Q1 2026 BetMGM Resorts International Earnings Call

April 14, 2026

Operator 2: Good day, and welcome to the BetMGM Q1 2026 Financial Update. Joining from the company today are Adam Greenblatt, Chief Executive Officer, and Gary Fritz, the Chief Financial Officer. At this time, all participants are in a listen-only mode. After the opening remarks, there will be a 30-minute question and answer session. To ask a question during the session, you will need to press star one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one again. Please be advised that today's conference is being recorded. I would now like to turn the call over to Adam Greenblatt.

Operator: Good day, and welcome to the BetMGM Q1 2026 Financial Update. Joining from the company today are Adam Greenblatt, Chief Executive Officer, and Gary Deutsch, the Chief Financial Officer. At this time, all participants are in a listen-only mode. After the opening remarks, there will be a 30-minute question and answer session. To ask a question during the session, you will need to press star one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one again. Please be advised that today's conference is being recorded. I would now like to turn the call over to Adam Greenblatt.

Good day and welcome to the bed M. G. M Q1, 'twenty 'twenty six financial update joining from the company today are Adam Green Black Chief Executive Officer, and Gary Deutsch, Chief Financial Officer.

At this time all participants are in a listen only mode.

After the opening remarks, there will be a 30 minute question and answer session.

I'll ask a question. During this session you will need to press star one on your telephone you will then hear an automated message advising your hand is raised to withdraw your question. Please press star one again please.

Please be advised that today's conference is being recorded.

I'd now like to turn the call over to Adam Green, but.

Adam Greenblatt: Good morning, everyone, and thank you for joining us. Today, we'll be providing an update on our Q1 performance, as well as discussing our refreshed guidance for the full year. It's been a steady start to 2026, during which BetMGM has continued to deliver on our strategy. As we said at our full-year results in February, as the industry continues to evolve, we will continue to focus on winning the BetMGM way. BetMGM's strategic improvements across player acquisition and management, operational discipline, and product continue to underpin our model and position us to generate sustainable profitable growth this year and beyond. For Q1, net revenue was $696 million, up 6% year-on-year, and we generated adjusted EBITDA of $25 million. Q1 results were slightly below expectations due to a combination of player-friendly sports results and marketplace conditions, including intensifying competitive dynamics.

Good morning, everyone and thank you for joining us today will be providing an update on our Q1 performance as well as discussing our refreshed guidance for the full year.

It's been a steady stones to 2026 during which bet MGM has continued to deliver on our strategy.

And as we said at our full year results in February as the industry continues to evolve we will continue to focus on winning the bet MGM way.

But MGM strategic improvements across player acquisition and management.

Operational discipline and product continue to underpin our model and position us to generate sustainable profitable growth this year and beyond.

For Q1, net revenue was $696 million up 6% year on year, and we generated adjusted EBITDA of $25 million.

So Q1 results were slightly below expectations due to a combination of player friendly sports results and marketplace conditions.

Including intensifying competitive dynamics.

Adam Greenblatt: Our underlying fundamentals are healthy and growing, and we've built the business to ensure that we are nimble and rational allocators of capital between our iGaming and sports businesses. As an iGaming-first operator who's approaching $2 billion of annual iGaming revenue, we are better positioned than most, if not all others, from the ever-escalating noise of prediction markets present in the market. As we look to the rest of the year, we will continue to focus on where we are seeing the best returns. We are putting increased focus and capital behind BetMGM's positions of strength, which are our multi-product states that include our iGaming business, Nevada, which is the epicenter of our omnichannel advantage and a major source of adjusted EBITDA generation, and on servicing our core base of higher-value premium mass players.

Our underlying fundamentals are healthy and growing.

And we've built the business to ensure that we are nimble and rational allocators of capital between our I gaming and sports businesses.

And as and I gaming first operator, who's approaching $2 billion of annual gaming revenue, we are better positioned than most if not all of this.

From the escalating noise of prediction market presence in the markets.

As we look to the rest of the year, we will continue to focus on where we are seeing the best returns.

We are putting increased focus on capital behind bet mgm's positions of strength, which are.

Our multi product states that include our I gaming business.

Nevada, which is the epicentre of Omnichannel advantage and a major source of adjusted EBITDA generation and on servicing our core base of higher value premium mass players.

Adam Greenblatt: We are focused on controlling the controllables to deliver what ultimately matters, which is sustainable growth of Adjusted EBITDA. While we now expect revenue for 2026 in the range of $2.9 to 3.1 billion, we still expect to deliver Adjusted EBITDA in line with guidance, albeit at the lower end of the existing $300 to 350 million guidance range. We also continue to see a path to $500 million of Adjusted EBITDA in 2027. Let me provide a little more detail on the performance during Q1 across each part of the business. Our iGaming business delivered $481 million of net revenue in Q1, up 9% year-on-year, reflecting solid top-line growth supported by ongoing refinements in player management and bonus optimization.

We are focused on controlling the controllable to deliver what ultimately matters, which is sustainable growth of adjusted EBITDA.

So well.

While we now expect revenue for 2026 in the range of $2 90 to $3 $1 billion, we still expect to deliver adjusted EBITDA in line with guidance.

Albeit at the lower end of the existing $300 million to $350 million guidance range.

We also continue to see a path to $500 million of adjusted EBITDA in 2027.

So let me provide a little more detail on the performance during Q1 across each parts of the business.

Alright gaming business delivered $481 million of net revenue in Q1 up 9% year on year, reflecting solid topline growth supported by ongoing refinements in Playa management and bonus optimization.

Adam Greenblatt: This important and ongoing work has driven significant uplift to player values in Q1, as NGR per active was up 12%, more than offsetting the trimming of monthly actives. iGaming contribution was $143 million in the face of a customer acquisition market that has heated up slightly. While the number of players acquired in Q1 was ahead of our expectations, total cost of acquisition was a little higher as CPAs have been drifting up. Nevertheless, we are very comfortable with the paybacks we've been seeing on new players, so feel good about the outlook for 2026 in gaming. Our powerful iGaming engine continues to be fueled by best-in-class content and differentiated experiences.

This important and ongoing work has driven significant uplift to player values in the first quarter as NGL per active was up 12% more than offsetting the trimming of monthly actives.

Yeah.

Hi, gaming contribution was $143 million in the face of a customer acquisition markets.

It's heated up slightly.

So while the number of players acquired in Q1 was ahead of our expectations total cost of acquisition was a little higher as CPA as had been drifting up.

Nevertheless, we are very comfortable with the paybacks, we've been seeing on new players. So I feel good about the outlook for 2026 in gaming.

Our powerful like gaming engine continues to be fueled by best in class content and differentiated experiences.

Adam Greenblatt: This quarter, we're proud to announce we are the home of Gold Blitz under our new partnership with Games Global, giving our players exclusive access to all Gold Blitz titles before they launch to the wider market. We also launched exclusive titles from the Survivor franchise, celebrating the show's 50th anniversary season. Looking ahead, we continue to focus on building on this momentum with additional exclusive game launches, as well as delivering a smooth Alberta launch in July. Turning to sports, OSB net revenue was $203 million, and that's up 4% year-over-year. As I mentioned, the top line saw some drag from unfavorable sports results, roughly 60 basis points versus theoretical margin. Don't forget, BetMGM sports business has relatively more higher staking, higher value bettors.

This quarter, we are proud to announce we are the home of goldblatt.

Our new partnership with games global giving our players exclusive access to all gold Blitz titles before they launch to the wider market.

We also launched exclusive titles from the survivor franchise celebrating the show's 50th anniversary season.

Looking ahead, we continue to focus on building on this momentum with additional exclusive game launches as well as delivering a smooth Alberta launch in July.

Turning to sports OSB net revenue was $203 million and that's up 4% year over year.

As I mentioned the top line saw some drag from unfavorable sports results.

Roughly 60 basis points, just theoretical margin.

And don't forget.

But MGM sports business is relatively more highest staking higher value buses.

Adam Greenblatt: While this does result in somewhat more volatility in our hold percentage, the affinity of these players to BetMGM is an advantage for us, as they tend to be more resilient compared to a highly recreational customer base. Similar to my comment on iGaming regarding our strategy of prioritizing quality over volume, in OSB, we've continued to refine our approach to player management, resulting in handle per active up 23% and NGR per active up 25% versus last year. This is due to our improved player mix, that is more higher value players and fewer marginal players. The combined effect is a reduction in active players. As you'd expect, there are a lot more marginal players versus premium players. The most significant change in the operating environment for OSB in Q1 has been a significant increase in CPAs.

