Caesars Entertainment’s second quarter was marked by a mix of digital momentum and challenges in its core Las Vegas business, which contributed to a negative market reaction. Management attributed the digital segment’s strength to product innovation, notably the launch of a universal digital wallet and proprietary player account management system in Nevada. However, CEO Tom Reeg described the Las Vegas market as “softer than last year,” citing lower high-end gaming activity and a shorter booking window as key issues. Regional operations were also affected by construction-related disruptions and specific one-time events.
Is now the time to buy CZR? Find out in our full research report (it’s free).
Caesars Entertainment (CZR) Q2 CY2025 Highlights:
- Revenue: $2.91 billion vs analyst estimates of $2.87 billion (2.7% year-on-year growth, 1.2% beat)
- Adjusted EPS: -$0.20 vs analyst estimates of $0.09 (significant miss)
- Adjusted EBITDA: $890 million vs analyst estimates of $965.3 million (30.6% margin, 7.8% miss)
- Operating Margin: 18.1%, in line with the same quarter last year
- Market Capitalization: $4.99 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Caesars Entertainment’s Q2 Earnings Call
- Daniel Brian Politzer (JPMorgan) asked for specifics on Las Vegas booking stabilization. CEO Tom Reeg explained that forward cash room forecasts had stopped declining in July, though he cautioned against expecting a quick rebound.
- Brandt Antoine Montour (Barclays) inquired about changes in promotional strategy. President Anthony Carano outlined how data-driven, targeted campaigns allow Caesars to test offers nationally and refine strategies for profitability.
- David Brian Katz (Jefferies) probed the drivers behind digital segment growth. Reeg emphasized product innovation, improved customer acquisition tools, and partnership expense reductions as key to achieving $500 million in EBITDA by 2026.
- Elizabeth Dove (Goldman Sachs) asked about future capital investments in Las Vegas. Carano detailed upcoming room remodels, third-party partnerships for new amenities, and the launch of the Vanderpump Hotel at Cromwell.
- Steven Donald Pizzella (Deutsche Bank) questioned operating expense trends. Reeg noted flat expenses despite union wage increases in Vegas, with regional markets seeing only typical inflationary pressures.
Catalysts in Upcoming Quarters
In the coming quarters, the StockStory team will be monitoring (1) progress on digital platform adoption and the rollout of the single-wallet system to additional jurisdictions, (2) the trajectory of group bookings and event-driven revenue in Las Vegas as the convention calendar ramps up, and (3) regional margin improvement as legacy marketing investments are optimized and one-time disruptions subside. Execution of asset-light deals and continued product innovation in digital gaming will also be key to tracking Caesars’ strategic progress.
Caesars Entertainment currently trades at $24.14, down from $28.44 just before the earnings. In the wake of this quarter, is it a buy or sell? The answer lies in our full research report (it’s free).
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