Caesars Digital saw its quarterly adjusted EBITDA jump more than 50% year over year, but exactly what drove the increase remains unclear.
Caesars released its Q3 earnings report Tuesday afternoon after the market closed, but did not hold a conference call due to its pending acquisition by Fertitta Entertainment, which would take the company private.
Total casino revenue grew 6.8% to $1.754 billion for the quarter, across both land-based and online operations. That growth was “primarily driven by growth in iGaming handle coupled with improved [online] sports betting hold,” the company said in its 10-Q filing.
Caesars Digital Q3 details
Caesars Digital reported an adjusted EBITDA margin of 13.5% in the third quarter, up 4.5 percentage points from the 9.0% recorded last year. That pushed adjusted EBITDA to $44 million, up 57%, compared to 4.8% revenue growth to $326 million.
Sports betting contributed modestly to the increase, as handle ticked up 1.2% to $2.505 billion and hold rose to 7.9%, up from 7.8% last year.
Online casino was the the primary driver of revenue growth. While handle rose just 1.5% to $4.832 billion, hold hit 4.0%, up 11.1% from the prior year.
The company offered broad comments on the growth.
“Our Caesars Digital segment’s net revenues, net income (loss), Adjusted EBITDA, and Adjusted EBITDA margin increased for the three and nine months ended September 30, 2026, as compared to the same prior year periods, primarily due to increased iGaming handle and hold as well as sports betting hold coupled with reduced marketing costs,” the company said.
Costs are falling
Caesars Digital’s costs were essentially flat for the quarter. The company paid $95 million in gaming taxes, up $7 million from last year, though other costs fell by $8 million to $187 million.
Promotional spending, however, increased. Caesars offered $85 million in digital promotions during the quarter, up from $78 million last year.
CEO Tom Reeg has said for years that costs tied to sports betting partnerships would decline over time. The company still has $309 million in obligations extending through 2040, including $146 million due through 2030.
Caesars has also paid $22 million in costs related to the merger with Fertitta this year.
