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Item 7. Management’s Discussion and Analysis

2026-02-26 compared with 2025-02-27 · 278 added, 276 removed, 358 unchanged (61% of the section changed)

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EXECUTIVE OVERVIEW

PENN Entertainment, Inc., together with its subsidiaries (“PENN,” or the “Company”), is North America’s leading provider of integrated entertainment, sports content, and casino gaming experiences.

As of the issuance date of this report, PENN operated in 28 jurisdictions throughout North America, with a broadly diversified portfolio of casinos, racetracks, and online sports betting, and iCasino offerings under well-recognized brands including Hollywood Casino ® , L’Auberge ® , ESPN BET™, and theScore BET Sportsbook and Casino ® .

PENN’s ability to leverage its partnership with ESPN, Inc.

and ESPN Enterprises, Inc.

(together, “ESPN”), the “worldwide leader in sports,” and its ownership of theScore™, the top digital sports media brand in Canada, is central to the Company’s highly differentiated strategy to expand its footprint and efficiently grow its customer ecosystem.

PENN’s focus on organic cross-sell opportunities is reinforced by its market-leading retail casinos, sports media assets, and technology, including a proprietary state-of-the-art, fully integrated digital sports and iCasino betting platform and an in-house iCasino content studio (PENN Game Studios).

The Company’s portfolio is further bolstered by its industry-leading PENN Play™ customer loyalty program, offering its approximately 32 million members a unique set of rewards and experiences.

PENN Entertainment, Inc., together with its subsidiaries (“PENN,” the “Company,” “we,” “our,” or “us”), operates in 28 jurisdictions throughout North America, with a broadly diversified portfolio of casinos, racetracks, and online sports betting (“OSB”) and iCasino offerings.

PENN’s focus is on organic cross-sell opportunities, reinforced by its market-leading retail casinos, sports media assets and technology, including a proprietary state-of-the-art, fully integrated digital sports betting and iCasino platform, and an in-house iCasino content studio.

The Company’s portfolio is further bolstered by its industry-leading PENN Play TM customer loyalty program, offering its over 33 million members a unique set of rewards and experiences.

The majority of the real estate assets (i.e., land and buildings) used in our operations are subject to triple net master leases;

the most significant of which are with Gaming and Leisure Properties, Inc.

GLPI) (“GLPI”), a real estate investment trust (“REIT”), and include the AR PENN Master Lease, 2023 Master Lease, PENN Master Lease (prior to January 1, 2023), and Pinnacle Master Lease (as such terms are defined in Note 11, “Leases” in the notes to our Consolidated Financial Statements and collectively referred to as the “Master Leases”).

Recent Acquisitions, Dispositions, Development Projects, and Other

On February 17, 2023, we acquired the remaining 64% of the outstanding shares of Barstool Sports, Inc.

(“Barstool”) common stock not already owned by us for a consideration of approximately $405.5 million, which is inclusive of cash and common stock issuance, repayment of Barstool indebtedness of $23.8 million, transaction expenses, and other purchase price adjustments in accordance with GAAP (the “Barstool Acquisition”).

Prior to the acquisition, we held a 36% ownership interest, which was accounted for under the equity method.

On August 8, 2023, PENN entered into a Sportsbook Agreement (the “Sportsbook Agreement”) with ESPN, which provides for a long-term strategic relationship between PENN and ESPN relating to online sports betting in the United States.

Pursuant to the Sportsbook Agreement, PENN rebranded its existing Barstool Sportsbook across all online platforms in the United States as ESPN BET (the “Sportsbook”) and oversees daily operations of the Sportsbook.

In addition to the Sportsbook Agreement, on August 8, 2023, PENN and ESPN, Inc.

entered into an Investment Agreement (the “Investment Agreement”) providing for the issuance to ESPN, Inc.

of certain warrants to purchase shares of PENN common stock, and setting forth certain other governance rights of ESPN, Inc.

See Note 12, “Commitments and Contingencies” in the notes to our Consolidated Financial Statements for additional information.

On August 8, 2023, we entered into a stock purchase agreement with David Portnoy (the “Barstool SPA”) and we sold 100% of the outstanding shares of Barstool common stock.

As a result of the Barstool SPA, we recognized a pre-tax loss on disposal of $923.2 million (inclusive of $714.8 million in goodwill and intangible assets write offs and a $70.0 million indemnification liability) incurred in the third quarter of 2023.

See Note 5, “Acquisitions and Dispositions” and Note 18, “ Fair Value M e asurements ” in the notes to our Consolidated Financial Statements.

For information on the tax-related impacts from the Barstool transaction, see Note 13, “Income Taxes” in the notes to our Consolidated Financial Statements.

On February 21, 2023, as described in Note 11, “Leases” in the notes to our Consolidated Financial Statements, the Company and GLPI entered into an agreement to amend and restate the triple net master lease dated November 1, 2013 (the “AR PENN Master Lease”), effective January 1, 2023, to (i) remove the land and buildings for Hollywood Casino Aurora (“Aurora”), Hollywood Casino Joliet (“Joliet”), Hollywood Casino Columbus (“Columbus”), Hollywood Casino Toledo (“Toledo”), and the M Resort Spa Casino (“M Resort”), and (ii) make associated adjustments to the rent after which the initial rent in the AR PENN Master Lease was reset to $284.1 million, consisting of $208.2 million of building base rent, $43.0 million of land base rent and $32.9 million of percentage rent (as such terms are defined in the AR PENN Master Lease).

The AR PENN Master Lease remains subject to annual rent escalators and a percentage rent reset every five years.

Concurrent with the execution of the AR PENN Master Lease, the Company and GLPI entered into a new master lease (the “2023 Master Lease”), effective January 1, 2023, specific to the properties associated with Aurora, Joliet, Columbus, Toledo, M Resort, Hollywood Casino at The Meadows (“Meadows”) and Hollywood Casino Perryville (“Perryville”) and a master development agreement (the “Master Development Agreement”).

The 2023 Master Lease terminated the individual triple net leases associated with Meadows and Perryville.

The 2023 Master Lease incurs a 1.5% fixed escalator on November 1 of each year, and is also subject to a one-time increase of $1.4 million effective November 1, 2027.

The 2023 Master Lease and AR PENN Master Lease are cross-defaulted, cross-collateralized, and coterminous, and subject to a parent guarantee.

The 2023 Master Lease includes a base rent (the “2023 Master Lease Base Rent”) equal to $232.2 million and the Master Development Agreement contains additional rent (together with the 2023 Master Lease Base Rent, the “2023 Master Lease Rent”) equal to (i) 7.75% of any project funding received by PENN from GLPI for an anticipated relocation of PENN’s riverboat casino and related developments with respect to Aurora (the “Aurora Project”) and (ii) a percentage, based on the then-current GLPI stock price, of any project funding received by PENN from GLPI for certain anticipated development projects with respect to Joliet, Columbus, and M Resort (the “Other Development Projects” and together with the Aurora Project, the “PENN Development Projects”).

The Master Development Agreement provides that GLPI will fund up to $225 million for the Aurora Project and, upon our request, up to $350 million in the aggregate for the Other Development Projects, in accordance with certain terms and conditions set forth in the Master Development Agreement.

These funding obligations of GLPI expire on January 1, 2026.

We expect our new Joliet facility to open in the fourth quarter of 2025, and the new hotel tower at the M Resort, the new Aurora facility, and the Columbus hotel tower to open in the first half of 2026.

GLPI) (“GLPI”), a real estate investment trust (“REIT”), and include the AR PENN Master Lease, 2023 Master Lease, and Pinnacle Master Lease (as such terms are defined in Note 11, “Leases” in the notes to our Consolidated Financial Statements and collectively referred to as the “Master Leases”).

Realignment of Digital Strategy

On November 6, 2025, PENN announced the mutual decision for an early termination (the “Termination Agreement”) of its Sportsbook Agreement for United States (“U.S.”) OSB with ESPN, Inc.

and ESPN Enterprises Inc.

(together, “ESPN”).

Pursuant to the Termination Agreement, PENN’s exclusive right to use the ESPN BET trademark for OSB in the U.S.

ended on December 1, 2025.

As a result, we have realigned our digital focus to leverage the strength of our U.S.

iCasino and Canadian operations, while continuing to use OSB to drive both the acquisition of customers with significant lifetime value and unique cross-sell opportunities across PENN’s retail and digital assets.

On December 1, 2025, we rebranded our OSB offering in the U.S.

to theScore Bet.

We have operated theScore Bet brand in Ontario since 2022, and our OSB product in both the U.S.

and Canada now leverages connectivity with the theScore media app, which has approximately 4 million monthly active users across North America.

PENN’s iCasino forward approach has clear long-term alignment to our core business, which focuses on cross-sell opportunities across our ecosystem and enhanced connectivity to our PENN Play loyalty program.

Our OSB offerings will continue to provide top of funnel acquisition and cross-sell opportunities for our Hollywood-branded iCasino, which will remain integrated into our OSB product in states where legal, in addition to serving as a standalone iCasino app.

Recent Development Projects

On October 10, 2022, the Company announced its intent to pursue four new development projects, including the land-based relocations of Hollywood Casino Joliet (“Joliet”) and Hollywood Casino Aurora (“Aurora”), a second hotel tower at M Resort Spa Casino (“M Resort”), and a new hotel at Hollywood Casino Columbus (“Columbus”).

Subsequently, on February 21, 2023, as described in Note 11, “Leases” in the notes to the Consolidated Financial Statements, the Company and GLPI entered into a master development agreement (the “Master Development Agreement”) related to these development projects.

The Master Development Agreement provides that GLPI will fund (i) up to $225.0 million for the relocation of our riverboat casino and related developments with respect to Aurora (the “Aurora Project”);

and (ii) upon our request, up to $130.0 million for the relocation of our riverboat casino and related developments with respect to Joliet (the “Joliet Project”), up to $150.0 million for the second hotel tower at M Resort (the “M Resort Project”), up to $70.0 million for the new hotel tower at Columbus (the “Columbus Project” and together with Joliet Project and M Resort Project, the “Other Development Projects,” and together with the Aurora Project, referred to as the “PENN Development Projects”), all within accordance with certain terms and conditions set forth in the Master Development Agreement.

GLPI has committed up to $225.0 million in funding for the Aurora Project at a 7.75% cap rate, which we are required to draw and the funding will be structured as rent under the 2023 Master Lease (as described in Note 11, “Leases” in the notes to the Consolidated Financial Statements).

Rent within the 2023 Master Lease will also increase by a percentage, based on the then-current GLPI stock price, of any project funding received by PENN from GLPI for the Other Development Projects.

The PENN Development Projects still under construction are all subject to necessary regulatory and other government approvals.

The Joliet Project to relocate its riverboat casino operations to a new, state-of-the-art land-based facility opened on August 11, 2025.

The best-in-class property features approximately 1,000 slots and 43 live table games, including high-limit slots and table games, a baccarat room, and a retail sportsbook.

Its unique bars and restaurants include Sorellina by Giada De Laurentiis and Boulevard Food & Drink Hall.

Additional features of the new property include an approximately 10,000 square foot, all-ages event center with meeting areas, and approximately 1,330 parking spaces.

On August 1, 2025, the Company received the full $130.0 million in committed funding from GLPI for the Joliet Project, resulting in a $10.1 million increase in annual rent, subject to annual escalation pursuant to the 2023 Master Lease.

The Aurora Project to relocate its riverboat casino operations to a new, land-based facility is expected to open late in the second quarter of 2026.

The land-based casino will feature roughly 1,200 gaming positions, approximately 220 guest rooms, a retail sportsbook, outdoor entertainment area, full-service spa, high-quality bars and restaurants, an approximately 12,000 square foot event center with meeting areas, and approximately 1,700 parking spaces.

The Aurora Project included the transfer of certain parcels of land from the City of Aurora, and up to $50.0 million of the project will be funded by the city through a new bond issuance.

As of February 25, 2026, we have neither requested nor received any funding from GLPI for the Aurora Project, while the Company has received $29.3 million from the City of Aurora.

The second hotel tower at M Resort opened on December 1, 2025.

