PENN Entertainment, Inc. Reports Second Quarter Results

For the three months
ended June 30,

(in millions, except per share data, unaudited)

2026

2025

Revenues

$

1,857.4

$

1,765.0

Net income (loss)

$

32.6

$

(18.3

)

Consolidated Adjusted EBITDA ⁽¹⁾

$

312.6

$

236.1

Rent expense associated with triple net operating leases ⁽²⁾

$

163.3

$

156.0

Cash payments to our REIT Landlords under Triple Net Leases ⁽³⁾

$

247.1

$

240.0

Diluted earnings (loss) per common share

$

0.24

$

(0.12

)

(1)

For more information, definitions, and reconciliations see the “Non-GAAP Financial Measures” section below.

(2)

Consists of the operating lease components of (i) our triple net master lease dated November 1, 2013 with Gaming and Leisure Properties, Inc. (Nasdaq: GLPI) (“GLPI”), as amended and restated effective January 1, 2023 (the “AR PENN Master Lease”), (ii) our triple net master lease entered into in conjunction with, and coterminous with, the AR PENN Master Lease (the “2023 Master Lease”), and (iii) our triple net master lease dated December 4, 2025 with VICI Properties Inc. (NYSE: VICI) (“VICI”) for the real estate assets used in the operations of Margaritaville Resort Casino and Hollywood Casino at Greektown (the “VICI Master Lease”), which replaced the Company’s prior separate triple net leases with VICI for such properties. Collectively these arrangements are referred to as our “triple net operating leases.” The expense related to operating lease components contained within our triple net operating leases are recorded as “General and administrative” within the unaudited Consolidated Statements of Operations.

(3)

Consists of total cash payments made to GLPI and VICI (referred to collectively as our “REIT Landlords”) under our triple net operating leases (as defined above), the Pinnacle Master Lease, and the Morgantown Lease and collectively referred to as our “Triple Net Leases.”

For the three months
ended June 30,

2026

2025

Diluted earnings (loss) per share

$

0.24

$

(0.12

)

Impairment loss

—

0.10

Gain on disposal of assets

(0.03

)

—

Pre-opening expenses

0.17

0.03

Legal matters inclusive of litigation settlements

(0.02

)

0.06

Transaction costs and other

0.14

0.01

Non-operating items:

Loss on early extinguishment of debt

0.01

0.08

Gain related to debt and equity investments

—

(0.01

)

Other income

—

(0.02

)

Foreign currency transaction loss

—

0.01

Income tax impact on net income adjustments ⁽¹⁾

(0.07

)

(0.04

)

Adjusted EPS

$

0.44

$

0.10

(1)

The income tax impact reflects current and deferred tax effects based on the nature of each adjustment and the applicable tax jurisdiction.

For the three months
ended June 30,

For the six months
ended June 30,

(in millions, unaudited)

2026

2025

2026

2025

Revenues:

Northeast segment ⁽¹⁾

$

731.6

$

711.6

$

1,418.7

$

1,392.5

South segment ⁽²⁾

301.9

302.2

583.1

590.5

West segment ⁽³⁾

151.5

137.7

297.2

267.4

Midwest segment ⁽⁴⁾

320.6

297.0

626.5

579.9

Interactive ⁽⁵⁾

349.4

316.1

707.7

606.2

Other ⁽⁶⁾

5.6

5.7

10.9

11.0

Intersegment eliminations ⁽⁷⁾

(3.2

)

(5.3

)

(7.7

)

(10.0

)

Total revenues

$

1,857.4

$

1,765.0

$

3,636.4

$

3,437.5

Segment Adjusted EBITDAR ⁽⁸⁾:

Northeast segment ⁽¹⁾

$

220.2

$

209.5

$

414.7

$

403.7

South segment ⁽²⁾

109.0

104.8

213.2

208.1

West segment ⁽³⁾

55.0

53.5

109.0

99.2

Midwest segment ⁽⁴⁾

133.0

121.8

251.7

235.6

Interactive ⁽⁵⁾

(9.5

)

(62.0

)

(20.4

)

(151.0

)

Other ⁽⁶⁾

(31.8

)

(35.5

)

(63.2

)

(74.3

)

Rent expense associated with triple net operating leases

(163.3

)

(156.0

)

(326.6

)

(311.9

)

Consolidated Adjusted EBITDA ⁽⁹⁾

$

312.6

$

236.1

$

578.4

$

409.4

(1)

The Northeast segment consists of the following properties: Ameristar East Chicago, Hollywood Casino at Greektown, Hollywood Casino Bangor, Hollywood Casino at Charles Town Races, Hollywood Casino Columbus, Hollywood Casino Lawrenceburg, Hollywood Casino Morgantown, Hollywood Casino at PENN National Race Course, Hollywood Casino Perryville, Hollywood Casino Toledo, Hollywood Casino York, Hollywood Gaming at Dayton Raceway, Hollywood Gaming at Mahoning Valley Race Course, Marquee by PENN, Hollywood Casino at The Meadows, and Plainridge Park Casino.

