As 2026 kicks off, PENN Entertainment finds itself at a pivotal crossroads, one that’s less about crisis management and more about strategic recalibration. The Wyomissing-based gaming giant announced sweeping organizational changes this week, effectively streamlining its corporate structure while doubling down on what’s actually working: its retail casino portfolio and Hollywood-branded iGaming products.
The restructuring, which CEO Jay Snowden framed as essential for operational efficiency and improved capital discipline, marks the company’s latest move to extract itself from an expensive digital betting misadventure. Two longtime executives, Todd George, Executive Vice President of Operations, and Rich Primus, Senior Vice President and Chief Information Officer, are stepping down as their roles are eliminated. Both positions have been declared redundant under the new organizational blueprint, with regional leadership absorbing operational oversight and marketing functions moving closer to executive leadership.
Snowden acknowledged in the company’s announcement:
Todd and Rich have made significant contributions to PENN’s evolution over the past decade and helped build the strong foundation we have in place today.
George spent over 13 years with PENN, overseeing everything from regional operations to the modernization of flagship properties. Most recently, he shepherded the August 2025 opening of the new $185 million Hollywood Casino Joliet and the December completion of M Resort’s $206 million second hotel tower in Henderson, Nevada. Primus, meanwhile, served as CIO for more than a decade, spearheading the company’s “3Cs” initiative while developing its cybersecurity framework and enterprise technology roadmap.
From Racetracks to Regional Gaming Empire
To understand where PENN is headed, it helps to understand where it’s been. The company traces its roots back to 1972, when a group of civic leaders in central Pennsylvania established Penn National Race Course in Grantville. For a decade, the venue operated as a modest thoroughbred racing facility under the Turf Club’s management. But in 1982, Peter D. Carlino took control, setting the stage for what would become a decades-long expansion story.
By 1994, Penn National Gaming went public on NASDAQ, raising $18 million to pay down debt and develop off-track betting parlors. The company’s first major pivot came in 1997 with the acquisition of Charles Town Races in West Virginia, a deal that introduced video lottery terminals and marked PENN’s official entry into diversified gaming. From there, the acquisitions came fast: Hollywood Casino Corporation in 2003, Argosy Gaming in 2008, and Pinnacle Entertainment in 2018. Each deal broadened PENN’s geographic footprint and strengthened its position in the regional casino market.
But the real transformation came later. In 2018, PENN became the first Pennsylvania casino to offer sports betting following the Supreme Court’s repeal of PASPA. The following year, it launched its first online casino, Hollywood Casino, in Pennsylvania. Then came the digital media plays: a 36 percent stake in Barstool Sports for $163 million in 2020, followed by the $2 billion acquisition of Score Media and Gaming in 2021. The company even rebranded itself from Penn National Gaming to PENN Entertainment in 2022, signaling its ambitions to become more than just a regional casino operator.
Today, PENN operates 43 properties across 20 states, with online sports betting in 19 jurisdictions and iCasino offerings in five. Full-year 2024 revenue hit $6.58 billion, cementing the company’s status as one of North America’s leading integrated entertainment providers.
The ESPN Bet Gamble That Didn’t Pay Off
The ESPN Bet partnership, announced with considerable fanfare in August 2023, was supposed to be PENN’s big swing at the online sports betting duopoly. To make it happen, the company sold Barstool Sports back to founder Dave Portnoy for just $1, recording an eye-watering $800 million to $850 million non-cash loss in the process, and committed to paying ESPN $150 million annually for a decade, totaling $2 billion in licensing fees. The deal gave PENN the right to rebrand its sportsbook under the ESPN name, theoretically unlocking access to the sports network’s massive audience and brand equity.
ESPN Bet officially launched in November 2023, and early metrics looked promising: the rebranding drove 2.9 million new users into the PENN ecosystem during its first week alone. But driving downloads and driving profitable, engaged betting activity turned out to be very different things. Industry analysts point to several factors behind the collapse. Timing was terrible, by late 2023, FanDuel and DraftKings had already locked down 44 percent and 34 percent of the U.S. sports betting market, respectively, making it nearly impossible for latecomers to crack the duopoly.
