PENN

PENN's FY2025 looks catastrophic at the headline — net income of -$843M, EPS of -$5.83, operating income of -$674M, and ROE of -46% — but the damage is dominated by a non-cash event. Management disclosed an $825.0M goodwill impairment on the Interactive (digital) reporting unit after its carrying value exceeded fair value; strip that out and operating income is roughly breakeven-to-slightly-positive. The cleaner read is operating cash flow, which actually rose 41.4% to $508M. So the core retail casino/racetrack portfolio across 28 North American jurisdictions still throws off cash even as the income statement screams crisis. At $22.06 the market cap is just $2.95B against $6.96B of revenue (P/S 0.4), pricing in continued digital failure rather than any recovery.

The real story is the implosion and reset of the online strategy. On Nov 6, 2025 PENN mutually terminated its ESPN BET sportsbook deal — the exclusive ESPN BET trademark right ended Dec 1, 2025 — and rebranded U.S. OSB to theScore Bet, leaning on theScore media app's ~4M monthly active users and an iCasino-forward pivot. This is the second failed major OSB brand bet (Barstool, then ESPN), and the goodwill writedown is the accounting admission that the prior digital thesis didn't pencil out. The 10-K's own sensitivity table is a yellow flag: a 10% cut to forecasted Interactive revenue/EBITDA would trigger a further ~$105M impairment, so more non-cash hits are plausible if the theScore relaunch underwhelms.