The M Resort Project added 375 rooms to the Company’s property south of the Las Vegas Strip, bringing its total to 765 rooms and suites.

Along with the rooms, the project includes expanded meeting space, updated amenities, and additional local partnerships.

On November 3, 2025, the Company received the full $150.0 million in committed funding from GLPI for the M Resort Project, resulting in an $11.7 million increase in annual rent, subject to annual escalation pursuant to the 2023 Master Lease.

The new hotel at Columbus is expected to open late in the second quarter of 2026.

The hotel is expected to include 180 rooms, meeting space, an additional restaurant, and local partnerships and amenities.

We did not request or receive any funding from GLPI for the Columbus Project, and GLPI’s funding commitment expired on December 31, 2025.

On April 24, 2025, the Company announced a development project to relocate its Ameristar Council Bluffs (“ACB”) riverboat casino operations to a new, land-based property to be rebranded as Hollywood Casino Council Bluffs (“HCCB”).

Under the proposed plan, the new HCCB is expected to include roughly 125,000 square feet of new development with approximately 58,000 square feet of gaming space and more than 1,000 positions on a single level.

The new facility will complement the existing retail sportsbook, 160-room hotel, and dining options in the landside portion of the current infrastructure.

The project is anticipated to cost between $180.0 million and $200.0 million and is expected to open in late 2027 to early 2028.

GLPI has committed to finance up to $150.0 million at a 7.1% cap rate, which may be structured at PENN’s option as either rent or a 5-year term loan that is prepayable at any time without penalty.

Strategic Overview

We believe that our portfolio of assets provides us with the benefit of geographically diversified cash flow from operations.

We expect to continue to expand our gaming operations through the implementation and execution of a disciplined capital expenditure program at our existing properties, the pursuit of strategic acquisitions and investments, and the development of new gaming properties.

In addition, the acquisition of theScore and our Sportsbook Agreement with ESPN reflects our strategy to continue evolving from the nation’s largest regional gaming operator to a best-in-class omni-channel provider of retail gaming, iCasino, and sports betting entertainment.

Our sports media assets and proprietary online sports betting and iCasino technology reinforce our strategy to continue evolving from the nation’s largest regional gaming operator to a best-in-class omni-channel provider of retail gaming, iCasino, and sports betting entertainment.

Additionally, our iCasino forward strategy with long-term alignment to our core business will focus on cross-sell opportunities across our ecosystem and enhanced connectivity to our PENN Play loyalty program.

Operating and Competitive Environment

Most of our properties operate in mature, competitive markets.

We expect the majority of our future growth to come from our online sports betting and iCasino businesses;

We expect the majority of our future growth to come from our OSB and iCasino businesses;

improvements, expansions, or relocations of our existing properties;

entrance into new jurisdictions;

entrance into new jurisdictions or verticals;

expansions of gaming in existing jurisdictions;

strategic investments and acquisitions;

and cross-sell opportunities between our retail gaming, online sports betting, and iCasino businesses.

and cross-sell opportunities between our retail gaming, OSB, and iCasino businesses.

Our portfolio is comprised largely of well-maintained regional gaming facilities, which has allowed us to develop what we believe to be a solid base for future growth opportunities.

We continuously adjust operations, offerings, and cost structures to reflect changing economic conditions, as well as consumer demand and behaviors.

We also continue to focus on revenue and cost synergies from recent acquisitions, technology enhancements, and providing customers with additional gaming and entertainment experiences through our differentiated omni-channel strategy.

We seek to grow our customer database and PENN Play loyalty program through our online sports betting and iCasino businesses, the development of new properties, the expansion of existing properties and other business lines, and through partnerships with third-party partners, such as The Kroger Company, Ticketmaster Entertainment, LLC, Norwegian Cruise Line Holdings Ltd., Live Nation Entertainment, Inc., and Choice Hotels International, Inc.

In addition, our strategic acquisitions (e.g.

theScore) and strategic relationships (e.g.

our Sportsbook Agreement with ESPN), are expected to allow us to acquire new customers, expand our player database, and provide additional revenue streams, all in furtherance of our omnichannel strategy.

We also continue to focus on technology enhancements and providing customers with additional gaming and entertainment experiences through our differentiated omni-channel strategy.

We seek to grow our customer database and PENN Play loyalty program through our iCasino and OSB businesses, the development of new properties, the expansion of existing properties and other business lines, and through partnerships with third-party partners, such as Shake Shack Inc., Ticketmaster Entertainment, LLC, Norwegian Cruise Line Holdings Ltd., Live Nation Entertainment, Inc., and Choice Hotels International, Inc.

In addition, we believe that our online gaming offerings, combined with other strategic relationships we have, or may develop in the future, should enable us to acquire new customers, expand our player database, and provide additional revenue streams that enhance our omnichannel strategy.

The gaming, media, and entertainment industries are characterized by an increasingly high degree of competition among a large number of participants.

sports and third-party internet or mobile-based gaming platforms, including both legal and illegal iCasino and sports betting operations.

We compete with a variety of gaming operations, including casinos and hotel casinos of varying quality and size and other gaming options such as state and province-sponsored internet lotteries, sweepstakes, charitable gaming, video gaming terminals at bars, restaurants, taverns and truck stops, historical horse racing gaming terminals, illegal slot machines and skill games, fantasy sports and third-party internet or mobile-based gaming platforms, including both legal and illegal iCasino and sports betting operations, and emerging prediction markets.

See the “Segment comparison of the years ended December 31, 2025 and 2024” section below for discussions on our results of operations by reportable segment.

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However, based on our experience, we can generally offer some insight into the factors that we believe are likely to account for such changes and which factors may have a greater impact than others.

For example, decreases in discretionary consumer spending have historically been brought about by actual or perceived weakened general economic conditions, such as recessions, inflation, rising interest rate environments, tight credit conditions, high unemployment levels, higher income taxes, low levels of consumer confidence, weakness in the housing market, high fuel or other transportation costs, low consumer confidence, global hostilities, political or social unrest, and the effects of pandemics.

For example, decreases in discretionary consumer spending have historically been brought about by actual or perceived weakened general economic conditions, such as recessions, inflation, rising interest rate environments, tight credit conditions, high unemployment levels, higher income taxes, low levels of consumer confidence, weakness in the housing market, high fuel or other transportation costs, global hostilities, political or social unrest, and the effects of pandemics.

In addition, visitation and the volume of play have historically been negatively impacted by significant construction surrounding our properties, adverse regional weather conditions, and natural disasters.

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The majority of our revenues is gaming revenue, which is highly dependent upon the volume and spending levels of customers at our properties.

Our gaming revenue is derived primarily from slot machines (which represented approximately 86%, 85%, and 84% of our gaming revenue in 2024, 2023, and 2022, respectively) and, to a lesser extent, table games, online sports betting, and iCasino.

Our gaming revenue is derived primarily from slot machines (which represented approximately 86%, 86%, and 85% of our gaming revenue in 2025, 2024, and 2023, respectively) and, to a lesser extent, table games, OSB, and iCasino.

Aside from gaming revenue, our revenues are primarily derived from our hotel, dining, retail, commissions, program sales, admissions, concessions, and certain other ancillary activities, and our racing operations.

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Therefore, changes in table game hold percentages do not typically have a material impact to our results of operations and cash flows.

Key performance indicators related to online gaming revenue, including online sports betting and iCasino, are handle, which is a volume indicator, and “win” or “hold” percentage.

Our online sports betting win percentage is in the range of approximately 4.6% to 9.2% of online handle, online slot win percentage is in the range of approximately 4.5% to 4.9% of online slot handle, and our online table game hold percentage is in the range of approximately 1.6% to 2.2% of online table game handle.

For online gaming, customers deposit cash into their online accounts for use in online sports betting and iCasino play.

Key performance indicators related to online gaming revenue, including OSB and iCasino, are handle, which is a volume indicator, and “win” or “hold” percentage.

Our OSB win percentage is in the range of approximately 4.6% to 9.8% of online handle and our iCasino win percentage is in the range of approximately 1.6% to 5.8% of online handle.

For online gaming, customers deposit cash into their online accounts for use in OSB and iCasino play.

Liabilities are recognized for online player account funds that have not been withdrawn and for wagers that have been placed on events that have not yet occurred.

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The win or hold percentage is the net amount of gaming wins and losses, with liabilities recognized for any bonus funds deposited into player accounts.

Given that online sports betting wagers are made based on the outcomes of future sporting events, the win or hold percentage can vary based on the bet type (i.e.

straight wagers vs.

Given that OSB wagers are made based on the outcomes of future sporting events, the win or hold percentage can vary based on the bet type (i.e., straight wagers vs.

parlay wagers).

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The Northeast, South, West, and Midwest segments (referred to as our “retail segments”) primarily generate revenue from gaming operations (such as slot machines and table games), food and beverage offerings and hotel visitation.

The Interactive segment includes all of our online sports betting, online casino/iCasino, and social gaming (collectively referred to as “online gaming”) operations, management of retail sports betting, media, and the operating results of Barstool Sports subsequent to the Barstool Acquisition on February 17, 2023 and prior to the Barstool divestiture on August 8, 2023 (as defined and discussed in Note 5, “Acquisitions and Dispositions” in the notes to our Consolidated Financial Statements ).

The Interactive segment includes all of our OSB, online casino/iCasino, and social gaming (collectively referred to as “online gaming”) operations, management of retail sports betting, media, and the operating results of Barstool Sports, Inc.

(“Barstool” or “Barstool Sports”) subsequent to the Barstool Acquisition on February 17, 2023 and prior to the Barstool divestiture on August 8, 2023 (as defined and discussed in Note 5, “Acquisitions and Dispositions” in the notes to our Consolidated Financial Statements ).

Our gaming and racing properties are grouped by geographic location, and each is viewed as an operating segment with the exception of our two properties in Jackpot, Nevada, which are viewed as one operating segment.

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RESULTS OF OPERATIONS

The following table highlights our revenues, net income (loss), and Adjusted EBITDA, on a consolidated basis, as well as our revenues and Adjusted EBITDAR by reportable segment.

The following table highlights our revenues, reportable segment revenues, net loss, Consolidated Adjusted EBITDA, and Segment Adjusted EBITDAR.

Such segment reporting is consistent with how we measure our business and allocate resources internally.

We consider net income (loss) to be the most directly comparable financial measure calculated in accordance with generally accepted accounting principles in the United States (“GAAP”) to Adjusted EBITDA and Adjusted EBITDAR, which are non-GAAP financial measures.

Refer to “Non-GAAP Financial Measures” below for the definitions of Adjusted EBITDA, Adjusted EBITDA margin, Adjusted EBITDAR, and Adjusted EBITDAR margin;

as well as a reconciliation of net income (loss) to Adjusted EBITDA and Adjusted EBITDAR and related margins.

We consider net loss to be the most directly comparable financial measure calculated in accordance with generally accepted accounting principles in the United States (“GAAP”) to Consolidated Adjusted EBITDA, which is a non-GAAP financial measure.

Refer to “Reportable Segment Measures ” below for the definition of Segment Adjusted EBITDAR.

Refer to “Non-GAAP Financial Measure” below for the definition of Consolidated Adjusted EBITDA as well as a reconciliation of net loss to Consolidated Adjusted EBITDA.

For the year ended December 31,

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Total $ 6,961.0 $ 6,578.1 $ 6,362.9

Net income (loss) $ (313.3) $ (491.4) $ 221.7

Adjusted EBITDAR:

Net loss $ (845.3) $ (313.3) $ (491.4)

Segment Adjusted EBITDAR (3) :

Northeast segment $ 795.0 $ 801.0 $ 831.0

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(139.5) (116.7) (110.8)

1,292.3 1,512.6 1,939.4

Rent expense associated with triple net operating leases (4)

(631.7) (620.1) (591.1)

Adjusted EBITDA $ 672.2 $ 921.5 $ 1,789.8

Net income (loss) margin (4.8) % (7.7) % 3.5 %

Adjusted EBITDAR margin 19.6 % 23.8 % 30.3 %

Adjusted EBITDA margin 10.2 % 14.5 % 28.0 %

(1) The Other category, included in the tables to reconcile the segment information to the consolidated information, consists of the Company’s stand-alone racing operations, namely Sanford-Orlando Kennel Club, Sam Houston and Valley Race Park, the Company’s joint venture interests in Freehold Raceway (which ceased operations on December 28, 2024), and our management contract for Retama Park Racetrack.