(2)

The South segment consists of the following properties: 1^st Jackpot Casino, Ameristar Vicksburg, Boomtown Biloxi, Boomtown Bossier City, Boomtown New Orleans, Hollywood Casino Gulf Coast, Hollywood Casino Tunica, L’Auberge Baton Rouge, L’Auberge Lake Charles, and Margaritaville Resort Casino.

(3)

The West segment consists of the following properties: Ameristar Black Hawk, Cactus Petes and Horseshu, M Resort Spa Casino, and Zia Park Casino.

(4)

The Midwest segment consists of the following properties: Ameristar Council Bluffs, Argosy Casino Alton, Argosy Casino Riverside, Hollywood Casino Aurora, Hollywood Casino Joliet, our 50% investment in Kansas Entertainment, LLC, which owns Hollywood Casino at Kansas Speedway, Hollywood Casino St. Louis, Prairie State Gaming, and River City Casino.

(5)

The Interactive segment includes all of our online sports betting, online casino/iCasino and social gaming operations, management of retail sports betting, and media. Interactive revenues are inclusive of a tax gross-up of $185.5 million and $137.9 million for the three months ended June 30, 2026 and 2025, respectively, and $371.3 million and $266.1 million for the six months ended June 30, 2026 and 2025, respectively.

(6)

The Other category, included in the tables to reconcile the segment information to the consolidated information, consists of the Company’s stand-alone racing operations, namely Sanford-Orlando Kennel Club, Sam Houston and Valley Race Park, and our management contract for Retama Park Racetrack. The Other category also includes corporate overhead, which consists of certain expenses, such as payroll, professional fees, travel expenses, and other general and administrative expenses that do not directly relate to or have not otherwise been allocated. Corporate overhead was $29.5 million and $38.7 million for the three months ended June 30, 2026 and 2025, respectively, and $57.7 million and $74.7 million for the six months ended June 30, 2026 and 2025, respectively. Corporate overhead for the three and six months ended June 30, 2025 included $9.4 million and $17.1 million, respectively, of legal and advisory costs related to activist activity in connection with our 2025 annual meeting of shareholders.

(7)

Primarily represents the elimination of intersegment revenues associated with our retail sportsbooks, which are operated by PENN Interactive.

(8)

See definition of Segment Adjusted EBITDAR within the “Reportable Segment Measures” section below.

(9)

See definition of Consolidated Adjusted EBITDA within the “Non-GAAP Financial Measures” section below.

For the three months
ended June 30,

For the six months
ended June 30,

(in millions, unaudited)

2026

2025

2026

2025

Net income (loss)

$

32.6

$

(18.3

)

$

29.8

$

93.2

Income tax expense

7.1

6.4

15.8

54.1

Interest expense, net

100.9

95.9

201.8

206.7

Interest income

(2.0

)

(2.1

)

(3.8

)

(5.3

)

Income from unconsolidated affiliates

(8.6

)

(13.3

)

(16.9

)

(20.9

)

Gain on financing arrangement

—

—

—

(215.1

)

Loss on early extinguishment of debt

1.8

11.8

1.8

11.8

Other (income) expenses

(0.1

)

(2.9

)

0.2

(4.2

)

Operating income

131.7

77.5

228.7

120.3

Stock-based compensation

17.4

16.1

31.5

31.7

Cash-settled stock-based awards variance ⁽¹⁾

(2.6

)

(3.1

)

(6.0

)

(6.3

)

Pre-opening expenses

23.0

4.4

27.2

4.9

Depreciation and amortization

117.8

110.5

234.8

218.5

Impairment loss ⁽²⁾

—

15.0

—

15.0

Income from unconsolidated affiliates

8.6

13.3

16.9

20.9

Non-operating items of equity method investments ⁽³⁾

1.1

1.1

2.3

2.2

Other expenses ⁽⁴⁾

15.6

1.3

43.0

2.2

Consolidated Adjusted EBITDA

$

312.6

$

236.1

$

578.4

$

409.4

(1)

Our cash-settled stock-based awards are adjusted to fair value each reporting period based primarily on the price of the Company’s common stock. As such, significant fluctuations in the price of the Company’s common stock during any reporting period could cause significant variances to budget on cash-settled stock-based awards.

(2)

Related to an impairment charge in our Midwest segment.

(3)

Consists primarily of depreciation expense associated with our Kansas Entertainment joint venture.

(4)

For the three and six months ended June 30, 2026, other expenses primarily consisted of transaction costs and non-recurring restructuring charges, primarily severance, related to the Company’s new corporate organizational structure. For the six months ended June 30, 2026, other expenses also included settlement costs and related legal and advisory fees associated with the Cooperation Agreement with HG Vora Capital Management, LLC and related parties.