And while this does result in somewhat more volatility in our hold percentage. The affinity of these players to bet MGM is an advantage for us as they tend to be more resilient compared to a highly recreational customer base.

Similar to my comments on <unk> gaming regarding our strategy of prioritizing quality over volume in.

In OSB, we've continued to refine our approach to player management.

Resulting in handle per active up 23% and NGL proactive up 25% versus last year.

This is due to our improved play a mix that is more higher value players and fewer marginal place. The combined effect is a reduction in active plays as you'd expect there are a lot more marginal players versus premium plays.

Okay.

The most significant change in the operating environment for OSB in the quarter has been a significant increase in Cps.

Adam Greenblatt: While some OSB peers increased marketing intensity, this jump is largely driven by new sports betting companies buying media in the category. They call themselves prediction markets, and they are buying sports betting keywords as well as throwing money at any sports media property that will take it. They are targeting sports bettors directly in their marketing, thereby bidding up the cost of acquiring new OSB players and extending payback periods. Some of these companies even have sportsbook mode in their product in an attempt to offer as close an experience as possible to sports betting. As a reminder, we stand with 40 AGs, our OSB regulators, regulated states, and tribal partners. We look forward to an expedient outcome of the almost inevitable hearing of the pro-states rights, pro-tribal rights, and anti-prediction markets case by SCOTUS.

While some OSB peers increased marketing intensity.

This jump is largely driven by news sports betting companies buying media in the category.

They call themselves prediction markets.

And there are buying sports betting keywords as well as throwing money at any sports media property that will take it.

They are targeting sports betters directly in their marketing, thereby bidding up the cost of acquiring new OSB players.

And extending payback periods.

Some of these companies even have sports book mode in their product in an attempt to offer as close an experience as possible to sports betting.

Yeah.

As a reminder.

We stand with 40 Ags <unk> OSB.

OSB regulators.

Related states and tribal partners.

We look forward to an expedient outcome of the almost inevitable hearing of the pro States rights Pro tribal rights and anti prediction markets case by SCOTUS.

Adam Greenblatt: In the meantime, we're refining our approach to OSB marketing for the rest of the year under the assumption that current media conditions persist. Looking further out, I'm confident that the current intensity will abate. You just have to look at the player-level unit economics for prediction market operators, and you will quickly conclude that the current spending wave cannot sustain. By contrast, our unit economics are strong. When you account for the Q1 headwinds from results and this prediction market's moment of hyperspend, you see that our growth potential looks strong and well-positioned for a future change in the dynamics surrounding prediction markets. Nevertheless, with those Q1 headwinds, our OSB contribution was $10 million in the quarter. In retail sports, we delivered net revenue of $11 million, down 43% year-on-year. The decline was driven by a few large VIP-related payouts.

In the meantime.

We're refining our approach to OSB marketing for the rest of the year under the assumption that current media conditions persist.

Looking further out.

I'm confident that the current intensity will abate.

You just have to look at the payer level unit economics for prediction market operators and you will quickly conclude that.

At the current spending wave cannot sustain.

By contrast.

Our unit economics are strong.

When you account for the Q1 headwinds from results and this prediction markets moment of hyper spend you see that our growth potential looks strong.

And well positioned for a future change in the dynamics surrounding prediction markets.

Nevertheless.

With those Q1 headwinds RSP contribution was $10 million in the quarter.

In retail sports, we delivered net revenue of $11 million down 43% year on year.

The decline was driven by a few large VIP related payouts.

Adam Greenblatt: These short-term results aside, we continue to see strong momentum in Nevada across digital and retail combined, as we've increased our market share, and we're acquiring and retaining players efficiently. While headline growth was modest in Q1, I want to highlight again that player values in the sports business have strengthened meaningfully. We will continue to focus on winning the BetMGM way and are well-positioned to capitalize on several opportunities ahead this year, including the World Cup, launch of both OSB and iGaming in Alberta, improved trading capabilities, and deepening our established omnichannel advantage in Nevada. Now to return to the consolidated BetMGM financial picture. Q1 total contribution was $116 million. Adjusted EBITDA was $25 million, and CapEx was $3 million. Adjusted EBITDA minus CapEx continues to be the best proxy for total cash to parents for the year.

These short term results aside we continue to see strong momentum in Nevada across digital and retail combined as we've increased our market share and.

And we are requiring and retaining players efficiently.

Okay.

So.

While the headline growth was modest in Q1.

I want to highlight again that player values in the sports business have strengthened meaningfully we will continue to focus on winning the bet MGM way.

And are well positioned to capitalize on several opportunities ahead this year, including the World Cup.

Launch of both OSB and I gaming in Alberta improve.

Improved trading capabilities and deepening our established Omnichannel advantage in Nevada.

Now to return to the consolidated bet MGM financial picture Q.

Q1, total contribution was $116 million.

Adjusted EBITDA was $25 million and Capex was $3 million.

Adjusted EBITDA minus Capex continues to be the best proxy for total cash two parents for the year.

Adam Greenblatt: To save you doing the math for Q1, that's $22 million. As for returning excess cash to our parents, our transformation into a consistently cash-generative business continues, with BetMGM now paying parent fees to Entain and MGM Resorts. These fees hit our P&L as operating expenses and are separate from the cash distributions we began in late 2025. For Q1, parent fees were $3 million in total, and this will be the only cash to parents for Q1 given the seasonality of our business with marketing investments timing for NFL and March Madness, as well as accrued annual compensation payouts. In summary, while it is early in the year and our business and sector have an H2 bias, we will continue to focus on our areas of strength and where we see better paybacks, not to be misinterpreted as sacrificing growth for short-term margin.

And to save you're doing the math for Q1, that's $22 million.

As for returning excess cash to our parents our transformation into a consistently cash generative business continues with bet MGM now paying parent fees to maintain and MGM resorts.

These fees hits, our P&L as operating expenses in a separate from the cash distributions. We began in late 2025.

For Q1 parent fees were $3 million in total and this will be the only cash to parents for Q1, given the seasonality of our business with marketing investments timing for NFL and March madness as.

As well as accrued annual compensation payouts.

So in summary.

While it is early in the year in our business and sector have a second half bias.

We will continue to focus on our areas of strength.

And where we see better paybacks.

Not to be misinterpreted or sacrificing gross for short term margin.

Adam Greenblatt: Winning the BetMGM way means we continue to focus on iGaming and multi-product states, Nevada, and our higher-value players around the country in sports. Let me reiterate that we are laser-focused on generating profitable, sustainable growth. We remain confident in achieving our Adjusted EBITDA range for 2026, albeit at the lower end, and we continue to see a pathway to delivering $500 million Adjusted EBITDA in 2027. Our strategy is working and our business fundamentals remain healthy despite some headwinds in sports so far this year. As we look to the rest of 2026, we progress with confidence and discipline. With that, I'll hand it over to the operator to open the line for questions.

Winning the bet MGM way means we continue to focus on I gaming and multi product states, Nevada, and Ohio value players around the country in sports.

Let me reiterate that we are laser focused on generating profitable sustainable growth.

We remain confident in achieving our adjusted EBITDA range for 2026, albeit at the lower end.

And we continue to see a pathway to delivering $500 million.

Adjusted EBITDA in 2027.

Our strategy is working and our business fundamentals remain healthy despite some headwinds in sports so far this year.

As we look to the rest of 2026, we progressed with confidence and discipline.

And with that I'll hand, it over to the operator to open the line for questions.

Operator 2: Thank you. As a reminder, to ask a question, please press star one on your telephone and wait for your name to be announced. To withdraw your question, please press star one again. We ask that you limit yourself to one question only in order to enable as many people to participate as possible. Please stand by while we compile the Q&A roster. Your first question comes from Brandt Montour with Barclays. Please proceed with your question.

Operator: Thank you. As a reminder, to ask a question, please press star one on your telephone and wait for your name to be announced. To withdraw your question, please press star one again. We ask that you limit yourself to one question only in order to enable as many people to participate as possible. Please stand by while we compile the Q&A roster. Your first question comes from Brandt Montour with Barclays. Please proceed with your question.

Thank you.

