BUSINESS UPDATE Disclaimer This document does not constitute an offer to sell, or a solicitation of an offer to purchase, any securities in any jurisdic tion where such offer or sale is not permitted. Any securities referred to herein, if any, have not been, and will not be, registered under the Securities Act of 1933, as amended (the "Securities Act"), or under any state sec urities laws in the United States. Securities may not be offered or sold in the United States unless they are registered or exempt fr ...

Core Points - BetMGM is updating its terms of service to explicitly prohibit athlete harassment, with account suspension for customers using abusive language towards athletes, coaches, or league personnel [1][2] - The update aims to enhance clarity around the policy and reinforces BetMGM's commitment to sports integrity and player safety, subject to regulatory approval [2] - BetMGM's Chief Compliance Officer emphasized the company's dedication to safeguarding athletes and taking decisive action against confirmed harassment [3] Company Overview - BetMGM operates in 30 markets, offering both mobile and retail sports betting options, accessible via iOS, Android, and desktop [4] - The company is a joint venture between MGM Resorts International and Entain Plc, providing exclusive access to MGM's U.S. sports betting and online gaming businesses [6] - Founded in 2018 and headquartered in New Jersey, BetMGM utilizes advanced technology from Entain to deliver its services [6]

Core Viewpoint - VICI Properties (VICI) is currently undervalued at an 11.7X AFFO multiple, despite concerns about the changing gaming environment and declining travel to Las Vegas [2][43]. Industry Analysis - The legal landscape for online sports betting changed significantly in 2018 when the Supreme Court overturned PASPA, allowing states to regulate their own sports betting laws [4]. - Online gaming revenue has surged, now accounting for 30% of commercial gaming revenue, up from 11% in 2021, raising concerns that it may cannibalize traditional casino revenues [6]. - Visitor numbers to Las Vegas have declined, with a reported 3.09 million visitors in September, a 9% decrease from the previous year, and convention attendance down over 18% [7]. Company Analysis - VICI has a favorable leasing structure where tenants are responsible for property upgrades, and it has the most efficient overhead among REITs [5]. - Major tenants, Caesars Entertainment and MGM Resorts, account for 70% of VICI's rental revenue [31]. - VICI's revenues are derived from long-term master leases with built-in escalators, providing stability despite the volatility in casino earnings [33]. Financial Performance - VICI's AFFO has remained stable, showing no significant impact from the current weakness in Las Vegas or the rise of online sports betting [36]. - The company is expected to achieve a 6.3% dividend yield and 4% annual AFFO growth, with potential for higher returns if the stock appreciates to a higher multiple [47]. Market Sentiment - The current market valuation of VICI appears to be overly pessimistic, trading at a discount compared to peers despite its superior track record and growth potential [46]. - Analysts believe that the downturn in Las Vegas is cyclical rather than secular, suggesting a recovery is likely [21].

Core Insights - The global gambling industry in 2025 is projected to be worth over $574.55 billion, with a compound annual growth rate (CAGR) of approximately 5.1 percent, but it is experiencing a significant bifurcation between traditional land-based operations and the rapidly growing digital sector [1][4]. Group 1: Market Dynamics - The land-based gambling industry faces challenges from inflation and changing travel trends post-pandemic, while the digital sector, driven by online gaming and sports betting, is experiencing robust growth rates of up to 12.3% CAGR [2][4]. - The online segment is valued at $117.5 billion, highlighting a shift from location-based entertainment to a mobile-first transactional economy [4]. - The US casino revenues are softening in the terrestrial sector, with operators like MGM Resorts International facing operational challenges, while high-net-worth individuals sustain profitability in luxury markets like Singapore [5][6]. Group 2: Regulatory Environment - A significant regulatory crackdown on the sweepstakes casino sector has occurred, transferring billions from unregulated platforms to the regulated ecosystem, benefiting major players like DraftKings and FanDuel [17][18]. - The introduction of a regulated market in Brazil has positioned it as the fifth largest betting market globally, with projected revenues of $4.1 billion and a high-barrier licensing regime [22][23][24]. Group 3: Competitive Landscape - The North American market has evolved into a disciplined oligopoly dominated by FanDuel, DraftKings, and BetMGM, with FanDuel holding a 43% market share in online sports betting [13][14]. - DraftKings reported $1.14 billion in Q3 2025 revenue but faced a net loss of $256.8 million, indicating ongoing challenges with customer acquisition costs [15]. - BetMGM has carved out a sustainable niche in iGaming, capturing 21% of the market and generating significant net revenue [16]. Group 4: Technological Innovations - Mobile channels dominate online gambling, with nearly 80% of usage mediated by smartphones, leading to changes in product design and user acquisition strategies [8]. - Artificial Intelligence has transitioned from a marketing tool to a critical component of profitability, enhancing user experience and operational efficiency [34][39]. - The crypto-gambling sector is growing, with Stake.com projected to reach nearly $4.7 billion in revenue by 2025, indicating a bifurcation between regulated and crypto-native operators [35]. Group 5: Regional Insights - Singapore has emerged as a leading gaming market, with Las Vegas Sands reporting strong performance driven by affluent travelers, while Thailand's plans for casino development have been delayed due to political instability [27][28]. - The UAE has entered the global gaming market with a regulated framework, aiming to create a high-end tourism integrated model [31]. - Europe is experiencing consolidation, exemplified by the $4.6 billion acquisition of Tipico by the Banijay Group, creating a closed ecosystem for betting and media [32].

