PENN Returns to Profit on Record Retail Quarter and Signals Texas Push

PENN Entertainment reported third-quarter net income of $32.6 million on revenue of $1,840.0 million for the quarter ended 30 September, reverting to profit a year after an $825.0 million impairment drove an $865.1 million loss. The company announced the results on 5 November 2026 and said its retail operations set a third-quarter revenue record, while Chief Executive Jay Snowden said PENN is "ready to play offense" in Texas after the 3 November elections.

Financial headline and the drivers

PENN's consolidated revenue for Q3 rose to $1,840.0 million from $1,717.3 million a year earlier. Net income was $32.6 million, or $0.24 per diluted share, reversing the prior-year loss of $865.1 million that included $825.0 million of impairments in the Interactive segment.

Consolidated Adjusted EBITDA, reported after rent paid to its real estate landlords, increased to $284.0 million from $194.9 million. The company said Retail revenue across its four regional segments produced $1.49 billion, up 5% and a third-quarter record.

Segment Adjusted EBITDAR for the total company rose to $501.8 million, up 7.7% year-on-year.

Retail performance by region

Midwest led the recovery, with revenue up 14.6% to $341.9 million and Segment Adjusted EBITDAR up 12.9% to $134.5 million, driven by ramp-up at Hollywood Casino Aurora and Joliet. Northeast reached $208.1 million, South $108.3 million, and West was flat at $50.9 million. CEO Jay Snowden attributed the West's flat performance to weak table hold at the M Resort and a Las Vegas market that he described as "a little soft." He also noted higher Illinois tax tiers affected margins at Aurora and Joliet.

Chief Financial Officer Felicia Hendrix said PENN raised full-year retail guidance by $16 million to $5.89 billion in revenue, and by $10 million to $1.973 billion in Adjusted EBITDA.

Snowden said October was PENN's strongest month of 2026 for year-over-year gaming revenue growth in Pennsylvania, after the state's skill game ban took effect on 14 October.

Interactive segment and digital repair

Interactive revenue was reported at $348.4 million, but that figure included a $191.4 million gross-up for gaming taxes on partner skins; excluding the gross-up, Interactive revenue was $157.0 million, versus $158.2 million a year earlier.

PENN reduced the Interactive segment's adjusted EBITDA loss to $18.3 million, down from a loss of $76.6 million the prior year. Management attributed the improvement to more targeted promotions, a richer iCasino product mix and lower costs. The company said theScore Bet and Hollywood iCasino narrowed the digital loss even while underlying online revenue remained broadly flat.

CFO Hendrix guided fourth-quarter Interactive revenue of $445 million, including a $242 million gross-up, and Adjusted EBITDA of $18.7 million. That guidance implies a full-year Interactive loss of $20 million, equivalent to the company's Alberta investment. Snowden said, "2027 will be profitable for the year."

Chief Technology and Product Officer Aaron LaBerge said PENN is steering spending away from US sports customer acquisition and has seen no material effect from prediction markets.

Liquidity, leverage and capital allocation priorities

At quarter end PENN held $2.0 billion of liquidity and traditional net debt of $1,761.8 million, giving traditional net leverage of 2.3x and lease-adjusted leverage of 5.6x. Snowden ranked priorities for 2027: paying down debt first, share buybacks second — citing a free cash flow yield over 20% — then projects in Council Bluffs and New Orleans, and lastly M&A. The company provided no repurchase figure for the quarter.

Retail EBITDAR rose by $36.0 million, while the Interactive loss contracted by $58.3 million, figures the company used to explain the quarter's move back into profitability.

Texas comment and regulatory reality

Snowden discussed Texas after the 3 November midterms, noting PENN runs two of Texas' three Class 1 thoroughbred tracks: Sam Houston in Houston and Retama Park near San Antonio, with Retama listed under a management contract in the earnings release. He said PENN would spend more time in the state and was "ready to play offense," while adding the election outcome remained hard to predict.

The company did not put a dollar figure on any Texas opportunity. PENN acknowledged that a governor cannot legalise casinos by executive action: casino gaming in Texas requires a constitutional amendment passed by two-thirds of both legislative chambers and then by voters, and media projections suggested the Texas Senate would remain Republican. PENN pointed to the defeat of Lt. Governor Dan Patrick and the win by Democrat Vikki Goodwin as relevant to the political mix, while noting Gina Hinojosa defeated Greg Abbott in the governor's race per Associated Press coverage cited in the release.

Outlook and unanswered questions

PENN's fourth-quarter Interactive guidance needs $203 million of underlying revenue against the $157.0 million reported in Q3, a marked step-up. Management's positioning put debt reduction first, buybacks second and M&A last, while asserting 2027 should be profitable at the corporate level if Interactive meets its targets.

The quarter illustrates a regional casino operator being carried by its physical assets while the digital business is brought back to profitability. Texas remains an option rather than a plan, constrained by constitutional and legislative processes, and the company's leverage and Interactive execution will be the numbers that matter in 2027.

"We're ready to play offense," Jay Snowden said on the company's post-results call, referencing Texas and PENN's strategic posture.

"2027 will be profitable for the year," Snowden added when discussing Interactive's path back to profitability.