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Caesars Entertainment is watching the new sports prediction market pretty closely. They’re ready to jump in if the rules ever get sorted out—just as long as it doesn’t put their current gaming licenses at risk.
Executives talked about all this on a recent call with Wall Street analysts. People wanted to know if competition from places like Kalshi—a platform where you can buy sports-related contracts that the CFTC regulates—was a concern. Investors and regulators are pretty interested, but some states and tribal operators aren’t thrilled. They worry these new markets could cut into regular sports betting revenue.
A Cautious Approach
“We’re actively watching it and as we said before, we can’t be out on the lead on this,” said Eric Hession, President of Caesars Sports and Online. “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 added that Nevada and several other jurisdictions have advised licensed operators to avoid engaging with prediction markets until legal clarity improves.
Caesars CEO Tom Reeg reinforced the company’s cautious stance, emphasizing that while Caesars recognizes the growth potential of prediction markets, compliance remains the top priority. “We will not put any of our licenses at risk,” he said. “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.”
So far, Hession said prediction markets have not had a meaningful impact on Caesars’ operations, suggesting their volume mainly stems from unregulated states or younger demographics aged 18–21.
Strong Digital Momentum
Despite ongoing headwinds, Caesars’ digital business continues to perform well. Third-quarter EBITDA reached $28 million, down $24 million year-on-year, primarily due to the sale of the World Series of Poker, lower NFL hold in September, and increased iGaming costs.
Online sports betting handle rose 6%, while iGaming revenue grew 29% in the quarter. Meanwhile, Caesars is gearing up to roll out a new version of its Horseshoe online casino later this year. The plan is for digital revenue to drive about 20% growth at the top line and make up half of EBITDA, which should help them reach that $500 million EBITDA goal they keep talking about.
There’s also been some chatter about spinning off the digital side of the business. Still, analysts don’t see that happening anytime soon. Caesars seems set on building out its digital business and keeping things steady for now.
Source: Gambling News