Consolidated Adjusted EBITDA (5)

$ 830.1 $ 672.2 $ 921.5

(1) The Other category, included in the tables to reconcile the segment information to the consolidated information, consists of the Company’s stand-alone racing operations, namely Sanford-Orlando Kennel Club, Sam Houston and Valley Race Park, the Company’s joint venture interest in Freehold Raceway (which ceased operations on December 28, 2024), and our management contract for Retama Park Racetrack.

Expenses incurred for corporate and shared services activities that are directly attributable to a property or are otherwise incurred to support a property are allocated to each property.

The Other category also includes corporate overhead costs, which consist of certain expenses, such as:

payroll, professional fees, travel expenses, and other general and administrative expenses that do not directly relate or have not otherwise been allocated.

Corporate overhead costs were $104.8 million, $106.7 million, and $98.5 million for the years ended December 31, 2024, 2023, and 2022, respectively.

The Other category also includes corporate overhead, which consists of certain expenses, such as:

payroll, professional fees, travel expenses, and other general and administrative expenses that do not directly relate to or have not otherwise been allocated.

Corporate overhead was $134.8 million, $104.8 million, and $106.7 million for the years ended December 31, 2025, 2024, and 2023, respectively.

Corporate overhead for the year ended December 31, 2025 includes $22.4 million of legal and advisory costs related to activist activity in connection with the Company’s 2025 annual meeting of shareholders held on June 17, 2025 (the “2025 Annual Meeting”).

(2) Primarily represents the elimination of intersegment revenues associated with our retail sportsbooks, which are operated by PENN Interactive.

(3) The total is a mathematical calculation derived from the sum of reportable segments (as well as the Other category).

As noted within “Non-GAAP Financial Measures” below, Adjusted EBITDAR, and the related margin, is presented on a consolidated basis outside the financial statements solely as a valuation metric.

(4) For the years ended December 31, 2024 and 2023, pertains to the following operating leases:

(3) See definition of “Segment Adjusted EBITDAR” within the “Reportable Segment Measures” section below.

(4) Pertains to the following operating leases:

(i) AR PENN Master Lease;

(ii) 2023 Master Lease;

(iii) Margaritaville Lease;

and (iv) Greektown Lease.

For the year ended December 31, 2022, pertains to the operating lease components contained within the (i) PENN Master Lease (specific to the land and building components associated with the operations of Hollywood Gaming at Dayton Raceway and Hollywood Gaming at Mahoning Valley Race Course);

(ii) Meadows Lease;

(iii) Margaritaville Lease;

(iv) Greektown Lease;

and (v) Tropicana Lease (which terminated on September 26, 2022).

(iii) Margaritaville Lease (for the period January 1, 2023 to December 3, 2025);

(iv) Greektown Lease (for the period January 1, 2023 to December 3, 2025);

and (v) VICI Master Lease (beginning December 4, 2025).

(5) See definition of Consolidated Adjusted EBITDA within the “N on-GAAP Financial Measure” section below.

Consolidated comparison of the years ended December 31, 2025 and 2024

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Total revenues $ 6,961.0 $ 6,578.1 $ 6,362.9 $ 382.9 $ 215.2 5.8 % 3.4 %

Gaming revenues for the year ended December 31, 2024 increased by $263.7 million compared to the prior year, primarily due to an increase in gaming revenues at our Interactive segment, partially offset by a decrease in gaming revenues within our South segment.

In addition to severe weather events negatively impacting our South segment operations during the third quarter , severe weather affected weekends and holidays across all our regional property segments during the first quarter, negatively impacting our operations.

Furthermore, retail gaming revenues decreased as new supply continues to impact visitation in certain retail property segments.

Food, beverage, hotel, and other revenues for the year ended December 31, 2024 decreased by $48.5 million compared to the prior year, primarily due to the inclusion of 100% of the operating results of Barstool subsequent to the Barstool Acquisition on February 17, 2023 and prior to the Barstool disposal on August 8, 2023 in the prior year.

Due to the Barstool disposal, the current year does not include any Barstool revenues.

T his was offset by an increase in gaming tax amounts related to third-party online sports betting and/or iCasino partners for online sports betting and iCasino market access of $45.2 million compared to the prior year.

Gaming revenues for the year ended December 31, 2025 increased by $180.5 million compared to the prior year, primarily due to an increase in online gaming revenues at our Interactive segment.

This increase was due to iCasino and online sports betting growth driven by ongoing product enhancements and decreased promotional expense.

Additionally, the recent openings of our new land-based Joliet facility and the second hotel tower at M Resort contributed to i ncreases in revenues within our Midwest and West segments, respectively.

Despite weather events negatively impacting our Northeast segment, its revenues increased by $8.6 million compared to the prior year .

Increases in revenues within our Northeast, Midwest, and West segments were partially offset by decreases within our South segment, where new supply continues to impact visitation.

Food, beverage, hotel, and other revenues for the year ended December 31, 2025 increased by $202.4 million compared to the prior year, primarily due to an increase in gaming tax reimbursement amounts related to third-party online sports betting and/or iCasino partners for online sports betting and iCasino market access of $152.7 million compared to the prior year.

Our South segment’s food, beverage, hotel, and other revenues increased compared to the prior year, reflecting higher room availability and guest traffic following the completion of room renovations and remodeling at certain properties in 2025, as well as the reopening of select dining venues.

See “Segment comparison of the years ended December 31, 2025 and 2024” below for more detailed explanations of the fluctuations in revenues.

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Food, beverage, hotel, and other 1,162.2 985.5 1,011.4 176.7 (25.9) 17.9 % (2.6) %

985.5 1,011.4 767.2 (25.9) 244.2 (2.6) % 31.8 %

General and administrative 1,633.8 1,568.4 1,563.4 65.4 5.0 4.2 % 0.3 %

5 unchanged sentences

Gaming expenses consist primarily of gaming taxes, payroll, advertising, marketing and promotional, and other expenses associated with our gaming operations.

Gaming expenses for the year ended December 31, 2024 increased by $439.6 million compared to the prior year, primarily due to costs related to the Sportsbook Agreement and Investment Agreement with ESPN which commenced on August 8, 2023 (see Note 12, “Commitments and Contingencies” in the notes to our Consolidated Financial Statements) and increased gaming costs driven by increased ESPN BET volumes.

Gaming expenses for the year ended December 31, 2025 increased by $17.4 million compared to the prior year.

F or the year ended December 31, 2025 , gaming taxes increased at our retail properties within our Northeast, West, and Midwest segments , due to an increase in gaming revenues, and at our Interactive segment, due to an increase in online gaming revenue as discussed above.

The increase was partially offset by a decrease in marketing expense at our Interactive segment compared to the prior year.

In the prior year period, we incurred additional marketing expenses to support our initial launch of ESPN BET within our Interactive segment .

Food, beverage, hotel, and other expenses consist primarily of payroll costs, costs of goods sold, and other costs associated with our food, beverage, hotel, retail, racing, and Interactive operations.

Food, beverage, hotel, and other expenses for the year ended December 31, 2024 decreased $25.9 million compared to the prior year, primarily due to the inclusion of

Barstool operating expenses in the prior year subsequent to the Barstool Acquisition on February 17, 2023 and prior to the Ba rstool disposal on August 8, 2023.

Due to the Barstool disposal, the current year does not include any Barstool operating expenses.

The decrease for the year ended December 31, 2024 was partially offset by an increase in gaming tax reimbursement amounts related to third-party online sports betting and/or iCasino partners for online sports betting and iCasino market access.

Food, beverage, hotel, and other expenses for the year ended December 31, 2025 increased $176.7 million compared to the prior year, primarily due to increases in gaming tax reimbursement amounts related to third-party online sports betting and/or iCasino partners for online sports betting and iCasino market access.

General and administrative expenses include items such as compliance, facility maintenance, utilities, property and liability insurance, surveillance and security, and lobbying expenses, as well as all expenses for administrative departments such as accounting, purchasing, human resources, legal, and internal audit.

7 unchanged sentences

and rent expense associated with our triple net operating leases.

General and administrative expenses for the year ended December 31, 2024 increased by $5.0 million compared to the corresponding prior year, primarily due to an increase in rent expense associated with triple net operating leases of $29.0 million stemming primarily from annual escalators on our triple net operating leases.

The increase was offset by a decrease in stock-based compensation.

Depreciation and amortization for the year ended December 31, 2024 decreased $1.5 million compared to the corresponding prior year.

Impair ment losses for the year ended December 31, 2024 relate to impairment charges taken on our goodwill and other intangible assets of $12.3 million and $76.8 million, respectively, as a result of our annual impairment assessment during the fourth quarter of 2024.

Increased competition in our South and Midwest segments led to slight reductions in long-term projections at some of our properties which resulted in goodwill impairment charges in 2024.

Increased supply has led to reductions in long-term projections for certain of our properties in our Northeast and South segments, resulting in gaming license and trademark impairment charges at certain reporting units in both of those segments in 2024.

Refer to Note 8 , “ Goodwill and Other Intangible Assets ” in the notes to our Consolidated Financial Statements for further discussion of impairment charges.

Loss on disposal of Barstool relates to the loss on the sale of 100% of the outstanding shares of Barstool to David Portnoy in exchange for nominal cash consideration as described in Note 5, “Acquisitions and Dispositions” in the notes to our Consolidated Financial Statements.

General and administrative expenses for the year ended December 31, 2025 increased by $65.4 million compared to the prior year, primarily due legal and advisory costs related to activist activity incurred in connection with the Company’s 2025 Annual Meeting of $22.4 million, an increase in pre-opening expenses of $17.3 million for the PENN Development Projects, and an increase in rent expense of $11.6 million stemming from the 2023 Master Lease lease modifications on August 1, 2025 and November 3, 2025, as well as annual escalators on our triple net operating leases.

Impairment losses for the year ended December 31, 2025 primarily relate to an impairment charge at our Interactive segment for goodwill of $825.0 million as a result of an interim impairment assessment during the third quarter of 2025, an impairment charge at our ACB property for its trademark of $15.0 million as a result of an interim impairment assessment during the second quarter of 2025, an impairment charge at our South segment for goodwill of $7.0 million as a result of our annual impairment assessment during the fourth quarter of 2025, and impairment charges at our Northeast, South, and West segments for other intangible assets of $98.3 million as a result of our annual impairment assessment during the fourth quarter of 2025.

The impairment of goodwill at our Interactive segment resulted from the Company’s realignment of its digital focus following the mutual decision for an early termination of our Sportsbook Agreement with ESPN (as defined in Note 12, “Commitments and Contingencies” ).

The impairment of the trademark at our ACB property resulted from the strategic decision to rebrand ACB.

The impairment of goodwill in our South segment resulted from economic challenges in a specific operating region which led to reductions in long-term cash flow projections.

Additionally, a former expansion of legislation in the market, increased supply, and economic challenges resulted in reductions in long-term projections for certain of our properties in our Northeast, South, and West segments, resulting in gaming license and trademark impairment charges at certain reporting units in those segments in 2025.

See Note 8, “Goodwill and Other Intangible Assets” in the notes to the Consolidated Financial Statements for further discussion.

During the year ended December 31, 2024, we recorded impairment charges on our goodwill and other intangible assets of $12.3 million and $76.8 million, respectively, as a result of our annual impairment assessment during the fourth quarter of 2024.

