Entain and MGM Raise Earnings for Joint BetMGM Venture

BetMGM is showing strong momentum through the first half of 2025. Strong enough to have its two co-owners announce increased confidence and guidance for the full year result, now predicted to come in closer to $2.6 billion in net revenue versus the previously announced $2.4 billion. This follows a very strong Q1 2025, where net revenue increased by 34%, and Q2 is now looking equally positive.

BetMGM was formed as a 50/50 partnership between MGM Resorts International and GVC Holdings for $200 million each in 2018, immediately following the PAPSA ruling by the Supreme Court, which allowed states to make their own decisions on betting and online gaming. Today this partnership runs a successful BetMGM Sportsbook and BetMGM Online Casino.

BetMGM would open its first online sportsbook in New Jersey just months later. GVC Holdings would face some tough questions from the British authorities in 2019 and 2020 regarding its Turkish operations, which it had sold years earlier and rebranded as Entain PLC, in what the company described at the time as a nod to a new era of “good conduct.” 

MGM, perhaps thinking that Entain was in a precarious position, or possibly simply wanting to position itself outside of any potential broadening scandal, made an offer to buy out its partners for $11 billion in 2021. Still, the offer was declined as ludicrously low, which is testament alone to the rapid growth of BetMGM, considering the initial $200 million investment just three short years earlier. 

Rumors of an Entain sale of its stake have persisted over the years, however, reaching a new level of intensity in late 2024 after the Australian regulatory body AUSTRAC warned of potentially severe fines for the company over reputed anti-money laundering (AML) and counter-terrorism financing (CTF) failures.

MGM has made no secret of its desire to take back full control over the extremely profitable spin-off. Still, the issue, as ever, has been price, especially of a meteorically rising asset. 

The latest announcement that the company expects to generate at least $100 million in EBITDA off of that increased $2.6 billion in net revenue, a modest margin but ticking upwards, can only sweeten the pot from Entain’s point of view. At the same time, every quarter MGM holds off is a higher price that they will have to pay. 

We aren’t exactly clear on what forward-looking statements companies on the London Stock Exchange are allowed to use in press releases, but it is worth noting that Entain states its “reinforced confidence...in a pathway to $500 million in EBITDA in the coming years.” That's a bold statement indeed, though it's hard to determine whether it's aimed at Entain investors or perhaps the MGM board instead.

Both Entain and MGM saw their share prices rise by over 10% on the news, indicating that investor sentiment is positive, regardless of the exact optics. 

Whether MGM will decide that now is the time to make another offer and whether Entain might be persuaded to let go of an appreciating asset that, by its own calculations, may soon be spinning off more than $500 million a year in earnings is a question best left to Entain’s board and interim CEO Stella David, and one that MGM CEO Bill Hornbuckle is almost certainly carefully weighing yet again.