• Consolidated Net Revenues: $2.8 billion, increased 2% year over year.
• Total Adjusted EBITDA: $884 million, increased 4% year over year.
• Las Vegas Same-Store Adjusted EBITDAR: $433 million, essentially flat year over year.
• Las Vegas EBITDA Margins: 43.2%, up 50 basis points year over year.
• Regional Segment Adjusted EBITDAR: $440 million, up 2% year over year.
• Caesars Digital Net Revenue: $335 million, up 19% year over year.
• Caesars Digital Adjusted EBITDA: $43 million, up $38 million year over year.
• Sports Betting Net Revenue Growth: 9% year over year.
• iCasino Net Revenue Growth: 53% year over year.
• Full Year CapEx Expectation: Approximately $600 million, excluding Virginia joint venture.
• Interest Expense Expectation: Approximately $775 million for 2025.
• Stock Repurchase: $100 million at an average price of $23.84 per share.

• Warning! GuruFocus has detected 5 Warning Signs with CZR.

Release Date: April 29, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Caesars Entertainment Inc (NASDAQ:CZR) reported a 2% increase in consolidated net revenues to $2.8 billion and a 4% increase in total adjusted EBITDA to $884 million year over year.
• The Las Vegas segment achieved the third-best Q1 performance on record, with same-store adjusted EBITDAR of $433 million and improved EBITDA margins by 50 basis points.
• Caesars Digital segment saw a 19% increase in net revenue to $335 million and a significant rise in adjusted EBITDA by $38 million year over year.
• The Regional segment experienced a 2% increase in adjusted EBITDAR, driven by stable same-store trends and contributions from New Orleans and Danville.
• Caesars Entertainment Inc (NASDAQ:CZR) successfully implemented cost controls in labor, marketing, and reinvestment levels, leading to a flow-through rate exceeding their annual 50% target.

Negative Points

• Las Vegas occupancy and cash ADR were slightly down, and the segment faced tough comparisons due to the Super Bowl and weather disruptions.
• The Regional segment was negatively affected by weather disruptions and the loss of an extra operating day compared to the previous year.
• Caesars Digital faced challenges with poor hold during March Madness, impacting revenue growth.
• The company anticipates a decline in skin revenues and World Series of Poker revenues, which could impact future quarters.
• Caesars Entertainment Inc (NASDAQ:CZR) is cautious about potential economic impacts from policy changes in the US, which could affect future performance.

Q & A Highlights

Q: Can you provide an outlook on Las Vegas bookings and group-related activities for the rest of the year? A: Thomas Reeg, CEO, stated that group bookings were about 20% of their first-quarter room base, slightly higher than the full-year average. They expect 2025 to be a record year for group bookings, with particular strength in the fourth quarter. Forward bookings for cash room revenue look in line with last year's numbers for the second quarter, and they have levers to pull if they see any softness in demand.

Q: What was the impact of weather and leap year on regional performance, and how did it affect results? A: Thomas Reeg, CEO, mentioned that the net impact of weather and leap year was in excess of $10 million. Leap year in Las Vegas alone accounted for a $6 million impact.

Q: How are you managing cost savings and margins in Las Vegas, and are there any one-time factors involved? A: Anthony Carano, President and COO, explained that the team is focused on driving efficiencies across labor, food and beverage, and vendor negotiations. Thomas Reeg, CEO, added that the rotation in food and beverage additions over the last four to six quarters has contributed to improved margins as they anniversary those openings.

Q: Have you observed any changes in customer behavior, particularly among lower-tier customers, in response to economic conditions? A: Thomas Reeg, CEO, noted that there has been no significant change in customer behavior. Rated play is up mid-single digits, while unrated play is slightly softer. He emphasized that the bulk of their customers are not stock owners and are not directly impacted by broader economic concerns.

Q: Can you discuss the growth prospects for iGaming and sports betting, and how they are expected to progress? A: Thomas Reeg, CEO, stated that both iGaming and sports betting are expected to generate significant EBITDA in the next 18 months. He anticipates that iGaming legislation will become more appealing to states looking to plug budget holes, and the growth in iCasino is expected to continue at a strong pace.

Q: How are you addressing the volatility in sports betting hold percentages, and what measures are being taken to improve odds setting? A: Thomas Reeg, CEO, explained that volatility in sports betting hold is inherent due to small sample sizes and correlated outcomes. Eric Hession, President of Caesars Digital, added that they are improving hold by enhancing their offerings in tennis, soccer, and other sports, and by increasing the Parlay mix.

Q: What are your thoughts on spinning off the digital segment, given the strong operating trends? A: Thomas Reeg, CEO, reiterated that their primary focus is to deliver on the numbers laid out since 2021. If they achieve their goals and do not see value reflected in the equity, they will consider all options to create shareholder value.

Q: How are you leveraging your real estate holdings in Las Vegas and regional markets to maintain balance sheet stability? A: Thomas Reeg, CEO, expressed confidence in their balance sheet position, highlighting the growth in digital and improved free cash flow. He noted that they have options to manage their real estate holdings if needed, but currently feel well-positioned to weather economic softness.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.