The following table presents our consolidated other income (expenses):

10 unchanged sentences

Gain on REIT transactions, net $ 3.3 $ — $ 500.8 $ 3.3 $ (500.8) N/M N/M

Gain on financing arrangement $ 215.1 $ — $ — $ 215.1 $ — N/M N/M

Loss on early extinguishment of debt $ (11.8) $ (0.3) $ — $ (11.5) $ (0.3) N/M N/M

Other $ 5.3 $ 5.5 $ (72.1) $ (0.2) $ 77.6 (3.6) % N/M

Income tax benefit $ 28.0 $ 8.2 $ 46.4 $ 19.8 $ (38.2) 241.5 % (82.3) %

Other $ 4.7 $ 5.3 $ 5.5 $ (0.6) $ (0.2) (11.3) % (3.6) %

Income tax benefit (expense) $ (24.6) $ 28.0 $ 8.2 $ (52.6) $ 19.8 N/M 241.5 %

N/M - Not meaningful

Interest expense, net increased for the year ended December 31, 2024, as compared to the prior year, due to overall increase in interest rates on our Senior Secured Credit Facilities as well as the Pinnacle Master Lease rent escalator effective May 1, 2024.

Interest income decreased for the year ended December 31, 2024, as compared to the prior year, primarily due to a decrease in the amount invested in money market funds, which we use for short term investing.

Interest expense, net decreased by $64.7 million for the year ended December 31, 2025, as compared to the prior year.

The prior year and the first quarter of 2025 included interest expense related to the Company’s financing arrangement, which is described in further detail below in “Gain on financing arrangement.” Additionally, capitalized interest related to the PENN Development Projects increased from the prior year period.

Interest income decreased by $13.9 million for the year ended December 31, 2025, as compared to the prior year, primarily due to lower cash balances invested in our money market funds.

Income from unconsolidated affiliates relates principally to our investment in the Kansas Entertainment and Freehold Raceway joint venture.

Operations at Freehold Raceway ceased on December 28, 2024.

The increase of $2.8 million for the year ended December 31, 2024, compared to the corresponding prior year, is due to the year ended December 31, 2023 including a $4.1 million loss for Barstool prior to the Barstool Acquisition on February 17, 2023.

Gain on Barstool Acquisition, net relates to the gain on our acquisition of all the outstanding shares of Barstool common stock not already owned by us on February 17, 2023 as described in Note 5, “Acquisitions and Dispositions” to our Consolidated Financial Statements.

The gain consists of $66.5 million related to the remeasurement of our equity investment immediately prior to the acquisition date and $16.9 million related to the acquisition of the remaining 64% of Barstool common stock.

Gain on REIT transactions, net relates to the execution of both the AR PENN Master Lease and 2023 Master Lease on February 21, 2023, effective January 1, 2023, which resulted in the (i) derecognition of $1.6 billion of financing obligations and (ii) derecognition of $1.1 billion of Property and Equipment, net.

In conjunction with entering into the 2023 Master Lease, the individual triple net leases associated with Meadows and Perryville were terminated which resulted in a $6.5 million loss from the derecognition of right-of-use assets and lease liabilities.

See Note 11, “Leases” to our Consolidated Financial Statements for additional details on both of these transactions.

Loss on early extinguishment of debt relates to the repricing of the Senior Secured Credit Facilities on December 4, 2024.

The change in income from the prior year is due to fluctuations in earnings from our investments in these unconsolidated affiliates.

Gain on REIT transactions, net relates to the derecognition of assets associated with the previously leased Joliet facility in connection with the 2023 Master Lease modification, effective August 1, 2025.

See Note 11, “Leases” to our Consolidated Financial Statements for further discussion.

Gain on financing arrangement relates to a $215.1 million non-cash gain on a financing arrangement that we entered into in February 2021 with a third-party, which provided the Company with upfront and non-refundable cash proceeds while permitting us to participate in future proceeds on certain insurance coverage claims for economic losses PENN sustained due to the COVID-19 pandemic.

During the first quarter of 2025, the Company determined that obligations under these claims are no longer probable and therefore recognized a non-cash gain related to this obligation comprised of cash proceeds received in 2021 of $72.5 million and $142.6 million of accreted non-cash interest.

See Note 10, “Long-Term Debt” to the Consolidated Financial Statements for additional details.

Loss on early extinguishment of debt relates to the repurchases of the 2.75% convertible notes due 2026 (the “Convertible Notes”).

See Note 10, “Long-term Debt” to our Consolidated Financial Statements for further discussion.

Other primarily relates to realized and unrealized gains and losses on equity securities held by PENN Interactive, unrealized gains and losses related to certain Barstool shares (prior to the Barstool Acquisition on February 17, 2023), as well as miscellaneous income and expense items.

Equity securities were provided to the Company in conjunction with entering into multi-year agreements with sports betting operators for online sports betting and iCasino market access across our portfolio.

For the year ended December 31, 2024 , other income primarily consisted of dividend income of $4.4 million, offset by an unrealized holding loss of $0.1 million.

For the year e nded December 31, 2023 other income primarily consisted of dividend income of $10.8 million, offset by an unrealized holding loss of $6.4 million.

Income tax benefit fo r the year ended December 31, 2024, was $28.0 million, as compared to $8.2 million for the year ended December 31, 2023.

Our effective tax rate (income taxes as a percentage of income from operations before income taxes) was 8.2% for the year ended December 31, 2024, as compared to 1.7% for the ye ar ended December 31, 2023.The effective tax rates for both 2024 and 2023 are not correlated to the amount of our loss before income taxes due to the foreign losses for which no benefit was recognized and the impact of the significant nondeductible losses sustained from the Barstool divestiture, respectively.

The Company’s effective tax rate in the current year is lower than the federal statutory rate of 21%, primarily because of nondeductible compensation and an increase in the valuation allowances on both foreign and certain state losses that are more likely than not to be utilized before expiring, as discussed in Note 5 , “ Acquisition s and Dispositions ” and Note 13, “Income Taxes.”

Accordingly, the Company increased the valuation allowance by $61.1 million during 2024 on foreign and certain state and deferred tax assets and $179.0 million in 2023 for the capital loss carryforward generated from the Barstool divestiture transaction and for certain foreign and state deferred tax assets that are not more likely than not to be realized, resulting in an increase to income tax expense.

See Note 13, “Income Taxes” to our Consolidated Financial Statements for further discussion.

Our effective income tax rate can vary each reporting period depending on, among other factors, the geographic and business mix of our earnings, changes to our valuation allowance, and the level of our tax credits.

Certain of these and other factors, including our history and projections of pre-tax earnings, are considered in assessing our ability to realize our net deferred tax assets.

Other primarily relates to realized and unrealized gains and losses on equity securities held by PENN Interactive as well as miscellaneous income and expense items.

The equity securities were sold in the second quarter of 2025.

Income tax expense fo r the year ended December 31, 2025 was $24.6 million, as compared to a $28.0 million benefit for the year ended December 31, 2024.

Our effective tax rate (income taxes as a percentage of loss from operations before income taxes) was (3.0)% for the year ended December 31, 2025, as compared to 8.2% for the ye ar ended December 31, 2024.

The change in the effective tax rate for the year ended December 31, 2025 compared to the prior year was primarily due to:

(i) excluding certain foreign losses for which no tax benefit can be recognized in our worldwide effective tax rate calculation;

(ii) non-deductible permanent items;

(iii) state taxes;

and (iv) changes to the valuation allowance.

See Note 13, “Income Taxes” to the Consolidated Financial Statements for additional details.

Our effective income tax rate may vary each reporting period depending on, among other factors, the geographic and business mix of our earnings, changes to our valuation allowances, and the level of our tax credits.

These and other factors, including our history and projections of pre-tax earnings, are considered in assessing the realizability of our net deferred tax assets.

On July 4, 2025, the One Big Beautiful Bill Act (“OBBB”) was enacted.

The impacts were limited to timing differences, including bonus depreciation, accelerated research and experimental expenses, and utilization of interest carryforwards, with no material effect on the Company’s effective tax rate.

The enactment lowered current year cash taxes, and the resulting current year federal net operating loss and tax credit carryforwards are expected to be fully utilized in future periods.

Segment comparison of the years ended December 31, 2025 and 2024

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Adjusted EBITDAR margin 28.7 % 29.1 % 30.3 % (40) bps (120) bps

The Northeast segment’s revenues for the year ended December 31, 2024 increased by $17.3 million over the prior year, primarily due to increases in gaming and non-gaming revenues at several of our properties, as well as increased visitation to our food and beverage outlets, offset by a reduction in gaming revenues at several of our properties due to increased competition.

For the year ended December 31, 2024 the Northeast segment’s Adjusted EBITDAR decreased by $30.0 million as compared to the prior year, and Adjusted EBITDAR margin decreased to 29.1%, primarily due to the reversal of certain accrued gaming taxes in the prior year and increased labor costs in the current year .

The Northeast segment’s revenues for the year ended December 31, 2025 increased by $13.5 million over the prior year despite weather events negatively impacting the segment.

Increases in revenue were primarily due to an increase in gaming revenues, particularly slots revenues, as well as an increase to food and beverage revenue.

For the year ended December 31, 2025 the Northeast segment’s Adjusted EBITDAR decreased by $6.0 million as compared to the prior year, and Adjusted EBITDAR margin decreased to 28.7%, primarily due to increases in gaming taxes and general and administrative expenses.

Severe weather events in the fourth quarter of 2025 also negatively impacted our operations.

South Segment

9 unchanged sentences

Adjusted EBITDAR margin 34.4 % 37.1 % 40.6 % (270) bps (350) bps

The South segment’s revenues for the year ended December 31, 2024 decreased by $47.4 million over the prior year, primarily due to a decrease in gaming revenues as increased competition negatively impacted visitation at several of our properties and severe weather events in the first and third quarter of 2024 negatively impacted our operations.

Food, beverage, hotel, and other revenues decreased primarily due to the acceleration of hotel remodeling in the third quarter of 2024, and the negative weather impact on operations, as discussed above.

For the year ended December 31, 2024 , the South segment’s Adjusted EBITDAR decreased by $60.9 million as compared to the prior year, and Adjusted EBITDAR margin decreased to 37.1%, primarily due to the decrease in gaming revenues as described above.

Additionally, the year ended December 31, 2023 was positively i mpacted by the receipt of $19.6 million in business interruption proceeds related to the loss experienced in 2020 due to Hurricane Laura.

The South segment’s revenues for the year ended December 31, 2025 decreased by $1.9 million over the prior year, primarily due to a decrease in gaming revenues as increased competition negatively impacted several of our properties, partially offset by an increase in revenue from non-gaming amenities .

The decrease in gaming revenues was offset by increased food, beverage, hotel, and other revenues, reflecting higher room availability and guest traffic following the completion of room renovations and remodeling at certain properties in 2025, as well as the reopening of select dining venues.

For the year ended December 31, 2025 , the South segment’s Adjusted EBITDAR decreased by $31.6 million as compared to the prior year, and Adjusted EBITDAR margin decreased to 34.4%, primarily due to the decreases in gaming revenues discussed above, and increased labor costs.

For the year ended December 31, $ Change % / bps Change

8 unchanged sentences

Adjusted EBITDAR margin 36.4 % 35.7 % 38.6 % 70 bps (290) bps

The West segment’s revenues for the year ended December 31, 2024 decreased by $3.2 million over the prior year, primarily due to road construction and increased competition negatively impacting visitation at our West segment properties, partially offset by an increase in food, beverage, hotel, and other revenues.

For the year ended December 31, 2024, the West segment’s Adjusted EBITDAR decreased by $16.7 million as compared to the prior year, and Adjusted EBITDAR margin decreased to 35.7%, primarily due to the decreases in gaming revenues discussed above and increased labor costs.

The West segment’s revenues for the year ended December 31, 2025 increased by $17.9 million over the prior year, primarily due to increased gaming revenues, as well as an increase to food and beverage revenue.

The year ended December 31, 2025 also benefited from the opening of the second hotel tower at M Resort on December 1, 2025.

For the year ended December 31, 2025, the West segment’s Adjusted EBITDAR increased by $10.1 million as compared to the prior year, and Adjusted EBITDAR margin increased to 36.4%, primarily due to the increases in gaming revenues discussed above.

Midwest Segment

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Adjusted EBITDAR margin 40.2 % 41.5 % 42.4 % (130) bps (90) bps

The Midwest segment’s revenues for the year ended December 31, 2024 decreased by $0.4 million over the prior year , primarily due to a decrease in gaming revenues as severe weather events in the first quarter of 2024 negatively impacted visitation.