As a reminder to ask a question. Please press star one on your telephone and wait for your name to be announced to withdraw. Your question. Please press star. One again, we ask that you limit yourself to one question only in order to enable as many people to participate as possible. Please.

Please standby, while we compile the Q&A roster.

Okay.

Your first question comes from Brent mature.

With Barclays. Please proceed with your question Hi, everybody thanks for that.

Brandt Montour: Hi, everybody. Thanks for the question and taking the time this morning. You spoke a lot about the competitive environment on the sports side, and I think there was a little bit of a comment about the iGaming side, which is what I'm asking about to you. Have you seen a meaningful change in the competitive environment on the iGaming side? You mentioned in your release that you're leaning in to iGaming. Is this across the industry dynamic that is new? Is it something that's going to change your go-to-market strategy? How should we think about that in relation to the guidance change for the rest of the year? Thanks.

And taking the time this morning, and you spoke a lot about the competitive environment.

On the sports side, and I think there was a little bit.

<unk> of our comment about the IQ me inside which is which is what I'm asking about do you have you seen.

A meaningful change in the competitive environment on the gaming side and you mentioned in your release that you are leaning in to I gaming is this a across the industry dynamic.

That is new is it something that's going to change your go to market strategy and then how should we think about that in relation to the guidance change for the rest of the year. Thanks.

Adam Greenblatt: Yes. Hi, Brandt, and firstly, thanks for attending. Thank you for the question. Look, I think iGaming is just reflecting that we haven't seen a new state since 2022, and the market is competitive. It's always been competitive. We've seen pockets of new competition in certain states. You may have seen that one of our competitors entered the Michigan market in December, spent a bunch of money, and then reinvested in players at a meaningfully above market rate. Won a lot of market share in their first month, GGR market share, that is. Lo and behold, as you'd expected, we expected, that impact is now easing. To answer your question, we're just seeing a natural evolution, progressive evolution of the competitive situation in the market. We have seen pockets of new competition. We don't believe them to be meaningful disruptors.

Hi, Brad and firstly, thanks for attending thank you for the question look I think gaming is just reflecting.

That we haven't seen a new states since 2022 and the market is competitive it's always been competitive.

We've seen pockets of new competition in certain states. You may you may have seen that one of our competitors.

The Michigan market in December.

Spent a bunch of money.

And then reinvested in players that have.

Meaningfully above market rates.

One a lot of market share in their first in their first month G. Gel market share that is and then lo and behold as you'd expect as we expected.

That impact is now.

Is it.

So Josh to your question, we're just seeing a natural evolution progressive evolution of the competitive situation in the market. We have seen pockets of new competition, we don't believe them to be meaningful disruptors and as ever we feel like our strategy is the right. One we lead with content as you know we lead with exclusive.

Adam Greenblatt: As ever, we feel like our strategy is the right one. We lead with content, as you know. We lead with exclusive, as you know, and of course, with the best brand in the business around that, we think we're pretty well set up to continue to win in our iGaming markets.

As you know and of course with the best brand in the business around.

Around that we we think we're pretty well set up to continue to win.

In our gaming markets.

Brandt Montour: Okay. Thanks for that. A quick follow-up. The Q1 you said came in a little bit below your internal expectations. Can you just give us a split up in terms of the guidance downgrade for the full year? How much of that was in the Q1 versus the rest of the year?

Okay. Thanks for that and a quick follow up.

The <unk> you said came in a little bit below your internal expectations can you just give us a split up in terms of the guidance a downgrade for the full year, how much of that was in the <unk> versus the rest of the year.

Adam Greenblatt: Gary, do you want to take that?

Gary do you want to take that yes, I mean, it's it's in both but the first quarter remember was in the case of sports was really driven by.

Gary Fritz: Yeah. It's in both, but Q1, remember, in the case of sports, was really driven by a lot of bad results for the house. That needs to be considered in. We look at the markers of how the cohorts and players are progressing. We do carry that forward, in what we see. It's sort of evenly distributed would be my fast answer to that.

Gary Deutsch: Yeah. It's in both, but Q1, remember, in the case of sports, was really driven by a lot of bad results for the house. That needs to be considered in. We look at the markers of how the cohorts and players are progressing. We do carry that forward, in what we see. It's sort of evenly distributed would be my fast answer to that.

A lot of bad results for the house, so that needs to be considered in and we look at the markers of how the cohorts and players are progressing so we do carry that forward and what we see but it's pretty evenly distributed would be my my fast ACH.

Brandt Montour: All right. Thanks, everyone.

Alright, thanks, everyone.

Yes.

Operator 2: Your next question comes from Barry Jonas with Truist. Please proceed with your question.

Operator: Your next question comes from Barry Jonas with Truist. Please proceed with your question.

Your next question comes from Barry Jonas with true.

Please proceed with your question.

Patrick Keon: Hey, good morning. This is Patrick Keon on for Barry. Thank you for taking our questions. You gave your thoughts on prediction markets. We just wanted to double-click there. Could you give any updated thoughts on potential cannibalization to sports betting handle in shared states? Is it still your view that prediction could potentially expedite legalization in states that don't currently offer OSB and iGaming? Thank you.

Patrick Keough: Hey, good morning. This is Patrick Keon on for Barry. Thank you for taking our questions. You gave your thoughts on prediction markets. We just wanted to double-click there. Could you give any updated thoughts on potential cannibalization to sports betting handle in shared states? Is it still your view that prediction could potentially expedite legalization in states that don't currently offer OSB and iGaming? Thank you.

Hey, Good morning. This is Patrick on for Barry. Thank you for taking our questions.

You gave your thoughts on prediction markets, we just wanted to double click there could.

Could you give any updated thoughts on potential cannibalization to sports betting handle and shared states and is it still your view that prediction could potentially expedite legalization in states that don't carry offer currently offer OSB and <unk>. Thank you.

Adam Greenblatt: Okay. Two parts there, Patrick, masquerading as Barry. Look, the cannibalization question. I actually think these results, our results in sports are pretty encouraging because what we are still seeing, notwithstanding a weak margin in our OSB business in Q1, we are still seeing year-on-year growth despite billion-dollar new spenders in the category. I think what we and the industry will show is a degree of resilience in OSB that is justifiable. I think what we've guided to, we and others, and analysts likewise, have guided to mid-single digits impact. If you contextualize that with all the other competitive challenges, macro environments, and the existence of prediction markets, I think our Q1 results, certainly in sports, are pretty encouraging. They're certainly for the industry likewise. In terms of your second question, which is expediting legalization, it's not actually something we've said before.

Okay two parts there Patrick.

Escalating as Barry.

Look the cannibalization question I actually think these results our results in sports.

While pretty encouraging.

Because what we are still seeing notwithstanding a weak margin in our OSB business in the first quarter, we are still seeing year on year growth. Despite.

Billion dollar spend is in the new spenders in the category.

And I think what we and the industry will show US a degree of resilience in OSB.

That is justifiable.

And so you know I think what we've guided to we and others and analysts likewise have guided to.

Mid single digits impact.

So if you contextualize that with all the other.

Competitive.

Competitive challenges macro environments.

And the existence of prediction markets I think our first quarter results certainly in sports are pretty encouraging.

As I said before the industry Likewise.

In terms of your second question, which is expediting legalization, if something actually something we've said before.

Adam Greenblatt: Without question, I was at the conference, the Indian Gaming Association Conference on the West Coast a couple of weeks ago, and this was certainly one of the topics or the central topic at the conference, the impact and threat that prediction markets represented. It was one of the factors referenced for their desire to see sports betting legalized in the state of California. I think directionally it's helpful, but it's not as direct an impact as some were hoping and some might suggest, but certainly helpful.

But without question.

Yeah I was at the.

The.

Conference The Indian Gaming Association conference on the West Coast, a couple of weeks ago.

And this was certainly one of the topics.

Once the central topic at the conference.

The rollout.

The impact and threat that prediction markets represented.

And it was one of the factors referenced.

For their desire to see sports betting.

Legalized in the steady California.

So I think Directionally that's helpful.

But it's not as direct an impact as as somewhat hoping on semi suggests but certainly not certainly helpful.

Operator 2: Thanks so much. Appreciate it.

Patrick Keough: Thanks so much. Appreciate it.

Thanks, so much I appreciate it.

Adam Greenblatt: Sure.

Yeah.

Operator 2: A reminder to please limit yourself to one question. Thank you. Your next question comes from Ed Young with Morgan Stanley. Please proceed with your question.

