November 8, 2024 3 min read

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PENN Entertainment Remains Bullish on ESPN BET Despite Mixed Q3 Performance

CEO Snowden noted that the digital sector had a robust foundation and was positioned for further growth in several promising jurisdictions

PENN Entertainment announced its third-quarter results, showcasing stellar performance in retail revenues and ongoing challenges in the digital space. Q3  retail revenue reached $1.4 billion with an adjusted EBITDA of $472 million, surpassing earlier projections. However, the Interactive segment recorded a $91 million EBITDA loss on $141 million in adjusted revenue as PENN continues to invest heavily in ESPN BET.

PENN Invested Heavily in Its Digital Sector

PENN’s retail market share grew in Ohio, Massachusetts, and Kansas, reinforcing the brand’s foothold in the competitive US gambling market. New customer acquisition and loyalty-building activities within their retail sportsbooks helped offset declines in the Northeast and Southern regions. PENN has four growth projects in the pipeline, with Hollywood Joliet slated to open in late 2025 and three additional developments expected in early 2026.

The new developments should extend PENN’s brick-and-mortar footprint and help the company drive consistent free cash flow beginning in 2025. PENN CEO Jay Snowden was confident in the company’s diverse strategy, which includes ongoing retail investment and digital growth via ESPN BET. He noted that the company would maintain the pace of its strategic expansions, hopefully translating them into sustained growth.

We’ll continue to invest where we feel like we’re going to get the best returns, and that becomes clearer and clearer for us every day on both the retail side as well as on the digital side.

Jay Snowden, PENN Entertainment CEO

The $91 million loss in the Interactive segment highlights the financial weight of growing ESPN BET. Snowden acknowledged that spending on promotional activities, particularly around the football season, took a financial toll. However, he noted the company’s strategic decision to remain disciplined, aiming for long-term loyalty rather than immediate gains.

The Operator Fostered Further Online and Retail Synergies

The partnership with ESPN has yielded early signs of success for PENN’s digital business. Snowden noted that the seven ESPN BET-branded retail sportsbooks that launched in Q3 perfectly aligned with PENN’s broader rebranding strategy aimed at unifying online and retail sports betting experiences under the ESPN banner. 

Features like account linking allow users to monitor and manage bets seamlessly across the ESPN app and website, streamlining the overall experience. Snowden added that such a personalized betting experience would prove pivotal in driving engagement, retention, and monetization. He also highlighted how product improvements ahead of the football season improved parlay mix and structural hold, bolstering ESPN BET’s position.

Weve got some momentum in the business right now. ESPN BET has generated meaningful growth as we primarily focus on reactivation and retention efforts.

Jay Snowden, PENN Entertainment CEO

Snowden concluded that the ESPN BET platform has shown real promise to become a true leader in the sports betting market. He added that PENN’s constant boundary-pushing innovations would continue providing users with a seamless, premium betting experience. Despite short-term difficulties, Snowden was confident that the operator’s long-term approach would pay off, setting the stage for a groundbreaking year in 2025 and beyond.

Deyan is an experienced writer, analyst, and seeker of forbidden lore. He has approximate knowledge about many things, which he is always willing to apply when researching and preparing his articles. With a degree in Copy-editing and Proofreading, Deyan is able to ensure that his work writing for GamblingNews is always up to scratch.

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