The decrease was partially offset by an increase in food and beverage revenues.

For the year ended December 31, 2024, the Midwest segment’s Adjusted EBITDAR decreased by $9.8 million as compared to the prior year, and Adjusted EBITDAR margin decreased to 41.5%, primarily due to the decreases in gaming revenues discussed above and increased labor costs.

The Midwest segment’s revenues for the year ended December 31, 2025 increased by $9.2 million compared to the prior year , primarily due to an increase in gaming revenues driven by the relocation of Joliet from a riverboat casino operation to a new land-based facility that opened on August 11, 2025.

For the year ended December 31, 2025, the Midwest segment’s Adjusted EBITDAR decreased by $12.2 million as compared to the prior year, and Adjusted EBITDAR margin decreased to 40.2%, primarily due to increases in labor costs and general and administrative expenses.

Severe weather events in the fourth quarter of 2025 also negatively impacted our operations.

Interactive Segment

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Food, beverage, hotel, and other (1)

738.5 569.7 637.7 168.8 (68.0) 29.6 % (10.7) %

Total revenues $ 1,302.6 $ 959.9 $ 718.8 $ 342.7 $ 241.1 35.7 % 33.5 %

Adjusted EBITDAR $ (499.5) $ (402.5) $ (74.9) $ (97.0) $ (327.6) N/M N/M

Adjusted EBITDAR margin (52.0) % (56.0) % (11.3) % N/M N/M

Adjusted EBITDA $ (267.5) $ (499.5) $ (402.5) $ 232.0 $ (97.0) N/M N/M

Adjusted EBITDA margin (20.5) % (52.0) % (56.0) % N/M N/M

(1) - “Food, beverage, hotel, and other” only includes “other” revenue.

N/M - Not meaningful

The Interactive segment’s revenues for the year ended December 31, 2024 increased by $241.1 million, compared to the prior year, primarily due to an increase in gaming revenues.

Gaming revenues were positively impacted by an increase in gaming volume compared to the prior year, as 2024 contains a full year of ESPN BET operating results and lower promotional expenses.

The increase was partially offset by a decrease in other revenues, of which $99.2 million relates to Barstool revenues subsequent to the Barstool Acquisition on February 17, 2023 and prior to the Barstool disposal on August 8, 2023 being included in the year ended December 31, 2023.

Due to the Barstool disposal, the current year does not i nclude any Barstool operating results.

Other revenues are inclusive of gaming tax amounts related to third-party online sports betting and/or iCasino partners for online sports betting and iCasino market access of $435.6 million, $390.4 million, and $251.6 million for the years ended December 31, 2024, 2023, and 2022, respectively.

For the year ended December 31, 2024, the Interactive segment’s Adjusted EBITDAR decreased by $97.0 million as compared to the prior year, primarily due to the decrease in other revenues as discussed above, as well as costs related to the Sportsbook Agreement and Investment Agreement with ESPN, which commenced on August 8, 2023.

Adjusted EBITDAR margin increased primarily due to the increase in gaming revenues as discussed above.

The Interactive segment’s revenues for the year ended December 31, 2025 increased by $342.7 million, compared to the prior year, primarily due to an increase in gaming revenues and other revenues.

Gaming revenues were positively impacted by growth in our Hollywood-branded iCasino and theScore Bet iCasino apps, and higher slot product mix improving hold rates.

O nline sports betting growth was driven by ongoing product enhancements.

Other revenues are inclusive of gaming tax amounts related to third-party online sports betting and/or iCasino partners for online sports betting and iCasino market access of $588.3 million for the year ended December 31, 2025 compared to $435.6 million for the year ended December 31, 2024.

For the year ended December 31, 2025, the Interactive segment’s Adjusted EBITDA and Adjusted EBITDA margin increased compared to the prior year, primarily due to the increase in gaming revenues, discussed above, and a decrease in marketing expense.

For the year ended December 31, $ Change % / bps Change

5 unchanged sentences

Total revenues $ 18.5 $ 19.6 $ 20.2 $ (1.1) $ (0.6) (5.6) % (3.0) %

Adjusted EBITDAR $ (116.7) $ (110.8) $ (97.6) $ (5.9) $ (13.2) N/M N/M

N/M - Not meaningful

Adjusted EBITDAR $ (139.5) $ (116.7) $ (110.8) $ (22.8) $ (5.9) 19.5 % 5.3 %

Other consists of the Company’s stand-alone racing operations, as well as corporate overhead costs, which primarily includes certain expenses such as payroll, professional fees, travel expenses, and other general and administrative expenses that do not directly relate to or have not otherwise been allocated.

Revenues have decreased slightly compared to the prior ye ar, primarily due to fluctuations in racing revenues.

Changes in Adjusted EBITDAR for the year ended December 31, 2024 primarily relate to increased labor costs, slightly offset by a decrease in general and administrative costs.

Non-GAAP Financial Measures

Revenues decreased compared to the prior ye ar, primarily due to fluctuations in racing revenues.

Corporate overhead expenses were $134.8 million for the year ended December 31, 2025 compared to $104.8 million for the year ended December 31, 2024.

Corporate overhead expenses for the year ended December 31, 2025 include $22.4 million of legal and advisory costs related to activist activity in connection with our 2025 Annual Meeting.

Changes in Adjusted EBITDAR for the year ended December 31, 2025 primarily relate to increased general and administrative costs, inclusive of the $22.4 million of legal and advisory costs as described above.

Reportable Segment Measures

Segment Adjusted EBITDAR is our measure of profit or loss for our reportable segments and underlying operating segments.

We define Segment Adjusted EBITDAR as earnings before interest expense, net, interest income, income taxes, depreciation and amortization, stock-based compensation, debt extinguishment charges, impairment losses, insurance recoveries, net of deductible charges, changes in the estimated fair value of our contingent purchase price obligations, gain or loss on disposal of assets, the difference between budget and actual expense for cash-settled stock-based awards, pre-opening expenses, loss on disposal of a business, non-cash gains/losses associated with REIT transactions as described in Note 11, “Leases” to our Consolidated Financial Statements, non-cash gains/losses associated with partial and step acquisitions as measured in accordance with ASC Topic 805, “Business Combinations,” and other.

Segment Adjusted EBITDAR excludes rent expense associated with triple net operating leases (which is a normal, recurring cash operating expense necessary to operate our business).

Segment Adjusted EBITDAR is inclusive of income or loss from unconsolidated affiliates, with our share of non-operating items (such as interest expense, net, income taxes, depreciation and amortization, and stock-based compensation expense) added back for Barstool Sports (prior to our acquisition of the remaining 64% of Barstool common stock on February 17, 2023) and our Kansas Entertainment, LLC joint venture.

Segment Adjusted EBITDAR margin is Segment Adjusted EBITDAR divided by related segment revenues.

Non-GAAP Financial Measure

Use and Definitions

In addition to GAAP financial measures, management uses Adjusted EBITDA, Adjusted EBITDAR, Adjusted EBITDA margin, and Adjusted EBITDAR margin as non-GAAP financial measures.

These non-GAAP financial measures should not be considered a substitute for, nor superior to, financial results and measures determined or calculated in accordance with GAAP.

Each of these non-GAAP financial measures is not calculated in the same manner by all companies and, accordingly, may not be an appropriate measure of comparing performance among different companies.

We define Adjusted EBITDA as earnings before interest expense, net, interest income, income taxes, depreciation and amortization, stock-based compensation, debt extinguishment charges, impairment losses, insurance recoveries, net of deductible charges, changes in the estimated fair value of our contingent purchase price obligations, gain or loss on disposal of assets, the difference between budget and actual expense for cash-settled stock-based awards, pre-opening expenses, loss on disposal of business, non-cash gains/losses associated with REIT transactions as described in Note 11, “Leases” to our Consolidated Financial Statements, non-cash gains/losses associated with partial and step acquisitions as measured in accordance with ASC Topic 805, “Business Combinations,” and other.

Adjusted EBITDA is inclusive of income or loss from unconsolidated affiliates, with our share of non-operating items (such as interest expense, net, income taxes, depreciation and amortization, and stock-based compensation expense) added back for Barstool Sports (prior to our acquisition of the remaining 64% of Barstool common stock on February 17, 2023) and our Kansas Entertainment, LLC joint venture.

Adjusted EBITDA is inclusive of rent expense associated with our triple net operating leases with our REIT landlords.

Although Adjusted EBITDA includes rent expense associated with our triple net operating leases, we believe Adjusted EBITDA is useful as a supplemental measure in evaluating the performance of our consolidated results of operations.

We define Adjusted EBITDA margin as Adjusted EBITDA divided by consolidated revenues.

Adjusted EBITDA has economic substance because it is used by management as a performance measure to analyze the performance of our business, and is especially relevant in evaluating large, long-lived casino-hotel projects because it provides a perspective on the current effects of operating decisions separated from the substantial non-operational depreciation charges and financing costs of such projects.

We present Adjusted EBITDA because it is used by some investors and creditors as an indicator of the strength and performance of ongoing business operations, including our ability to service debt, and to fund capital expenditures, acquisitions and operations.

In addition to GAAP financial measures, management uses Consolidated Adjusted EBITDA as a non-GAAP financial measure.

This non-GAAP financial measure should not be considered a substitute for, nor superior to, financial results and measures determined or calculated in accordance with GAAP.

This non-GAAP financial measure is not calculated in the same manner by all companies and, accordingly, may not be an appropriate measure of comparing performance among different companies.

We define Consolidated Adjusted EBITDA as earnings before interest expense, net, interest income, income taxes, depreciation and amortization, stock-based compensation, debt extinguishment charges, impairment losses, insurance recoveries, net of deductible charges, changes in the estimated fair value of our contingent purchase price obligations, gain or loss on disposal of assets, the difference between budget and actual expense for cash-settled stock-based awards, pre-opening expenses, loss on disposal of business, non-cash gains/losses associated with REIT transactions as described in Note 11, “Leases” to our Consolidated Financial Statements, non-cash gains/losses associated with partial and step acquisitions as measured in accordance with ASC Topic 805, “Business Combinations,” and other.

Consolidated Adjusted EBITDA is inclusive of income or loss from unconsolidated affiliates, with our share of non-operating items (such as interest expense, net, income taxes, depreciation and amortization, and stock-based compensation expense) added back for Barstool Sports (prior to our acquisition of the remaining 64% of Barstool common stock on February 17, 2023) and our Kansas Entertainment, LLC joint venture.

Consolidated Adjusted EBITDA is inclusive of rent expense associated with our triple net operating leases with our REIT landlords.

Although Consolidated Adjusted EBITDA includes rent expense associated with our triple net operating leases, we believe Consolidated Adjusted EBITDA is useful as a supplemental measure in evaluating the performance of our consolidated results of operations.

Consolidated Adjusted EBITDA has economic substance because it is used by management as a performance measure to analyze the performance of our business, and is especially relevant in evaluating large, long-lived casino-hotel projects because it provides a perspective on the current effects of operating decisions separated from the substantial non-operational depreciation charges and financing costs of such projects.

We present Consolidated Adjusted EBITDA because it is used by some investors and creditors as an indicator 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.

In order to view the operations of their casinos on a more stand-alone basis, gaming companies, including us, have historically excluded from their Adjusted EBITDA calculations certain corporate expenses that do not relate to the management of specific casino properties.

However, Adjusted EBITDA is not a measure of performance or liquidity calculated in accordance with GAAP.

Adjusted EBITDA information is presented as a supplemental disclosure, as management believes that it is a commonly used measure of performance in the gaming industry and that it is considered by many to be a key indicator of the Company’s operating results.

We define Adjusted EBITDAR as Adjusted EBITDA (as defined above) plus rent expense associated with triple net operating leases (which is a normal, recurring cash operating expense necessary to operate our business).

Adjusted EBITDAR is presented on a consolidated basis outside the financial statements solely as a valuation metric.

