment, which generated an adjusted EBITDAR of $471.7 million with margins at 33.8%. The CEO pointed outd that these stable results stemmed from strong demand supported by enhanced offerings and revamped ESPN BET sportsbooks, which now extend across multiple locations, including seven rebranded outlets in Louisiana and Ohio.
The quarter’s retail success was tempered by external factors, including a low hold in the Northeast and a reduction in guest volume in the Southern region due to severe weather and hotel renovations. Still, Snowden noted an uptick in customer value at sites where hotel refurbishments have been completed, projecting further positive returns from the continued modernization of its properties.
ESPN BET: A Successful Integration and Expanding Engagement
On the interactive side, PENN’s digital revenue totaled $244.6 million, with an adjusted EBITDA loss of $90.9 million. The company’s recent expansion into New York, following the September launch of ESPN BET, allowed it to extend its sports betting reach to 19 states. The digital platform upgrade included ESPN integrations that are fueling customer engagement and enhancing user experience across both betting and media content. Snowden shared that the fourth quarter has started on a promising note, with expectations for continued growth driven by ESPN BET’s capabilities and new features planned for release soon.
One of PENN’s strategic highlights this quarter was the deepened integration with ESPN BET, which launched account linking between ESPN and ESPN BET in October. This functionality allows users to sync their ESPN and ESPN BET profiles, providing a more personalized betting experience. According to PENN’s Chief Technology Officer Aaron LaBerge, the account linking feature has already seen a strong uptake, with “tens of thousands” of users linking their accounts. This integration has led to increased engagement, with higher bets placed and more media consumption on ESPN’s platform.
Snowden described the ESPN BET integration as a significant technical achievement and one that is already contributing to PENN’s broader strategy of appealing to casual sports bettors. To better cater to this audience, PENN has added new parlay options, branded feature bets, and more in-play betting functions, with further product enhancements expected soon. The company aims to leverage ESPN’s extensive media reach for effective customer acquisition, building a fan-centric environment that strengthens player loyalty.
In addition, PENN’s integration with ESPN also offers features like fantasy sports lineup access, which has shown encouraging results. In September, the company implemented “pseudo-personalization” around fantasy content, resulting in a 20% growth boost. Moving forward, the company aims to enhance this offering, providing a more native, seamless experience for fantasy sports enthusiasts.
Strategic Growth in New York and Hollywood Casino Platform Development
Another upcoming initiative for PENN is the launch of its Hollywood Casino digital platform. Currently, online casino customers are directed to ESPN BET, a situation that Snowden referred to as “messy” for users seeking a distinct casino experience. To streamline access, PENN plans to launch the Hollywood Casino digital platform in Pennsylvania in early 2025, with other states like Michigan, New Jersey, and West Virginia expected to follow. This platform aims to make casino gaming more accessible and clear-cut for online players who prefer the Hollywood Casino brand.
Looking beyond digital initiatives, PENN Entertainment is also actively developing four retail casino projects, emphasizing growth in both its physical and digital operations. Among these projects are the relocations of two Hollywood casinos in Illinois and new hotel towers planned for sites in Ohio and Nevada. Snowden reaffirmed that these projects remain on track and within budget, indicating a strategic focus on expanding and enhancing the company’s footprint across key U.S. markets.
