Bally's Corp 10-Q

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Cautionary Note Regarding Forward-Looking Statements This Quarterly Report on Form 10-Q includes forward-looking statements within the meaning of the securities laws. Forward-looking statements are statements as to matters that are not historical facts, and include statements about our plans, objectives, expectations and intentions. Forward-looking statements are not guarantees and are subject to risks and uncertainties. Forward-looking statements are based on our current expectations and assumptions. Although we believe that our expectations and assumptions are reasonable at this time, they should not be regarded as representations that our expectations will be achieved. Actual results may vary materially. Forward-looking statements speak only as of the time of this report and we do not undertake to update or revise them as more information becomes available, except as required by law. Important factors beyond those that apply to most businesses, some of which are beyond our control, that could cause actual results to differ materially from our expectations and assumptions include: • unexpected costs and other events impacting our planned construction projects, including Bally’s Chicago; • unexpected costs, difficulties integrating and other events impacting our completed acquisitions and our ability to realize anticipated benefits; • risks associated with our rapid growth, including those affecting customer and employee retention, integration and controls; • risks associated with the impact of the digitalization of gaming on our casino operations, our expansion into online gaming (“iGaming”) and sports betting and the highly competitive and rapidly changing aspects of our interactive businesses generally; • the very substantial regulatory restrictions applicable to us, including costs of compliance; • global economic challenges, including the impact of public health crises, global and regional conflicts, rising inflation, rising interest rates and supply-chain disruptions, could cause economic uncertainty and volatility and impact discretionary consumer spending; • restrictions and limitations in agreements to which we are subject, including our debt, could significantly affect our ability to operate our business and our liquidity; and • other risks identified in Part I. Item 1A. “Risk Factors” of Bally’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025 as filed with the SEC on March 23, 2026 and other filings with the SEC. The foregoing list of important factors is not exclusive and does not include matters like changes in general economic conditions that affect substantially all gaming businesses. You should not place undue reliance on our forward-looking statements. 51 Overview We are a global gaming, hospitality, entertainment and technology company with an expanding international footprint across casino, interactive and lottery markets. We provide our customers and partners with physical and interactive entertainment and gaming experiences worldwide. Our offerings include traditional casino gaming, iGaming, online bingo, sportsbook, free-to-play games and technology driven lottery and gaming solutions. As of March 31, 2026, we own and operate 20 casinos globally, including in the United Kingdom (“UK”) and in 11 states across the United States (“US”), along with a golf course in New York and horse racetracks in Colorado and Wyoming. We also own Bally Bet Sportsbook & Casino, a premier sports betting and iCasino platform licensed in 14 jurisdictions in North America, and a majority equity interest in Bally’s Intralot S.A. (“Intralot”) which is active in 39 jurisdictions worldwide and is comprised of a global lottery, technology, management and services business and also the Bally’s Interactive International division, a leading global interactive gaming operator. We also have rights to developable land in Las Vegas at the site of the former Tropicana Las Vegas, have been awarded a license to build a full-scale casino and resort in The Bronx, New York (“Bally’s New York”), and are developing an integrated destination resort in Chicago, Illinois. Our Strategy and Business Developments We seek to continue to grow our business by focusing on expanding our integrated casino and interactive gaming platform, optimizing our capital structure, and employing disciplined growth initiatives. We believe that interactive gaming represents a significant strategic opportunity for the future growth of Bally’s and we will continue to proactively allocate resources in regions where we anticipate iGaming regulation, in addition to those markets where iGaming is already well-established. Across the globe, we engage in multiple state and private bidding processes, seeking to obtain new lottery agreements through our innovative technology and solutions. We seek to increase revenues at our casinos and resorts through enhancing the guest experience by providing popular games, restaurants, hotel accommodations, entertainment and other amenities in attractive surroundings with high-quality guest service. We believe that our recent acquisitions have expanded and diversified us from financial and market exposure perspectives, while continuing to mitigate our susceptibility to regional economic downturns, idiosyncratic regulatory changes and increases in regional competition. We continue to make progress on the integration of our acquired assets and deploying capital on our strategic growth projects. These steps have advanced our transformation into a globally diversified gaming and technology operator with a strengthened portfolio, expanded global footprint and enhanced platforms across both digital and land-based channels. 2025 Transactions On February 7, 2025, the Company completed the previously announced transactions under the Agreement and Plan of Merger (as amended, the “Merger Agreement”) with SG Parent LLC, a Delaware limited liability company (“Parent”), The Queen Casino & Entertainment, Inc., a Delaware corporation and affiliate of Parent (“Queen”), Epsilon Sub I, Inc., a Delaware corporation and wholly owned subsidiary of the Company (“Merger Sub I”), Epsilon Sub II, Inc., a Delaware corporation and wholly owned subsidiary of the Company (“Merger Sub II”, and together with the Company and Merger Sub I, the “Company Parties”), and, solely for purposes of specified provisions thereof, SG CQ Gaming LLC, a Delaware limited liability company (“SG Gaming” and together with Parent and Queen, the “Buyer Parties”). On October 8, 2025 (the “Intralot Closing Date”), the Company completed the previously announced acquisition under the transaction agreement (the “Transaction Agreement”) of Intralot, pursuant to which Intralot agreed to acquire Bally’s International Interactive through a combined cash-and-equity transaction. Pursuant to the Transaction Agreement, (i) Intralot paid the Company €1.5 billion ($1.8 billion) in cash and issued approximately 873.7 million new shares in exchange for all of the issued and outstanding capital stock of Bally’s Holdings Limited which held Bally’s International Interactive, (ii) the Company’s ownership of Intralot increased to a controlling 57.9% interest through the issuance of equity to the Company’s consolidated subsidiary Premier Entertainment Sub, LLC via PE Sub Holdings LLC, an indirect wholly owned subsidiary of the Company, making the Company the majority shareholder of Intralot (the “Intralot Transaction”). As a result of obtaining a controlling financial interest in Intralot, the Company retained control of Bally’s International Interactive, via Bally’s Holdings Limited, throughout the transaction. On the Intralot Closing Date, legal ownership of Bally’s Holdings Limited transferred from Premier Entertainment Sub to Intralot; however, Bally’s Corporation simultaneously obtained control of Intralot. Accordingly, Bally’s maintained control of Bally’s International Interactive, and as a result, the transfer of Bally’s International Interactive was accounted for as an equity transaction with the initial recognition of a 42.1% non-controlling interest, and no gain or loss was recognized in earnings. 