Financial Data and Key Metrics Changes - The company reported all-time record net revenue of $934 million and adjusted EBITDA of $451 million for the second quarter of 2025, marking the fifth consecutive second quarter of record results [8][29] - Adjusted EBITDA for the Live and Historical Racing segment grew by $17 million or 6% compared to the prior year, driven primarily by HRM growth in Kentucky and Virginia [30] - The company generated $455 million or $6.29 per share of free cash flow in the first half of the year, with a reduction in maintenance capital projection by $10 million to $80 million to $90 million [35][36] Business Line Data and Key Metrics Changes - Churchill Downs Racetrack adjusted EBITDA was down $1 million, less than 1%, due to a high prior year comparison from the 150th Kentucky Derby [30] - All HRM properties in Kentucky delivered growth in the second quarter, with strong performance from Northern Kentucky and Louisville venues [31] - The Exacta business contributed over $3 million to adjusted EBITDA growth from third-party customers and HRM properties [32] Market Data and Key Metrics Changes - Wagering on the Derby race increased by 11% over last year's all-time high, with Derby Day wagering up 9% and Derby Week wagering rising 6% [15] - Virginia properties collectively delivered over $8 million of growth compared to the prior year, despite a higher handle tax rate [31] - The company expects to close the transaction for the Casino Salem project in New Hampshire in the third quarter, targeting a state-of-the-art gaming and entertainment destination [23] Company Strategy and Development Direction - The company aims to grow Derby Week through ticketing revenue, broadcast rights, wagering, sponsorships, and selective renovations [10][18] - A new seven-year contract with NBC is expected to provide a $10 million increase in adjusted EBITDA for 2026 [13] - Strategic investments in capital improvements are planned to enhance guest experiences and broaden appeal [19][20] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the growth potential in Virginia and Kentucky, with a strong focus on building customer relationships and brand awareness [21][92] - The company anticipates generating significant growth for Derby Week in 2026 based on various catalysts [20] - Management highlighted the importance of international marketing efforts to enhance the global presence of the Kentucky Derby [50] Other Important Information - The company announced a new common stock repurchase program of up to $500 million, reflecting confidence in future growth [36] - The federal tax bill is expected to reduce cash taxes by $50 million to $60 million in 2025, with similar benefits anticipated for 2026 [37][56] Q&A Session Summary Question: Expectations around pricing at the Starting Gate Pavilion - Management expects increased demand and pricing for the Starting Gate Pavilion due to positive word-of-mouth from last year's introduction [40] Question: Discussion on the New Hampshire market - Management indicated that the Salem location is strategically positioned to tap into both New Hampshire and Massachusetts markets, with a strong demographic outlook [44] Question: International attendance and marketing for the Derby - Management noted that thoroughbred racing is a global sport, and efforts are underway to build international connections and sponsorships [50] Question: Impact of the federal tax bill on future cash flow - Management expects similar cash tax savings for 2026 as in 2025, with a focus on strategic capital management and shareholder returns [56][58] Question: Growth potential for HRM properties in Kentucky and Virginia - Management believes there is substantial runway for growth in both states, with strong metrics supporting continued expansion [61] Question: Strategies for driving visitation to The Rose - Management emphasized the importance of building brand awareness and customer relationships in the Northern Virginia market [90]

Core Points - NBC Sports will present the Kentucky Oaks in primetime for the first time on May 1, 2026, at 8 p.m. ET on NBC and Peacock, enhancing the event's visibility and audience reach [2][3] - The Kentucky Derby, America's oldest major sporting event, will take place on May 2, 2026, and the previous year's event was the most-watched since 1989, peaking at 21.8 million viewers [3] - Churchill Downs Incorporated (CDI) has extended its partnership with NBC Sports, making NBC the longest-running broadcaster of the Kentucky Derby, covering 32 editions from 2001 to 2032 [4] Company Overview - Churchill Downs Incorporated (CDI) has been creating entertainment experiences for over 150 years, with a focus on the Kentucky Derby and expansion into live racing, online wagering, and casino gaming [5]