Caesars Net Revenues Drop by 3.33% in Third Quarter of 2024
Caesars Entertainment, a pivotal player in the global gambling landscape, recently published its financial results for the third quarter ended September 30th, 2024. The report indicates a 3.33% decrease in total revenues, amounting to $2.9 billion, though this decline has been significantly offset by a remarkable rise in online revenue streams.
Despite the overall revenue drop, Caesars Digital reported an impressive 40.9% surge in net revenues, generating $303 million for the quarter. The online sector achieved an astounding 2,500% increase in adjusted EBITDA, showcasing the robust growth potential within the digital gambling space.
Third Quarter 2024 Overview and Highlights
- GAAP Net Revenues: $2.9 billion, down 3.33% year-on-year
- GAAP Net Loss: $9 million, compared to a net income of $74 million in Q2 2023
- Same-store Adjusted EBITDA: $1 billion, stable compared to Q3 2023
- Caesars Digital Adjusted EBITDA: $52 million, a staggering increase of 2,500% year-on-year (up from $2 million)
Tom Reeg, Chief Executive Officer of Caesars Entertainment, Inc., remarked: “In the third quarter, we achieved a consistent $1 billion in same-store consolidated Adjusted EBITDA. Our Las Vegas segment experienced record hotel, food and beverage, and banquet revenues, driven by high occupancy rates and strong average daily room rates (ADR). However, regional operations faced challenges from intensified competition, ongoing construction disruptions, and challenging year-over-year comparisons. Notably, Caesars Digital set an all-time quarterly record for Adjusted EBITDA, fueled by over 40% growth in net revenues.”
Bret Yunker, Chief Financial Officer, added: “On October 17th, we completed a successful $1.1 billion senior unsecured refinancing. This, coupled with other financings undertaken earlier this year, positions us well for substantial interest expense savings in 2025. Additionally, we have secured $250 million in cash proceeds from the sale of our World Series of Poker (WSOP) brand, and we are making significant progress on our multi-year renovations at Caesars New Orleans and Caesars Virginia.”
Successful Sale of the World Series of Poker Brand
Caesars also confirmed the successful finalization of its previously announced sale of the intellectual property rights for the World Series of Poker (WSOP) brand to NSUS Group Inc. This transaction is valued at $250 million in cash and includes a $250 million promissory note payable five years post-closing, supported by the WSOP intellectual property assets.
Under this new agreement, Caesars retains the rights to host the prestigious WSOP live tournament series at its Las Vegas venues for the next two decades. Furthermore, Caesars will continue to operate its updated WSOP Online real-money poker platform in Nevada, New Jersey, Michigan, and Pennsylvania. However, Caesars will face limitations on offering online peer-to-peer real-money poker services outside these defined parameters. The Caesars-branded brick-and-mortar poker rooms will continue to feature the WSOP name, with Caesars properties designated for hosting preferred live WSOP Circuit events.
As part of this new arrangement, several longstanding WSOP executives will transition to NSUS’s leadership team. Ty Stewart will assume the role of Chief Executive Officer for the new WSOP division, with Gregory Chochon as Chief Operating Officer, and Erik Eidissen serving as Communications Manager. These leaders bring over three decades of combined experience in managing the WSOP brand and are poised to drive its growth and strategic initiatives under the new ownership.
Strategic Agreement to Sell LINQ Promenade
Following the successful conclusion of the WSOP sale, Caesars announced a definitive agreement to sell the LINQ Promenade to a joint venture formed by TPG Real Estate (TPG) and Acadia Realty Trust’s Investment Management Platform, with a purchase price set at $275 million. This transaction is subject to standard regulatory approvals and is expected to close by the fourth quarter of 2024.
Tom Reeg commented on this strategic move, stating: “The sale of the LINQ Promenade exemplifies our strategy to divest non-core assets, facilitating a quicker path towards our debt reduction goals. I extend my gratitude to the LINQ Promenade team and tenants for their contributions over the last decade, and I wish them continued success.”
As the gambling industry continues to evolve, Caesars Entertainment remains committed to leveraging its extensive portfolio and innovative strategies to lead in both traditional and digital markets.
For more insights on the latest trends and developments in the gambling sector, stay tuned for further updates from our team of experts.