52 For further information on our recent acquisitions, refer to Notes 1 “General Information” and 7 “Business Combinations” to our condensed consolidated financial statements presented in Part I, Item 1 of this Quarterly Report on Form 10-Q. Operating Structure Our business is organized into four reportable segments: (i) Casinos & Resorts, (ii) Bally’s Intralot B2B, (iii) Bally’s Intralot B2C, and (iv) North America Interactive. Casinos & Resorts - includes 19 land-based casino properties, two horse racetracks and one golf course in the US: Property Name Location Bally’s Atlantic City Casino Resort (“Bally’s Atlantic City”) Atlantic City, New Jersey Bally’s Black Hawk (1)(2) Black Hawk, Colorado Bally’s Chicago Casino (“Bally’s Chicago”) (3) Chicago, Illinois Bally’s Dover Casino Resort (“Bally’s Dover”) (2) Dover, Delaware Bally’s Evansville Casino & Hotel (“Bally’s Evansville”) (2) Evansville, Indiana Bally’s Kansas City Casino (“Bally’s Kansas City”) (2) Kansas City, Missouri Bally’s Lake Tahoe Casino Resort (“Bally’s Lake Tahoe”) Lake Tahoe, Nevada Bally’s Quad Cities Casino & Hotel (“Bally’s Quad Cities”) (2) Rock Island, Illinois Bally’s Shreveport Casino & Hotel (“Bally’s Shreveport”) (2) Shreveport, Louisiana Bally’s Tiverton Casino & Hotel (“Bally’s Tiverton”) (2) Tiverton, Rhode Island Bally’s Twin River Lincoln Casino Resort (“Bally’s Twin River”) (2) Lincoln, Rhode Island Bally’s Vicksburg Casino (“Bally’s Vicksburg”) Vicksburg, Mississippi Hard Rock Hotel & Casino Biloxi (“Hard Rock Biloxi”) (2) Biloxi, Mississippi Bally’s Arapahoe Park Aurora, Colorado Bally’s Golf Links at Ferry Point (“Bally’s Golf Links”) Bronx, New York The Queen Baton Rouge (2) Baton Rouge, Louisiana Bally’s Baton Rouge Casino and Hotel (“Bally’s Baton Rouge”) (2) Baton Rouge, Louisiana Casino Queen Marquette (2) Marquette, Iowa DraftKings at Casino Queen (2) East St. Louis, Illinois Bally’s Thunder Plains Park Hillsdale, Wyoming __________________________________ (1) Consists of three casino properties: Bally’s Black Hawk North Casino, Bally’s Black Hawk West Casino and Bally’s Black Hawk East Casino. (2) Properties leased from Gaming and Leisure Properties, Inc. (“GLPI”). Refer to Note 15 “Leases” for further information. (3) Temporary casino facility as the Company’s future permanent casino resort in Chicago (the “Chicago Permanent Facility”) is constructed. The site of the Chicago Permanent Facility is leased from GLPI. Bally’s Intralot B2B - includes Intralot’s global lottery operations and the Company’s licensing business. Bally’s Intralot B2C - includes the Company’s interactive European gaming operations, Intralot’s B2C lottery operations, as well as one casino property, Bally’s Newcastle, in the UK. North America Interactive - includes the North American operations of Bally’s Interactive, primarily a B2C online iGaming and online sportsbook operator; and consumer facing service and marketing engines. Refer to Note 18 “Segment Reporting” to our condensed consolidated financial statements for additional information on our segment reporting structure. 53 Macroeconomic and Other Factors Our business is subject to risks caused by global economic challenges, including those caused by public health crises such as the COVID-19 pandemic, the impact of global and regional conflicts, rising inflation, rising interest rates and supply-chain disruptions, that can cause economic uncertainty and volatility. These challenges can negatively impact discretionary consumer spending and could result in a reduction in visitors to our properties, including those that stay in our hotels, or discretionary spending by our customers on entertainment and leisure activities. In addition, inflation generally affects our business by increasing our cost of labor. In periods of sustained inflation, it may be difficult to effectively control such increases to our costs and retain key personnel. Key Performance Indicators The key performance indicator used in managing our business is consolidated Adjusted EBITDA and segment Adjusted EBITDAR which are non-GAAP measures. Adjusted EBITDA is defined as earnings, or loss, for the Company, or where noted its reporting segments, before, in each case, interest expense, net of interest income, provision (benefit) for income taxes, depreciation and amortization, non-operating (income) expense, acquisition and other transaction related costs, share-based compensation and certain other gains or losses as well as, when presented for our reporting segments, an adjustment related to the allocation of corporate cost among segments. Segment Adjusted EBITDAR is Adjusted EBITDA (as defined above) for the Company’s reportable segments, plus rent expense associated with triple net operating leases for the real estate assets used in the operations of the Bally’s casinos. We use consolidated Adjusted EBITDA and segment Adjusted EBITDAR to analyze the performance of our business and they are used as determining factors for performance-based compensation for members of our management team. We use consolidated Adjusted EBITDA and segment Adjusted EBITDAR when evaluating operating performance because we believe that the inclusion or exclusion of certain recurring and non-recurring items is necessary to provide a more fulsome understanding of our core operating results and as a means to evaluate period-to-period performance. Also, we present consolidated Adjusted EBITDA and segment Adjusted EBITDAR because they are used by some investors and creditors as indicators of the strength and performance of ongoing business operations, including our ability to service debt, and to fund capital expenditures, acquisitions and operations. These calculations are commonly used as a basis for investors, analysts and credit rating agencies to evaluate and compare operating performance and value companies within our industry. Consolidated Adjusted EBITDA and segment Adjusted EBITDAR information is presented because management believes that they are commonly used measures of performance in the gaming industry and that they are considered by many to be key indicators of our operating results. Consolidated Adjusted EBITDAR is used outside of our financial statements solely as a valuation metric. Consolidated Adjusted EBITDAR is defined as consolidated Adjusted EBITDA plus rent expense associated with triple net operating leases. Consolidated Adjusted EBITDAR is an additional metric used by analysts in valuing gaming companies subject to triple net leases since it eliminates the effects of variability in leasing methods and capital structures. This metric is included as supplemental disclosure because (i) we believe Consolidated Adjusted EBITDAR is used by gaming operator analysts and investors to determine the equity value of gaming operators and (ii) financial analysts refer to Consolidated Adjusted EBITDAR when valuing our business. We believe Consolidated Adjusted EBITDAR is useful for equity valuation purposes because (i) its calculation isolates the effects of financing real estate, and (ii) using a multiple of Consolidated Adjusted EBITDAR to calculate enterprise value allows for an adjustment to the balance sheet to recognize estimated liabilities arising from operating leases related to real estate. Consolidated Adjusted EBITDA and segment Adjusted EBITDAR should not be construed as alternatives to net income, the most directly comparable GAAP measure, as indicators of our performance. In addition, consolidated Adjusted EBITDA and segment Adjusted EBITDAR as used by us may not be defined in the same manner as other companies in our industry, and, as a result, may not be comparable to similarly titled non-GAAP financial measures of other companies. Consolidated Adjusted EBITDAR should not be viewed as a measure of overall operating performance or considered in isolation or as an alternative to net income, because it excludes the rent expense associated with our triple net operating leases for real estate assets used in the operations of our casino properties. 