Caesars Entertainment Q4 Results Negatively Impacted by F1 Attendance

The parent company of one of our best sports betting sites and a top real-money online casino has had to temper some expectations for its upcoming financial results.

With Caesars it will release its Q4 results in February, J.P. Morgan analyst Joseph Greff revealed he has lowered his target prediction from $499 million to $485 million. The Q4 figures will be released after market close on February 25, 2025, at 5 p.m. ET. 

The dwindling figures for its Q4 figures have been attributed to lower attendance compared to 2023 at the Formula 1 Las Vegas Grand Prix, which raced over three days from November 22 to November 23. 

The 2023 Las Vegas Grand Prix

2023 was the first year Formula One was set to race on the strip, promising a never-before-seen spectacle for fans. Even though it was marketed as a race of a lifetime, Caesars Entertainment did not seem to benefit from the event. In a report, Greff observed that “higher-end” properties benefited more than the middle-tier and lower-end casinos in which Caesars specialized. Therefore, the poorer-than-expected performance from the 2024 event is not surprising.

Mixed results for Caesars

While experts anticipate the Q4 figures for Caesars with potential for disappointment, it’s not been all bad news for Caesars Entertainment in 2024. In its Q2 reports, company shares were up, with CEO Tom Reeg mentioning: “On a consolidated basis, the Company generated $1 billion of Adjusted EBITDA. Our operating results reflect year-over-year growth in Adjusted EBITDA in our Las Vegas segment driven by record same-store revenues, hotel occupancy, and Average Daily Rate (ADR).”

However, any celebrations were cut short by its Q3 results. Net revenues declined by 2.6% year over year, and adjusted EBITDA decreased by 4%. Despite this, Caesars' CEO remained optimistic, “Group business was stronger in ’24 than ‘23, and will be stronger in ‘25 than ’24.”

However, that optimism is misplaced, according to Greff. In addition to the poor performance at the Las Vegas Grand Prix, including lower attendance than the previous year, construction disruption for casinos in New Orleans and mediocre performances from its casino properties in Atlantic City may negatively impact Caesars in Q4. 

Caesars looking to sell its non-core casinos

Despite the opening and rebranding of its New Orleans and Virginia Casinos, the casino group revealed in May that it was considering selling some of its “non-core” casinos. 

“We have a number of assets that produce very little or no cash flow that are non-core to the business, non-operating casinos that could potentially be monetized at attractive rates where you wouldn’t have to change your model much,” said Reeg in response to a question from Greff. “And without getting too forward-looking, you shouldn’t be surprised if some of those types of things start to happen in 2024 that our leverage reduction is not limited to only free cash flow.”

Despite multiple forecasts that the Formula One Grand Prix would boost tourism and revenue for various businesses, Caesars Entertainment seems to be an outlier. However, with slowly declining figures due to numerous factors, the blame can’t be placed solely on low F1 attendance.