ESPN Bet also suffered from what observers called a “minimally viable product” problem. While the ESPN brand was powerful, the underlying technology and user experience couldn’t match the sophisticated platforms that DraftKings and FanDuel had spent years refining. According to state regulatory filings, ESPN Bet captured just 3.2 percent of total handle across 14 states that disclose brand-level data, tying for sixth place with Bet365, far short of the double-digit market share targets PENN and ESPN had set for themselves.
The partnership agreement included a clause allowing either party to terminate after three years if specific market share performance thresholds weren’t met. By early November 2025, both sides had seen enough. In Snowden’s words to analysts:
We could see through the first couple of months of football season, while we’re making a lot of improvements in a number of areas, we weren’t on a trajectory to get to that level of market share. And so you know where it’s headed. Why string this along?
On December 1, 2025, just shy of 28 months after the partnership launched, ESPN Bet officially shut down. ESPN pivoted to a content and marketing partnership with DraftKings, while PENN rebranded its U.S. sports betting platform to theScore Bet, the name it already used in Canada.
The Barstool Chapter: A Cautionary Tale
The ESPN Bet failure might have stung less if PENN hadn’t already burned through hundreds of millions on another digital media misfire. The Barstool Sports saga started in February 2020, when PENN acquired a 36 percent stake in the irreverent sports and pop-culture media company for $163 million. The deal made sense on paper: Barstool had more than 200 million followers across its digital platforms and a fiercely loyal, demographically desirable audience.
PENN launched Barstool Sportsbook in Pennsylvania in September 2020, and the app handled $11 million in wagers during its first week. The company exercised its option to acquire the remaining 64 percent of Barstool in February 2023 for an additional $388 million, bringing total investment to around $550 million.
But the Barstool brand proved to be a double-edged sword. While founder Dave Portnoy’s unfiltered persona attracted a dedicated following, it also brought regulatory scrutiny and negative publicity, complications that became increasingly problematic for a heavily regulated public company. More importantly, Barstool struggled with user conversion. Despite its massive social media reach, the sportsbook couldn’t efficiently turn followers into profitable bettors.
When the ESPN opportunity emerged in mid-2023, PENN decided to cut its losses. The company sold Barstool back to Portnoy for $1 that August, though the agreement gave PENN the right to 50 percent of proceeds from any future sale. Portnoy, for his part, seemed relieved. “The regulated industry is probably not the best place for Barstool Sports and the type of content we make,” he said at the time.
theScore: A Canadian Success Story Comes Home
Ironically, PENN’s most successful digital asset may be the one it’s had all along. Score Media and Gaming, acquired in 2021 for $2 billion, operates theScore, one of the most popular sports media apps in North America with roughly 4 million monthly active users. TheScore started life in 2012 as a spin-out from Score Media after Rogers Media acquired the company’s television business. The app built a loyal following by providing fast, clean sports news and scores with a mobile-first design philosophy.
In 2019, theScore entered into a 20-year market access agreement with Penn National Gaming (as it was then known), allowing the company to operate sports betting in multiple U.S. states. When PENN acquired theScore outright in 2021, the app was already a proven product in Canada, offering both sports media content and a fully integrated sportsbook in Ontario.
With ESPN Bet now in the rearview mirror, theScore Bet has become PENN’s primary online sports betting brand across all 21 U.S. jurisdictions where the company operates. The rebrand went live on December 1, 2025, the same day the ESPN partnership officially ended. In states where legal, theScore Bet integrates PENN’s Hollywood Casino iGaming products directly into the app, creating a one-stop shop for online betting and casino play.
To lead theScore’s media division, PENN in December 2024 appointed Nate Ravitz, a longtime ESPN executive with deep digital content expertise. Ravitz spent 17 years at ESPN, rising to Senior Vice President of Digital Content. He’s perhaps best known as co-host of the popular “Fantasy Focus Football” podcast, but his role at ESPN extended far beyond that, encompassing content strategy and audience engagement across ESPN.com and the network’s digital properties. His appointment signals that PENN views theScore’s media platform, not just its sportsbook, as central to its strategy going forward.