54 First Quarter 2026 Results The following table presents, for the periods indicated, certain revenue and income items: Successor Predecessor (in millions) Three Months Ended March 31, 2026 Period from February 8, 2025 to March 31, 2025 Period from January 1, 2025 to February 7, 2025 Total revenue $ 755.7 $ 368.7 $ 220.5 Income (loss) from operations 91.6 (1.8) (20.8) Net (loss) income (160.9) 34.5 (51.0) The following table presents, for the periods indicated, certain income and expense items expressed as a percentage of total revenue: Successor Predecessor Three Months Ended March 31, 2026 Period from February 8, 2025 to March 31, 2025 Period from January 1, 2025 to February 7, 2025 Total revenue 100.0 % 100.0 % 100.0 % Gaming and non-gaming expenses 47.2 % 44.1 % 47.4 % General and administrative 41.8 % 43.5 % 51.9 % Gain on sale-leaseback (14.0) % — % — % Depreciation and amortization 12.9 % 12.9 % 10.1 % Total operating costs and expenses 87.9 % 100.5 % 109.4 % Income (loss) from operations 12.1 % (0.5) % (9.4) % Other (expense) income: Interest expense, net (14.5) % (14.0) % (12.3) % Other non-operating expense, net (19.3) % (2.4) % (1.1) % Total other expense, net (33.8) % (16.5) % (13.4) % Loss before income taxes (21.7) % (17.0) % (22.8) % (Benefit) provision for income taxes (0.4) % (26.3) % 0.3 % Net (loss) income (21.3) % 9.4 % (23.1) % __________________________________ Note: Amounts in table may not subtotal due to rounding. Segment Performance During the first quarter of 2025, the Company moved a component of the North America Interactive operating segment into a separate operating segment, which is reported in the Corporate & Other category. In the fourth quarter of 2025, the Company further updated its operating and reportable segments in connection with the Intralot Transaction. These changes were made to better align with the Company’s strategic growth initiatives and how its chief operating decision maker evaluates performance and allocates resources. Prior period reportable segment results and related disclosures have been conformed to reflect the Company’s current reportable segments. 55 The following table sets forth certain financial information associated with results of operations: Successor Predecessor (in thousands, except percentages) Three Months Ended March 31, 2026 Period from February 8, 2025 to March 31, 2025 Period from January 1, 2025 to February 7, 2025 Revenue: Gaming Casinos & Resorts $ 300,698 $ 178,534 $ 95,984 Bally’s Intralot B2C 239,132 107,736 74,849 North America Interactive 51,025 27,509 14,934 Total Gaming revenue 590,855 313,779 185,767 Non-gaming Casinos & Resorts 79,030 48,317 28,315 Bally’s Intralot B2B 73,956 4,883 3,720 Bally’s Intralot B2C 806 131 416 North America Interactive 9,431 48 2,007 Corporate & Other 1,644 1,536 273 Total Non-gaming revenue 164,867 54,915 34,731 Total revenue $ 755,722 $ 368,694 $ 220,498 Operating costs and expenses: Gaming Casinos & Resorts $ 116,555 $ 64,515 $ 37,637 Bally’s Intralot B2C 108,051 44,437 33,335 North America Interactive 50,256 24,571 17,022 Total Gaming expenses $ 274,862 $ 133,523 $ 87,994 Non-gaming Casinos & Resorts $ 43,735 $ 24,840 $ 16,240 Bally’s Intralot B2B 33,178 — — Bally’s Intralot B2C 161 1,140 16 North America Interactive 4,531 2,565 68 Corporate & Other — 564 202 Total Non-gaming expenses $ 81,605 $ 29,109 $ 16,526 General and administrative Casinos & Resorts $ 181,550 $ 92,005 $ 63,503 Bally’s Intralot B2B 26,974 — — Bally’s Intralot B2C 47,354 20,123 16,818 North America Interactive 12,909 3,029 5,512 Corporate & Other 47,259 45,234 28,568 Total General and administrative $ 316,046 $ 160,391 $ 114,401 Margins: Gaming expenses as a percentage of Gaming revenue 47 % 43 % 47 % Non-gaming expenses as a percentage of Non-gaming revenue 49 % 53 % 48 % General and administrative as a percentage of Total revenue 42 % 44 % 52 % 56 The three months ended March 31, 2026 (successor) compared to the successor period from February 8, 2025 to March 31, 2025 and the predecessor period from January 1, 2025 to February 7, 2025. Total Revenue The following table sets forth certain financial information associated with revenue: Successor Predecessor (in thousands) Three Months Ended March 31, 2026 Period from February 8, 2025 to March 31, 2025 Period from January 1, 2025 to February 7, 2025 Gaming $ 590,855 $ 313,779 $ 185,767 Hotel 29,654 18,713 11,006 Food and beverage 33,633 20,254 11,304 Technology Services 58,905 — — Licensing 3,011 4,883 3,720 Retail, entertainment and other 39,664 11,065 8,701 Total revenue $ 755,722 $ 368,694 $ 220,498 Total revenue for the Successor three months ended March 31, 2026 increased 28%, from $589.2 million for the Predecessor period from January 1, 2025 to February 7, 2025 and successor period from February 8, 2025 to March 31, 2025. Increases in total revenue from the Predecessor period from January 1, 2025 to February 7, 2025 and Successor period from February 8, 2025 to March 31, 2025 are primarily driven by the revenue additions from Queen, beginning on February 8, 2025, and the Intralot entities, beginning October 8, 2025, contributing $68.5 million and $95.2 million, respectively, to the Successor three months ended March 31, 2026. Gaming and Non-gaming Expenses During the Successor three months ended March 31, 2026, gaming and non-gaming expenses grew proportionally relative to total revenue. The expenses for the Predecessor period from January 1, 2025 to February 7, 2025 and Successor period from February 8, 2025 to March 31, 2025 amounted to $267.2 million. This growth in expenses compared to the prior year is primarily due to the changes in revenue year over year. General and Administrative General and administrative expense for the Successor three months ended March 31, 2026 compared to the Predecessor period from January 1, 2025 to February 7, 2025 and Successor period from February 8, 2025 to March 31, 2025, increased 15% or $41.3 million, from $274.8 million. These increases were mainly attributable to additional costs for the Queen properties and Intralot entities of $26.6 million and $34.3 million, respectively, offset by a $25.0 million decrease in costs associated with the Merger compared to the prior year. Depreciation and Amortization Depreciation and amortization expense for the Successor three months ended March 31, 2026 increased $27.6 million from $69.8 million compared to the Predecessor period from January 1, 2025 to February 7, 2025 and Successor period from February 8, 2025 to March 31, 2025. Changes year over year are primarily due to a $28.1 million increase in expense attributable to our Intralot business, partially offset a decrease in depreciation expense related to the assets sold as part of the Bally’s Twin River sale-leaseback with GLPI in the first quarter of 2026. 