For the three months
ended June 30,

For the six months
ended June 30,

(in millions, except per share data, unaudited)

2026

2025

2026

2025

Revenues

Gaming

$

1,396.6

$

1,367.7

$

2,730.9

$

2,666.0

Food, beverage, hotel, and other

460.8

397.3

905.5

771.5

Total revenues

1,857.4

1,765.0

3,636.4

3,437.5

Operating expenses

Gaming

833.2

869.7

1,641.1

1,723.5

Food, beverage, hotel, and other

333.7

282.0

663.1

546.9

General and administrative

441.0

410.3

868.7

813.3

Depreciation and amortization

117.8

110.5

234.8

218.5

Impairment loss

—

15.0

—

15.0

Total operating expenses

1,725.7

1,687.5

3,407.7

3,317.2

Operating income

131.7

77.5

228.7

120.3

Other income (expenses)

Interest expense, net

(100.9

)

(95.9

)

(201.8

)

(206.7

)

Interest income

2.0

2.1

3.8

5.3

Income from unconsolidated affiliates

8.6

13.3

16.9

20.9

Gain on financing arrangement

—

—

—

215.1

Loss on early extinguishment of debt

(1.8

)

(11.8

)

(1.8

)

(11.8

)

Other

0.1

2.9

(0.2

)

4.2

Total other income (expenses)

(92.0

)

(89.4

)

(183.1

)

27.0

Income (loss) before income taxes

39.7

(11.9

)

45.6

147.3

Income tax expense

(7.1

)

(6.4

)

(15.8

)

(54.1

)

Net income (loss)

32.6

(18.3

)

29.8

93.2

Net loss attributable to non-controlling interest

0.5

0.9

1.0

1.2

Net income (loss) attributable to PENN Entertainment, Inc.

$

33.1

$

(17.4

)

$

30.8

$

94.4

Earnings (loss) per share:

Basic earnings (loss) per share

$

0.25

$

(0.12

)

$

0.23

$

0.63

Diluted earnings (loss) per share

$

0.24

$

(0.12

)

$

0.23

$

0.59

Weighted-average common shares outstanding—basic

133.7

149.0

133.6

150.6

Weighted-average common shares outstanding—diluted

137.1

149.0

134.4

164.7

(in millions, unaudited)

June 30,
2026

December 31,
2025

Cash and cash equivalents

$

887.2

$

686.6

Total traditional debt

$

2,814.7

$

2,904.1

Cash and cash equivalents

(887.2

)

(686.6

)

Traditional net debt ⁽¹⁾

$

1,927.5

$

2,217.5

Amended Revolving Credit Facility due 2031

$

—

$

—

Amended Term Loan A Facility due 2031

446.9

—

Amended Term Loan B Facility due 2033

960.0

—

Amended Revolving Credit Facility due 2027

—

570.0

Amended Term Loan A Facility due 2027

—

453.8

Amended Term Loan B Facility due 2029

—

965.0

5.625% Notes due 2027

400.0

400.0

4.125% Notes due 2029

400.0

400.0

6.75% Notes due 2031

600.0

—

2.75% Convertible Notes due 2026

—

106.7

Other long-term obligations

7.8

8.6

Total traditional debt

2,814.7

2,904.1

Debt discounts and debt issuance costs

(40.1

)

(17.0

)

$

2,774.6

$

2,887.1

Total traditional debt

$

2,814.7

$

2,904.1

Cash and cash equivalents

(887.2

)

(686.6

)

Cash rent payments to REIT landlords ⁽²⁾

7,860.8

7,742.4

$

9,788.3

$

9,959.9

Consolidated Adjusted EBITDA ⁽³⁾

$

999.1

$

830.1

Rent expense associated with triple net operating leases ⁽³⁾

$

646.5

$

631.7

Lease-adjusted net leverage ratio ⁽¹⁾

5.9x

6.8x

Traditional net leverage ⁽¹⁾

2.9x

4.5x

(1)

See “Non-GAAP Financial Measures” section below for more information as well as the definitions of Traditional net debt, Lease-adjusted net leverage ratio, and Traditional net leverage.

(2)

Amount equals 8 times the total cash rent payments to REIT landlords for the trailing twelve months.

(3)

Balance is presented on a trailing twelve months basis.

For the three months
ended June 30,

For the six months
ended June 30,

(in millions, unaudited)

2026

2025

2026

2025

Cash payments to our REIT Landlords under Triple Net Leases

$

247.1

$

240.0

$

494.8

$

480.0

Cash payments (refunds) related to income taxes, net

$

1.9

$

25.7

$

(14.9

)

$

6.0

Cash paid for interest on traditional debt

$

16.7

$

21.1

$

60.5

$

57.8

Capital expenditures

$

97.5

$

159.4

$

192.0

$

284.6