Operator: A reminder to please limit yourself to one question. Thank you. Your next question comes from Ed Young with Morgan Stanley. Please proceed with your question.

A reminder to please limit yourself to one question. Thank you.

Your next question comes from Ed Young with Morgan Stanley. Please proceed with your question.

Ed Young: Thank you. My question's on the shape of the guidance for this year. You've obviously reduced the revenue guide. You've maintained, although moved to the lower end of the EBITDA guide. I think that implies now about 40% drop through midpoint of revenue, low point of EBITDA. Could you just reflect a little bit on where you're finding those additional cost savings and how do you think about the balance of cost out in an environment where you're saying there's heightened competition and obviously actives are also in negative territory across both products? Thanks.

Thank you my question is on the shape of the guidance for this year you will see reduced the revenue guide you've maintained or they've moved to the lower end of the EBITDA Guide I think that implies now about 40% drop through mid point of revenue low point of EBITDA. So can you just reflect a little bit on why youre, finding additional cost savings and how do you.

Think about the balance of cost outs in an environment, where you're saying there's heightened competition. Obviously active saw also in negative territory across both products.

Adam Greenblatt: Gary, you want to take that?

Gary you want to take that sure I mean, the simple answer is aligned with us, saying that we're going to focus at our areas of strength.

Gary Fritz: Sure. The simple answer is aligned with us saying that we're going to focus in our areas of strength, and we're going to do less marketing into some of the broader OSB-only states for general batches of players. There's going to be a reduction in marketing to that part, and that's going to drive our ability to stay on plan for the EBITDA guidance. Obviously, in a world of AI and a world of just general rationalization of how we do business, there's other areas where we look across the business on the cost front. The real leverage that's going to drive us into that range is going to be the change in the marketing trajectory, particularly in sports, OSB states only.

Gary Deutsch: Sure. The simple answer is aligned with us saying that we're going to focus in our areas of strength, and we're going to do less marketing into some of the broader OSB-only states for general batches of players. There's going to be a reduction in marketing to that part, and that's going to drive our ability to stay on plan for the EBITDA guidance. Obviously, in a world of AI and a world of just general rationalization of how we do business, there's other areas where we look across the business on the cost front. The real leverage that's going to drive us into that range is going to be the change in the marketing trajectory, particularly in sports, OSB states only.

Going to do less marketing into some of the broader OSB.

Only states for general batches of players and there's going to be.

Reduction in marketing to that part and Thats going to drive our ability to stay on plan for the EBITDA guidance and obviously in a world of AI in a world of general rationalization that how would your business.

There's other areas, where you look across the business on the cost front, but it's a real lever that's going to drive us into that range is going to be the change in the marketing trajectory, particularly in sports OSB States only.

Adam Greenblatt: Look, just to add to that. I believe one of BetMGM's strengths is our approach to how we buy media, how we invest in marketing. One of our guiding principles is to remain flexible. We use the word nimble in my prepared remarks. It is to continue to be nimble. These kind of what we believe to be short-term changes in the environment, we can respond to in a rational capital allocation approach. For me, this is just another example of that. What we're going to be doing is we're going to be pruning the least efficient pockets of spend, and we reallocate it to where we're seeing best paybacks. H2 of the year in sports will be a two-part effect, a little bit of easing in sports and a little bit more determined investment in game.

Just to add to that one novo I believe one of our MGM strengths.

He is our approach to how we buy media, how we how we invest in marketing.

One of our guiding principles is to remain flexible we use the word nimble in my prepared remarks is to continue to be nimble. So these kind of what we believe to be short term changes in the environment, we can respond to an a.

Capital Rush in a rational capital allocation.

Approach.

And so for me. This is just another example of that you know what we're going to be doing is we're going to be pruning, the least efficient pockets of spend and we reallocated to where we are seeing best best Paybacks, and then second half of the year in sports will be a two.

To put in effect, a little bit of easing and sports and a little bit more determined.

Investments in game.

Ed Young: Thank you.

Thank you.

Operator 2: Your next question comes from Joseph Stauff of Susquehanna. Please proceed with your question.

Operator: Your next question comes from Joseph Stauff of Susquehanna. Please proceed with your question.

Your next question comes from Joe Stauff of Susquehanna. Please proceed with your question.

Joseph Stauff: Thanks. Good morning, Adam. I just wanted to follow up and maybe ask you. I understand the competitive sort of dynamics and the higher yields and higher spending that you're getting per customer. What's the right way, possibly, to think about monthly active user growth, say, going forward throughout the rest of the year?

Joe Stauff: Thanks. Good morning, Adam. I just wanted to follow up and maybe ask you. I understand the competitive sort of dynamics and the higher yields and higher spending that you're getting per customer. What's the right way, possibly, to think about monthly active user growth, say, going forward throughout the rest of the year?

Thanks, Good morning, Adam.

I just wanted to follow up and maybe ask you I understand the competitive dynamics in.

The higher yields and higher spending and you're getting per customer.

What's the right way, possibly to think about you know.

Monthly active user growth say going forward throughout the rest of the year.

Yeah.

Adam Greenblatt: Firstly, hi, Joe. The answer is I don't have an answer for you today that is definitive. We're going to follow the data, and so we'll be investing where our predicted paybacks are achieved, and we optimize this multiple times a week. To try and give you, given the number of changes, given the number of moving parts, to try and forecast the profile of monthly actives, I think would be a degree of detail that inevitably would be incorrect. What we expect, however, is the impact of our strategy, the broad directional impact of our strategy to continue, which means that in sports, we should see a progressive easing in monthly actives.

Firstly hi, John.

The answer is I don't have an answer for you today that is the definitive it's really great. We're going to follow the data and so we will be investing where we're a payback predicted paybacks are achieved and we optimize this.

Multiple times a week.

Sorry to try and give you any given the number of changes given the number of moving parts to try and.

At forecast the profile of monthly actives, I think would be a degree of detail that's inevitably would be would be incorrect.

What we expect however is that the.

The impact of our strategy the broad directional impact of our strategy to continue which means that in sports, we should see a progressive easing and monthly actives, we should see a continued increase in <unk>.

Adam Greenblatt: We should see a continued increase in per-player values in sports. On the iGaming side, the effective work or the impact of our player management techniques that we implemented and refined last year in OSB, we're increasingly applying to our gaming business. You should see, and we're anticipating seeing it, a marginal trimming of the low-end, marginal players on our iGaming business too. We will be acquiring aggressively to fill up the bucket. Ultimately, what the profile of actives in iGaming will be the net effect of those two effects. The strategy, as ever, is quality over quantity.

Play of values.

In.

In sports and on the gaming side, the effective work says or the impact of our player management techniques that we implemented in refined last year in OSB, we're increasingly applying to our gaming business. So you should see and we were anticipating.

King.

Our marginal trimming of the low end marginal players.

Our I gaming business too, but we will be acquiring aggressively too.

Fill up the bucket so ultimately what the profile of back to deny gaming will be the net effect of those two effects.

Strategy as ever is quality over quantity.

Joseph Stauff: Appreciate the answer.

Joe Stauff: Appreciate the answer.

I appreciate the answer.

Adam Greenblatt: Thanks, Joe.

Thanks Chuck.

Operator 2: Your next question comes from Daniel Politzer with JPMorgan. Please proceed with your question.

Operator: Your next question comes from Daniel Politzer with JPMorgan. Please proceed with your question.

Your next question comes from Dan <unk> with J P. Morgan. Please proceed with your question.

Daniel Politzer: Good morning, everyone, and thanks for the question. To what extent, if any, have you seen the prediction market operators encroaching on the premium mass customer that you've come to focus on versus some of the others in your database? Have you seen any difference in behavior among the customers within the tiers of your database?

Dan Politzer: Good morning, everyone, and thanks for the question. To what extent, if any, have you seen the prediction market operators encroaching on the premium mass customer that you've come to focus on versus some of the others in your database? Have you seen any difference in behavior among the customers within the tiers of your database?

Good morning, everyone and thanks for the question.

What extent if any have you seen the prediction market operators encroaching on the premium premium mass customer that you've come to focus on versus some of the others. In your database have you seen any difference in behavior among among the customers within.

Within your database.