Group 1 - Robinhood officially launched a themed event called "YES/NO" on December 16, which is seen as a significant upgrade to its prediction market business and a direct challenge to traditional betting giants like DraftKings and FanDuel, as well as existing platforms like Kalshi [1] - Bank of America warns that this technological shift by a major tech player like Robinhood could fundamentally alter customer acquisition costs and fee structures across the industry [1] - Robinhood's recent announcement of a joint venture with Susquehanna Investment Group aims to reduce its reliance on Kalshi, potentially posing a competitive threat to DraftKings and FanDuel [1] Group 2 - The competition among Robinhood, Kalshi, and Polymarket in event contract fees is intensifying as they vie for user attention against established sports betting apps like FanDuel and DraftKings, which offer recognizable bonuses and promotions [2] - Robinhood plans to acquire a 90% stake in the derivatives exchange MIAXdx by November 2025, aiming to create a new federally regulated derivatives and prediction market trading platform, with the deal expected to close in early 2026 [2] - This acquisition will enable Robinhood to establish a fully autonomous and vertically integrated trading ecosystem, eliminating third-party platform fees and leveraging "zero-fee" and strong liquidity advantages to mainstream event contracts for retail investors [2] Group 3 - The new exchange will be managed by a joint venture, with Robinhood as the controlling party and Susquehanna acting as the liquidity provider from day one, aiming to expand Robinhood's rapidly growing "prediction contract" business [3] - Unlike traditional fixed-odds betting, prediction markets offer real-time pricing based on peer-to-peer pricing, providing more betting options on events that traditional bookmakers cannot cover [3] - Robinhood's prediction market business has seen rapid growth, with 9 billion contracts traded and over 1 million users participating since its launch, contributing to an annualized revenue exceeding $100 million in less than a year [3]

Core Insights - BetMGM has launched a new responsible gambling campaign featuring Connor McDavid and Terry Ryan, promoting the use of in-app responsible gambling tools [1][2][4] - The campaign, titled "Mullet Over," aims to deliver a lighthearted message while encouraging customers to engage with responsible gambling features [2][4] - Previous campaigns have shown success, with a 38% increase in players using deposit limits and a 55% increase in players using stake limits in Ontario following the 2024 campaign [4] Company Overview - BetMGM is a leading sports betting and iGaming operator, formed through a partnership between MGM Resorts International and Entain Plc [8][9] - The company offers a variety of gambling services, including sports betting and online gambling, utilizing advanced technology from Entain [9] - BetMGM is headquartered in New Jersey and has been operational since 2018 [9] Responsible Gambling Initiatives - The "Mullet Over" campaign emphasizes the importance of responsible gambling, featuring tools such as time and spending limits [3][4] - BetMGM's GameSense program provides player education and promotes responsible play across its platforms [3] - The company is committed to finding innovative ways to communicate responsible gambling messages to its customers [4]

Core Insights - Century Casinos, Inc. has opened a new BetMGM retail sportsbook at Century Casino & Hotel Cape Girardeau, marking the launch of both retail and online sports betting in Missouri [1][3] - The sportsbook features a modern environment with high-definition screens, comfortable viewing areas, and various betting options on major sporting events [2][3] - The opening aligns with Century's strategy to expand its product offerings and enhance its market position in the newly established sports wagering landscape in Missouri [3] Company Overview - Century Casinos operates multiple casino properties across the United States, including locations in West Virginia, Maryland, Missouri, Colorado, and Nevada, as well as in Canada and Poland [6] - The company trades on The Nasdaq Capital Market under the symbol CNTY [7] BetMGM Overview - BetMGM is a leading sports betting and gaming entertainment company, formed through a partnership between MGM Resorts International and Entain Plc, providing access to MGM's U.S. sports betting and online gaming businesses [5]

Core Insights - Missouri's legal sports betting is set to launch statewide on December 1, with analysts predicting a competitive online sports betting market due to the state's population ranking 19th in the U.S. [1] - The first-year betting volume in Missouri is expected to reach between $3.5 billion and $4 billion, coinciding with a busy sports event period and aggressive promotional activities from major betting companies [1] - The legalization of sports betting in Missouri was approved by voters through Amendment 2 in November 2024, allowing for online and physical betting under the regulation of the Missouri Gaming Commission [1] Group 1 - Major players in the Missouri market are expected to include FanDuel and DraftKings as early leaders in betting volume, with BetMGM, Caesars Entertainment, bet365, and Fanatics also holding significant market shares [1] - DraftKings holds one of the two unlinked mobile operating licenses in Missouri, allowing statewide operations without mandatory partnerships with casinos or teams, focusing on same-game parlays and live betting options [2] - Circa Sports unexpectedly received the second unlinked license, known for its precise odds and higher betting limits [2] Group 2 - BetMGM has obtained a temporary license and plans to launch statewide online operations, supported by a market access agreement with Century Casinos [3] - Caesars Sportsbook will begin operations on launch day through existing ownership of Missouri casinos, emphasizing its rewards program for cross-selling between its app and physical casinos [3] - Other notable operators include bet365, which is partnering with the St. Louis Cardinals, and Fanatics, which has secured an online betting license through a market access agreement with Boyd Gaming [3]

