The CEO of theScore parent company, PENN Entertainment, said the firm took a hit of around $4 million as a result of its recent layoffs.
PENN eliminated dozens of content, sales and other staff at the Canadian sports media and gaming company in mid-June. More than 75 employees were let go and given severance packages, cuts which roughly halved the size of the brand’s editorial newsroom and also impacted the sales team.
A PENN spokesperson told Canadian Gaming Business on June 20 that the changes “reflect the ongoing evolution of our digital business” and its online strategy. PENN continues to lean theScore into the online sports betting, online casino and other gaming verticals.
Speaking on an earnings call on Thursday to recap a quarter which produced record gaming revenue for PENN Interactive, which also includes ESPN Bet and the standalone Hollywood Casino app in the U.S., CEO Jay Snowden addressed the recent downsizing. He noted that “approximately $2.9 million [$3.9 million CAD] in severance costs incurred as part of our strategic workforce adjustments to drive efficiencies and support a modern scalable technology infrastructure.”
“Excluding that one-time expense, we would have come in slightly ahead of the midpoint of our digital Q2 guide and consensus,” he added.
The layoffs at Toronto-headquartered theScore came after PENN implemented multiple rounds of layoffs in the second half of 2024 at its U.S.-facing sportsbook ESPN Bet.
Felicia Hendrix, EVP and CFO, added that in the long-term, PENN expects to see run rate savings in general and administrative expenses of approximately $27.5 million CAD, roughly $13.7 million CAD of which will come in the second half of this year, “as a function of our strategic workforce adjustments.”
PENN underlines theScore’s digital evolution
PENN acquired Canadian legacy sports media company theScore from the Levy family in October 2021 for around $2 billion USD. theScore Bet was already live in New Jersey at that time, and launched on day one of the regulated Ontario market in April 2022.
But the new owners quickly shut down theScore Bet’s American operations on July 1, 2022, to focus on the brand’s home Ontario market, and the parent company launched the ESPN Bet venture with Disney in 2023 to replace its previous U.S. online betting brand, Barstool Sportsbook.
theScore Bet offers both sports betting and online casino across Ontario, and PENN this year launched a standalone theScore Casino app. Snowden said earlier this year that Ontario is PENN Interactive’s number-one market in North America in terms of revenues, gross profit and contribution margin.
iGaming Ontario (iGO) does not break down market share figures by operator, but PENN executives have suggested in the past that theScore Bet has a double-digit market share in the province.
PENN Interactive nears profitability as Alberta awaits
Snowden was speaking on Thursday after PENN announced its best quarter ever for online gaming. Interactive revenue for the three months ended June 30 grew by 35.9% year over year to a record $434.3 million CAD, including a tax gross-up of $189.5 million CAD. For the first six months of the year, Interactive revenue is at $833.2 million CAD, 37.7% higher than last year.
Overall, PENN Interactive is still making a loss, but the deficit is shrinking. Adjusted EBITDA was still in the red at a loss of $85 million CAD, but this was 39.7% better than this time last year. Year-to-date adjusted EBITDA is around half of what it was through the first six months of 2024.
Monthly Average Users (MAUs) were up 4.7% year over year and the always-stronger iCasino segment saw 49% growth in MAUs with PENN vaunting record cross-sell efforts from its online sports betting business.
While Snowden noted “there’s still plenty of work to do,” PENN is forecasting that its North American online sports betting and online casino operations will be EBITDA-positive for the first time in the fourth quarter of this year. That takes into account extra costs such as higher tax rates in states including New Jersey and Illinois and the launch of sports betting in Missouri in December.
PENN also intends to launch theScore Bet in Alberta when that province starts letting commercial operators do business, touted to be early 2026. Snowden was asked on Thursday whether the cost of launching online sports betting and online casino in Alberta, assuming theScore is granted a license, would threaten its profitability target.
“It would not,” Snowden responded. “When I say profitable in ’26, we know that Alberta’s going to launch at some point in, we think, early ’26 from what we’ve been told. So that’s built into our assumptions. We’re targeting right now Q1 [2026], which is the best information we have.”