Adam Greenblatt: Hey, Dan. We're actually seeing the more premium parts of our database incredibly resilient. In fact, those are of the whole, if you imagine a pyramid of players, the higher up you get, the better performing our year-on-years and our players have performed. Actually, I think the impact of our strategy is proving to be correct or appropriate or resilient in these more turbulent times.

Hey, Dan.

We're actually seeing the more premium talks about database incredibly resilient in fact those are of the whole if you imagine a pyramid of players.

Higher up you get the better performing.

You are in euros and in all players have had.

Have performed so actually I think.

I think the impact of our strategy is is proving to be correct or appropriate.

Resilient.

These more turbulent times.

Daniel Politzer: Got it. Thanks so much.

Dan Politzer: Got it. Thanks so much.

Got it thanks, so much.

Operator 2: Your next question comes from Shaun Kelley with Bank of America. Please proceed with your question.

Operator: Your next question comes from Shaun Kelley with Bank of America. Please proceed with your question.

Your next question comes from Shaun Kelly with Bank of America. Please proceed with your question.

Shaun Kelley: Hi, good morning, everyone. Adam or Gary, just wanted to circle back on or stay on prediction markets and just ask, does the outlook that you've given embed a material improvement in the CAC environment from here? I mean, you sound optimistic that this may be a point in time. I definitely think there's a scenario out there at least where we actually think spending could increase as we move through World Cup and into the sort of NFL, which we think might be more about the peak acquisition period for some of these markets. Kind of what is your outlook embed and kind of how are you thinking about that trajectory, appreciating that it doesn't feel rational at the moment? It does feel like it could actually get worse.

Hi, good morning, everyone.

Yeah, Adam or Gerry just just wanted to circle back on your stay on prediction markets and just ask you know does the outlook that you've given embed a material improvement in the CAC environment from here I mean, you sound optimistic that this may be a point in time.

I definitely think there is a scenario out there at least where we actually think spending could increase as we move through World Cup and then does that sort of NFL, which we think might be more about the peak acquisition period for some of these markets. So kind of what does your outlook embed and kind of how are you thinking about that trajectory appreciating that it doesn't feel rational at the moment. It does feel like it could actually get worse.

Adam Greenblatt: Yeah. Listen, as I said in the opening remarks, Shaun, firstly, hi. We're controlling the controllables. I don't control what others choose to spend and the rational analysis underpinning that investment, right? We're assuming the current CPA environment prevails for the rest of the year. Our plan for the rest of the year and our guidance for the rest of the year takes that into account. I'm not assuming that what we believe to be irrational current spend suddenly becomes rational. I'm expecting that the land grab that is currently the reality continues. We are positioning ourselves for when that position changes. In terms of our longer-term guidance, we think we've got a terrific business underneath us. We have the telemetry in place to buy and maintain, acquire, and support our target players.

Yeah.

As I said in the opening remarks, Sean Firstly hi.

We're controlling the controllable I don't control, what others choose to spend in the irrational analysis underpinning that investments right. So what do we get what we are we are not assuming any we're assuming the current CPA environment prevails for the rest of the year and up at our plans for the rest of the year and our guidance for the rest of the year takes that into account.

So I'm assuming that's what.

What we believe to be irrational current spend suddenly.

Suddenly becomes rational.

Yeah, Yeah, I'm expecting that the land grab that.

That is currently the reality continues.

And we are positioning ourselves for when that position changes and in terms of our longer term guidance. We think we've got a terrific business underneath this we have the telemetry and place to buy in Manitex binds to acquire and support targets.

Target players and we will continue to right size our investments according to the market conditions in line with that strategy and in line with our target payback.

Adam Greenblatt: And we'll continue to right-size our investment according to the market conditions in line with that strategy and in line with our target payback. It's really as simple as that. To your point, will we see the spend go up before we see rational? I'm not sure. I wouldn't want to make any comments about others' decisions. But we're pleased with where we are positioned, and I think long term, the market is going to come back to us. And I think that is an exciting moment and exciting thing to look forward to for the online sports betting industry.

It's really as simple as that to your point will they continue to will we see the spend go up before that we see rational I'm.

I'm not sure I wouldn't want to make any comments about the in the other's decisions but.

Where we're pleased with where we are positioned and I think long term.

Long term the market is going to come back to us.

I think that is an exciting moment, an exciting thing to look forward to for the online sports betting industry.

Shaun Kelley: Makes a lot of sense. Thank you.

It makes a lot of sense. Thank you.

Yeah.

Operator 2: Your next question comes from Monique Pollard with Citi. Please proceed with your question.

Operator: Your next question comes from Monique Pollard with Citi. Please proceed with your question.

Your next question comes from Monique Pollard with Citi. Please proceed with your question.

Monique Pollard: Hi. Adam, Gary, thank you for taking my question. Following on from the last question, in terms of your 2027 guidance, so that $500 million of EBITDA that you still see the pathway to for next year, I'm just wondering what gives you the confidence that you can still achieve that if we're going to come in at the lower end of the EBITDA range for this year? Whether, understand for this year, you're not assuming any change in the CPA environment, but whether in 2027, there is a natural assumption that there's a bit more rationality in terms of CPAs. Thank you.

Hi, Hi, Gary Thank you for taking my question.

Following on.

From from the last question in terms of your 'twenty 'twenty seven guidance say that 500 million of EBITDA that you still see the pathway T. For next year I'm. Just wondering what gives you the confidence that you can still achieve that if we're going to come in at the lower end of the EBIT dollar range for this year and weather.

Understand so this year, you're not assuming any change in the CPA environment, whether in 2027. There is a natural assumption that that is a bit more rationality in terms of CPI.

Yes.

Adam Greenblatt: I mean, the starting point is that we have a really healthy business. We have a business where on the gaming side, where we're pushing on $2 billion of revenue, and we've got so many exciting things for our players in our pipeline. As I said in my opening remarks, the best game on the retail floor, Gold Blitz, and the franchise of Gold Blitz is now BetMGM's exclusively for the initial period when it's of most interest to real gamers. What we're seeing is player values are going up. NGR per player is going up. We're getting more and more out of Nevada. We're getting more out of omnichannel. We've got a lot of exciting things coming. Sure, it's a one-off. We have the World Cup this year, but it's a stimulus of growth.

I mean, the starting point is that we have a really healthy.

Business.

You know, we have a business where on the on the gaming side, where we're pushing on $2 billion of revenue and we've got so many exciting things for all players in our pipeline.

As I said in my opening remarks.

With the.

The best game on the retail floor gold blips in the French size of Goldblatt is is not bad mgm's exclusively for the initial period when it's of most interest to two real games.

What we're seeing is player values are going up NGL per players going up.

We're getting more and more out of Nevada, we're getting more out of Omnichannel.

And we've got a lot of exciting things coming you know we have sure. It's a one off we have the World Cup. This year, but it's the stimulus of of growth. We have most excitingly I think for this year.

Adam Greenblatt: Most excitingly, I think, for this year, we have Alberta launching now, confirmed 13 July 2024. Alongside that, what I believe to be our sleeping giant of a casino brand, the Borgata, particularly relevant in the Northeast. We're refreshing that brand and repositioning that for a different audience, a different demographic, to seek to expand our relevance to even more gamers versus the BetMGM core brand. We see no bottom of premium players. You put all of that together, combined with the potential for another new iGaming state next year in Virginia, combined with the potential, not certainty, of course, the potential for a more rational sports marketing environment, sports CPA environment, you can quite easily see a pathway. Now, are there risks? Sure. Do we remain confident that that is achievable? Yes. That's, I think, the balance, Monique Pollard.

Alberto launching now confirmed 13th of July.

Alongside that Oh, what I believe to be our sleeping giant of a casino brand the borgata, particularly relevant in the in the northeast we're refreshing that brand.

Repositioning that for a different audience, a different demographic to seek to expand our relevance to even more games versus the better bet MGM call Brent.

And we see no debt.

No bottom.

<unk> premium players.

And so you put all of that together.

Combined with the potential for another.

Another new I gaming state next year in Virginia, combined with the potential not certainty of course, the potential for a more rational sports.

Sports marketing environments with CPA environments, you can quite easily see a pathway.

Now are there risks Shaw.

But do we remain confident that that is achievable yes.

And that's I think the balance money.

Monique Pollard: That's understood. Thank you. Your next question comes from Ben Chaiken with Mizuho. Please proceed with your question.

Monique Pollard: That's understood. Thank you.

