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  • ESPN Bet Changes Partners to DraftKings • This Week in Gambling

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    The partnership between Penn Entertainment and ESPN Bet will end nearly eight years ahead of schedule, marking a major shift in the U.S. sports betting landscape. Originally launched in late 2023 as a 10-year, $1.5 billion agreement, ESPN Bet was intended to combine ESPN’s massive sports media reach with Penn’s gaming expertise. The collaboration struggled to meet expectations, capturing only around three percent of the national betting market, far below its initial targets.

    Penn announced that the partnership will conclude on December 1, 2025. The decision was described as mutual and amicable. Following the split, Penn will rebrand its sportsbook under the name theScore Bet, a brand it already operates in Canada. The ESPN Bet app will automatically transition to the new identity once the deal ends. Penn CEO Jay Snowden said the move allows the company to focus on integrating its digital products and expanding its iCasino business, rather than relying heavily on expensive media partnerships.

    For ESPN, the end of ESPN Bet does not signal a retreat from the sports wagering space but rather a strategic pivot. The network has entered into a new multi-year deal with DraftKings, which will become the exclusive official sportsbook and odds provider of ESPN. This partnership will go into effect the same day the Penn deal expires. ESPN plans to integrate DraftKings’ sportsbook and fantasy products directly into its platforms, including a new betting tab within the ESPN app and expanded betting-focused programming such as ESPN Bet Live.

    The decision underscores how challenging it remains for new entrants to secure market share in the crowded U.S. sports betting sector, dominated by DraftKings and FanDuel. Despite ESPN Bet’s strong brand recognition and heavy promotional backing, it failed to convert that visibility into sustained customer growth.

    With the transition, ESPN shifts from operating a branded sportsbook to leveraging its media dominance through strategic integrations, while Penn refocuses on its core gaming operations. The end of ESPN Bet’s short-lived run illustrates the evolving balance between media partnerships and betting operators competing for attention in an increasingly saturated market.

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    This Week in Gambling

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  • ESPN Bet’s Underperformance Causes Analyst to Lower Penn’s Price Target

    ESPN Bet’s Underperformance Causes Analyst to Lower Penn’s Price Target

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    In a recent development impacting the stock market, Penn Entertainment saw a downgrade in its price target by Deutsche Bank analyst Carlo Santarelli. The analyst revised the target down to $19 per share from the previous $22, maintaining a “Neutral” rating. This alteration came in the wake of a turbulent trading day where Penn Entertainment’s stock closed at $16.28, marking a 2.51% decrease.

    Penn Entertainment Faces Downward Revision Due to ESPN Bet’s Performance

    The primary reason cited for this downward revision was the larger-than-expected losses incurred by Penn Entertainment in its online operations. Specifically, Santarelli highlighted the disappointing performance of ESPN Bet, attributing the setback to the platform’s mix of parlay and straight bets, which reportedly skewed lower on the parlay side compared to competitors.

    Initial projections of a $167 million first-quarter digital loss for Penn Entertainment were revised by Santarelli to a staggering $187 million deficit. 

    Despite this setback, some positive indicators were identified within Penn’s brick-and-mortar establishments. The Midwest region showcased strength, compensating for the underperformance observed at Penn’s Dixie casinos.

    Although revenue from regional casinos remained stagnant in February and March following a 13% decline in January due to adverse weather conditions, Santarelli revised his cash-flow projection for Penn’s casino portfolio to $481 million for the quarter, up from $478 million. However, the overall cash-flow forecasts for the company diminished to $267 million from the initial estimate of $284 million.

    Penn Entertainment’s Future Hinges on ESPN Bet’s Performance

    Santarelli emphasized the pivotal role of ESPN Bet in determining Penn Entertainment’s future trajectory. While acknowledging the shares’ multi-year underperformance as intriguing, he advocated for a cautious approach, citing ESPN Bet as the primary driver of the stock’s performance in the foreseeable future.

    At the same time in March, Penn Entertainment’s CEO, Jay Snowden, expressed satisfaction with the success of ESPN BET following its launch in 17 US states, recording 1.1 million downloads in its first week. Snowden anticipates further growth for the sportsbook, particularly with upcoming improvements ahead of the football season, aiming to enhance revenue, market share, and overall growth for Penn Entertainment.

    Despite the challenges anticipated by analysts in the digital sphere, Penn’s brick-and-mortar casinos were described as stable performers. Furthermore, optimism surrounded Penn Entertainment’s forthcoming upgrades and maintenance program slated for 2024-2025. This initiative includes the construction of new hotel towers at M Resort and Hollywood Columbus, in addition to the establishment of new casinos at Hollywood Joliet and Hollywood Aurora.

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    Silvia Pavlof

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