57 Income (Loss) From Operations Income from operations wa s $91.6 million for the Successor three months ended March 31, 2026, compared to Loss from operations of $22.6 million for the Predecessor period from January 1, 2025 to February 7, 2025 and Successor period from February 8, 2025 to March 31, 2025. Changes year over year are primarily due to a $105.8 million Gain on sale-leaseback in the Successor three months ended March 31, 2026. Other Income (Expense) Other Expense was $255.7 million for the Successor three months ended March 31, 2026, compared to $90.4 million for the Predecessor period from January 1, 2025 to February 7, 2025 and Successor period from February 8, 2025 to March 31, 2025. The increase of $165.4 million year over year is primarily due to a $63.4 million Loss on Extinguishment of Debt and $104.3 million Loss on fair value of fair value option assets in the Successor three months ended March 31, 2026, compared to $17.4 million Loss on Extinguishment of Debt and $5.5 million gain on fair value of fair value option assets in the Predecessor period from January 1, 2025 to February 7, 2025 and Successor period from February 8, 2025 to March 31, 2025. Provision (Benefit) for Income Taxes During the three months ended March 31, 2026 (Successor) and the period from February 8, 2025 to March 31, 2025 (Successor), the Company recorded a benefit for income tax of $3.2 million and $97.1 million, respectively. For the period from January 1, 2025 to February 7, 2025 (Predecessor), the Company recorded a provision of $0.7 million. The effective tax rate for the three months ended March 31, 2026 (Successor), the period from February 8, 2025 to March 31, 2025 (Successor) and the period from January 1, 2025 to February 7, 2025 (Predecessor) was 2.0%, 155.2% and (1.3)%, respectively. As of March 31, 2026 (Successor), the Company projects an annual tax benefit relative to its pre-tax loss offset in part by the valuation allowance on interest and a $13.3 million discrete provision on the benefit of the Bally’s Twin River sale-leaseback during the three months ended March 31, 2026 (Successor). Net Loss Net loss attributable to Bally’s Corporation for the three months ended March 31, 2026 (Successor) was $161.9 million compared to a combined net loss of $16.5 million for the Predecessor period from January 1, 2025 to February 7, 2025 and Successor period from February 8, 2025 to March 31, 2025. This fluctuation from the prior year was attributable to the factors noted above. 58 Adjusted EBITDA and Adjusted EBITDAR by Segment The following table presents segment Adjusted EBITDAR, which is our reportable segment GAAP measure and our primary measure for profit or loss for our reportable segments, and consolidated Adjusted EBITDA. The following table reconciles consolidated Adjusted EBITDA, which is a non-GAAP measure, to net income (loss), as derived from our financial statements: Successor Predecessor (in thousands) Three Months Ended March 31, 2026 Period from February 8, 2025 to March 31, 2025 Period from January 1, 2025 to February 7, 2025 Adjusted EBITDAR Casinos & Resorts $ 96,196 $ 71,540 $ 23,554 Bally’s Intralot B2B 15,116 4,883 3,720 Bally’s Intralot B2C 87,092 43,312 25,220 North America Interactive (7,137) (2,345) (5,661) Corporate & Other (12,336) (9,703) (6,774) Total 178,931 107,687 40,059 Rent expense associated with triple net operating leases (1) (55,647) (24,416) (15,669) Adjusted EBITDA 123,284 83,271 24,390 Interest expense, net of interest income (109,905) (51,737) (27,229) Benefit (provision) for income taxes 3,249 97,093 (664) Depreciation and amortization (97,443) (47,481) (22,343) Non-operating (income) expense (2) (169,303) (12,254) (3,525) Foreign exchange (loss) gain 21,088 1,591 194 Transaction costs (3) (13,989) (7,738) (5,106) Tropicana Las Vegas demolition and closure costs (4) (6,194) (5,931) (2,605) Share-based compensation (2,551) (2,740) (1,954) Gain on sale-leaseback, net (5) 105,845 — — Merger Agreement and Intralot Transaction costs (6) (8,758) (15,875) (11,233) Other (7) (6,180) (3,683) (949) Net (loss) income $ (160,857) $ 34,516 $ (51,024) __________________________________ (1) Consists of the operating lease components contained within our triple net leases for the real estate assets used in the operations of certain Casinos & Resorts properties. (2) Non-operating expense, net includes: (i) change in value of performance warrants, (ii) gain (loss) on extinguishment of debt, (iii) non-operating items of equity method investments and fair value option assets, and (iv) other (income) expense, net. (3) Includes acquisition, integration and other transaction related costs, and financing costs incurred in connection with the Company’s sale lease-back transactions. (4) Demolition and closure costs associated with the Tropicana Las Vegas property which is part of the plan to redevelop the site with a state-of-the-art integrated resort and ballpark. As part of the binding term sheet, GLPI has reimbursed the Company for its demolition expenses and had increased rent to reflect the additional funding. (5) Gain on sale-leaseback, net is related to the transaction for Bally’s Twin River which occurred during the three months ended March 31, 2026. (6) Costs incurred in connection with the Company’s merger with Standard General and the Intralot Transaction. (7) Other includes the following items: (i) restructuring initiatives in connection with the Intralot transaction, (ii) Oracle ERP non-capitalizable implementation costs, (iii) non-routine legal expenses, contract termination charges, and settlement costs for matters outside the normal course of business, (iv) storm related insurance and business interruption recoveries, and (v) other individually de minimis expenses. Critical Accounting Estimates There were no material changes to other critical accounting estimates during the period covered by this Quarterly Report on Form 10-Q. Refer to Item 7 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 for a complete list of our Critical Accounting Estimates. 59 Recent Accounting Pronouncements Refer to Note 5 “Recently Issued Accounting Pronouncements” in Part I, Item 1 of this Quarterly Report on Form 10-Q for a description of recent accounting pronouncements that affect us. Liquidity and Capital Resources Overview We are a holding company. Our ability to fund our obligations depends on existing cash on hand, cash flow from our subsidiaries and our ability to raise capital. Our primary sources of liquidity and capital resources have been cash on hand, cash flow from operations, borrowings under our Revolving Credit Facility (as defined herein) and proceeds from the issuance of debt and equity securities. We assess liquidity in terms of the ability to generate cash or obtain financing in order to fund operating, investing and debt service requirements. Our primary ongoing cash requirements include the funding of operations, capital expenditures, acquisitions and other investments in line with our business strategy and debt repayment obligations and interest payments. Our strategy has been to maintain moderate leverage and substantial capital resources in order to take advantage of opportunities, to invest in our businesses and acquire properties at what we believe to be attractive valuations. As such, we have continued to invest in our land-based casino business and build on our interactive/iGaming business. We believe that existing cash balances, operating cash flows and availability under our Revolving Credit Facility, as explained below, will be sufficient to meet funding needs for operating, capital expenditure and debt service purposes. Cash Flows Summary Successor Predecessor (in thousands) Three Months Ended March 31, 2026 Period from February 8, 2025 to March 31, 2025 Period from January 1, 2025 to February 7, 2025 Net cash (used in) provided by operating activities $ (145,021) $ 42,001 $ (80,186) Net cash provided by (used in) investing activities 120,187 (20,797) (17,697) Net cash (used in) provided by financing activities (242,446) 14,073 97,988 Effect of foreign currency on cash and cash equivalents and restricted cash 13,981 (1,497) (457) Net change in cash and cash equivalents and restricted cash (253,299) 33,780 (352) Cash and cash equivalents and restricted cash, beginning of period 906,686 230,902 231,254 Cash and cash equivalents and restricted cash, end of period $ 653,387 $ 264,682 $ 230,902 Operating Activities Net cash used in operating activities for the three months ended March 31, 2026 (Successor) was $145.0 million compared to $38.2 million for the Predecessor period from January 1, 2025 to February 7, 2025 and the Successor period from February 8, 2025 to March 31, 2025. The increase in cash used was primarily driven by increased net losses during the three months ended March 31, 2026 (Successor) of $144.3 million, coupled with the changes in working capital, offset by the $97.9 million received from GLPI in the current period for capital expenditures related to the construction of the Company’s permanent casino in Chicago. Investing Activities Net cash provided by investing activities for the three months ended March 31, 2026 (Successor) was $120.2 million compared to net cash used in investing activities of $38.5 million for the Predecessor period from January 1, 2025 to February 7, 2025 and the Successor period from February 8, 2025 to March 31, 2025. This increase was driven primarily by the $685.0 million of proceeds received from the Bally’s Twin River sale-leaseback, offset by the $500.0 million paid in the first quarter of 2026 for the New York gaming license fee. 60 Financing Activities Net cash used in financing activities for the three months ended March 31, 2026 (Successor) was $242.4 million compared to net cash provided by financing activities of $112.1 million for the Predecessor period from January 1, 2025 to February 7, 2025 and the Successor period from February 8, 2025 to March 31, 2025. The fluctuation from the 2025 periods is primarily due to $123.8 million of net debt repayments during the three months ended March 31, 2026 (Successor), compared to net debt issuances of $435.4 million during the 2025 periods, coupled with the $416.2 million of share repurchases during the Successor period from February 8, 2025 to March 31, 2025. Capital Return Program As of March 31, 2026, there was $95.5 million available for use under the capital return program, subject to limitations in our regulatory and debt agreements. Future share repurchases may be effected in various ways, which could include open-market or private repurchase transactions, accelerated stock repurchase programs, tender offers or other transactions. The amount, timing and terms of any return of capital transaction will be determined based on prevailing market conditions and other factors. There is no fixed time period to complete share repurchases. We did not pay cash dividends during the Successor three months ended March 31, 2026, the Successor period from February 8, 2025 to March 31, 2025, nor the Predecessor period from January 1, 2025 to February 7, 2025, nor do we currently intend to pay any dividends on our common stock in the foreseeable future. Any future determinations relating to our dividend policies will be made at the discretion of our Board and will depend on conditions then existing, including our financial condition, results of operations, contractual restrictions, capital and regulatory requirements and other factors our Board may deem relevant. Debt and Lease Obligations Unsecured Notes On August 20, 2021, we issued $750.0 million aggregate principal amount of 5.625% senior notes due 2029 and $750.0 million aggregate principal amount of 5.875% senior notes due 2031. On October 1, 2021, upon the closing of the Gamesys acquisition, we assumed the issuer obligation under the unsecured notes. The indenture contains covenants that limit the ability of the Company and its restricted subsidiaries to, among other things, (i) incur additional indebtedness, (ii) pay dividends on or make distributions in respect of capital stock or make certain other restricted payments or investments, (iii) enter into certain transactions with affiliates, (iv) sell or otherwise dispose of assets, (v) create or incur liens and (vi) merge, consolidate or sell all or substantially all of the Company’s assets. These covenants are subject to exceptions and qualifications set forth in the indenture. 2028 Notes In connection with the closing of the Merger on February 7, 2025, we entered into a note purchase agreement and issued $500.0 million in aggregate principal amount of first lien senior secured notes due October 2, 2028, at an annual interest rate of 11%, payable quarterly (the “2028 Notes”). These notes were guaranteed by the same restricted subsidiaries that guarantee the credit facilities under the Credit Agreement (as defined below) and secured by the same collateral securing the credit facilities under the Credit Agreement. The note purchase agreement mandated redemption offers in certain situations, such as asset sales and unpermitted debt issuances, with specific redemption premiums applicable within the first two years. After two years, notes can be redeemed at par. The note purchase agreement also included covenants limiting, among other things additional indebtedness, dividend payments, asset sales, investments, and liens, subject to certain exceptions and qualifications. In October 2025, the Company paid down the entire $500.0 million outstanding on its 2028 Notes as further described below. Credit Facility On October 1, 2021, the Company and certain of its subsidiaries entered into a credit agreement (the “Credit Agreement”) with Deutsche Bank AG New York Branch, as administrative agent (in such capacity, the “Administrative Agent”) and collateral agent (in such capacity, the “Collateral Agent”), and the other lenders party thereto, providing for a senior secured term loan facility in an initial aggregate principal amount of $1.945 billion (the “Term Loan Facility”), which was scheduled to mature in 2028, and a senior secured revolving credit facility in an initial aggregate principal amount of $620.0 million (the “Revolving Credit Facility”), which had an initial maturity date in 2026. 61 In September 2025, the Company executed a Third Amendment to the Credit Agreement (“Amendment No. 3” and the Credit Agreement, as so amended, the “Amended Credit Agreement”), by and among the Company, the subsidiaries of the Company party thereto as guarantors, the lenders party thereto, the Administrative Agent and the Collateral agent, and an Incremental Joinder Agreement (the “Incremental Joinder Agreement”) with Jefferies Finance LLC and the Administrative Agent. The Incremental Joinder Agreement increased the available commitments under the Revolving Credit Facility by $50.0 million to $670.0 million. Amendment No. 3 and the Incremental Joinder Agreement collectively extended the maturity date of a portion of the Revolving Credit Facility and updated certain covenants and pricing provisions for the Revolving Credit Facility. Following the effectiveness of Amendment No. 3 and the Incremental Joinder Agreement which occurred on January 6, 2026, a portion of the Revolving Credit Facility will mature in 2028, while the remaining portion will continue to mature on its originally scheduled maturity date in 2026. Amendment No. 3 and the Amended Credit Agreement also provide for reductions in revolving commitments and related prepayments if specified transactions are completed. The Revolving Credit Facility will continue to bear interest, at the Company’s option, at a SOFR-based or base-rate benchmark plus an applicable margin determined by the Company’s consolidated total-leverage ratio. The credit facilities under the Amended Credit Agreement continue to be guaranteed by the Company’s restricted subsidiaries (subject to customary exceptions) and secured by a first-priority lien on substantially all of the assets of the Company and such guarantors. Amendment No. 3 also refined the financial maintenance covenant applicable to the revolving lenders and reduced the utilization threshold at which the covenant becomes effective to 25%. The Amended Credit Agreement allows the Company to increase the size of the Term Loan Facility or request one or more incremental term loan facilities or increase commitments under the Revolving Credit Facility or add one or more incremental revolving facilities in an aggregate amount not to exceed the greater of $325.0 million and 50% of the Company’s consolidated EBITDA for the most recent four-quarter period plus or minus certain amounts as specified in the Amended Credit Agreement, including an unlimited amount subject to compliance with specified financial ratios. The Amended Credit Agreement contains covenants that limit the ability of the Company and its restricted subsidiaries to, among other things, incur additional indebtedness, pay dividends or make certain other restricted payments, sell assets, make certain investments, and grant liens. These covenants are subject to exceptions and qualifications set forth in the Amended Credit Agreement. The Revolving Credit Facility also includes certain