Key points:
- Q1 2025 net revenue reached a record $642.6m, up 9% year-on-year
- Net income fell 5% to $76.7m; Adjusted EBITDA increased 1% to $245.1m
- Gaming revenue rose 9.9% to $267.2m; Live and Historical Racing up 11%
Churchill Downs Incorporated (CDI) has reported record net revenue of $642.6m for Q1 2025, a 9% year-on-year increase from $590.9m. The result reflects continued expansion in historical racing machine (HRM) venues and the April 2024 opening of Terre Haute Casino Resort in Indiana.
The Live and Historical Racing segment contributed $276.4m in revenue, up 11%. Notably, Virginia HRM venues generated $18.2m in incremental revenue, boosted by the November 2024 debut of The Rose Gaming Resort.
In Kentucky, Owensboro Racing and Gaming opened in February 2025, helping the state’s HRM locations deliver an $8.9m revenue increase.
Gaming revenue rose by $24m to $267.2m in the first quarter. The Terre Haute Casino Resort alone added $31.6m, helping offset a $7.6m decline across CDI’s existing gaming portfolio, where properties experienced regional softness, increased competition, adverse weather and the impact of the leap year.
EBITDA edges up, but net income declines on lower recoveries
Adjusted EBITDA reached $245.1m for the quarter, a 1% increase. However, net income attributable to CDI declined by 5% to $76.7m, impacted by a $6.7m after-tax decrease in insurance recoveries recorded in Q1 2024.
Excluding one-off items, adjusted net income declined $4.8m, largely due to lower equity income, higher interest expense and the non-controlling treatment of United Tote earnings.
The gaming segment recorded $123.5m in adjusted EBITDA, up slightly from $122.8m the previous year. Live and Historical Racing added $102m, a $1.2m increase, while Wagering Services reported $41.3m in EBITDA, also up from $39.6m.
TwinSpires steady as sports betting remains subdued
CDI’s Wagering Services and Solutions segment generated $115.8m in revenue, up modestly from $114.1m in Q1 2024. Gains were led by Exacta, which benefitted from expanded HRM operations in Virginia and New Hampshire, contributing an additional $3.1m. TwinSpires Horse Racing added $0.8m but faced higher legal costs, reducing its contribution to EBITDA.
The sports betting business posted a $2.2m decline in revenue. The company officially exited Kentucky’s sportsbook market in February 2025, following similar underperformance in previous quarters.
Capital projects and cost control reshape strategic outlook
CDI confirmed it will pause development on several high-profile projects at Churchill Downs Racetrack, including The Skye, Conservatory and Infield General Admission enhancements, citing economic conditions. However, upgrades to the Finish Line Suites and The Mansion for the 152nd Kentucky Derby remain on track.
Administrative costs increased in Q1, with corporate compensation and overhead expenses rising by $1m, reflecting CDI’s growing operational footprint.
Shareholder returns and financial position
In March, CDI’s Board approved a new $500m share repurchase programme, which includes $125.6m in remaining authorisation from its prior programme. During Q1, the company repurchased 798,250 shares for $89.4m and paid a dividend of $0.409 per share on 3 January – marking the 14th consecutive annual increase.
As of 31 March 2025, CDI reported net bank leverage of 4.0x and maintained a stable liquidity profile following the February amendment to its credit agreement, which reduced borrowing costs.
Looking ahead
The Q1 results follow CDI’s record-breaking 2024, where the company generated $2.7bn in revenue. That year’s gains were driven by a historic Kentucky Derby and strategic gaming expansion, particularly across HRM venues.
With new properties now contributing and key development decisions adjusted to the macroeconomic backdrop, CDI enters the second quarter with momentum tempered by cost pressures and a recalibrated capital roadmap.