That's understood. Thank you.

Operator: Your next question comes from Ben Chaiken with Mizuho. Please proceed with your question.

Your next question comes from Ben Chaiken with Mizuho. Please proceed with your question.

Ben Chaiken: Hey, thanks for taking my question. I'd like to dig into iGaming a little bit. Just if we could open up how you're thinking about growing this business, how you're thinking about the underlying core trends here. Do you think we've kind of peaked in terms of the core underlying user growth? What levers are at your disposal, both 2026 and 2027? Thanks.

Hey, Hey, thanks for taking my questions I'd like to dig into I gaming a little bit just if we could open up how youre thinking about.

Growing this business how are you thinking about the underlying core trends here.

Do you think we've kind of peaked in terms of the core underlying user growth and then what levers are at your disposal, both 'twenty six 'twenty seven.

Adam Greenblatt: Yeah. Thanks, Ben. I'll take that. Gary, if you want to chime in or, obviously, jump in. Look, in gaming, what we're aiming to do over the next 24 months is build on our powerful success and our momentum. The strategy that we've spoken multiple times about before in terms of content continues. Exclusive content, and we have a new pipeline of even more titles. That strategy continues. To name a few, we're at the dawn, the early stages of our The Wizard of Oz franchise and Wheel of Fortune. We just launched the Survivor game. It's its 50th anniversary. Gold Blitz, I've talked about. BetMGM is positioning ourselves in the sector, in the market as the home of entertainment, and that builds on MGM Resorts' right to win, if you like, in that positioning.

Yeah.

Thanks Ben.

Takes that Guy if you want to chime in on for obviously jump in.

Okay gaming, what we are aiming to do over the next 24 months is built on a powerful success and our momentum.

And that's the strategy that we've spoken multiple times about before in terms of content continues.

Exclusive content and we have a <unk>.

Pipeline of even more titles.

That strategy continues.

To name a few we're at the we're at the Dawn of the early stages of a wizard of Oz franchise of wheel of Fortune. We just launched the survivor game. Its a 50th anniversary goalposts I've talked about that MGM is positioning ourselves in this sector in the markets as the home of entertainment and that builds on MGM resorts.

Right to win if you like.

In that positioning we are capitalizing on the the.

Adam Greenblatt: We are capitalizing on the talents and expertise of MGM Resorts' entertainment prowess in a number of dimensions. The other elements of our strategy that has been extremely successful, our players have enjoyed interacting with our engagement tools. We're seeing, on average, many days a week of engagement from our whole player base. So those are players that come and have a live session with BetMGM many days a week. Live is something that we are leaning into, and it really lives at the intersection of some of the things I've just talked about. So if you go into the MGM Grand, you can see there's a live studio in the casino which powers our Ontario business. We think that is a format from which we can build, and we have some plans that we're working with MGM Resorts on to continue to do that.

The talents and expertise of MGM resorts entertainment prowess.

And a number of dimensions.

We have also.

Other elements of our strategy that has been extremely successful a players have enjoyed.

Enjoyed interacting with our engagement tools, we're seeing.

On average many days a week of engagement from our whole player base. So those all players that come in have a session life session with bet MGM many days a week.

Live is something that we're leaning we are leaning into and its really lives at the intersection of some of the things I've just talked about so if you go into the MGM Grand you can see there's a live studio in the casino, which powers, our Ontario business. We think that is a format from which we can build.

And have some plans that we're working with MGM resorts on.

To continue to do that.

Adam Greenblatt: The last area is obviously the area of jackpots. We gave out, I think, in 2025, over $140 million to our players in jackpots, and that's another reason to come to BetMGM. Now, your last question is, have we got to the end of all the players that are interested in the category playing? I would say no, and refer to a statistic which I've referred to in previous calls, which is, the potential depth of this market in the US is, I find, just staggering. The statistic is this. I think it was published by the AGA. In 2019, obviously before COVID, over 40% of US adults visited some kind of casino property during the year.

And the last areas obviously.

The Arab jackpots.

We gave out I think in 2025 over a $114 million to our players and jackpots and that's another reason to come to bet MGM now.

Question.

Last question is have we got to the end of the all.

While all the players that are interested in the category playing.

And I would say no and referred to a statistic, which I've referred to in previous calls which is.

The potential depth of this market in the U S is.

Find just staggering and the statistic is this.

Think was published by the AGM in 2019 are.

Obviously before Covid.

Over 40% of the U of U S. Adults visited some kind of a casino property during the year.

Adam Greenblatt: Now, if you assume that that is the potential market, that's the base of adults who have a positive disposition towards the category, then I think we have a long way to go.

Now if you assume that that is.

Potential markets.

That's the base of <unk> of adults, who have a positive disposition towards the category.

I think we have a long way to go.

Ben Chaiken: Thank you.

Thank you.

Operator 2: Your next question comes from Ben Shelley with UBS. Please proceed with your question.

Operator: Your next question comes from Ben Shelley with UBS. Please proceed with your question.

Your next question comes from Ben Shelly with UBS. Please proceed with your question.

Ben Shelley: Thanks very much for taking my question. I just wanted to ask about EBITDA cadence and delivery. Could you briefly talk about the seasonality of EBITDA generation through the year and how that cadence supports delivery of your revised EBITDA guidance? Thank you.

Thanks, very much for taking my question I just wanted to ask about EBITDA cadence in delivery could you briefly talk about the seasonality of EBIT dollar generation through D. Yet on how that cadence supports delivery of your revised EBITDA guidance. Thank you.

Adam Greenblatt: Sure. Look, when we look at it from the year, you've got a period in the middle of the year that turned out to be very good for us last year. We had really good results. We're back weighted somewhat. We expect that the Q4 is a place where we're going to have the most. I don't think you could look at it as dramatically different across the year other than the fact that we spike in Q4. We expect to have Q2 and Q3. If you were to normalize, Q1, Q2, and Q3 wouldn't seem that different from Q1. Obviously, we had the setback with the results in Q1. Look at the middle of the year to be strong, and then, the Q4 is typically sort of double those middle-of-the-year months.

Gary Deutsch: Sure. Look, when we look at it from the year, you've got a period in the middle of the year that turned out to be very good for us last year. We had really good results. We're back weighted somewhat. We expect that the Q4 is a place where we're going to have the most. I don't think you could look at it as dramatically different across the year other than the fact that we spike in Q4. We expect to have Q2 and Q3. If you were to normalize, Q1, Q2, and Q3 wouldn't seem that different from Q1. Obviously, we had the setback with the results in Q1. Look at the middle of the year to be strong, and then, the Q4 is typically sort of double those middle-of-the-year months.

Sure.

Look when we look at it from the year.

You've got a period in the middle of the year turned out to be very good for us last year, we had really good results.

Were back weighted somewhat we expect it to fourth quarter is a place where we're going to have the most but I mean I don't think you can look at it is dramatically different across the year other than the fact that we spike in fourth quarter.

We expect to have Q2 and Q3, if you were to normalize Q1, Q2 and Q3 when seem that different from Q1, obviously, we had the setback with the with the results in Q1. So if I look at the middle of the year to be strong in any of the fourth quarter is typically sort of double those metal beer months.

Ben Shelley: Thanks very much.

Thanks very much.

Operator 2: Your next question comes from David Katz with Jefferies. Please proceed with your question.

Operator: Your next question comes from David Katz with Jefferies. Please proceed with your question.

Your next question.

Comes from David Katz with Jefferies. Please proceed with your question.

David Katz: Hi. Good morning, everyone. Thanks for taking my question. Appreciate all the commentary. I understand that ocean of competitive spendings, right? The way we've often seen that is that there's that initial wave of competitive spending that buys customers off, and depending on what the experience and the product is, that can be temporary. I wonder if you have any insight to the degree that these sort of unlicensed competition is buying customers out of your ecosystem, and whether you're seeing any duration to that, and whether they return over time as we've seen historically.

Hi, Good morning, everyone. Thanks for taking my question I appreciate all the commentary.

When.

I, you know I understand that ocean.

Competitive spending.

And the way you know.

We've often seen that goes.

You know that there is there is that initial wave of competitive spending that buys customers off and depending on what the experience and the product goes that can be temporary I wonder if you have any insight to the degree that you know.

As these sort of unlicensed competition is buying customers.

Out of your ecosystem and whether youre seeing any duration.

To that and whether you know that.

They return over time.

