Caesars Outlook Bright Despite Dim Strip

Caesars online casino continues its reign in the digital casino space, posting their strongest quarter yet, and while the brick and mortar world has shone less brightly, there were bright spots there as well. Overall, net revenues rose to $2.9 billion in the second quarter, up from $2.8 billion in Q2 2024. 

Income was up in both regional, digital, and branded businesses but was down in Las Vegas, falling from $1.1 billion to $1.05 billion in the second three months of 2025. But the regional pickup to $1.43 billion from $1.35 billion, along with Caesars Digital’s gain from $276 million to $343 million, made up for the Sin City slowdown.

EBITDA numbers were much the same, with Las Vegas off a full $45 million to just $469 million in earnings, but the regional markets pared their $469 million in Q2 earnings last year to just $439 million this year. 

Caesars corporate managed to add to the red, from a $40 million loss last year to $50 million this year but Digital improved from just $40 million in earnings to nearly $80 million in Q2 of 2025, which left the company with $955 million this year vs. last year's even $1 billion.

Net debt also declined slightly from $11.4 billion at the beginning of the year to $11.29 billion after the first six months, but that number remains far too high for some analysts' liking. 

Though as others point out, Caesars owns more than half of their land, which could be monetized by a sell-off to a REIT should the company find itself pressed for cash, and the ramping up of cash flow being spun off from the digital arm, which CEO Tom Reeg says is headed toward $500 million annually in EBITDA, should allow the company to continue to pay down obligations.

Breaking Down Caesars Digital

That $343 million in net revenue Caesars Digital earned in the second quarter was up a very impressive 25%, and that $80 million in EBITDA was up an even more impressive 100% against the same quarter last year. 

Caesars has been stating since 2021 that they would drive the digital arm to $500 million in annual EBITDA by 2026, and they appear to be on the cusp of making that 5 year prediction come true. Sports betting grew by a relatively lackluster 28% when held up against the rocket-like rise of online casino earnings, up 51%.

Sports betting was flat on the wager side but managed its rise through increased hold (8.9%), accomplished mainly by increased bettor interest in parlay and prop bets. The iCasinos side saw a rapid rise in all metrics, including hold, volume, and average monthly users. 

The company pointed to their new live dealer studio in Michigan and an innovative remote live slot studio on the floor at the Tropicana in Atlantic City as just some of the ways they are attempting to grow the online gaming market, as well as the introduction of new proprietary games from their new in-house development studio.

It’s been no secret that most Caesars senior management and high-end investors, including Carl Icahn, have long stated that they don’t believe that Caesars stock gets the impact it should from the digital side of the business, and so for several years there have been rumors and questions about just if and when Caesars would consider a spinoff of Caesars Digital to unlock more value.

During the earnings call, CEO Reeg was blunt: “We would absolutely pursue a separation if we believe that it would drive significant value to our shareholders, and we think we'll be in a position where we're at our targets at some point in the first half of '26.” 

Which seems to put to rest most of the guesswork on what a timeline for the company spinning off this asset might look like, and it would seem tied to that $500 million in annual EBITDA that has long been their goal. 

Caesars may be struggling a bit in the glare of the summer sun in Las Vegas, but they aren’t alone. What the company has that many of its Strip competitors don’t is a surging online sports and casino business that is already outpacing even the rosiest of projections and seems poised for a spinoff early next year.

Investors and analysts alike will be watching closely as 2026 nears, but despite some headwinds, Caesars appears to be holding a very strong hand.