Caesars Entertainment reports mixed Q3 results amid asset sales

Caesars Entertainment reported mixed third-quarter financial results, highlighting continued growth in its digital operations and a steady performance in adjusted EBITDA, but also a net revenue dip due to competitive pressures and new construction. The company also disclosed strategic asset sales and refinancing steps to bolster its 2025 outlook.

For the third quarter ending September 30, Caesars posted GAAP net revenues of $2.9 billion, with a GAAP net loss of $9 million compared to a $74 million profit last year. The company maintained same-store adjusted EBITDA at $1.0 billion, while its digital division reported a notable surge, reaching $52 million in adjusted EBITDA, up from $2 million in Q3 2023.

“Results in Las Vegas reflect record third-quarter hotel, F&B and banquet revenues driven by strong occupancy and cash ADRs,” said CEO Tom Reeg, emphasizing the resilience of Caesars’ Las Vegas operations amid robust demand, which led to $1 billion in revenue for the segment. The regional segment, however, faced challenges from new competition, construction disruptions, and difficult year-over-year comparisons.

Caesars Digital emerged as a bright spot, showing over 40% growth in net revenues. iCasino revenue surged 83%, aided by new market entries in Pennsylvania and West Virginia. Reeg noted the company’s digital growth has been outpacing competitors, with expectations of continued strength in the fourth quarter.

“We’ve been outpacing our peers in growth by about two times and coming into the quarter, I expect we’re closing to three times in the third quarter and that’s without the rollout of the Horseshoe brand,” he added.

To manage interest expenses, Caesars closed a $1.1 billion refinancing deal in October, positioning it for savings in 2025. The company also advanced its asset-light strategy by selling the World Series of Poker brand for $500 million and Linq Promenade for $275 million. However, Reeg discarded the sale of actual casinos in the near future.

“We have no asset-sale processes of actual casinos ongoing as we speak," he told analysts. "We’re economic animals, so if it ultimately makes sense that the best way to drive value is to transact, that’s a possibility. But there’s nothing ongoing."

Revenue from Las Vegas’s upcoming F1 event is anticipated to dip slightly from 2023 levels, reflecting a softer hold on high-end business. Despite this, the company projects an uptick in Las Vegas room revenue in Q4 and strong demand for 2025, bolstered by convention bookings and key regional projects like Caesars Virginia and the New Orleans renovation.

As of Q3 end, Caesars reported $12.7 billion in debt, with $802 million in cash, and Reeg expressed optimism that continued asset sales will enhance liquidity and support growth into 2025.