As we've seen historically.

Adam Greenblatt: David, I'll jump on the end of the question. Firstly, thanks for the question. I'll jump onto the end of it right off the bat, which is my expectation is that the majority of these players will return over time because the product experience in online sports betting is better. Our ability to reinvest in that player is greater because we retain more margin than any single participant in prediction markets. We have a higher service level, and because of, certainly on BetMGM side, our relationship with MGM allows us to reward in a way that digital-only does not. I think for a number of reasons, the value proposition of BetMGM and quite frankly, the online sports betting sector is better for most players, but not all players, right?

David I'll jump on the end of your question, especially thanks for the question I'll jump on to the end of its rivals the best which is my expectation is that the majority of these players will return over time.

Because the product experience and online sports betting is better.

Our ability to reinvest in that player is greater because we retained more margin than any single participant in prediction markets.

And we have a higher service level and because certainly on bet MGM side, our relationship with MGM allows us to reward in a way that's digital only does not it does not.

So I think for a number of reasons the the.

The value proposition.

I'll bet MGM and frankly, the online sports betting online sports betting sector is better for most players.

But not all place right. If you are a professional player. If you were a market maker. If you are a kid in high school. Unfortunately.

Adam Greenblatt: If you are a professional player, if you are a market maker, if you are a kid in high school, unfortunately, there isn't really a better place for you than the prediction markets if you want to bet on sports. That's not our customer. I found it relevant that Kentucky just clarified its own online sports betting laws to ensure that the youngest person that can play is 21. This is a good thing for obvious reasons. Put all that together, what we are seeing is in the prediction markets. Someone described it to me like, where is it going to end? It's going to end with the hardcore grinder poker environments where you have shark on shark violence. Because what's going to happen?

There isn't really a better place for you than the prediction markets. If you want if you want to bet on sports.

But that's not our customer.

I found it a.

Relevance that's.

Yeah.

Kentucky, just clarified it's earned online sports betting laws to to ensure that the the youngest person that can play in 'twenty one.

This is a good thing.

Now for obvious reasons.

And so put all that together what we're seeing is in the prediction markets we're seeing.

Someone described it to me like we're just going to and it's going to end with like the hardcore.

Grind poker environments, where you have shell can chalk violence.

Because what's going to happen what do we have we seen already seen happening and where do other exchange markets in this space and up in other parts of the world. What happens is the recreational players flow back in time majority of recreational players slowed back in time to prediction markets.

Adam Greenblatt: What have we already seen happening, and where do other exchange markets in this space end up in other parts of the world? What happens is the recreational players flow back in time. Majority of recreational players flow back in time to prediction markets. Shark customers who don't otherwise have a place to play are in the prediction markets. Recreational players lose too quickly, and there's data for this. Hopefully, underage players stop playing. You put all those together, I think it paints a picture of what the future of prediction market ecosystem for sports looks like.

Sharp customers, who don't otherwise have a place to to play or in the or are in the prediction markets.

Recreational players lose too quickly.

And this data at Fortis and and hopefully underrated players stopped play.

So you put all those together I think it paints a picture of what the future of prediction market ecosystem for sports looks like.

David Katz: Thank you.

Thank you.

Operator 2: Your next question comes from John DeCree with CBRE Capital Advisors. Please proceed with your question.

Operator: Your next question comes from John DeCree with CBRE Capital Advisors. Please proceed with your question.

Your next question comes from John Decree with CBRE Capital Advisors. Please proceed with your question.

John DeCree: Hi, guys. Thank you. Covered a lot of ground so far. Adam, I think you mentioned Virginia at least once in your response to questions. Curious if you could give us your high-level thoughts on iGaming legislative process. We saw some momentum in Virginia, Maine. Are you seeing, or are your folks on the government affairs side telling you there's increased interest from legislators? What's your kind of view today, and the outlook?

Hi, guys. Thank you.

Covered a lot of ground so far Adam I think you mentioned, Virginia at least once in your response to questions, but curious if you could give us your high level thoughts on gaming legislative process, we saw smoke met them in Virginia, Maine are you seeing.

Or are your folks on the government affairs side, telling you. There is increased interest from from legislators, what's your kind of view today and the <unk>.

Outlook.

Okay.

Adam Greenblatt: I'll start with the one I like to talk about most, which is Virginia, because I feel pretty positive about the likelihood of us seeing enabling legislation in 2027 in Virginia. We've obviously seen legislation passed in Maine, that's subject to the people's vote. Look, it's a small state, and the economic potential is small. I think in previous comments I said that it's not a needle mover one way or the other, but directionally, having more states adopting iGaming is definitely a good thing. I remain positive that this is going to see momentum pick up. The reality, John, is that every state is a different set of political considerations. It's not only the demeanor of the legislature, it's also the presence of naysayers on the ground. Some incumbent retail casinos are pretty active in their no campaigns.

So I'll start with the one I'd like to talk about most witches, Virginia, because I feel pretty positive about the likelihood of us seeing enabling legislation in 2027.

In Virginia, we've obviously seen legislation passed in Maine.

That's subject to the People's vote is.

It's not a small state.

Economic potential is small I think in previous comments I said that it's not a needle mover one.

One way or the other but directionally, having more more states adopting I gave you is a good thing.

It is definitely a good thing.

<unk>.

I remain positive that this is going to see them.

Yeah.

[noise] momentum pick up.

But the reality Jamie is that every state has a different set of political.

Cool considerations.

It's not only the Dominion road the legislature, it's also the.

Presence of <unk>.

May say is on the ground the incumbents.

Some incumbent retail casinos.

Are pretty active and there are no campaigns.

Adam Greenblatt: It's not without its complexity, but I do think directionally, we are going to see more momentum in the coming years.

So it's not without its complexity, but I do think directionally, we are going to see more momentum in the coming in the coming years.

Adam Greenblatt: It's not without its complexity, but I do think directionally, we are going to see more momentum in the coming years.

John DeCree: Thanks, Adam.

Thanks, Adam.

Adam Greenblatt: Sure.

Okay.

Operator 2: Your next question comes from Jordan Bender with Citizens. Please proceed with your question.

Operator: Your next question comes from Jordan Bender with Citizens. Please proceed with your question.

Your next question comes from Jordan Bender with citizens. Please proceed with your question.

Jordan Bender: Hi, everyone. Thanks for the question. I'm going to follow up on Joe's question from earlier on the call around player growth. Your comments around how it's hard to model what growth might look like later in the year, has that always been the case that visibility is hard to model six to nine months out, or has prediction market spend clouded your visibility to where you really don't know what the customer acquisition environment is outside of what you're seeing here in the near term?

Hi, everyone. Thanks for the question.

Kind of follow up on Joe's question from earlier on the call around player growth your comments around how it is hard to model.

What growth might look like later in the year is that always been the case that visibility is hard to model 69 mile salad or his prediction market span cloud and your visibility to where you really don't know why the customer acquisition environment is outside of what you are seeing here in the near term.

Adam Greenblatt: Yeah, look, I think it's the latter. Let me just jump there, Jordan. Firstly, thank you for your analysis. I enjoy some of your prediction market pieces. It's the latter. As we look at BetMGM's plan for the rest of the year, quite a lot of things are changing. We're changing some things in response to the external environment. With change comes outcome uncertainty, obviously. The reason I pause about giving some longer-term guidance or guidance on the active for the rest of the year is because it will be the outcome of a number of moving parts, which makes it a little bit more complicated to model. That's it.

Yeah look I think the.

Where your your.

I think its the latter I mean, just jumped agile and especially thank you for your analysis I enjoy your some of your prediction market thesis.

It's the latter.

As we look at <unk> are planned for the rest of the year.

Quite a lot of things are changing so we're changing some things in response to the external environment.

And with change comes outcome uncertainty, obviously and so the reason I pause about giving some longer term guidance both with guidance on this on the active for the rest of the year is because it will be the outcome of a number of moving parts, which makes it a little bit more complicated to model.

It's and that's it.

Gary Fritz: Yeah, against our internal projections, we have had higher player values, higher handle per active than what we expected coming into the year, and the player counts have been lower, and the overall net impact is up. It's balancing those multiple metrics together. When we talk about things like handle, the hold has a factor on how the handle spins up. We dial up and look at all those metrics. Overall, the theme is we continue to see higher than expected player values.

