Financial Data and Key Metrics Changes - The Retail segment generated revenues of $1.4 billion with adjusted EBITDAR of $465.8 million, resulting in segment adjusted EBITDAR margins of 32.8% [16] - The Interactive segment reported revenues of $297.7 million, including a tax gross-up of $139.5 million, and an adjusted EBITDA loss of $76.6 million [18] - Total liquidity at the end of 2025 was $1.1 billion, including $660 million in cash and cash equivalents [20] Business Line Data and Key Metrics Changes - The North America iCasino business achieved its highest quarterly gaming revenue to date, improving nearly 40% year over year, driven by record cross-sell from OSB of 62% [8] - The introduction of a standalone app and improved cross-sell from online sports betting led to a 79% increase in iCasino monthly active users (MAUs) during the third quarter [9] - The company expects fourth quarter 2025 revenues for the Retail segment to range from $1.41 billion to $1.43 billion, with adjusted EBITDAR ranging from $455 million to $475 million [18] Market Data and Key Metrics Changes - The company noted stable demand across gaming and non-gaming amenities, particularly in markets not impacted by new supply and increased competitor promotional activity [11] - The new Hollywood Casino in Joliet has seen a 42% increase in its active database since opening, with over 50% of that growth coming from previously inactive customers [12] Company Strategy and Development Direction - The company is shifting its interactive focus to prioritize digital assets in Canada and Hollywood iCasino products, emphasizing cross-sell opportunities across its ecosystem [5] - The transition to the Score Bet brand is expected to optimize the digital business and operate more efficiently, including replacing fixed media spends with performance-based marketing [7] - The company plans to continue investing in growth capital while also focusing on share repurchases and deleveraging [22][24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's positioning to compete effectively in the evolving industry landscape, highlighting the importance of an omnichannel strategy [28] - The company aims to achieve breakeven or better in its interactive segment by 2026, with a focus on profitability and operational efficiency [10][96] - Management acknowledged the challenges posed by increased competition and promotional activity but remains optimistic about the company's ability to maintain its market position [41][44] Other Important Information - The company announced an early termination of its exclusive online sports betting marketing agreement with ESPN, ceasing cash payments at the end of 2025 [15] - A total of $38.1 million will be paid to ESPN for marketing services incurred through December 1, with an additional $5 million for traditional media support [15] - The company has repurchased $354 million of shares as of November 5, with a new three-year $750 million share repurchase authorization commencing on January 1, 2026 [21] Q&A Session Summary Question: Can you talk about the near-term and long-term profitability for interactive following the ESPN exit? - Management highlighted that the digital investments aimed to attract younger customers and cross-sell to retail businesses, with a focus on profitability moving forward [32][34][38] Question: How has increased competition and promotional activity impacted operations? - Management noted that while new competition has led to increased marketing costs, properties not impacted by new supply are performing well [41][44] Question: Can you clarify the expected marketing costs post-ESPN? - Management indicated that marketing costs will be significantly lower than those previously paid to ESPN, allowing for more targeted spending in high-return markets [48][49] Question: What are the strategies for customer retention during the rebranding to Score Bet? - Management expressed confidence in retaining customers due to improved user experience and a comprehensive marketing plan, emphasizing that the app experience will remain unchanged [84][90] Question: What is the company's leverage target moving forward? - Management stated that the optimal lease-adjusted leverage level is below five times, with a focus on deleveraging while remaining opportunistic in capital allocation [76][78]