Caesars Entertainment reported lackluster results in its latest earnings report as the company continues to scale its online sports betting and casino business.
The Nevada-based entertainment and gaming conglomerate generated $2.8 billion in net revenue in Q3 2024 compared to $3 billion for the same period last year. Caesars also failed to meet Wall Street analyst estimates of third-quarter revenue of $2.9 billion.
The company reported also reported a net loss of $9 million in Q3 2024. By comparison, Caesars Entertainment posted a net income of $74 million for the same period last year.
Caesars Digital reports strong quarter
Despite its third-quarter losses, Caesars Digital posted year-over-year revenue growth.
The segment, which operates Caesars’ online sports betting and iGaming brands, reported $303 million in revenue in Q3, up from $215 million for the same period last year. The results in Q3 2024 generated a quarterly record adjusted EBITDA of $52 million. By comparison, Caesars Digital reported an adjusted EBITDA of $2 million in Q3 2023.
Caesars Digital benefited in Q3 from growth in its iGaming business, which reported an 83% increase in net revenue growth compared to the same period in 2023. Caesars Digital attributed the growth to Horseshoe Casino brand launch in Michigan. The brand expanded to both Pennsylvania and West Virginia this week. Caesars Digital also expects to bring the Horseshoe Casino brand to New Jersey and Ontario this year.
Caesars Digital also reported a 55% increase in volume for its iGaming business in Q3.
Its sports betting business also reported year-over-year revenue growth during the quarter with a 36% uptick compared to Q3 2023. Caesars Digital cited an increased hold for its growth. In Q3, its sports betting hold closed at 8.6% compared to 6.5% in Q3 2023.
“Enhancements we’ve made to the app drove higher parlay and cash-out mix, which helped drive structural hold improvements during the quarter,” said Caesars Sports and Online Gaming President Eric Hession during the company’s earnings call. “Given our roadmap and our customers’ receptivity to the enhanced parlay options, we now believe that achieving structural hold above 10% threshold is achievable over the next few years.”
As of Q3, Caesars offers online and retail sports betting in 32 North American markets. The company plans to be strategic and efficient in marketing to players in those areas.
“On the sports side, you’ll notice in the states that report the reinvestment levels, were generally about half of what the market average is. And we feel that that’s an appropriate strategy through our segmented marketing that may have the opportunity to come down even further,” continued Hession.
Major sales for Caesars
The gaming and entertainment giant reported its latest earnings amid finalizing a $500 million sale of the World Series of Poker brand (WSOP) to GGPoker parent company NSUS. The deal sees Caesars hand over the intellectual property rights of the WSOP.
Caesars will continue to host the summer WSOP series at a Las Vegas property for the next 20 years despite the sale to NSUS. Caesars Digital will also license brand rights from NSUS to operate WSOP sites across the country and preferential rights to WSOP Circuit events.
Caesars has also announced a $275 million sale of the LINQ Promenade to a joint venture between TPG Real Estate and the Investment Management Platform of Acadia Realty Trust. The deal, subject to regulatory approvals, is expected to close in Q4.