financial covenants the Company is required to maintain throughout the term of the Revolving Credit Facility. These financial covenants include a provision whereby, in the event utilization under the Revolving Credit Facility exceeds 25% of the total revolving commitment, the Company is required to maintain a first lien secured net indebtedness to Adjusted EBITDA ratio of 4.00 to 1.00. In May 2026, the Required Revolving Lenders and Administrative Agent under the Company’s Revolving Credit Facility conditionally waived compliance with the consolidated net leverage ratio covenant for each fiscal quarter ending during the period commencing March 31, 2026 through the earlier of (i) the Company’s election to terminate the waiver upon certifying compliance with the covenant as of the most recently ended fiscal quarter, or (ii) the date immediately preceding the delivery of the compliance certificate for the quarter ending March 31, 2027 (the “Covenant Waiver Period”). The waiver remains subject to the Company’s ongoing satisfaction of certain liquidity maintenance requirements, restrictions on additional secured indebtedness, compliance with the covenants under the Company’s term loan credit agreement and agreement to enter into an amendment to the revolving credit facility within a specified period in order to incorporate certain covenants from the Company’s term loan credit agreement. Failure to satisfy any such condition will result in automatic termination of the waiver and reinstatement of the covenant in full force and effect. As of the date of this filing, the Company was in compliance with all applicable terms of the waiver. The Company expects to remain in compliance through the Covenant Waiver Period and, for applicable covenants, through the next twelve months. With proceeds from the Transaction Agreement, the Company paid down $500.0 million of its secured indebtedness, applied pro rata across its 2028 Notes and Term Loan Facility. Subsequently, the Company satisfied the remaining principal balance of its 2028 Notes with an additional payment of $395.0 million, and incurred and paid a make-whole payment pursuant to the note purchase agreement. 62 The Company is a party to certain currency swaps which synthetically convert $500.0 million of its Term Loan Facility to an equivalent fixed-rate Euro-denominated instrument, due October 2028, with a weighted average fixed interest rate of approximately 6.69% per annum. The Company is also a party to additional currency swaps to synthetically convert $200.0 million, notional, of its floating rate Term Loan Facility, to an equivalent GBP-denominated floating rate instrument, due October 2026. Additionally, as part of the Company’s risk management program to manage its overall interest rate exposure, the Company has entered into a series of interest rate contracts in a notional aggregate amount of $1.00 billion, to further manage the Company’s exposure to interest rate movements associated with the Company’s variable rate Term Loan Facility through its synthetic conversion to fixed rate debt. The tenor of these contracts were matched with the maturity of the Term Loan Facility tranche maturing on October 1, 2028. Refer to Note 11 “Derivative Instruments” and Note 14 “Long-Term Debt” in Part I, Item 1 of this Quarterly Report on Form 10-Q for further information. Intralot Greek Retail Bond In February 2024, Intralot established a common bond loan program (the “Intralot Greek Retail Bond”) for the issuance of up to €130.0 million aggregate principal amount of bonds, with a minimum issuance of €120.0 million. The bonds were admitted to trading on the Fixed Income Securities category of the Regulated Market of the Athens Stock Exchange. As of March 31, 2026 (Successor) and December 31, 2025 (Successor), there was €130.0 million and €130.0 million aggregate principal amount outstanding under the Intralot Greek Retail Bond, respectively. The bonds bear interest at a fixed rate of 6.00% per annum, payable semi-annually, which will remain fixed throughout the duration of the bonds. Upon its maturity on February 27, 2029, Intralot will be required to repay the principal in full, together with outstanding accrued interest and any other amounts payable. Intralot may redeem all or a portion of the bonds, subject to a minimum redemption amount of €15.0 million and a requirement that at least €50.0 million in aggregate principal amount remain outstanding after any partial redemption. The Intralot Greek Retail Bond is an unsecured obligation of Intralot, with the benefit of a first-priority pledge over a designated bond loan collateral account. The bonds rank pari passu with the claims of all other unsecured creditors of Intralot, with the exception of claims that have a statutory privilege. The Intralot Greek Retail Bond is not guaranteed by any of Intralot’s subsidiaries. In the event of a change of control each bondholder has the right to require Intralot to repurchase of part or all of such bondholder’s bonds at a price equal to 101% of the nominal value, plus accrued and unpaid interest and any additional amounts. Intralot Greek Senior Facilities Agreement On October 3, 2025, Intralot Capital Luxembourg S.A. (“Intralot Capital”), a wholly owned indirect subsidiary of the Company, entered into a Senior Facilities Agreement (the “Intralot Greek Term Loan”) with Alpha Bank S.A., Optima Bank S.A., Piraeus Bank S.A., CrediaBank S.A. and other parties, providing for an amortizing euro-denominated term loan facility in an aggregate amount up to €200.0 million. As of March 31, 2026 (Successor) and December 31, 2025 (Successor), Intralot had €200.0 million and €200.0 million outstanding under the Intralot Greek Term Loan, respectively. The Intralot Greek Term Loan bears interest at a rate equal to 7.0% per annum. Interest periods may be selected in accordance with the agreement terms. The Intralot Greek Term Loan requires semi-annual principal repayments plus accrued interest through the maturity date of October 8, 2029. Subject to an intercreditor agreement, Intralot Greek Term Loan caries the same security priority as other senior secured obligations. Intralot British Pound Term Loan On September 18, 2025, Intralot Capital entered into a Senior Facilities Agreement (the “Intralot British Term Loan”) with various lenders and agents, providing for a sterling-denominated term loan facility in an aggregate principal amount of £400.0 million. As of March 31, 2026 (Successor) and December 31, 2025 (Successor), £400.0 million and £400.0 million was outstanding under the Intralot British Term Loan, respectively. 63 The Intralot British Term Loan bears interest at a rate equal to SONIA (Sterling Overnight Index Average) plus a margin of 5.5%. Interest periods may be one, three, or six months, or such other periods as agreed among the parties. The Borrower pays accrued interest on the last day of each interest period. The Intralot British Term Loan is secured by first-ranking security interests, including pledges over shares in the obligors and material subsidiaries and, in certain jurisdictions, security over substantially all assets of the obligors. The Intralot British Term Loan matures on October 8, 2031. Intralot Fixed and Floating Interest Rate Bonds Intralot Capital has issued €600 million aggregate principal amount of 6.75% Senior Secured Fixed Rate Notes due 2031 (the “Intralot Fixed Rate Notes”) and €300 million aggregate principal amount of Senior Secured Floating Rate Notes due 2031 (the “Intralot Floating Rate Notes” and, together with the Intralot Fixed Rate Notes, the “Intralot Notes”), pursuant to an indenture dated September 30, 2025 (the “Intralot Indenture”) among Intralot Capital, Intralot, and its subsidiaries, as guarantor, and The Law Debenture Trust Corporation p.l.c., as trustee. As of March 31, 2026 (Successor) and December 31, 2025 (Successor), the full €900 million aggregate principal amount of the Intralot Notes was outstanding. The Intralot Fixed Rate Notes bear interest at a fixed rate of 6.750% per annum, payable semi-annually, commencing on April 15, 2026. The Intralot Floating Rate Notes bear interest at a rate per annum, reset quarterly, equal to three-month EURIBOR (subject to a 0% floor) plus 4.500%, payable quarterly, commencing on February 28, 2026. The Intralot Notes mature on October 15, 2031. The Intralot Notes are senior secured obligations of Intralot Capital, secured by first-ranking security interests (to the extent legally possible) over the share of obligors and material subsidiaries, structural intercompany receivables, and to the extent customary in the applicable jurisdiction, substantially all assets of the obligors. Enforcement of security is subject to an intercreditor agreement, and the Intralot Notes may share collateral on an equal ranking or junior basis with other permitted indebtedness as described in the Intralot Indenture. The Intralot Notes are unconditionally guaranteed, jointly and severally, by Intralot and future guarantors that is required to become a guarantor under the Intralot Indenture. The guarantees are subject to customary limitations under applicable law. The Intralot Fixed Rate Notes may be redeemed at the option of Intralot Capital, in whole or in part, at any time on or after October 15, 2027, at determined redemption prices over time, plus accrued and unpaid interest. Prior to October 15, 2027, Intralot Capital may redeem the Intralot Fixed Rate Notes at a premium, which is the greater of (a) 1% of the outstanding principal amount and (b) the present value of the redemption price at October 15, 2027 plus all required interest payments through that date, computed using a discount rate equal to the Bund Rate plus 50 basis points, over the outstanding principal amount. The Intralot Floating Rate Notes may be redeemed at the option of Intralot Capital at any time on or after October 15, 2026, at a redemption price equal to 100.0% of the principal amount redeemed plus accrued and unpaid interest. In addition, prior to October 15, 2027 (in the case of Intralot Fixed Rate Notes) or October 15, 2026 (in the case of Intralot Floating Rate Notes), Intralot Capital may redeem up to 40% of the aggregate principal amount of the Intralot Notes with the net cash proceeds of certain equity offerings at a redemption price equal to 106.750% (in the case of Intralot Fixed Rate Notes) of the principal amount plus accrued and unpaid interest, subject to certain conditions, including that at least 50% of the original aggregate principal amount of the Intralot Notes must remain outstanding immediately after each such redemption. The Intralot Notes are not convertible into equity securities of Intralot Capital or any other entity. Intralot Super Senior Revolving Credit Facility Intralot Capital is a party to a Super Senior Revolving Credit Facility Agreement (the “Intralot RCF Agreement”) with various lenders and agents, providing for revolving credit commitments in an aggregate principal amount equal to the greater of €190.0 million and 40.0% of Intralot’s four-quarter consolidated EBITDA. The facility may be utilized by way of revolving loans, letters of credit, or ancillary facilities. The minimum utilization amount is €0.5 million for euro-denominated borrowings. 64 The Intralot RCF Agreement initially bears interest at the applicable reference rate plus a margin of 4.50% per annum, subject to future leverage-based adjustments ranging from 4.75% to 3.75% based on Intralot’s senior secured net leverage ratio. Intralot Capital pays a commitment fee equal to 30% of the applicable margin on unused commitments, payable quarterly in arrears. Letter of credit fees are equal to the applicable margin for revolving loans, plus a fronting fee of 0.125% per annum. The facility matures on July 1, 2030. As of March 31, 2026 (Successor) and December 31, 2025 (Successor), the Company had no borrowing outstanding under the Intralot RCF Agreement, no letters of credit outstanding, and €160.0 million of unused commitments available. As of March 31, 2026 (Successor), the Company was in compliance with all covenants under its debt agreements and there were no defaults in principal, interest, sinking fund, or redemption provisions with respect to any of its outstanding indebtedness. Except as noted above with respect to the waiver of the consolidated first lien net leverage ratio covenant under the Company’s Revolving Credit Facility, no waivers of acceleration or covenant violations were in effect as of March 31, 2026 (Successor). The Company expects to be in compliance with all applicable covenants for the next twelve months. New Term Loan Facility On February 11, 2026, the Company entered into a new $1.1 billion term loan credit facility due 2031 (the “Term Loans”). The Term Loans are secured by substantially all material assets of the Company and its wholly owned subsidiaries, subject to customary exceptions and exclusions. Term Loan Facility and Revolving Credit Facility Repayments On February 11, 2026, the Company repaid in full the outstanding balance under its Term Loan Facility, resulting in cash payments of $1.48 billion. Additionally, in February 2026, the Company paid down $448.0 million of amounts outstanding under its Revolving Credit Facility, which had been drawn in January 2026 to fund the New York gaming license fee. In accordance with Amendment No. 3, following the closing of the Bally’s Twin River sale-leaseback, the Company’s commitments under its Revolving Credit Facility were reduced by 22.5%. Operating Leases The Company is committed under various operating lease agreements for real estate and property used in operations. Minimum rent payable under operating leases was $4.20 billion as of March 31, 2026, of which $223.1 million is due within the current year. Refer to Note 15 “Leases” in Part I, Item 1 of this Quarterly Report on Form 10-Q for further information. GLPI Leases As of March 31, 2026 (Successor), the Company leases certain properties from GLPI under three separate master lease agreements, the “Master Lease,” the “Master Lease No. 2,” and the “Queen Master Lease.” The Company’s Bally’s Evansville, Bally’s Dover, Bally’s Quad Cities, Bally’s Black Hawk, Bally’s Tiverton and Hard Rock Biloxi properties are leased under the terms of the Master Lease which requires combined initial minimum annual payments of $101.5 million. The Company’s Bally’s Kansas City, Bally’s Shreveport, DraftKings at Casino Queen, The Queen Baton Rouge and Bally’s Twin River properties are leased under the terms of the Master Lease No. 2 which requires combined initial minimum annual payments of $118.3 million. The Company’s Bally’s Baton Rouge and Casino Queen Marquette properties are leased under the terms of the Queen Master Lease, which requires initial combined minimum annual payments of $3.0 million, plus annual development rent of $11.3 million. All three leases have an initial term of 15 years and include four, five-year options to renew and are subject to a minimum 1% annual escalation or greater escalation dependent on CPI. The renewal options are not reasonably certain of exercise as of March 31, 2026 (Successor). On February 11, 2026, the Company completed the sale-leaseback of the land and real estate assets of Bally’s Twin River Lincoln Casino Resort to GLPI for total consideration of $700 million. The transaction was structured as a tax-free capital contribution and a substantial portion of the proceeds was used to reduce the Company’s debt. In connection with this transaction, the Bally’s Twin River property was added to Master Lease No. 2, increasing minimum annual payments by $56.0 million, and with annual escalations and extension options disclosed above. During the three months ended March 31, 2026 (Successor), the Company recorded a gain of $105.8 million, within Gain on sale-leaseback in the condensed consolidated statements of operations, representing the difference in the transaction price and the derecognition of assets. 65 In addition to the properties under the master leases explained above, the Company leases land associated with Tropicana Las Vegas under a ground lease established with GLPI in 2022 and modified in 2024. This lease has an initial term of 50 years, with the possibility of extending up to 99 years through renewal options, and requires initial minimum annual payments of $14.6 million, subject to minimum 1% annual increase or greater based on CPI. As of March 31, 2026 (Successor), the renewal options are not considered reasonably certain to be exercised. In 2025, the Company entered into a master lease agreement with GLPI (the “Chicago MLA”), for the property on which the Company plans to develop its Chicago Permanent Facility and a development agreement with GLPI (the “Chicago Development Agreement”) pursuant to which GLPI has committed to advance up to $940.0 million (the “GLPI Development Advances”) for the payment of hard costs used to construct the Chicago Permanent Facility in exchange for increasing the amount of rent payable to GLPI under the Chicago MLA. The Chicago MLA has an initial term of 15 years and includes four, five-year options to renew and is subject to annual escalation. Initial annual rent under the Chicago MLA was $20.0 million, with additional rent equal to 8.5% of the GLPI Development Advances that are granted to the Company. Under the Chicago Development Agreement, as construction occurs, the Company will recognize a construction receivable on the condensed consolidated balance sheets due from the GLPI. To the extent costs exceed the amount to be reimbursed by GLPI, such costs are considered prepaid rent, which will be added to the associated operating lease right of use asset once the lease commences. As of March 31, 2026 (Successor), the Company’s construction receivable balance, classified within Accounts receivable, net was $81.6 million, and its prepaid rent balance was $193.2 million. Capital Expenditures Capital expenditures are accounted for as either project, maintenance or capitalized software expenditures. Project capital expenditures are for fixed asset additions that expand an existing facility or create a new facility. Maintenance capital expenditures are expenditures to replace existing fixed assets with a useful life greater than one year that are obsolete, worn out or no longer cost effective to repair, along with spending on other small projects that do not fit into the project category. Capitalized software expenditures relate to the creation, production and preparation of software for use in our online gaming operations. Capital expenditures for the Successor three months ended March 31, 2026 were $38.9 million compared to $30.5 million and $16.4 million for the Successor period from February 8, 2025 to March 31, 2025 and the Predecessor period from January 1, 2025 to February 7, 2025, respectively. For the Successor three months ended March 31, 2026, we continued our spending on our planned projects and maintenance at our casino properties. Through the Chicago MLA, the Company has received reimbursement for capital expenditures during the three months ended March 31, 2026 (Successor), the Company received reimbursement of $97.9 million for capital expenditures related to the construction of the Chicago Permanent Facility. Bally’s Twin River - In connection with our partnership with IGT, we have committed to invest $100 million in Bally’s Twin River over the term of our master contract, ending in 2043, with Rhode Island to expand the property and add additional amenities along with other capital improvements. Approximately $40.0 million of the committed investment remains as of March 31, 2026. Bally’s Chicago - Pursuant to the Host Community Agreement with the City of Chicago, Bally’s Chicago Operating Company, LLC, a majority owned subsidiary of the Company, is required to spend at least $1.34 billion on the design, construction and outfitting of its temporary casino and the permanent resort and casino. The actual cost of the development may exceed this minimum capital investment requirement. In addition, land acquisition costs and financing costs, among other types of costs, are not counted toward meeting this requirement. As of March 31, 2026 (Successor), approximately $600.0 million of this commitment remains. We expect future funding of the permanent casino construction to be financed through the Chicago MLA agreement noted above and the Company’s capital resources. Bally’s New York - In November 2025, we entered into a conveyance agreement (the “Conveyance Agreement”) with the City of New York (the “City”) where the City agreed to (i) dispose of certain parkland property interests to Bally’s New York (the “Development Parcel”), (ii) alienate certain parkland in order to grant Bally’s New York a non-exclusive easement over such lands for purposes of accessing the Development Parcel and (iii) discontinue certain lands as parkland and alienate and transfer jurisdiction of such lands to the City’s Department of Transportation for use as public roadways (the “Ring Road Parcel”) to facilitate access to the Development Parcel and so the Development Parcel may be used by the Company for a gaming facility. 66 The closing of the transactions contemplated by the Conveyance Agreement was contingent upon, among other things, (i) Bally’s New York’s agreement to make certain capital improvements to Bally’s Golf Links with a fair market value of approximately $161 million and (b) to deliver security instruments to the City to secure the performance and completion of such capital improvements, (ii) the Company being awarded a downstate gaming facility license from the New York State Gaming Commission, (iii) payment by Bally’s New York to the City’s Department of Parks & Recreation of an administrative fee in the amount of $1 million, (iv) Bally’s New York’s agreement to pay for all costs and expenses for the development and mapping of the Ring Road Parcel and (v) Bally’s New York’s payment of real property transfer taxes with respect to the transactions contemplated by the Conveyance Agreement. Additionally, as part of the conditions for closing of the Conveyance Agreement, Bally’s New York amended its License Agreement and Licensor Consent with the City, which includes an obligation for Bally’s New York to design and construct a new permanent clubhouse on the licensed property. New York Gaming License Commitments In December 2025, the Company was awarded one of New York State’s three downstate commercial casino licenses for its planned Bally’s Bronx project, requiring the Company to pay a $500 million license fee, which was paid in the three months ended March 31, 2026 (Successor), as well as post a bond or cash deposit equal to 5% of the total project investment. The Company must also implement its community benefit commitments, including periodic public reporting, and engage an independent Compliance Monitoring Team approved by the New York State Gaming Commission to oversee regulatory, anti‑money‑laundering, and community‑benefit compliance. Additionally, in February 2026, the Company paid $115 million of the $125 million in total contingent consideration due to the seller of Bally’s Golf Links. Other Contractual Obligations Sponsorship Commitments - The Company has entered into several sponsorship agreements with various professional sports leagues and teams, allowing the Company use of official league marks for branding and promotions, among other rights. As of March 31, 2026, obligations related to these agreements were $105.4 million, with contracts extending through 2036. Interactive Technology Partnerships - The Company has certain multi-year agreements with its various market access and content providers, as well as its online sports betting platform partners, that require the Company to pay variable fees based on revenue, with minimum annual guarantees. As of March 31, 2026, the cumulative minimum obligation committed in these agreements is approximately $25.3 million, extending through 2029. ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 (the “Exchange Act”) and are not required to provide the information under this item.