PENN Entertainment and ESPN have formally ended their sports activities betting partnership, closing a deal initially valued at $2 billion and meant to final a decade. The two firms confirmed on Thursday, November 6, that their collaboration will finish efficient December 1, 2025, marking an early termination of what was as soon as seen as a groundbreaking union between gaming and sports activities media.
ESPN Bet Winds Down After Less Than Three Years
The partnership, introduced in 2023, rebranded Penn’s former Barstool Sportsbook as ESPN Bet, giving the operator unique rights to make use of ESPN’s title and entry its media and advertising platforms. However, after simply over two years, either side agreed to exit the deal below a mutual termination clause permitting both celebration to withdraw after the third 12 months if market efficiency targets weren’t met.
“When we first announced our partnership with ESPN, both sides made it clear that we expected to compete for a podium position in the space,” mentioned PENN Entertainment President and CEO Jay Snowden. “Although we made significant progress in improving our product offering and building a cohesive ecosystem with ESPN, we have mutually and amicably agreed to wind down our collaboration.”
Under the settlement, Penn was paying $150 million yearly in money to ESPN. The choice to terminate the contract early got here amid mounting losses for the ESPN Bet app, which struggled to realize traction in opposition to main opponents like DraftKings and FanDuel. According to state income studies, ESPN Bet’s deal with share stood at 2.8%, with a 2.6% income share year-to-date, down from 3.3% and a pair of.5% respectively in 2024.
The app’s poor efficiency led Penn to report significant digital losses. In its third-quarter monetary assertion for 2025, the corporate posted an $865.1 million web loss, largely tied to its interactive division. While total revenues reached $1.7 billion, digital gaming volumes fell in need of expectations.
Snowden mentioned PENN will redirect its efforts towards its rising iCasino operations and the Canadian market. “We plan to refocus our digital strategy on our growing iCasino business, while continuing to capitalize on our omnichannel advantage as the nation’s leading regional retail casino operator,” he acknowledged, as reported by Fox Business.
ESPN Pursues New Direction With DraftKings
As Penn winds down ESPN Bet, ESPN Chairman Jimmy Pitaro confirmed that the community will discover new alternatives within the gaming house. “Together, ESPN and PENN created a truly unique offering with unparalleled integrations across our various media assets,” Pitaro mentioned. “ESPN drove over 2.9 million new users into the PENN ecosystem, with a strong uptick in first time bettors this fall. We appreciate the collaboration we had with PENN and are now pursuing other media and marketing opportunities within this space.”
Sources advised Front Office Sports that ESPN is ready to signal a serious sponsorship take care of DraftKings, which can grow to be its unique sportsbook and odds supplier beginning December 2025. The full rollout, together with branding throughout ESPN’s digital and tv platforms, is predicted subsequent 12 months.
Under the termination settlement, all money funds to ESPN will finish within the fourth quarter of 2025. ESPN retains vested warrants to buy practically 8 million PENN shares at a weighted strike worth of $28.95, whereas all unvested and performance-based warrants will probably be forfeited. Penn should stop utilizing the ESPN model by December 15, 2025, although an extension is feasible in the course of the transition.
Penn pays $38.1 million to ESPN within the fourth quarter of 2025 and allocate one other $5 million towards advertising help for its subsequent enterprise. Disney, ESPN’s dad or mum firm, agreed to not launch or license one other ESPN-branded sportsbook for 15 months following the contract’s expiration.
Looking forward, Penn will revive its beforehand shuttered U.S. model theScore Bet to exchange ESPN Bet. The rebrand is deliberate for December 1, 2025, to align with the anticipated launch of sports activities betting in Missouri, pending regulatory approval. TheRating Bet will serve as Penn’s unified on-line sportsbook throughout the U.S. and Canada, built-in with the theScore media app, which boasts about 4 million month-to-month lively customers in North America.
“Our OSB product across both the U.S. and Canada will now leverage connectivity with the theScore media app,” Snowden defined, including that the combination will improve cross-sell alternatives for Penn’s Hollywood-branded iCasino, out there each as a standalone and built-in app in regulated states.
With the exit from ESPN Bet, Penn hopes to cut back mounted media prices, substitute them with performance-based advertising, and strengthen its place in digital on line casino gaming—a sector it believes gives stronger long-term profitability.
