Penn Gets Good News Amid Struggles With ESPN Bet

ESPN Bet’s poor financial performance may not be as bad as expected.

Penn Entertainment, which operates the sportsbook, has told investors its third-quarter numbers will be better than expected. While they are expecting an Earning Before Interest, Taxes, Depreciation, and Amortization (EBITDA) revenue loss of $95 million for the quarter, that number is $30 million less than the previous projection.

Penn has credited an increase in hold and parlays with the improvement, which could signal that ESPN Bet may finally be gaining some momentum. The platform has struggled to capture enough market share to generate much revenue, but some of that can be attributed to the number of bonuses offered as the platform expanded. Those bonuses have now been reigned in, meaning fewer bonus bets are available for customers.

The positive news comes soon after Penn discussed cutting jobs for its digital business, which includes the online sportsbook. While layoffs will likely still be coming, the recent news could mean there will be far fewer.

The question now is where ESPN Bet and Penn go from here. The numbers are improving but remain behind the first and many second-tier operators. As strong as the ESPN brand is, it appears bettors still prefer DraftKings, FanDuel, and the Vegas-based operators.

ESPN Bet Userbase Surges in September

In addition to the improved projections, Penn also saw growth in its customer base in September. The number of customers was up 161% compared to the year before, showing that bettors are still signing up despite the platform’s aggressive welcome bonuses being ended. 

While one month is hardly an indicator of future success, the kind of growth ESPN Bet saw in September is a good sign for Penn as they prepare to close 2024 strong.