Penn sees flat retail performance, interactive segment growth in Q2

Penn Entertainment reported second-quarter revenue of $1.76 billion, up 6% year-on-year, with growth in its interactive segment helping offset flat performance in retail casinos.

Retail casino revenue was $1.4 billion, unchanged from a year earlier, while adjusted EBITDAR came in at $498.6 million. The interactive division generated $316.1 million in revenue, a 35.9% increase, and narrowed its adjusted EBITDAR loss to $62 million from $102 million in the same period of 2024.

“Our interactive segment generated record gaming revenue in both online sports betting and online casino, driven by ongoing product enhancements and the advantages of our unique omnichannel ecosystem,” Chief Executive Jay Snowden said. “Still plenty of work to do.”

H1 2025 group revenue rose 5% to $3.4 billion. Interactive losses for the first half were $151 million, compared with $299 million in H1 2024. Adjusted earnings per share were $0.10, versus a loss of $0.18 a year earlier.

Penn held $671.6 million in cash and had $2.1 billion in net debt. It has repurchased $115.3 million worth of shares so far this year and reaffirmed its commitment to at least $350 million for 2025.

Snowden said regional gaming was supported by stable consumer confidence, strong employment, and low gas prices. “Americans have jobs, Americans spend money. It’s really quite simple as it relates to the regional gaming business, at least as long as I’ve been doing this, and gas prices have been low and they’ve stayed low. So those are all helpful tailwinds," he stated.

Penn is moving its Hollywood Casino Joliet and Aurora riverboats ashore, with Joliet opening today, Monday, ahead of schedule and Aurora expected in 2026. Ameristar Council Bluffs is slated to move ashore in late 2027 or 2028, and renovations are planned for Louisiana and Detroit casinos.

On sports betting, Penn is targeting a top-three U.S. position through its ESPN Bet partnership, with a full football season launch seen as critical after missing an early-season start in New York last year.

ESPN announced last week a deal to acquire most of the NFL’s media assets, including NFL Network and RedZone, in exchange for a 10% stake in the business. The agreement marks the first time a US sports league has secured ownership in a media organisation, which makes Penn optimistic.

“Maybe this is stating the obvious, but we think … all of those announcements are good for the entire ESPN ecosystem, of which ESPN Bet is certainly part,” Snowden told analysts.

Penn is also navigating a proxy dispute with activist investor HG Vora, which has challenged its digital strategy and executive pay. The company reduced available board seats to two, electing two of HG Vora’s nominees. Legal and advisory costs tied to activist activity totaled $9.4 million in Q2 and $17.1 million year-to-date.