Churchill Downs Records Significant Earnings Growth Fueled by Historic Horse Racing Machines
Churchill Downs Incorporated (CDI) recently unveiled impressive financial results for the summer quarter, showcasing a significant 9% surge in revenue compared to the same period in 2024. The company achieved a record-breaking $262 million in earnings before interest, taxes, depreciation, and amortization (EBITDA), primarily driven by the exceptional performance of historic horse racing (HHR) machines. This financial upswing highlights CDI's strategic expansion in the gaming sector, particularly in key states like Virginia and Kentucky, and underscores the growing profitability of its diversified operations, including its temporary casino facility in New Hampshire.
The financial report, released after the stock market closed on Wednesday, covered the period from July 1 to September 30. During this quarter, CDI's HHR machines generated an additional $30 million in revenue from Virginia and nearly $21 million from Kentucky, demonstrating their strong market acceptance and contribution to the company's financial health. Furthermore, the temporary casino in Salem, New Hampshire, added an extra $2 million to the revenue streams, contributing to the overall positive performance.
The Louisville, Kentucky-based company reported a net revenue of $683 million, marking an increase of over $54 million compared to the same quarter in the previous year. While the net income attributable to CDI saw a decrease of $27 million, or 42%, to $38 million, this was primarily due to a one-time, non-cash impairment. This impairment reflects a reevaluation of a cash-generating asset where its book value exceeded its recoverable amount. However, the adjusted net income attributable to CDI demonstrated resilience, climbing by $5 million, or 7%, to $77 million. The adjusted EBITDA also saw a substantial rise of $27 million, or 11%, reaching a new record high.
Beyond the financial figures, Churchill Downs also highlighted several strategic achievements during the third quarter. A notable announcement included NBC Sports' decision to televise the 2026 Grade 1 Kentucky Oaks at night, a move expected to boost the event's visibility and appeal. The company also completed the expansion of its Rosie's casino in Richmond, Virginia, and acquired a 90% stake in Casino Salem in New Hampshire, further cementing its presence in the gaming market. Additionally, a new Rosie's location was opened in Henrico County, Virginia. These operational expansions and strategic investments underscore CDI's commitment to growth and market diversification.
In terms of shareholder returns, Churchill Downs declared an annual dividend of 43.8 cents per share. The company also engaged in significant share repurchases, returning over $53 million to stockholders. A total of 515,527 shares were repurchased, with $15 million, or 28%, attributed to a stock-repurchase program initiated in March 2025, and the remainder from a July repurchase. The company's net bank leverage stood at more than four times, indicating a robust financial structure and capacity for future investments. Executives are scheduled to host a shareholders call on Thursday at 8 a.m. EDT to discuss these results and future outlook.
Churchill Downs Incorporated's latest financial report paints a picture of strong operational performance and strategic expansion. The company's significant revenue growth, driven by the success of historic horse racing machines and strategic acquisitions, positions it favorably within the competitive gaming industry. Despite a temporary dip in net income due to a non-cash impairment, the underlying business fundamentals remain robust, with adjusted earnings showing healthy increases. The commitment to shareholder returns through dividends and share repurchases further reinforces investor confidence in CDI's long-term growth trajectory and market leadership.