Management believes that Adjusted EBITDAR is an additional metric traditionally 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 a supplemental disclosure because (i) we believe Adjusted EBITDAR is traditionally used by gaming operator analysts and investors to determine the equity value of gaming operators and (ii) Adjusted EBITDAR is one of the metrics used by other financial analysts in valuing our business.

We believe 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 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.

However, Adjusted EBITDAR when presented on a consolidated basis is not a financial measure in accordance with GAAP, and 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 and is provided for the limited purposes referenced herein.

Adjusted EBITDAR margin is defined as Adjusted EBITDAR on a consolidated basis divided by revenues on a consolidated basis.

Adjusted EBITDAR margin is presented on a consolidated basis outside the financial statements solely as a valuation metric.

We further define Adjusted EBITDAR margin by reportable segment as Adjusted EBITDAR for each segment divided by segment revenues.

Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measures

The following table includes a reconciliation of net income (loss), which is determined in accordance with GAAP, to Adjusted EBITDA and Adjusted EBITDAR, which are non-GAAP financial measures, as well as related margins:

In order to view the operations of their casinos on a more stand-alone basis, gaming companies, including us, have historically excluded from their Consolidated Adjusted EBITDA calculations certain corporate expenses that do not relate to the management of specific casino properties.

However, Consolidated Adjusted EBITDA is not a measure of performance or liquidity calculated in accordance with GAAP.

Consolidated Adjusted EBITDA information is presented as a supplemental disclosure, as management believes that it is a commonly used measure of performance in the gaming industry and that it is considered by many to be a key indicator of the Company’s operating results.

Reconciliation of GAAP Financial Measures to Non-GAAP Financial Measure

The following table includes a reconciliation of net loss, which is determined in accordance with GAAP, to Consolidated Adjusted EBITDA, which is a non-GAAP financial measure:

For the year ended December 31,

(dollars in millions) 2025 2024 2023

Net income (loss) $ (313.3) $ (491.4) $ 221.7

Income tax benefit (28.0) (8.2) (46.4)

Net loss $ (845.3) $ (313.3) $ (491.4)

Income tax expense (benefit) 24.6 (28.0) (8.2)

Interest expense, net 405.8 470.5 464.7

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Gain on REIT transactions, net (3.3) — (500.8)

Gain on financing arrangement (215.1) — —

Loss on early extinguishment of debt 11.8 0.3 —

Other (income) expense (5.3) (5.5) 72.1

Other income (4.7) (5.3) (5.5)

Operating income (loss) (673.6) 72.5 (690.2)

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Loss on disposal of assets (1)

Contingent purchase price (1)

(1.2) 1.9 (0.6)

Pre-opening expenses (1)

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945.3 89.1 130.6

Insurance recoveries, net of deductible charges (1)

(5.5) (13.9) (10.7)

Income from unconsolidated affiliates 37.7 28.1 25.3

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Other expenses (1)(5)

7.0 29.9 55.2

Adjusted EBITDA 672.2 921.5 1,789.8

Rent expense associated with triple net operating leases (1)

620.1 591.1 149.6

Adjusted EBITDAR $ 1,292.3 $ 1,512.6 $ 1,939.4

Net income (loss) margin (4.8) % (7.7) % 3.5 %

Adjusted EBITDA margin 10.2 % 14.5 % 28.0 %

Adjusted EBITDAR margin 19.6 % 23.8 % 30.3 %

Consolidated Adjusted EBITDA $ 830.1 $ 672.2 $ 921.5

(1 ) These items are included in “General and administrative” within the Company’s Consolidated Statements of Operations.

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As such, significant fluctuations in the price of the Company’s common stock during any reporting period could cause significant variances to budget on cash-settled stock-based awards.

(3) For the year ended December 31, 2024, impairment charges relate to the Northeast, South, and Midwest segments.

For the years ended December 31, 2023 and 2022, impairment charges relate to the Northeast segment.

(4) Consists principally of interest expense, net, income taxes, depreciation and amortization, and stock-based compensation expense associated with Barstool prior to us acquiring the remaining 64% of Barstool common stock (see Note 5, “Acquisitions and Dispositions” ) and our Kansas Entertainment joint venture.

(5) Consists of non-recurring acquisition and transaction costs, and finance transformation costs associated with the implementation of our new Enterprise Resource Management system.

(3) For the year ended December 31, 2025, impairment charges of $120.3 million and $825.0 million relate to our retail segments and Interactive segment, respectively.

For the year ended December 31, 2024, impairment charges included $89.1 million in our Northeast, South, and Midwest segments.

For the year ended December 31, 2023, impairment charges related to our Northeast Segment.

See Note 8, “Goodwill and Other Intangible Assets.”

(4) For the years ended December 31, 2025 and 2024, consists primarily of depreciation expense associated with our Kansas Entertainment joint venture.

The year ended December 31, 2023 primarily consisted of interest expense, net, income taxes, depreciation and amortization, and stock-based compensation expense associated with Barstool prior to us acquiring the remaining 64% of Barstool common stock (see Note 5, “Acquisitions and Dispositions” ) and our Kansas Entertainment joint venture.

(5) Consists primarily of non-recurring transaction costs, insurance recoveries, net of deductible charges, and prior to August 1, 2024, finance transformation costs.

LIQUIDITY AND CAPITAL RESOURCES

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Trends in our operating cash flows tend to follow trends in operating income, excluding non-cash charges, but can be affected by changes in working capital, the timing of significant interest payments, tax payments or refunds, and distributions from unconsolidated affiliates.

Net cash provided by operating activities decreased by $96.6 million for the year ended December 31, 2024 primarily due to a decrease in our reportable segments’ Adjusted EBITDAR, partially offset by changes in working capital primarily related to gaming receivables, accrued gaming taxes, and advanced payments and deposits.

Additionally, cash paid for interest and income taxes decreased compared to the prior year.

Net cash provided by operating activities increased by $148.9 million for the year ended December 31, 2025 primarily due to an increase in Adjusted EBITDAR from our Interactive segment, partially offset by a decrease in Segment Adjusted EBITDAR from our retail operations.

Investing Cash Flow

Cash used in investing activities for the year ended December 31, 2024 of $541.2 million, primarily relates to capital expenditures of $482.7 million.

For the year ended December 31, 2023, cash used in investing activities was primarily related to consideration paid for the Barstool Acquisition, net of cash acquired, of $314.6 million and capital expenditures of $360.0 million .

Cash used in investing activities for the year ended December 31, 2025 of $351.1 million primarily relates to capital expenditures of $647.7 million, partially offset by proceeds of $280.0 million from sale-and-leaseback transactions in conjunction with our development projects.

For the year ended December 31, 2024, cash used in investing activities of $541.2 million was primarily related to capital expenditures of $482.7 million .

Capital Expenditures

Capital expenditures are accounted for as either project capital (new facilities or expansions) or maintenance (replacement) which is inclusive of projects such as our retail sportsbooks, our cashless, cardless and contactless technology, and hotel renovations.

Cash provided by operating activities, as well as cash available under our Amended Revolving Credit Facility and Revolving Facility, was available to fund our capital expenditures for the years ended December 31, 2024, 2023, and 2022, as applicable.

Capital expenditures for the year ended December 31, 2024 were $482.7 million, inclusive of $229.4 million of capital maintenance expenditures and $253.3 million of capital project expenditures .

For the year ending December 31, 2025, our anticipated capital expenditures are approximately $244.9 million, which includes capital expenditures required under our Triple Net Leases, which require us to spend a specified percentage of total revenues.

Additionally f or the year ending December 31, 2025, we anticipate capital project expenditures of $490.9 million, the majority of which is in connection with the PENN Development Projects pursuant to our Master Development Agreement with GLPI (as described in Note 11, “Leases” in the notes to our Consolidated Financial Statements).

The Master Development Agreement provides that GLPI will fund up to $225.0 million for the Aurora Project and, upon PENN’s request, up to $350.0 million in the aggregate for the Other Development Projects, in accordance with certain terms and conditions set forth in the Master Development Agreement.

Capital expenditures are accounted for as either project capital (new facilities or expansions) or maintenance capital (replacement) which is inclusive of projects such as our retail sportsbooks, our cashless, cardless and contactless technology, and hotel renovations.

Cash provided by operating activities, as well as cash available under our Amended Revolving Credit Facility, was available to fund our capital expenditures for the years ended December 31, 2025, 2024, and 2023, as applicable.

Capital expenditures for the year ended December 31, 2025 were $647.7 million, inclusive of $239.3 million of maintenance capital expenditures and $408.4 million of project capital expenditures.

For the year ending December 31, 2026, our anticipated maintenance capital expenditures are approximately $220.0 million, which include c apital expenditures required under our Triple Net Leases, which require us to spend a specified percentage of total revenues.

Additionally f or the year ending December 31, 2026, we anticipate project capital expenditures of $225.0 million, the majority of which are in connection with the PENN Development Projects pursuant to our Master Development Agreement with GLPI (as described in Note 11, “Leases” in the notes to our Consolidated Financial Statements).

The Master Development Agreement provides that GLPI will fund up to $225.0 million for the Aurora Project and, upon PENN’s request, up to $350.0 million in aggregate for the Other Development Projects, in accordance with certain terms and conditions set forth in the Master Development Agreement.

The PENN Development Projects still under construction are all subject to necessary regulatory and other government approvals.

On August 1, 2025, the Company received the full $130.0 million in committed funding from GLPI for the Joliet Project which opened on August 11, 2025, and on November 3, 2025, the Company received the full $150.0 million in committed funding from GLPI for the M Resort Project, which opened on December 1, 2025.

We have neither requested nor received any funding from GLPI for the Aurora Project.

We did not request or receive any funding from GLPI for the Columbus Project, and GLPI’s funding commitment expired on December 31, 2025.

Financing Cash Flow

For the year ended December 31, 2025, net cash used in financing activities totaled $165.6 million compared to $186.5 million in net cash used in financing activities in the prior year.

During the year ended December 31, 2024, net cash used in financing activities primarily related to $50.3 million in principal payments on our finance leases, $40.8 million in principal payments on our financing obligations, $37.5 million in principal debt repayments, $35.4 million in payments on insurance financing, as well as $30.5 million in indemnification payments .

During the year ended December 31, 2023, net cash used in financing activities of $262.6 million primarily related to $149.8 million of common stock repurchases, $47.1 million in principal payments on our finance leases, $39.2 million in principal payments on our financing obligations, and $37.5 million in principal debt repayments.

During the year ended December 31, 2025, net cash used in financing activities primarily related to $354.4 million of common stock repurchases, $223.8 million of repurchases of our Convertible Notes, $53.4 million in principal payments on our finance leases, $43.5 million in principal payments on our financing obligations, $37.5 million in principal debt repayments, $31.1 million in payments on insurance financing, partially offset by net proceeds from our revolving credit facility of $570.0 million.

During the year ended December 31, 2024, net cash used in financing activities of $186.5 million primarily related to $50.3 million in principal payments on our finance leases, $40.8 million in principal payments on our financing obligations, $37.5 million in principal debt repayments, $35.4 million in payments on insurance financing, as well as $30.5 million in indemnification payments .

Debt Issuance and Other long-term Obligations

On May 3, 2022, the Company entered into a Second Amended and Restated Credit Agreement with its various lenders (the “Second Amended and Restated Credit Agreement”).

The Second Amended and Restated Credit Agreement provides for a $1.0 billion revolving credit facility, undrawn at close, (the “Amended Revolving Credit Facility”), a five-year $550.0 million term loan A facility (the “Amended Term Loan A Facility”) and a seven-year $1.0 billion term loan B facility (the “Amended Term Loan B Facility”) (together, the “Amended Credit Facilities”).

The proceeds from the Amended Credit Facilities were used to repay the existing Term Loan A Facility and Term Loan B-1 Facility balances.

On December 4, 2024, PENN entered into a Second Amendment with its various lenders to reduce the interest rate margins applicable to the Company’s approximately $978 million in existing Term B Facility loans from 2.75% to 2.50% for Term SOFR loans, and from 1.75% to 1.50% for base rate loans.