New Leadership, Unified Technology
The organizational restructuring announced this January consolidates technology and digital operations under Aaron LaBerge, PENN’s Chief Technology Officer and Head of Interactive. LaBerge joined PENN in July 2024 from The Walt Disney Company, where he spent more than 20 years in various technology leadership roles. Most recently, he served as President and CTO for Disney Entertainment and ESPN, overseeing technology and product development for Disney’s two media divisions, which included setting the vision for how Disney uses technology across its streaming services, sports content, and entertainment properties.
LaBerge’s hire was seen as a coup when it was announced, given his deep experience with large-scale consumer digital products and his intimate knowledge of ESPN’s operations, knowledge that should have been invaluable for the ESPN Bet partnership. With that partnership now dissolved, LaBerge’s responsibilities are expanding. He’ll now oversee enterprise IT in addition to PENN’s digital betting and iGaming platforms, creating a unified technology organization that aligns retail, digital, data, cloud, and security platforms under single leadership.
The company has also launched a search for a digital Chief Operating Officer who will handle day-to-day interactive operations and report to LaBerge. This structure is designed to let LaBerge focus on strategic technology decisions while someone else manages operational execution.
Regional operations leadership remains largely intact. Senior Vice Presidents Rafael Verde, Aaron Rosenthal, and Justin Carter will continue overseeing PENN’s retail casino portfolio, with Verde and Rosenthal reporting directly to CEO Snowden. Chief Marketing Officer Jennifer Weissman, who previously reported to the departing Todd George, will now report directly to Snowden as well. Her mandate includes maximizing omnichannel results, essentially figuring out how to drive customers seamlessly between PENN’s physical casinos and its digital products while enhancing the PENN Play loyalty program.
Hollywood Casino: The Bright Spot in PENN’s Digital Portfolio
While sports betting has been a source of frustration for PENN, the company’s iGaming business, online casino games, has been quietly thriving. Hollywood Casino, PENN’s primary online casino brand, has shown consistent growth across multiple states, particularly in Michigan, New Jersey, and Pennsylvania.
In Michigan alone, Hollywood Casino surpassed $9 million in monthly revenue for the first time in October 2025, marking the fifth time that year the brand set a new monthly record. The app has benefited from the broader explosion in U.S. iGaming revenue, which has consistently posted double-digit or even triple-digit growth rates in established markets. During PENN’s Q3 2025 investor call, management noted that iGaming business was up 40 percent year-over-year, while also hitting record quarterly revenue.
Pennsylvania has been particularly lucrative. The commonwealth generated approximately $3.5 billion in iGaming revenue during 2025 and is on track to exceed $4 billion in 2026, maintaining its position as the nation’s largest online casino market. Hollywood Casino’s four Pennsylvania locations collectively produced $136 million in total gaming revenue in September 2025, roughly 25 percent of the state’s total. Online casino revenue through Hollywood Casino Online in Pennsylvania was up 31 percent compared to the prior year.
This success is why PENN’s restructuring explicitly prioritizes iGaming over online sports betting. “Our OSB offerings will continue to provide top of funnel acquisition and cross-sell opportunities for our Hollywood-branded iCasino, which will remain integrated into our OSB product in states where legal, in addition to serving as a standalone iCasino app,” the company stated in its Q3 press release. Translation: sports betting is now viewed primarily as a customer acquisition channel for the more profitable iGaming business.
A Booming Industry, an Intensifying Battle
PENN’s struggles mask the explosive growth happening in the broader iGaming industry. The global online gambling market was valued at approximately $78.7 billion in 2024 and is projected to reach $153.6 billion by 2030, growing at a compound annual rate of 11.9 percent. Sports betting accounts for roughly 56 percent of that total, with online casinos, poker, and bingo making up the rest.
