Q3 Results Show Caesars’ Online Gambling Division Closing In On Profit

Written By Dave Briggs on November 1, 2023 - Last Updated on January 19, 2024
Image of Caesars Palace app next to digital hand holding ascending data graph for story on Michigan online gambling pushing Caesars Digital closer to profit in Q3

The digital division of Caesars Entertainment Inc., which includes an online casino in Michigan, is getting closer to turning a profit according to third-quarter earnings released Tuesday.

Caesars Digital is up 54% in net income when comparing the three months ending Sept. 30 with the same three months in 2022. Digital division net income is up 89% comparing the first nine months of 2023 to the same nine months in 2022.

Still, Caesars Digital is one of the company’s few gambling-specific divisions showing a net loss.

Caesars Digital lost $29 million in the third quarter, down from a net loss of $63 million compared to Q3 of 2022. In 2023, through September, Caesars Digital lost $83 million, compared to losing a whopping $755 million in 2022 through the same time frame.

Overall, Caesars is profitable in 2023 thanks to the performance of its Las Vegas and regional properties. The company showed a profit of $74 million in Q3, up 42.3% from the $52 million it earned in Q3 of 2022.

For the year, through September, Caesars Entertainment Inc. has a profit of $858 million up sharply from a loss of $751 million in the first nine months of 2022. That’s an improvement of 214%.

That loss of $755 million in the digital division was key to driving that 2022 loss through three quarters.

Caesars Michigan online gambling platform ranks fifth in Michigan in 2023

Caesars Casino Michigan ranks fifth in revenue of the state’s 15 online gambling operators through the first nine months of the year.

Top 10 Michigan online gambling operators by revenue in 2023 (through September):

  1. BetMGM – $495.7 million
  2. FanDuel – $415.7 million
  3. DraftKings – $321.6 million
  4. BetRivers – $87.3 million
  5. Caesars – $75.4 million
  6. Golden Nugget – $62.3 million
  7. WynnBet – $43.9 million
  8. Four Winds – $31.2 million
  9. PokerStars – $27.5 million
  10. Eagle – $25.27 million

The Caesars MI online casino had revenue of $62.8 million in the first nine months of 2023 — up 27% compared to the same period in 2022. Caesars had sports betting revenue of more than $12.6 million through September of 2022, which is up 7.7% from revenue of $11.7 million in the first nine months of 2022.

Combining online casinos and sports betting in Michigan, Caesars’ online gambling revenue of some $75.4 million in 2023 is up 23% from revenue of $61.1 million through the first nine months of 2022.

Standalone Caesars Palace online casino app already paying dividends

A move to launch a separate Caesars Palace online casino app from the company’s sportsbook app already shows signs of paying off. After the first full month of Caesars Palace Casino MI, revenue of $7.2 million in September 2023 alone was up $28.8 million compared to revenue from the Caesars online casino in September 2022.

September was the second-highest revenue total Caesars has had in 2023. April 2023 produced $8.7 million in revenue.

Caesars is seventh lifetime in Michigan with nearly $141.5 million in total digital gambling revenue in Michigan.

Top 10 Michigan online gambling operators by lifetime revenue:

  1. BetMGM – $1.5 billion
  2. FanDuel – $725 million
  3. DraftKings – $694 million
  4. BetRivers – $260 million
  5. Golden Nugget – $185 million
  6. WynnBet – $144.4 million
  7. Caesars – $141.5 million
  8. Barstool – $124.6 million
  9. PokerStars – $97.6 million
  10. Four Winds – $86.2 million

LEARN MORE ABOUT MI ONLINE CASINOS:

Caesars touts EBITDA record in Q3, overall profit

While the digital division pushes toward a profit, Caesars’ bottom line is still being driven by both Las Vegas and regional casinos.

Caesars does not have a retail casino in Michigan, but it does operate Caesars Windsor in Ontario, just across the river from Detroit.

In the third quarter alone, Caesars shows net income of $238 million from its Las Vegas casinos (down 2.9% compared to 2022). It also shows net income of $176 million from its regional casinos (down 16.6% from 2022).

Caesars Entertainment 2023 Net Income Through Q3*

Division20232022% Change
Las Vegas$792$7269.1%
Regional$375$480(22.2%)
Caesars Digital($83)($755)89%
Managed and Branded$83($321)29.7%
Corporate and Other($309)($881)64.9%
TOTAL$858($751)214%

*Data is in millions of dollars and is through Sept. 30, 2023. Brackets indicate a loss.

Caesars highlighted the following financial data points in Q3:

  • Generally Accepted Accounting Principles net revenues of $3.0 billion versus $2.9 billion for the comparable prior-year period.
  • GAAP net income of $74 million compared to net income of $52 million for the comparable prior-year period.
  • Consolidated Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization of $1.04 billion versus $1.01 billion for the comparable prior-year period.
  • Caesars Digital Adjusted EBITDA of $2 million versus $(38) million for the comparable prior-year period.

“During the third quarter of 2023, the company achieved an all-time consolidated Adjusted EBITDA record,” Caesars CEO Tom Reeg said in a press release. “We experienced adjusted EBITDA growth year over year in all three of our primary operating segments including Las Vegas, Regional and Caesars Digital. Our Regional segment achieved an all-time quarterly Adjusted EBITDA record as we harvest the recent portfolio investments within this segment.”

Photo by PlayMichigan
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Dave Briggs

Dave Briggs is a managing editor and writer for Catena Media. His expertise is covering the gambling industry in Michigan with an emphasis on online casino, online sports betting and horse racing sectors. He is currently reporting on the gambling industries in Michigan and Canada.

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