At December 31, 2024, we had $2.8 billion in aggregate principal amount of indebtedness, including $1.5 billion outstanding under our Amended Credit Facilities, $330.5 million outstanding under our 2.75% unsecured convertible notes due 2026 (the “Convertible Notes”), $400.0 million outstanding under our 5.625% senior unsecured notes due 2027 (the “5.625% Notes”), $400.0 million outstanding under our 4.125% senior unsecured notes due 2029 (the “4.125% Notes”), and $210.5 million outstanding in other long-term obligations.

No amounts were drawn on our Amended Revolving Credit Facility.

We have no debt maturing prior to 2026.

At December 31, 2025, we had $2.9 billion in aggregate principal amount of indebtedness, including $2.0 billion outstanding under our Amended Credit Facilities, $106.7 million outstanding under our Convertible Notes, $400.0 million outstanding under our 5.625% Notes, $400.0 million outstanding under our 4.125% Notes, and $8.6 million outstanding in other long-term obligations.

We had $570.0 million drawn on our Amended Revolving Credit Facility.

See definitions for (i) Amended Credit Facilities;

(ii) 5.625% Notes;

(iii) 4.125% Notes;

and (iv) Amended Revolving Credit Facility in Note 10, “Long-Term Debt” in the notes to the Consolidated Financial Statements.

T he Convertible Notes are scheduled to mature in 2026, however, the Company intends to refinance on a long-term basis.

As of December 31, 2025 we had conditional obligations under letters of credit issued pursuant to the Amended Credit Facilities with face amounts aggregating to $23.9 million resulting in $406.1 million available borrowing capacity under our Amended Revolving Credit Facility.

As of the date of this filing, the Company had $40.0 million in outstanding borrowings under its Amended Revolving Credit Facility, resulting in $939.1 million of available borrowing capacity.

As of February 25, 2026, the Company had $565.0 million in outstanding borrowings under its Amended Revolving Credit Facility, resulting in $411.1 million of available borrowing capacity.

Our Amended Credit Facilities, 5.625% Notes, and 4.125% Notes, require us, among other obligations, to maintain specified financial ratios and to satisfy certain financial tests.

In addition, our Amended Credit Facilities, 5.625% Notes, and 4.125% Notes, restrict, among other things, our ability to incur additional indebtedness, incur guarantee obligations, amend debt instruments, pay dividends, create liens on assets, make investments, engage in mergers or consolidations, and otherwise restrict corporate activities.

Our debt agreements also contain customary events of default, including cross-default provisions that require us to meet certain requirements under the AR PENN Master Lease, the 2023 Master Lease, PENN Master Lease (prior to January 1, 2023), and the Pinnacle Master Lease (all of which are defined in Note 11, “Leases” in the notes to our Consolidated Financial Statements ), each with GLPI.

Our debt agreements also contain customary events of default, including cross-default provisions that require us to meet certain requirements under the Master Leases.

If we are unable to meet our financial covenants or in the event of a cross-default, it could trigger an acceleration of payment terms.

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Share Repurchase Authorizations

During the second quarter of 2023, we completed our $750 million share repurchase authorization approved by the Board of Directors on February 1, 2022 (the “February 2022 Authorization”).

On December 6, 2022, a second share repurchase program was authorized for an additional $750 million (the “December 2022 Authorization”).

The December 2022 Authorization expires on December 31, 2025.

The Company utilized the capacity under the February 2022 Authorization prior to effecting any repurchases under the December 2022 Authorization.

On December 6, 2022, the Board authorized an additional $750.0 million share repurchase program (the “December 2022 Authorization”), which expired on December 31, 2025.

On October 30, 2025, the Board approved a new $750.0 million share repurchase program (the “October 2025 Authorization”), which commenced on January 1, 2026 and expires on December 31, 2028.

Repurchases by the Company are subject to available liquidity, general market and economic conditions, alternate uses for the capital, and other factors.

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There is no minimum number of shares that the Company is required to repurchase and the repurchase authorization may be suspended or discontinued at any time without prior notice.

No shares of the Company’s common stock were repurchased during the year ended December 31, 2024.

During the year ended December 31, 2023, the Company repurchased 5,438,221 shares of its common stock in open market transactions for $149.8 million at an average price of $27.54 per share under the February 2022 and December 2022 Authorizations.

The cost of all repurchased shares is recorded to “Treasury stock” within the Consolidated Balance Sheets.

No shares of the Company’s common stock were repurchased subsequent to the year ended December 31, 2024.

As of February 27, 2025, the remaining availability under our December 2022 Authorization was $749.5 million.

During the year ended December 31, 2025, the Company repurchased 20,090,831 shares of its common stock in open market transactions for $354.4 million at an average price of $17.64 per share under the December 2022 Authorization.

The cost of all repurchased shares is recorded to “Treasury stock” within the Consolidated Balance Sheets.As of February 25, 2026, the remaining availability under our October 2025 Authorization was $750.0 million.

Other Factors Affecting Liquidity

ESPN BET Sportsbook Agreemen t

On August 8, 2023, PENN entered into the Sportsbook Agreement with ESPN which provides for a long-term strategic relationship between PENN and ESPN relating to online sports betting in the United States.

In November 2023, the existing Barstool Sportsbook was rebranded and launched across all online platforms in the United States as ESPN BET, which included our Hollywood Casino-branded integrated iCasino offering within the sportsbook app in select U.S jurisdictions.

The Sportsbook Agreement has an initial 10-year term and may be extended for an additional ten years upon mutual agreement of PENN and ESPN.

In consideration for the media marketing services and brand and other rights provided by ESPN, PENN will pay $150.0 million per year in cash pursuant to the Sportsbook Agreement for the initial 10-year term and issue warrants pursuant to the Investment Agreement (see Note 12, “Commitments and Contingencies” in the notes to our Consolidated Financial Statements for additional information).

ESPN BET Sportsbook Agreement

On November 5, 2025, PENN and ESPN entered into the Termination Agreement, pursuant to which PENN’s exclusive right to use the ESPN BET trademark for OSB in the U.S.

terminated on December 1, 2025.

The company paid $155.6 million during the year ended December 31, 2025 related to the Sportsbook Agreement.

As of December 31, 2025, all outstanding payment obligations from PENN to ESPN under the Sportsbook Agreement have been settled.

See Note 12, “Commitments and Contingencies” in the notes to our Consolidated Financial Statements for additional information.

Triple Net Leases

The majority of the real estate assets (i.e., land and buildings) used in our operations are subject to triple net master leases;

the most significant of which are the AR PENN Master Lease, 2023 Master Lease, PENN Master Lease (prior to January 1, 2023), and Pinnacle Master Lease (as such terms are defined in Note 11, “Leases” in the notes to our Consolidated Financial Statements, and collectively referred to as the “Master Leases”) with GLPI.

We refer to the Master Leases, Perryville Lease (where applicable), the Meadows Lease (where applicable), the Margaritaville Lease, the Greektown Lease, the Tropicana Lease (terminated September 26, 2022) and the Morgantown Lease, collectively, as our “Triple Net Leases.” The Company’s Triple Net Leases are accounted for as either operating leases, finance leases, or financing obligations.

On February 21, 2023, the Company and GLPI entered into the AR PENN Master Lease, effective January 1, 2023, which amended and restated the PENN Master Lease to (i) remove the land and buildings for Aurora, Joliet, Columbus, Toledo, and the M Resort, and (ii) make associated adjustments to the rent after which the initial rent in the AR PENN Master Lease was reset to $284.1 million, consisting of $208.2 million of building base rent, $43.0 million of land base rent, and $32.9 million of percentage rent (as such terms are defined in the AR PENN Master Lease).

The AR PENN Master Lease remains subject to annual rent escalators and a percentage rent reset every five years.

Concurrent with the execution of the AR PENN Master Lease, the Company and GLPI entered into the 2023 Master Lease, effective January 1, 2023, specific to the properties associated with Aurora, Joliet, Columbus, Toledo, M Resort, Meadows, and Perryville and the Master Development Agreement.

The 2023 Master Lease terminated the individual triple net leases associated with Meadows and Perryville.

The 2023 Master Lease incurs a 1.5% fixed escalator on November 1 of each year, and is also subject to a one-time increase of $1.4 million effective November 1, 2027.

The 2023 Master Lease and AR PENN Master Lease are cross-defaulted, cross-collateralized, coterminous, and subject to a parent guarantee.

The 2023 Master Lease includes the 2023 Master Lease Base Rent equal to $232.2 million and the Master Development Agreement contains additional rent (together with the 2023 Master Lease Base Rent, the “2023 Master Lease Rent”) equal to (i) 7.75% of any project funding received by PENN from GLPI for the Aurora Project and (ii) a percentage, based on the then-current GLPI stock price, of any project funding received by PENN from GLPI for the Other Development Projects.

The Master Development Agreement provides that GLPI will fund up to $225 million for the Aurora Project and, upon PENN’s request, up to $350 million in the aggregate for the Other Development Projects, in accordance with certain terms and conditions set forth in the Master Development Agreement.

These funding obligations of GLPI expire on January 1, 2026.

the most significant of which are the AR PENN Master Lease, 2023 Master Lease, and Pinnacle Master Lease (as such terms are defined in Note 11, “Leases” in the notes to our Consolidated Financial Statements, and collectively referred to as the “Master Leases”) with GLPI.

We refer to the Master Leases, VICI Master Lease, Margaritaville Lease (prior to December 4, 2025), Greektown Lease (prior to December 4, 2025), and Morgantown Lease, collectively, as our “Triple Net Leases.” The Company’s Triple Net Leases are accounted for as either operating leases, finance leases, or financing obligations.

On December 4, 2025, the Company entered into a triple net master lease with VICI Properties Inc.

VICI) (“VICI”) (“VICI Master Lease”) which amended and restated the Margaritaville Lease and the Greektown Lease (both as defined in Note 11, “Leases” in the notes to our Consolidated Financial Statements) into a single combined lease.

The VICI Master Lease has an initial term through May 23, 2034, with four subsequent five-year renewal periods on the same terms and conditions, exercisable at the Company’s option.

Upon execution of the VICI Master Lease, initial annual rent was set at $80.7 million, representing the aggregate annual rent under the Margaritaville Lease and the Greektown Lease in effect immediately prior to December 4, 2025.

Annual rent will increase by 1.0% to $81.5 million effective June 1, 2026 and, thereafter, will be subject to an annual escalator of up to 1.0% each June 1, depending on a minimum coverage floor ratio of Net Revenue to Rent to be determined over the performance period from June 1, 2025 to May 31, 2026 (as defined within the VICI Master Lease).

Under our Triple Net Leases, in addition to lease payments for the real estate assets, we are required to pay the following, among other things:

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(iv) all tenant capital improvements;

and (v) all utilities and other services necessary or appropriate for

the leased properties and the business conducted on the leased properties.

and (v) all utilities and other services necessary or appropriate for the leased properties and the business conducted on the leased properties.

As of December 31, 2025 , we are required to make total annual minimum rent payments of $986.3 million , of which $970.0 million relates to our Triple Net Leases.

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2023 Master Lease 245.9 236.2 232.8

PENN Master Lease — — 480.3

Pinnacle Master Lease 349.6 346.7 339.4

Perryville Lease — — 7.8

Meadows Lease — — 24.6

VICI Master Lease (1)

Margaritaville Lease (1)

24.6 26.8 26.2

Greektown Lease (1)

Morgantown Lease 3.2 3.1 3.1

49.0 52.9 52.2

(1) Cash rent payable under the Tropicana Lease was nominal prior to the lease termination on September 26, 2022.

Therefore, it has been excluded from the table above.

Morgantown Lease 3.2 3.2 3.1

Total $ 967.8 $ 950.4 $ 937.8

(1) As discussed in Note 11, “Leases,” prior to December 4, 2025, lease payments made to VICI related to the Margaritaville and Greektown individual triple net leases;

effective December 4, 2025, lease payments made to VICI relate to the VICI Master Lease.

Other Contractual Cash Obligations

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Total $ 476.1 $ 268.8 $ 74.9 $ 36.8 $ 26.7 $ 21.4 $ 47.5

(1) Excludes the liability for unrecognized tax benefits of $44.8 million, as we cannot reasonably estimate the period of cash settlement with the respective taxing authorities.

