Caesars Digital continues adjusted EBITDA upward trend as Q3 revenue grows

Caesars Digital has continued its Q2 adjusted EBITDA profitability trend into Q3 with the firm reporting a positive $2m up from a negative $38m a year prior.

Releasing its latest financial update, the Las Vegas-headquartered operator confirmed a digital division net revenue increase of 1.4% year over year (YOY) in Q3 to $215m.

Caesars Digital’s net losses also fell sharply during Q3 by 54% YOY, from a negative $63m in Q3 2022 to a negative figure of $29m in the same period 12 months later.

At a group level, Caesars’ net revenue rose by a modest 3.7% YOY to $3bn, with overall company adjusted EBITDA increasing by 3.1% YOY to $1bn during the Q3 period.

Group net income rose by 42.3% YOY to $74m in Q3 from a prior Q3 2022 high of $52m.

Caesars’ other divisions all reported single-digit percentage increases in net revenue during Q3, apart from the managed and branded division, which saw net revenue growth of 40% YOY to $98m, and the corporate and other division, which saw its losses double to negative $4m.

Caesars’ flagship Las Vegas operations net revenue grew by 4% YOY to $1.1bn, with its adjusted EBITDA increasing by 0.4% to $482m and net income shrinking by 3% to $238m.

The firm’s regional casino business reported a net revenue increase of 2.3% YOY to $1.5bn, with adjusted EBITDA for the division reaching a record $575m. Regional division net income fell by 17% YOY during Q3 to $176m from a prior high of $211m.

Caesars CEO Tom Reeg welcomed the financial results for the quarter, drawing attention to the performance of individual business segments in his accompanying remarks.

“During the third quarter of 2023, the company achieved an all-time consolidated adjusted EBITDA record,” Reeg said.

“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,” the CEO added.

During the quarter, Caesars was hit in a so-called social engineering cyberattack made via one of its IT partners, in which a copy of the Caesars Rewards loyalty database was stolen by hackers containing data from thousands of resorts patrons.

To stem any consequential identity fraud, the firm has made identity verification and fraud prevention services available to its customers as well as a $1m insurance reimbursement policy to compensate any customers for expenses incurred as a result of the breach.

Caesars is however, facing a number of class action lawsuits in Nevada for allowing the breach to take place.