The U.S. market, which was worth just $2.5 billion in 2022, has experienced even more dramatic growth. By 2025, U.S. online gambling revenue is expected to hit $26.8 billion, with projections suggesting it could approach $40 billion by 2029, with platforms such as crypto casinos contributing to the growth. Mobile online gambling accounts for more than 65 percent of total iGaming revenue globally, and that percentage is even higher in the U.S., where desktop betting has largely been supplanted by app-based wagering.
Sports betting specifically is on a tear. The U.S. sports betting market generated $13 billion in revenue in 2024 and is forecasted to reach $17.5 billion in 2025. But the market remains highly concentrated: FanDuel and DraftKings together control roughly 78 percent of total gross gaming revenue, with FanDuel holding a 43 percent share and DraftKings claiming 34 percent. That leaves everyone else, including BetMGM, Caesars Sportsbook, Fanatics, and now theScore Bet, fighting over the remaining 22 percent.
The duopoly’s dominance isn’t just about brand recognition. Both FanDuel and DraftKings have spent years and hundreds of millions of dollars building sophisticated mobile platforms, refining their odds-pricing algorithms, and perfecting customer acquisition funnels. In 2021, DraftKings devoted roughly 75 percent of its revenue to marketing; FanDuel spent nearly 50 percent. Those investments have created network effects that make it extremely difficult for competitors to gain traction. Larger operators can afford to offer better odds and more promotions without sacrificing margins, which keeps users engaged and makes switching less appealing.
The competitive dynamics in iGaming are somewhat more favorable. While FanDuel and DraftKings still lead with 34 percent and 32 percent market shares respectively in states where they operate online casinos, the gaps aren’t as insurmountable. BetMGM commands roughly 22 percent of the U.S. iGaming market, while regional players like PENN’s Hollywood Casino can carve out profitable niches by leveraging their land-based loyalty programs and local brand recognition.
Consolidation Reshapes the Landscape
The iGaming industry saw a wave of consolidation in 2024 and 2025, with major operators and suppliers pursuing deals aimed at gaining scale, technology capabilities, and access to new regulated markets. Flutter Entertainment, FanDuel’s parent company, acquired Boyd Gaming’s remaining 5 percent stake in FanDuel for $1.51 billion, gaining full ownership of the market leader. The transaction valued FanDuel at approximately $26.7 billion and gave Flutter complete strategic flexibility in its largest and fastest-growing market.
On the supply side, Apollo Global Management completed a €5.42 billion acquisition of International Game Technology’s Gaming and Digital division along with Everi Holdings, creating one of the largest privately held gaming technology groups worldwide. The deal brought together IGT’s game content and platform infrastructure with Everi’s payments and fintech capabilities, establishing a vertically integrated supplier capable of competing with the biggest public gaming firms.
Europe saw even bigger moves. Allwyn International and OPAP agreed to merge in an all-share transaction valued at €16 billion, creating the world’s second-largest publicly listed gaming entertainment company. Banijay Group acquired a controlling stake in Tipico and combined it with Betclic under the Banijay Gaming division, forming one of the largest betting operators in continental Europe with projected annual revenue of €6.4 billion.
Even traditional gaming companies got in on the action. Japanese tech giant MIXI acquired a 66.4 percent stake in Australian sportsbook PointsBet for €162 million, while Sega Sammy Holdings completed a €92 million acquisition of GAN Limited to gain access to U.S. online betting technology. These cross-border deals illustrate how iGaming is evolving into a truly global industry where regional borders and business models are becoming increasingly interconnected.
The broader trend is clear: after years of explosive growth and market fragmentation, the industry is entering a maturity phase characterized by consolidation and a focus on profitability over growth at any cost. Operators that can’t achieve meaningful scale or differentiation are being acquired or forced to exit. For PENN, this means focusing resources on markets and products where it has genuine competitive advantages rather than trying to out-muscle well-funded national players in online sports betting.
Brick-and-Mortar Still Delivers
While much attention has focused on PENN’s digital stumbles, the company’s retail casino business remains strong and continues to generate the bulk of its revenue and profits. The Q3 2025 retail segment generated $1.4 billion in revenue and $465.8 million in adjusted EBITDA, translating to a healthy 32.8 percent margin. Full-year guidance for Q4 2025 projects retail segment revenue between $1.41 billion and $1.43 billion with adjusted EBITDA between $455 million and $475 million.
Two major property expansions came to fruition in the latter half of 2025, demonstrating PENN’s ongoing commitment to its physical footprint. Hollywood Casino Joliet, which opened on August 11, 2025, replaced a decades-old riverboat casino with a modern $185 million land-based facility. Located at the intersection of Interstate 80 and Interstate 55, where an estimated 230,000 vehicles pass daily, the new casino features approximately 1,000 slot machines, 43 live table games, an ESPN Bet sportsbook (which has since been rebranded to theScore Bet), and roughly 10,000 square feet of event and meeting space. The venue is designed as the anchor attraction of Rock Run Collection, a new super-regional commercial and residential development in the Chicagoland market.
The opening came nearly six months ahead of PENN’s original construction timeline, a testament to the operational execution that Todd George and his team delivered before the restructuring. The new casino created approximately 600 jobs, growing PENN’s Joliet workforce by 200 positions.
Just a few months later, in December 2025, PENN celebrated the opening of a second hotel tower at M Resort Spa Casino in Henderson, Nevada. The $206 million expansion added 375 rooms, nearly doubling the resort’s capacity to 765 total rooms and suites. The project also included the 15,000-square-foot Montese Ballroom, which opened in October, bringing M Resort’s total indoor and outdoor event space to more than 100,000 square feet. The expansion is expected to create 120 new jobs and significantly enhances M Resort’s ability to serve group business and convention traffic.
Timing for both projects was strategic. The M Resort expansion came online just ahead of the Wrangler National Finals Rodeo, New Year’s Eve celebrations, and CES, three of Las Vegas’s biggest annual events. More importantly for PENN’s broader strategy, the additional capacity allows the company to offer better Las Vegas rewards and experiences to holders of PENN Play loyalty cards, potentially driving visitation from customers at the company’s 42 other properties nationwide.
Additional projects remain in the pipeline. A new land-based Hollywood Casino Aurora in Illinois and a hotel tower at Hollywood Casino Columbus are both expected to open in late Q2 2026. The relocation of Hollywood Casino Council Bluffs is slated for late 2027 or early 2028. These developments underscore the reality that, for all the attention paid to digital betting, PENN’s core business remains rooted in physical casinos, and the company continues to invest accordingly.
Free Cash Flow and the Path Forward
The strategic shift PENN is undertaking centers on a few core principles: control what you own, exit expensive partnerships, and maximize free cash flow. Terminating the ESPN agreement immediately saves $150 million in annual licensing and marketing payments, a significant sum that can be redeployed toward customer acquisition for theScore Bet and Hollywood Casino or returned to shareholders. The company has indicated it will provide specific guidance on cost savings and free cash flow improvements tied to the restructuring when it reports Q4 2025 financial results in February 2026.
By owning theScore, theScore Bet, and Hollywood Casino outright, PENN no longer has to navigate the complexities and compromises that come with third-party brand partnerships. “Between theScore Media, theScore Bet, and Hollywood Casino, these are brands that we own and we control everything about how those operate,” Aaron LaBerge told analysts on the Q3 earnings call. “So we’re pretty optimistic about moving forward.”
The Interactive segment reported $297.7 million in revenue during Q3 2025 (including a $139.5 million tax gross-up) but posted an adjusted EBITDA loss of $76.6 million. Management expects the Q4 loss to be smaller and has set a target for the digital business to reach breakeven or better in 2026. Achieving that goal will depend heavily on theScore Bet’s ability to retain the user base built under the ESPN brand and on Hollywood Casino’s continued iGaming momentum.
The company took an $825 million non-cash impairment charge on its Interactive segment during Q3 2025, reflecting the write-down of goodwill and intangible assets related to its failed digital betting strategies. It’s a painful accounting entry, but one that clears the decks for a fresh start. PENN’s net loss for Q3 2025 totaled $865.1 million, driven almost entirely by that impairment.
Looking beyond digital, PENN’s retail operations remain the cash cow funding everything else. Operating cash flow for the nine months ended September 30, 2025, increased 56 percent year-over-year to $401 million. The company projects no cash taxes in 2025 and net cash interest expense of $160 million. Capital expenditure guidance for 2025 stands at $685 million, split between $430 million for development projects like the M Resort tower and Hollywood Joliet, and $255 million for maintenance.
Analysts Await Details
Wall Street will be watching closely when PENN reports Q4 earnings and provides 2026 guidance in late February. Consensus estimates currently project Q4 2025 earnings per share of negative $0.17, though estimates have been volatile given the Interactive segment impairment and restructuring charges. For full-year 2026, analysts are forecasting a return to profitability with EPS around $0.43.
The key questions investors want answered revolve around theScore Bet’s retention rates, Hollywood Casino’s growth trajectory, and the magnitude of cost savings from the organizational restructuring. If PENN can demonstrate that the digital business is on a path to breakeven while the retail segment maintains stable margins, the stock could find support. The company’s shares have been under pressure throughout 2025, reflecting skepticism about its ability to compete in online betting and concerns about integration execution.
One advantage PENN has is that expectations are now quite low. The company isn’t promising to challenge the FanDuel-DraftKings duopoly or to become a top-three national sportsbook. Instead, the message is more modest: leverage theScore’s existing brand equity in Canada and among sports media consumers, use online sports betting as a customer acquisition funnel for the more profitable iGaming business, and focus capital on retail properties where the company has defensible competitive positions.
There’s also an argument that PENN is better positioned now than at any point during the Barstool or ESPN eras simply because it finally controls its own destiny. No more splitting decisions with Dave Portnoy. No more navigating Disney’s corporate bureaucracy. No more paying astronomical licensing fees for brand access. For the first time in years, the company can make product, marketing, and technology decisions solely based on what’s best for its business rather than what satisfies a partner’s requirements.
A More Focused, Less Flashy Future
PENN Entertainment’s journey over the past five years reads like a cautionary tale about the perils of chasing shiny objects in fast-moving markets. The company spent more than $550 million acquiring and then quickly divesting Barstool Sports. It committed $2 billion to theScore, which has turned out reasonably well but hasn’t delivered transformational growth. And it pledged another $2 billion to ESPN for a partnership that collapsed in less than three years. All told, PENN has invested north of $4 billion trying to crack the online sports betting code, an amount that would have funded a lot of casino expansions and shareholder returns.
The silver lining is that PENN emerged with some valuable assets intact. TheScore has 4 million monthly users and a functional sportsbook platform that works in both the U.S. and Canada. Hollywood Casino has proven it can compete effectively in the iGaming space, posting 40 percent year-over-year growth. And the retail casino portfolio continues to generate consistent cash flow with attractive margins.
The January 2026 restructuring represents an acknowledgment that bigger isn’t always better and that focus matters more than footprint, especially when competing against well-funded national platforms with network effects. By consolidating leadership, cutting redundant roles, and eliminating expensive licensing agreements, PENN is positioning itself to play to its strengths: regional casino dominance, omnichannel loyalty programs, and a growing presence in online casino games.
Jay Snowden and his team have made plenty of expensive mistakes over the past half-decade. But credit them for recognizing when strategies aren’t working and being willing to pivot quickly rather than throwing good money after bad. The ESPN deal had an ejection clause, and PENN pulled the ripcord rather than waiting out a slow, expensive decline. The Barstool saga ended with a writeoff, but it ended. Now the company is refocusing on the businesses it actually controls and that are actually profitable.
Whether that’s enough to satisfy investors and reignite growth remains to be seen. The iGaming industry is booming, but it’s also consolidating around a few dominant players with scale advantages that are hard to overcome. PENN won’t be one of those dominant players, that ship has sailed. But as a focused regional operator with a solid retail foundation and a profitable online casino business, the company has a clearer path forward than it’s had in years. Sometimes the best strategy isn’t about swinging for the fences. Sometimes it’s about grinding out singles and doubles while keeping costs under control. For PENN Entertainment in 2026, that might be exactly what success looks like.
