PENN Entertainment, Inc. — Third Quarter 2026 Earnings Summary

Financial Performance:

• Total revenues for the three months ended September 30, 2026, were $1,840.0 million, up from $1,717.3 million in the prior year period.
• Net income for the quarter was $32.6 million, compared to a net loss of $865.1 million in the same period last year.
• Consolidated Adjusted EBITDA was $284.0 million, an increase from $194.9 million in the prior year period.
• Diluted earnings per share were $0.24, compared to a loss of $6.03 per share in the prior year period.
• Adjusted EPS was $0.32, compared to a loss of $0.22 per share in the prior year period.
• Total liquidity as of September 30, 2026, was $2.0 billion, including $1.0 billion in cash and cash equivalents.
• Traditional net debt was $1.8 billion as of September 30, 2026, down from $2.2 billion as of December 31, 2025.
• Cash payments to REIT landlords under triple net leases were $251.8 million for the quarter, compared to $241.9 million in the prior year period.
• Capital expenditures were $59.2 million for the quarter, compared to $172.7 million in the prior year period.

Guidance and Future Outlook:

• Management expressed confidence in achieving the full-year Adjusted EBITDA target in the Interactive segment.
• Healthy operating trends across both Retail and Interactive segments continued through October.
• The company highlighted the opportunity across its remaining development pipeline and its position for future growth.

Business Segments and Product Lines:

• Retail Segment:
  • Generated revenues of $1.5 billion.
  • Achieved Segment Adjusted EBITDAR of $501.8 million with margins of 33.7%.
  • Revenue growth was driven by same-store growth and contributions from completed development projects.
  • Performance was supported by increases in rated revenue, spend per visit across all age segments, and growth in unrated revenue.
  • Segment Adjusted EBITDAR margins improved year-over-year for the third consecutive quarter.
• Interactive Segment:
  • Generated revenues of $348.4 million, including a tax gross-up of $191.4 million.
  • Reported an Adjusted EBITDA loss of $18.3 million, a meaningful improvement from a loss of $76.6 million in the prior year period.
  • U.S. iCasino revenue growth was driven by standalone Hollywood iCasino.
  • Ontario revenue growth was driven by increased users and revenue per user in iCasino and online sports betting (OSB).
  • Early performance of Alberta iCasino and OSB operations expanded the Canadian presence.
• Reportable Segment Revenues (Three Months Ended Sept 30, 2026 vs. 2025):
  • Northeast: $708.3 million vs. $690.5 million.
  • South: $291.8 million vs. $291.0 million.
  • West: $147.5 million vs. $138.3 million.
  • Midwest: $341.9 million vs. $298.3 million.
  • Interactive: $348.4 million vs. $297.7 million.
• Reportable Segment Adjusted EBITDAR (Three Months Ended Sept 30, 2026 vs. 2025):
  • Northeast: $208.1 million vs. $197.9 million.
  • South: $108.3 million vs. $97.7 million.
  • West: $50.9 million vs. $51.1 million.
  • Midwest: $134.5 million vs. $119.1 million.
  • Interactive: $(18.3) million vs. $(76.6) million.

Market and Competitive Landscape:

• The company operates in 28 jurisdictions throughout North America with a diversified portfolio of casinos, racetracks, and online offerings.
• The company leverages its proprietary state-of-the-art, fully integrated digital sports betting and iCasino platform and an in-house iCasino content studio.
• The PENN Play™ customer loyalty program has over 34 million members.
• The company focuses on organic cross-sell opportunities between retail gaming, online sports betting, and iCasino businesses.

Risks and Challenges:

• The press release notes standard forward-looking statement risks including economic conditions, inflation, interest rates, and geopolitical uncertainty.
• Risks include competition in retail, mobile, and online gaming, as well as the ability to attract and retain user adoption in a rapidly evolving market.
• Potential risks involve regulatory changes, litigation outcomes, and the ability to maintain gaming licenses.
• The company faces risks related to the timing and cost of product and technology investments and development projects.

Management Commentary and Tone:

• CEO Jay Snowden described third-quarter results as highlighted by strong year-over-year growth in Retail Segment Adjusted EBITDAR and continued progress toward Interactive profitability.
• Management noted that the Retail segment delivered better-than-expected revenue and Adjusted EBITDAR results.
• Snowden stated that operational discipline and sustained revenue growth reinforce confidence in achieving full-year Interactive Adjusted EBITDA targets.
• Management expressed pleasure with the early performance of Alberta operations and the strategic focus on U.S. iCasino and Canada as key drivers of profitable growth.

Other Key Points:

• The company completed development projects contributing to Retail segment revenue.
• The Interactive segment continues to reinvest in attractive jurisdictions like Ontario and is expanding into Alberta.
• The company has a trailing twelve-month Lease-adjusted net leverage ratio of 5.6x and a Traditional net leverage ratio of 2.3x as of September 30, 2026.
• Corporate overhead was $30.4 million for the quarter, down from $34.0 million in the prior year period.
• Impairment losses for the quarter were $8.0 million, all within the South segment, compared to $825.0 million in the Interactive segment in the prior year period.
• The company hosted a conference call and webcast to discuss results and recent developments.