Gary Deutsch: Yeah, against our internal projections, we have had higher player values, higher handle per active than what we expected coming into the year, and the player counts have been lower, and the overall net impact is up. It's balancing those multiple metrics together. When we talk about things like handle, the hold has a factor on how the handle spins up. We dial up and look at all those metrics. Overall, the theme is we continue to see higher than expected player values.

Yeah, I mean, we had against our internal projections, we have had higher player values higher handle proactive.

What we expected coming into the year and the player counts have been lower in the overall net impact to us.

But.

It's balancing those multiple metrics together and when we talk about things like handle the Holt has a factor on how they handle spins up so we dial up and look at all those metrics, but overall the theme is we continue to see higher than expected player values.

Adam Greenblatt: Just finally, Jordan, for clarity, Gary, I think, has the most sophisticated model that this industry has ever seen, which he's very proud of, and we model bottom-up on everything from number of players by state, by product. We do have the numbers, but I don't want to give direction on them because of the risk profile of every aspect in the model, given the number of moving parts.

And just finally John for clarity.

We.

Gary I think has the most sophisticated model that this industry has ever seen which is very proud of and we measure.

Muddled buttoned up on everything from a number of players by state by product by them. So we do have the numbers, but I don't want to give direction on them because of the the risk profile of every aspects in the model given the number of moving parts.

Jordan Bender: Great. Thanks, guys.

Great. Thanks, guys.

Adam Greenblatt: Okay.

Okay.

Operator 2: Your next question comes from Richard Stuber with Deutsche Bank. Please proceed with your question.

Operator: Your next question comes from Richard Stuber with Deutsche Bank. Please proceed with your question.

Your next question comes from Richard Stuber with Deutsche Bank. Please proceed with your question.

Richard Stuber: Thank you. Good morning. Just a quick question on Nevada. You mentioned a few times that it's the core strength. How material now is the contribution from Nevada? Out of the $116 million reported, how much of that now is from Nevada? Thank you.

Thank you.

Good morning.

Quick question on in Nevada.

You mentioned, a few times that it's definitely cool spent.

Accrual amount is the contribution from Novartis after 115 million reported how much of that now.

Nevada.

Adam Greenblatt: Gary, I'm just looking at you. I think we gave some indications of Nevada's importance, its contribution last call. Not sure if that was prepared for this call.

So I.

I think we gave Gary I'm just looking at you as I think we gave we gave some indications of Nevada is important its contribution last call not sure if that was prepared for this call.

Adam Greenblatt: Gary, I'm just looking at you. I think we gave some indications of Nevada's importance, its contribution last call. Not sure if that was prepared for this call.

Gary Fritz: No, I don't think we pulled it for this call. Last call, I think we said it was a quarter of about EBITDA generation came from Nevada.

Gary Deutsch: No, I don't think we pulled it for this call. Last call, I think we said it was a quarter of about EBITDA generation came from Nevada.

No I don't the replay for this call, but it was last call I think we said it was a quarter of EBITDA generation came from Nevada.

Adam Greenblatt: Probably a little bit less than that this time, given the sports results were relatively weaker during this quarter compared with gaming.

Probably a little bit less than that at this time given the.

Sports results were relatively weaker during this quarter compared with gaming.

Richard Stuber: Thank you.

Okay. Thank you.

Adam Greenblatt: Okay.

Right.

Operator 2: We will now take our last question from Robin Farley of UBS. Please proceed with your question.

Operator: We will now take our last question from Robin Farley of UBS. Please proceed with your question.

We will now take our last question from Robin Farley of UBS. Please proceed with your question.

Robin Farley: Great. Thank you. Just wanted to circle back to your comment about what you're seeing with the spend from prediction markets being not sustainable. I know you don't necessarily know whether that means it's going to be a quarter or a year. I don't know if you have any would add on that, just also wondering how that's impacting your middle-tier customer versus higher-tier versus lower-tier, sort of equally in terms of the impact from what the prediction markets are doing or any color around that. Thanks.

Great. Thank you just wanted to circle back to comment.

Comment on Mt.

You are seeing with the sentence that seemed like a thing that is sustainable.

I know you you don't necessarily know whether that means it can be a quarter or a year right. Okay. And then I would add on that that would also wondering how that's impacting.

Your middle tier customers versus higher tier versus lower tier sort of equally in terms of the impact from the two markets you're doing any color on that.

Thanks.

Adam Greenblatt: Yes, I think similar to one of our previous questions, the higher up our value pyramid you go, the more resilient our players are proving to be. To focus to your question, if you focus on the bottom end of the pyramid, again, there are two factors driving relative softness versus the top half of the pyramid. One may well be the spend of prediction markets. The other may well be, and frankly is because the dynamic was happening before the prediction market spend, the work that we're doing on player management and ensuring that we put the right dollars into the right players' pockets by way of reinvestment. Right at the bottom of the pyramid, those players who may well be more susceptible to sampling, to the marketing of prediction markets.

Yes.

So I think similar to one of our previous questions. The most resilient the higher up all our value pyramid you go the more resilient.

Players are proving to be.

And so then we can send to focus to your question. If you focus on the bottom end of the pyramid again, there are two factors.

Driving relative softness versus the top of the pyramid, one may well be the spend of prediction markets.

The other may well be Oh, and frankly is because of the dynamic was what's happening before the prediction market spend are the work that we're doing on Playa management and ensuring that we put the right dollars into the right players pockets by way of Reinvestments and right right at the bottom of the of the pyramids those places.

They will be more susceptible to.

Something to the market, there's a marketing a prediction markets.

Adam Greenblatt: At the same time as they're being courted, we are reinvesting less in them, so that it might be a twofold impact. As I say, if you zoom out, notwithstanding a weak margin quarter in our sports business, we're still up year-on-year, notwithstanding all of these factors. I think back to, again, even higher. I think we are on the right track. Our strategy suits the market, and I think our strategies are enduring.

At the same time as they are being courted.

We are putting we are reinvesting less in them so that it might be a twofold impact, but you know as <unk>.

Sorry, if you zoom out we're still notwithstanding a weak margin quarter in our sports business. We are still up year on year. Notwithstanding all of these factors. So I think back to again, even higher I think we are on the right track our strategy suits the market and I think our strategies are enduring.

Robin Farley: Thank you. Just as a follow-up, is it possible for you to quantify, and maybe it's not, but how much of that bottom end of the pyramid is you intentionally culling those customers versus them being pulled by the prediction markets? I don't know if you can.

Thank you and just as a follow up is it possible for you to quantify and maybe it's not but how much is that by the end of the pyramid, if you intentionally calling those customers versus them being pulled by the market.

Can.

Adam Greenblatt: Yes

Yes.

Robin Farley: Quantify how much.

Adam Greenblatt: I think it's too difficult to parse out. What you can see and measure is the outcome rather than the fact that what was in the minds of the player as they made that decision. It's quite challenging.

I think I think it's too difficult to parse out what you can see and measure is the outcome rather than the fact that you know what was in the minds of the player as they made that decision. So I would say it's quite challenging.

Robin Farley: Okay, great. Thank you.

Okay, great. Thank you.

Adam Greenblatt: Okay.

Okay.

Operator 2: Thank you. That concludes the Q&A session. I will now turn the call over to Adam for his closing remarks. Please go ahead.

Operator: Thank you. That concludes the Q&A session. I will now turn the call over to Adam for his closing remarks. Please go ahead.

Thank you that concludes today's Q&A session I will now turn the call over to Adam first closing remarks. Please go ahead.

Adam Greenblatt: As ever, I just wanted to thank you very much for attending. As you've heard a few times from both Gary and I, we are focused on executing our strategic plan, and I'm personally very optimistic for not only the rest of this year, but the years beyond that. We look forward to updating you all next quarter, and just thanks again, and speak to you then. Bye-bye.

So as that but I just wanted to thank you very much for attending.

As you've heard a few times from from both Gary and I, we are focused on executing our strategic plan and our personnel.

Personally very optimistic.

For what not only the rest of this year, but the euro is beyond that group.

And so we look forward to updating you all next quarter and just thanks again and speak to you then.

Bye.

Operator 2: This concludes today's business update. Ladies and gentlemen, thank you for participating. You may now disconnect.

Operator: This concludes today's business update. Ladies and gentlemen, thank you for participating. You may now disconnect.

This concludes todays business update ladies and gentlemen, thank you for participating you may now disconnect.

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