Additionally, it does not include a total of $243.1 million related to the payments associated with our (i) contingent purchase price obligations;

and (ii) financing arrangement in which we received upfront cash proceeds permitting us to participate in future claims, as they are not fixed obligations.

(1) Excludes the liability for unrecognized tax related benefits and indemnification obligation of $80.0 million, as we cannot reasonably estimate the period of cash settlement with the respective taxing authorities.

Based on our current level of operations, we believe that cash generated from operations and cash on hand, together with amounts available under our Amended Credit Facilities, will be adequate to meet our anticipated obligations under our Triple Net Leases, debt service requirements, capital expenditures and working capital needs for the foreseeable future.

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(ii) that our anticipated earnings projections will be realized;

(iii) that we will achieve the expected synergies from our acquisitions and joint ventures;

(iii) that we will realize the anticipated benefits of our iCasino forward strategy and the rebranding of our U.S.

OSB product to theScore Bet;

and (iv) that future borrowings will be available under our Amended Credit Facilities or otherwise will be available in the credit markets to enable us to service our indebtedness or to make anticipated capital expenditures.

We caution that the performance and trends seen across our portfolio may not continue.

In addition, while we anticipated that a significant amount of our future growth would come through the pursuit of opportunities within other distribution channels, such as media, retail, and online gaming;

In addition, while we anticipate that a significant amount of our future growth would come through the pursuit of opportunities within other distribution channels, such as media, retail, and online gaming;

from acquisitions of gaming properties at reasonable valuations;

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there can be no assurance that this will be the case.

If we consummate significant acquisitions in the future or undertake any significant property expansions, our cash requirements may increase significantly, and we may need to make additional borrowings or complete equity or debt financings to meet these

requirements.

See “Risk Factors—Risks Related to Our Capital Structure” within “Item 1A.

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The nature of the estimates and assumptions are material due to the levels of subjectivity and judgment necessary to account for highly uncertain factors or the susceptibility of such factors to change.

The development and selection of critical accounting estimates, and the related disclosures, have been reviewed with the Audit Committee of our Board of Directors.

The development and selection of critical accounting estimates, and the related disclosures, have been reviewed with the Audit Committee of our Board.

We believe the current assumptions and other considerations used to estimate amounts reflected in our Consolidated Financial Statements are appropriate.

However, if actual experience differs from the assumptions and other considerations used in estimating amounts reflected in our Consolidated Financial Statements, the resulting changes could have a material adverse effect on our financial condition, results of operations, and cash flows.

The reassessment of the lease classification of the land and building components within the 2023 Master Lease, in connection with the August 1, 2025 and November 3, 2025 lease modifications, and the VICI Master Lease modification (as described in Note 11, “Leases” in the notes to our Consolidated Financial Statements) required management to apply significant judgment and make critical estimates and assumptions.

These estimates and assumptions included (i) the fair value of the land and building assets;

(ii) the lease term, including the determination of whether renewal options are reasonably certain of being exercised;

and (iii) the discount rate applied over the lease term, which is based on our collateralized incremental borrowing rate.

Goodwill and other intangible assets

As of December 31, 2025, the Company had $1.8 billion in goodwill and $1.4 billion in other intangible assets, net within its Consolidated Balance Sheets, represen ting 12.5% and 9.8% of total assets, respectively.

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Our annual goodwill and other indefinite-lived intangible assets impairment test is performed on October 1st of each year, or more frequently if indicators of impairment exist.

As a result of our annual test completed during the fourth quarter of 2024, we recognized $12.3 million in impairment charges on goodwill in our South and Midwest segments, $69.3 million in impairment charges on our gaming licenses in our Northeast and South segments, and $7.5 million in impairment charges on our trademarks in our Northeast and South segments.

During the second quarter of 2025, we identified an indicator of impairment on our trademark at Ameristar Council Bluffs and performed tests to assess for impairment, which resulted in an impairment charge of $15.0 million.

During the third quarter of 2025, we identified an indicator of impairment related to goodwill within our Interactive segment.

Accordingly, we performed an interim goodwill impairment test, which resulted in the recognition of an $825.0 million goodwill impairment charge.

As a result of our annual test completed during the fourth quarter of 2025, we recognized $7.0 million in impairment charges on our goodwill in our South segment, $88.3 million in impairment charges on our gaming licenses in our Northeast and South segments, and $10.0 million in impairment charges on our trademarks in our South and West segments.

For further discussion, see Note 8, “Goodwill and Other Intangible Assets” to our Consolidated Financial Statements.

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Risk Factors” of this Annual Report on Form 10-K.

Interactive goodwill

Goodwill at our Interactive segment comprises $1.5 billion of the total $2.6 billion balance as of December 31, 2024.

For our quantitative goodwill impairment test for the Interactive goodwill, an income approach, in which a discounted cash flow (“DCF”) model is utilized, and a market-based approach using guideline public company multiples of earnings before interest, taxes, depreciation, and amortization (“EBITDA”) from Interactive’s peer group are utilized in order to estimate the fair market value of the Interactive reporting unit.

The Company compares the fair value of the Interactive reporting unit to its carrying amount.

If the carrying amount of the Interactive reporting unit exceeds the fair value, an impairment is recorded equal to the amount of the excess (not to exceed the amount of goodwill allocated to the Interactive reporting unit).

The evaluation of goodwill requires the use of estimates about future operating results of the Interactive reporting unit to determine the estimated fair value of the reporting unit.

Interactive reporting unit goodwill

The Interactive reporting segment constitutes a single reporting unit for purposes of goodwill impairment testing and had a goodwill balance of $774.8 million as of December 31, 2025.

For our interim quantitative goodwill impairment test for the segment’s goodwill, an income approach, in which a discounted cash flow (“DCF”) model and a market-based approach used guideline public company multiples of earnings before interest, taxes, depreciation, and amortization (“EBITDA”) from the segment’s peer group was utilized in order to estimate the fair market value of the reporting unit.

The Company compared the fair value of the segment’s reporting unit to its carrying amount.

As the carrying amount of the reporting unit exceeded the fair value, an impairment was recorded equal to the amount of the excess, which was $825.0 million.

The evaluation of goodwill requires the use of estimates about future operating results of the reporting unit to determine the estimated fair value of the reporting unit.

The Company must make various assumptions and estimates in performing its impairment testing.

The implied fair value includes estimates of future cash flows that are based on reasonable and supportable assumptions which represent the Company’s best estimates of the cash flows expected to result from the use of

the assets including their eventual disposition.

Significant assumptions utilized in the estimation of future cash flows for the Interactive reporting unit include forecasted revenues, forecasted operating expenses, the discount rate used in the valuation, and the terminal year EBITDA exit multiple.

Significant assumptions utilized in the estimation of future cash flows for the reporting unit include forecasted revenues, the discount rate used in the valuation, and the terminal year EBITDA exit multiple.

These significant assumptions are complex and subjective.

They are sensitive to changes in underlying assumptions and can be affected by a variety of factors, including external factors, such as industry, geopolitical and economic trends, and internal factors, such as changes in the Company’s business strategy, which may re-allocate capital and resources to different or new opportunities which management believes will enhance its overall value but may be to the detriment of the Interactive reporting unit.

They are sensitive to changes in underlying assumptions and can be affected by a variety of factors, including external factors, such as industry, geopolitical and economic trends, and internal factors, such as changes in the Company’s business strategy, which may re-allocate capital and resources to different or new opportunities which management believes will enhance PENN’s overall value but may be to the detriment of the Interactive reporting unit.

Changes in estimates, increases in the Company’s cost of capital, reductions in transaction multiples, changes in operating and capital expenditure assumptions, or application of alternative assumptions and definitions could produce significantly different results.

Future cash flow estimates are, by their nature, subjective and actual results may differ materially from the Company’s estimates.

If our ongoing estimates of future cash flows are not met, we may have to record impairment charges in future periods.

Our estimates of cash flows are based on the current regulatory and economic climates, recent operating information, and budgets of the Interactive reporting unit.

If our ongoing estimates of future cash flows are not met, we may have to record additional impairment charges in future periods.

Our estimates of cash flows are based on the current regulatory and economic climates, recent operating information, and budgets of the reporting unit.

These estimates could be negatively impacted by changes in federal, state, provincial, or local regulations, economic downturns, or other events affecting our Interactive segment.

Forecasted cash flows (based on our annual operating plan as determined in the fourth quarter) can be significantly impacted by the local economies in which our Interactive reporting unit operates.

Forecasted cash flows can be significantly impacted by the local economies in which our Interactive reporting unit operates.

Increases in unemployment rates, inflation and/or interest rates can also result in decreased customer activity and/or lower customer spend.

Additionally, increases in gaming taxes approved by state and provincial regulatory bodies can negatively impact forecasted cash flows.

The goodwill at our Interactive reporting unit was subject to a sensitivity analysis to determine the potential additional impairment loss as of the September 30, 2025 testing date:

Amount of impairment loss as a result of:

(dollars in millions) Carrying Amount Passing Margin a 10% decrease in forecasted revenues and Adjusted EBITDA

PENN Interactive $766.0 — % $105.0

Gaming licenses

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The evaluation of gaming license intangible assets requires the use of estimates about future operating results of each reporting unit to determine the estimated fair value of the gaming license indefinite-lived intangible assets.

The Company must make various assumptions and estimates in performing its impairment testing.

The Company must make various assumptions and estimates in performing the impairment testing.

The implied fair value includes estimates of future cash flows (including an allocation of the projected payments under any applicable Triple Net Lease) that are based on reasonable and supportable assumptions which represent the Company’s best estimates of the cash flows expected to result from the use of the assets including their eventual disposition.

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Future cash flow estimates are, by their nature, subjective and actual results may differ materially from the Company’s estimates.

If our ongoing estimates of future cash flows are not met, we may have to record impairment charges in future periods.

If our ongoing estimates of future cash flows are not met, we may have to record additional impairment charges in future periods.

Our estimates of cash flows are based on the current regulatory and economic climates, recent operating information and budgets of the various properties where it conducts operations.

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Forecasted cash flows (based on our annual operating plan as determined in the fourth quarter) can be significantly impacted by the local economy in which our reporting units operate.

Increases in unemployment rates, inflation and/or interest

rates can also result in decreased customer visitation and/or lower customer spend per visit.

Increases in unemployment rates, inflation and/or interest rates can also result in decreased customer visitation and/or lower customer spend per visit.

Additionally, increases in gaming taxes approved by state regulatory bodies can negatively impact forecasted cash flows.

Assumptions and estimates about future cash flow levels, discount rates and multiples by individual reporting units are complex and subjective.

Reporting units with gaming licenses which were identified during our 2024 annual impairment assessment, performed as of October 1, 2024, as having less than a substantial passing margin, in addition to goodwill at our Interactive reporting unit, were subject to a sensitivity analysis to determine the potential impairment losses:

They are sensitive to changes in underlying assumptions and can be affected by a variety of factors, including external factors, such as industry, geopolitical and economic trends, and internal factors, such as changes in the Company’s business strategy, which may re-allocate capital and resources to different or new opportunities which management believes will enhance PENN’s overall value but may be to the detriment of an individual reporting unit.

Reporting units with gaming licenses which were identified during our 2025 annual impairment assessment, performed as of October 1, 2025, as having less than a substantial passing margin, were subject to a sensitivity analysis to determine the potential impairment losses:

Amount of impairment loss as a result of:

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Gaming License

Boomtown Bossier City $7.0 — % $2.0 $0.5

Boomtown New Orleans $5.5 — % $4.5 $1.0

Hollywood Casino at Greektown $22.0 — % $7.5 $2.0

Hollywood Casino at PENN National Race Course

$24.0 — % $6.0 $0.5

L’Auberge Lake Charles $221.3 0.3 % $30.0 $3.5

Amount of impairment loss as a result of:

(dollars in millions) Carrying Amount Passing Margin a 10% decrease in forecasted revenues and EBITDA

PENN Interactive $1,633.2 6.2 % $107.0

Meadows Racetrack and Casino $46.0 — % $9.0 $1.5

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis