KEY TAKEAWAYS
- PENN Entertainment will step up lobbying efforts in Texas after Republican Gov. Greg Abbott and Lieutenant Governor Dan Patrick were ousted in the midterm elections on Nov. 3.
- PENN operates two of the three Class I thoroughbred racetracks in the state and believes it stands to gain more than competitors if the state expands gambling in the coming years.
- CEO Jay Snowden hopes to see movement in other states, citing potential iGaming expansion in Ohio.
PENN Entertainment was encouraged by the midterm election results in several states, with a new opportunity for Texas gambling emerging.
Several key Texas leadership positions shifted as a result of Tuesday’s voting, including Democratic candidate Gina Hinojosa unseating Republican Greg Abbott as governor and Rep. Vikki Goodwin defeating Dan Patrick, a noted opponent of gambling expansion, in the lieutenant governor race.
The changes could bring significant repercussions for Texas gambling in the coming years.
Legal forms of Texas gambling are limited to:
- Retail lottery games
- Parimutuel wagering on racing
- Indian gaming casinos
- Charity bingo and raffles
PENN Entertainment is one major gambling operator with an existing presence in the state, as the operator of two Class 1 thoroughbred racetracks:
- Sam Houston in Houston
- Retama Park near San Antonio
PENN Entertainment ready to amp Texas gambling lobbying
Speaking on a third-quarter earnings call on Thursday, PENN Entertainment CEO Jay Snowden said the company intends to “play offense” in Texas as it advocates for gambling expansion in one of the hardest states to crack for the commercial gaming industry.
“We do not talk about it every call because it just hasn’t been a topic of conversation — not even hot, it hasn’t even really been warm for a variety of reasons — but we’ve been making investments in the state of Texas for decades,” Snowden said. “We have been operating in the gaming space through horse racing in Texas for a long time.
“We have got two great assets there and we are ready to play offense.”
Snowden added that the third Class 1 thoroughbred track in Texas is owned by the Chickasaw Nation in the Dallas-Fort Worth market. He said PENN Entertainment has “a great relationship” with the tribal nation. Relationships will be a focus for PENN in the new era of Texas politics.
“We also positioned well in that we have great relationships with the movers and shakers in Texas,” Snowden added. “We don’t need to get into names and entities, but we have very strong aligned relationships there. We have a great lobbying team, one of the best we have across the country.
“We will be spending even more time than we typically do in the state of Texas. We will be ready for whatever comes out of Texas, and we think we are positioned as well, if not better, than really anybody in the sector if something does happen.”
PENN Entertainment likely won’t be alone on that front. Gaming attorney Josh Kirschner, a partner at Holland & Knight and deputy leader of its gaming practice, told SBC Americas that he expects “a whole new breed of lobbyists” to start making their voices heard in the Texas gambling debate.
Snowden basks in ‘a really good day’ for gaming
Texas would need a constitutional amendment, a supermajority in a Republican Senate, and a statewide vote to expand its gaming market. But, as industry and legal experts told SBC Americas this week, the biggest obstacles to that eventuality were removed on election night.
“We feel really good about the opportunity,” Snowden added. “It’s always hard to predict what is going to happen. Obviously, you have a new governor and a new party there. The House flipped, the Senate did not. What does that all mean when you stir it around? We are not sure what comes out.”
Ultimately, though, Snowden called the Nov. 3 elections “a good day and a good night for the sector in a lot of ways, and certainly a really good day and night for PENN specifically.”
Could Ohio tip the scales for iGaming?
That might extend beyond Texas gambling. Snowden also suggested that retail gaming expansion in Georgia “could happen” after Democrat Keisha Lance Bottoms won the governor’s race, and Democrats flipped the House for the first time since 2004.
Most of Snowden’s post-midterms optimism relates to the potential for more brick-and-mortar gaming. After all, retail operations accounted for approximately $1.5bn of PENN Entertainment’s total $1.84bn in revenue during the third quarter of 2026. But, after PENN Interactive posted significant gains in Q3, the company’s CEO intends to push for online gambling expansion in some states where the political landscape shifted this week.
Snowden highlighted Ohio as the biggest example, where Democrat Amy Acton won the governor’s race after voicing support for legalizing online casino gambling during the campaign.
“Governor Acton, who is now going to be in office at the start of the year, was definitely more open to iGaming expansion,” he added. “You still have a Senate and a House there that are Republican, and it is always hard to map how those things will play out. We look forward to spending time with the new governor and her team and talking about the benefits, if done right, of iGaming legislation in a state like Ohio.
“As I’ve said before, I think once you hit one of those Midwest states that are all clustered together, Iowa, Indiana, Illinois, Ohio, one of those, the other states will probably start to accelerate in terms of how they think about the timing of legalizing iGaming.”
PENN Entertainment swings to profit in Q3
Snowden spoke on Thursday after PENN Entertainment reported a 7% uptick in total revenue from $1.72bn in Q3 2025 to $1.84bn. Consolidated adjusted EBITDA grew 46% from $194.9m to $284.0m, and PENN swung from an $865.1m net loss this time last year to $32.6m in net income in Q3 2026.
PENN Interactive segment revenues grew to $348.4m for the quarter, which Snowden attributed to the strength of the Hollywood Casino online operations in the U.S. and continued growth in Canada. PENN Entertainment launched Hollywood Casino and theScore Bet in Alberta in July. The digital business still runs at negative adjusted EBITDA, although it cut that deficit from $76.6m in Q3 2025 to $18.3m in the third quarter of this year.