Financial Data and Key Metrics Changes - Paysafe reported a 2% increase in revenue to $433.8 million for Q3 2025, with organic revenue growth of 6% [18][19] - Adjusted EBITDA grew by 7% to $126.6 million, resulting in an adjusted EBITDA margin of 29.2%, up 160 basis points year-over-year [19][20] - Adjusted net income was $40.3 million, or $0.70 per share, compared to $0.51 in Q3 of the previous year [21] Business Line Data and Key Metrics Changes - Merchant solutions volume increased by 9% to $34.9 billion, leading to organic revenue growth of 7%, primarily driven by e-commerce [22] - Digital wallet volume rose by 13% to $6.7 billion, with revenue from digital wallets increasing by 8% [24] - E-commerce growth moderated to over 20%, while iGaming growth exceeded 50% [10][27] Market Data and Key Metrics Changes - North America, the largest market, grew by 8%, driven by approximately 50% growth from iGaming [5] - Europe also experienced 8% growth, while Latin America was roughly flat due to a large customer contract renewal in the prior year [5] - The rest-of-world segment saw a double-digit decline, reducing its contribution to total revenue from 5% to 3% [6] Company Strategy and Development Direction - The company is focused on optimizing its SMB portfolio and expanding its direct sales channel, which has shown significant growth [12][13] - Plans to roll out value-added services and new products throughout 2026 are underway [14] - The company aims to enhance its digital wallet offerings and expand its geographic reach, particularly in Europe and Latin America [16][17] Management's Comments on Operating Environment and Future Outlook - Management acknowledged a longer timeline for delivering new product initiatives, particularly in the digital wallet segment, due to regulatory and banking complexities [38] - The company expects full-year organic growth to be in the range of 5%-6%, with adjusted EBITDA growth of 4%-5% [29] - Management remains confident in the long-term strategy and growth potential, despite current challenges [30] Other Important Information - The company repurchased 1.5 million shares for $20 million in Q3, with a total of $50 million year-to-date [4][26] - Total debt at the end of the quarter was $2.5 billion, with net leverage improving to 5.2 times [25] Q&A Session Summary Question: Dynamics within the SMB book and direct channel growth - Management indicated that direct channel growth will take time to build, with a focus on increasing sales team productivity and enhancing client stickiness through value-added services [32][33] Question: E-commerce deceleration details - The deceleration was primarily in non-core verticals, with iGaming growth remaining strong; challenges were faced with certain higher-risk merchant categories [34][35] Question: Timeline for new product deliveries - Management noted that the delivery of new wallet initiatives is taking longer than expected due to complexities in regulatory alignment and market expansion [38] Question: Medium to long-term deleveraging outlook - The company aims to reduce leverage below 4 times, with expectations to reach 3.5 times by 2027 [39]

Core Insights - DraftKings is expanding its market presence through exclusive media partnerships with ESPN and NBCUniversal, aiming to enhance brand visibility and customer engagement in a competitive sports gaming market [1][11][12] - The company is launching DraftKings Predictions, a new suite of sports event contracts, targeting states with limited access to online sports betting, which presents a significant growth opportunity [3][6][7] - DraftKings acknowledges the inherent risks associated with short-term sports outcomes affecting financial performance, but believes these will balance out over time [10] Media Partnerships - The partnership with ESPN positions DraftKings as the exclusive integration provider for live sports and digital platforms, covering 73% of national NBA broadcasts, which is expected to significantly boost customer acquisition [12] - The NBCUniversal agreement enhances DraftKings' omnichannel presence, allowing for improved cross-platform storytelling and user reach beyond traditional advertising [12][13] - These media partnerships are seen as long-term strategies to lower customer acquisition costs and drive scalable growth in a competitive landscape [13][14] Market Strategy - DraftKings is focusing on states where it does not currently operate sportsbooks, aiming to capture markets with substantial financial opportunities [7][9] - The company believes that the growth of prediction markets will facilitate the broader legalization of sports betting as states become more comfortable with real money gaming frameworks [9] - DraftKings' competitive edge lies in its technology, regulatory expertise, and existing customer base, which positions it favorably against pure-play prediction firms [8][9] Financial Performance - DraftKings reported a 2% increase in monthly unique player growth to 3.6 million, but lowered its forward guidance due to softer results, leading to a 7% decline in stock price [5] - The company's revenue is significantly influenced by sports outcomes, with Q2 results adding approximately $100 million to revenue, followed by a loss of over $300 million due to unfavorable NFL games in September and October [10]