PENN Entertainment tops estimates despite heavy ESPN BET loss

PENN Entertainment (NASDAQ:PENN) reported revenue dipped 0.6% year-over-year in Q2 to $1.663 billion. Revenue was up compared to a year ago in the Northeast, Midwest, and West segment, but fell in the South and Interactive segments.

Adjusted EBITDAR was reported at $367.0 million vs. $476.8 million a year ago after a heavy loss in the Interactive segment dragged on results. Adjusted EPS came in at -$0.18 vs. -$0.20 consensus and $0.38 a year ago.

PENN (PENN) said cross-sell opportunities from ESPN BET customers remain a key growth driver for the company, as the PENN Play database has grown to approximately 31 million members, including 3.8 million in the digital database, which was noted to be an increase of more than 80% since the launch of ESPN BET.

CEO update: “Our retail properties delivered solid results this quarter as our best-in-class team of operators continues to execute across our diverse portfolio of market leading assets. In our Interactive segment, top-of-funnel growth, improved risk and trading execution, and refined promotional strategies contributed to better-than-expected revenue and Adjusted EBITDA results.”

On the balance sheet, PENN (PENN) had total liquidity at the end of the quarter of $1.9 billion, inclusive of $877.6 million in cash. Traditional net debt as of the end of the quarter was $1.7 billion.

Shares of PENN Entertainment (PENN) were up 2.55% in premarket action on Thursday.