Key Moments:
- Caesars Entertainment is monitoring the sports prediction market and will only enter if regulations become clear
- Company leadership emphasized protecting gaming licenses and compliance over immediate entry into new sectors
- Digital operations have shown ongoing growth, with online sports betting handle increasing by 6% and iGaming revenue up 29% in the latest quarter
Regulatory Uncertainty Shapes Caesars’ Prediction Market Strategy
Caesars Entertainment is closely evaluating the changing sports prediction market. The company will only join once regulations are clear and existing licenses face no risk.
During a recent call with Wall Street analysts, executives addressed concerns about potential competition from platforms such as Kalshi, a CFTC-regulated venue where users can purchase sports-related contracts. This has sparked interest among investors and regulators, although some states and tribal operators have expressed worries that such markets might impact traditional sports betting revenues.
Eric Hession, President of Caesars Sports and Online, commented, “We’re actively watching it and as we said before, we can’t be out on the lead on this. We’re going to monitor it, so we’re not left behind if there’s regulatory clarity and that we have a good plan in place should that outcome happen.” Hession also noted that directions from Nevada and other jurisdictions advise licensees to avoid getting involved in the new markets until legal ambiguities are addressed.
CEO Tom Reeg further highlighted the company’s compliance-first approach, stating, “We will not put any of our licenses at risk. If a path develops where we can participate safely, we are prepared to go down that path. We’re watching it the same as you are.” According to Hession, prediction markets so far have not significantly affected Caesars’ business, suggesting most activity is coming from unregulated markets or younger users aged 18–21.
Digital Division Maintains Momentum
Despite challenges, Caesars’ digital segment continues to demonstrate robust performance. The company reported third-quarter EBITDA of $28 million, which represents a decline of $24 million compared to the previous year. This dip is mainly attributed to the sale of the World Series of Poker, a lower hold for NFL betting in September, and increased iGaming expenses.
Key growth was seen in Caesars’ digital platforms: the online sports betting handle increased by 6%, and iGaming revenue climbed 29% for the quarter. Plans are in place to launch an updated version of the Horseshoe online casino later this year. The company anticipates that digital revenues will generate about 20% top-line growth and contribute to roughly half of EBITDA, a component of its ongoing objective to reach $500 million in digital EBITDA.
No Immediate Plans for a Digital Spin-Off
Discussions have occurred regarding the possibility of spinning off the digital business. However, analysts do not expect this move to happen in the near future. Caesars continues to prioritize building and strengthening its digital assets within the company’s current structure.
| Quarter | EBITDA | Online Sports Betting Handle Growth | iGaming Revenue Growth |
|---|---|---|---|
| Q3 (most recent) | $28 million | 6% | 29% |
- Author
Daniel Williams
