PENN Entertainment, Inc.

Greetings, and welcome to the Penn Entertainment Second Quarter 2026 Earnings Call. I would now like to turn the conference over to Joe Cifoni, Investor Relations. Please go ahead.

Thank you, Tasha. Good morning, everyone, and thank you for joining Penn Entertainment's 2026 Second Quarter Conference Call and Webcast. We'll get to management's comments and presentation momentarily, as well as your Q&A. And during Q&A, we ask that everyone please limit themselves to one question and one follow-up. I'll briefly review the safe harbor disclosure and then we'll get right into the call. Please note that today's discussion contains forward-looking statements. Forward-looking statements involve risks, assumptions, and uncertainties that could cause actual results to differ materially. For more information, please see our press release for details on specific risk factors. It's now my pleasure to turn the call over to Penn CEO Jay Snowden. Jay, please go ahead.

Thanks, Joe, and good morning. I'm joined here by Felicia Hendrix and Aaron LaBerge, as well as other members of the senior management team. As you'll see from our release and investor presentation, we continue to execute against our 2026 strategic priorities during the second quarter. We're on track to deliver more than 20% year-over-year adjusted EBITDA growth this year, driven by strong performance across our retail portfolio and significant adjusted EBITDA improvement in our interactive segment. This growth, combined with our corporate overhead optimization, is benefiting cash flow growth, which in turn is enabling us to de-lever our balance sheet this year faster than originally expected. Penn's best-in-class property-level management teams delivered impressive results for the retail segment, achieving record quarterly revenues in Q2. This performance was reflected across the portfolio, with nine properties setting Q2 records for both revenues and adjusted EBITDA. We also saw another quarter of year-over-year growth in rated revenue, supported by meaningful contributions from mid- and high-worth customer segments, as well as growth in unrated revenue, which has now increased in five of the last seven quarters, underscoring broad-based consumer demand. This momentum continued through July. Slide 8 in our investor presentation highlights the combination of internal growth drivers and external market tailwinds that support our longer-term retail growth outlook. including our Pen Play loyalty program and omnichannel strategy, our strategic investments in both gaming and non-gaming amenities, our ongoing retail development project pipeline, limited new competitive supply, and third-party investments that are helping to drive economic growth in a few of our key markets. The interactive segment delivered another quarter of meaningful adjusted EBITDA improvement year-over-year as we continue to execute on our strategy of focusing on growth in our US iCasino and Canadian operations to improve profitability. Our US Hollywood-branded standalone casino app generated quarter-over-quarter as well as year-over-year growth, achieving record revenues in Q2. Our Ontario gaming operations continued to gain momentum, supported by strong growth in OSB revenues, aided by solid World Cup engagement and cross-sell of the reactivated World Cup OSB user base into iCasino. Revenue in the quarter was negatively impacted by customer-friendly online sportsbook outcomes. particularly in June during the NBA Finals and World Cup, as well as lower volumes in part due to our reduced marketing spend, lower value and unprofitable customer segments. Importantly, this shift is improving our marketing efficiency and is consistent with our disciplined approach to managing the interactive business that we outlined earlier this year. Notably, while our OSB hold rate was flat Euro of the year to date, our OSB net win rate improved. We saw encouraging interactive engagement trends during the World Cup. Approximately 70% of our Sportsbook users placed a World Cup wager with approximately 45% of those World Cup bettors placing a soccer wager for the first time. This event served as a meaningful engagement and reactivation opportunity for us heading into the NFL season. On July 13th, we launched the Scorebet Sportsbook and Casino and our standalone iCasino apps, the Score Casino and Hollywood Casino in Alberta, Canada. While still early, we are encouraged by our Alberta user and handle volumes on a per capita basis and believe our exclusive strategic partnership in Canada with the Toronto Blue Jays will complement the strength of the Scorebet brand there. Our expected investment in Alberta remains approximately $20 million for the year, and our 2026 interactive segment adjusted EBITDA guidance is unchanged at a loss of $20 million, which Felicia will discuss in more detail in a few minutes. But first, I want to cover some updates on our exciting retail development projects. Hollywood Casino Joliet, which opened last August, continued to deliver strong results in Q2, and that momentum has continued into early Q3. Our team there is doing a great job Meanwhile, M-Resort continues to capture previously unmet demand and drive enhanced property performance following the opening of our new hotel tower last December. M-Resort generated record net revenue and adjusted EBITDA in Q2, and notably we hosted three of our top five largest groups by revenue ever during the quarter. We recently opened our new hotel tower at Hollywood Columbus on June 12th, strengthening our position as the leading regional gaming destination in the state of Ohio. The property generated an all-time net revenue record in July, the first full month with the hotel open. Over the hotel's first month and a half of operations, we have seen outer market guests account for 85% of hotel cash revenue, which again speaks to it being a regional gaming destination. Additionally, over that same timeframe, rated guests have increased their average daily worth by 10% when staying at the hotel. Our final of the four growth projects, Hollywood Casino Aurora, opened on June 24th, and while still early, has been showing strong growth KPIs, approximately doubling admissions, slot volumes, table volumes, and non-gaming revenues versus prior year levels. Our hotel is also attracting higher worth customers, with our rated guests generating 21% higher average daily worth when staying at the property. The property is also driving trial and expanding our reach in the market as 20% of our guests since opening have been new to Hollywood Aurora. Additionally, 25% of our guests since opening were reactivated customers. Up next in the pipeline will be the relocation of Hollywood Council Bluffs. which is expected to open in 2028. This project will convert a first-generation riverboat casino license into a modern and more efficient land-based facility that will connect seamlessly with our existing 444-room hotel. We believe the new property will greatly enhance our competitive positioning in the greater Omaha market. The project has an anticipated construction budget of $180 to $200 million. That budget, the programming, and the design will be very similar to the new Hollywood Joliet in Illinois. And with that, I'll turn it over to Felicia.