Caesars Entertainment earns money from casino games, online wagering, hotel stays, dining and entertainment. In the third quarter of 2026, revenue grew, but operating profit fell 10.9% to $457 million as weaker Las Vegas hospitality sales and higher costs outweighed improvements elsewhere. Lower investment spending helped preserve cash, giving Caesars room to repay debt while its proposed acquisition by Fertitta Entertainment remained pending.
Analysis period: three and nine months ended September 30, 2026. Research cutoff: October 28, 2026, New York time.
Source: Caesars’ third-quarter 2026 Form 10-Q, statements of operations and cash flows, pp. 3 and 7–8; Note 1, pp. 9–11.
1. More revenue produced less profit because costs rose faster
Caesars’ revenue growth did not cover the increase in operating costs. Third-quarter expenses rose by $127 million against a $71 million revenue increase. That reduced operating profit by $56 million, before interest and taxes entered the calculation.
The deterioration extended beyond one quarter. During the first nine months, revenue rose 2.7%, but operating profit fell 3.7%. The quarter was weaker than that cumulative comparison: Caesars kept about 15.5 cents of operating profit from each revenue dollar, down from 17.9 cents a year earlier.
| Consolidated results, USD millions except margins and per-share amounts | Third quarter 2025 | Third quarter 2026 | First nine months 2025 | First nine months 2026 |
|---|---|---|---|---|
| Net revenue | 2,869 | 2,940 | 8,570 | 8,803 |
| Operating profit | 513 | 457 | 1,527 | 1,470 |
| Operating margin, calculated | 17.9% | 15.5% | 17.8% | 16.7% |
| Net interest expense | 576 | 570 | 1,729 | 1,712 |
| Consolidated net loss | −39 | −107 | −202 | −231 |
| Net loss attributable to Caesars | −55 | −123 | −252 | −283 |
| Basic and diluted loss per share, USD | −0.27 | −0.61 | −1.20 | −1.39 |
| Management’s Adjusted EBITDA | 884 | 865 | 2,723 | 2,672 |
Source: 2026 Form 10-Q, statements of operations, p. 3; Adjusted EBITDA reconciliation, p. 29. Margins are calculated from reported operating profit divided by revenue. The two loss rows distinguish the whole consolidated business from the portion belonging to Caesars after its partners’ earnings are removed.
The costs had identifiable causes. Gaming expenses rose with casino revenue and higher gaming taxes. General and administrative expenses increased partly because Caesars began operating Windsor directly and certain property tax credits expired. Higher general liability claims raised the cost of Caesars’ own insurance arrangements, increasing corporate expenses. Management says it is pursuing operating efficiencies, but those efforts had not stopped the overall expense increase.
Merger expenses also mattered, although they were not the whole problem. Caesars recorded $12 million of merger transaction costs in the quarter and $22 million over nine months. The broader transaction-and-other-cost line moved from a $10 million credit to an $11 million expense in the quarter; last year included asset recoveries. These are pretax amounts, and the filing does not provide a separate after-tax merger adjustment.
Source: 2026 Form 10-Q, Note 1, p. 11; MD&A, operating expenses, p. 35.
Management’s Adjusted EBITDA removes interest, taxes, depreciation, stock compensation and specified other items. It still fell 2.1% in the quarter. Thus, removing those items narrows the decline but does not reverse the business finding. The full reported-to-adjusted reconciliation appears in the calculation notes.
Interest expense exceeded operating profit in both the quarter and the nine-month period. Much of that interest represents property payments rather than bank borrowing, as explained below. Taxes provided less relief in the quarter: the tax benefit fell from $25 million to $10 million. Caesars increased allowances against some future tax deductions because it could not support their full use, while the prior-year quarter benefited from a tax-law-related allowance reduction. Sales growth therefore needs to produce more operating earnings before it can meaningfully reduce the company’s net loss.
Source: 2026 Form 10-Q, Note 10, p. 24; Adjusted EBITDA definition and reconciliation, pp. 40–41.
2. Las Vegas earned more from gambling but less from guests’ other spending
Better casino results cushioned a larger decline in Las Vegas hotel and dining revenue. Third-quarter casino revenue rose $27 million. Hotel revenue fell $27 million, and food and beverage revenue fell $34 million. An additional $12 million of other revenue, helped by the Grand Bazaar acquisition, limited the segment’s overall revenue decline to $22 million.
Management attributes the hospitality weakness to fewer city-wide convention events and lower leisure visitation, which reduced occupancy and hotel rates. Caesars’ Las Vegas occupancy fell from 91.6% to 89.1%. The simultaneous decline in dining revenue shows that the spending weakness extended beyond room sales.
The gambling improvement had two sources. Customers brought 8.1% more money to table games, and Caesars retained 21.6% of that money, compared with 17.4% a year earlier. The retained proportion is called “hold.” More play supports the business, but the higher hold also helped the comparison and should not be mistaken entirely for growth in customer spending. Slot wagering increased 3.0%.
Source: 2026 Form 10-Q, Las Vegas segment, p. 37; definition of operating measures, p. 33. Occupancy includes complimentary and discounted rooms.
Caesars could not reduce expenses in line with the softer hospitality sales. Las Vegas labor expense rose $5 million, gaming taxes rose $2 million and other segment expenses rose $7 million. Together with the revenue decline, these changes reduced Adjusted EBITDA by $36 million. The segment’s adjusted margin fell from 39.8% to 36.9%.
The history shows that this quarter followed an already weaker comparable period. It also puts the online business’s rebound in perspective.
| Reported third-quarter results, USD millions | 2024 | 2025 | 2026 |
|---|---|---|---|
| Las Vegas revenue | 1,062 | 952 | 930 |
| Las Vegas Adjusted EBITDA | 472 | 379 | 343 |
| Caesars Digital Adjusted EBITDA | 52 | 28 | 44 |
Sources: Caesars’ October 29, 2024 earnings release, pp. 1–2; 2026 Form 10-Q, Note 12, pp. 27–29. These are reported segment results, not a constant-property comparison. Caesars sold the LINQ Promenade in December 2024 and acquired Grand Bazaar in May 2026. The 2024 Digital business also preceded the October 2024 sale of the World Series of Poker trademark. Transaction dates: 2025 Form 10-K, MD&A, p. 36; 2026 Form 10-Q, Note 1.
Industry data show weaker summer room demand alongside growth in convention attendance. The Las Vegas Convention and Visitors Authority reported August visitor numbers down 4.3% and average room rates down 7.4%. Yet convention attendance increased 6.0% that month and 10.5% over the first eight months. Those periods differ from Caesars’ quarter, but they show why its explanation should not be expanded into a claim that convention attendance fell throughout the destination.
Source: LVCVA August 2026 Executive Summary, pp. 1–2. This is the monthly industry report retrieved for this analysis; its data end in August.
MGM’s October 28 release adds a relevant development after Caesars filed. MGM’s Las Vegas Strip room rates fell to $218 from $236 in the third quarter, while occupancy stayed at 89%. Its management said October had improved. That is useful evidence of broader pricing pressure and a possible recovery, but MGM’s October experience does not establish Caesars’ bookings. For Caesars, a stronger recovery requires room and dining sales to improve alongside gaming, because favorable table outcomes alone did not restore profit.
Source: MGM Resorts’ October 28, 2026 earnings release, pp. 1 and 3.
3. Regional expansion added earnings, but Windsor changes the comparison
Regional casinos supplied the largest revenue increase, although costs absorbed most of it. Third-quarter revenue increased $91 million to $1.627 billion. Adjusted EBITDA increased $18 million to $524 million, with the margin slipping from 32.9% to 32.2%.
Caesars began operating Windsor under a 20-year agreement on March 3, 2026. Previously it earned a management fee and recorded reimbursed management costs. It now includes the casino’s operations in its Regional segment. This adds a much wider set of revenue and expenses to the accounts, so the 5.9% reported regional revenue growth is not a measure of growth at unchanged properties.
The move also requires more capital and commitments. Caesars purchased approximately $42 million of furniture and equipment and $12 million of net working capital, and agreed to annual minimum property rent of about $19 million. The company now participates directly in running the property rather than principally earning management fees.
Source: 2026 Form 10-Q, Note 1, p. 11; Regional segment, p. 38.
Other improvements were operational. Management reported positive results from investments in Lake Tahoe and New Orleans. A national tournament in northern Nevada during the second quarter also helped the first-nine-month comparison.
The cost table explains why the additional revenue produced only a modest profit increase: regional labor costs rose $29 million, gaming taxes rose $16 million and other segment expenses rose $28 million in the quarter. The filing does not separate Windsor’s share of each increase. It does establish that the combined business had to spend $73 million more to earn its additional $91 million of revenue.
Source: 2026 Form 10-Q, segment expense disclosure, p. 27; Regional segment, p. 38.
Windsor also explains part of the apparent deterioration in Managed and Branded revenue. That segment’s quarterly revenue fell from $73 million to $58 million, but revenue reimbursing costs fell from $53 million to $37 million, with an equal reduction in expenses. Removing those reimbursements leaves calculated revenue of $21 million versus $20 million. Adjusted EBITDA nevertheless declined from $18 million to $17 million. The meaningful result is that regional earnings improved, while the change in reporting scope makes the headline revenue growth look stronger than the evidence for growth at existing operations alone.
Source: 2026 Form 10-Q, Managed and Branded results and reimbursable management costs, pp. 39–40.
4. Online profit improved faster than customer wagering
Caesars Digital became more profitable, but the quarter’s wagering growth was modest. Revenue rose 4.8% to $326 million, while Adjusted EBITDA rose from $28 million to $44 million. The segment moved from a $21 million loss attributable to Caesars to a $4 million profit.
| Digital operating measures | Third quarter 2025 | Third quarter 2026 |
|---|---|---|
| Sports betting amount wagered, USD millions | 2,476 | 2,505 |
| Sports betting hold | 7.8% | 7.9% |
| Online casino amount wagered, USD millions | 4,761 | 4,832 |
| Online casino hold | 3.6% | 4.0% |
| Adjusted EBITDA margin | 9.0% | 13.5% |
Source: 2026 Form 10-Q, Caesars Digital, p. 39. Wagering amounts are “handle,” not company revenue. The sports betting series excludes separately disclosed service arrangements; that scope is the same in both columns.
Sports wagering rose 1.2%, and online casino wagering rose 1.5%. Caesars retained a larger share of online casino wagers, which helped revenue grow faster than activity. Across the first nine months, online casino wagering increased a stronger 7.8%, while sports wagering was almost unchanged. This supports progress in online casino activity, rather than a broad acceleration across every digital product.
Lower expenses provided another important benefit. Quarterly Digital gaming taxes increased $7 million, but other segment expenses declined $8 million. Combined with $15 million of additional revenue, that explains the $16 million increase in Adjusted EBITDA. Management identifies lower marketing costs as a contributor. Promotional and complimentary incentives, however, rose from $78 million to $85 million; these are reflected in casino revenue and should not be confused with the separate marketing expense reduction.
Source: 2026 Form 10-Q, segment expenses, pp. 27–28; Digital operating measures and footnotes, p. 39.
The business has a practical way to connect online play with physical destinations: Caesars Rewards links qualifying gaming, hotel, restaurant and retail spending. Management’s strategy is to encourage customers to use more of the network. This gives Caesars a way to bring existing guests to more of its services, although the filing does not isolate the profit earned from customers crossing between online and physical properties.
Sources: 2025 Form 10-K, Item 1, “Rewards Programs”; 2026 Form 10-Q, Note 7, p. 20.
Digital expansion remains subject to jurisdictional approvals, competition and gaming taxes. Caesars operated online sports betting in 28 jurisdictions and online casinos in six at quarter-end. Its current improvement is useful, but the $16 million quarterly earnings gain was still smaller than Las Vegas’ $36 million decline. Sustained customer activity and cost control will matter more than assuming each future period produces the same favorable betting outcomes.
Source: 2026 Form 10-Q, Note 1, p. 11; segment results, pp. 37–39.
5. Lower capital spending preserved cash despite weaker operating cash flow
Cash remaining after property investment improved because Caesars spent less, not because operations generated more cash. Operating cash flow fell 5.6% during the first nine months. Cash purchases of property and equipment fell faster, allowing the difference between the two to increase.
| Consolidated cash measures, USD millions | First nine months 2025 | First nine months 2026 |
|---|---|---|
| Operating cash flow | 998 | 942 |
| Cash purchases of property and equipment, shown as positive spending | 648 | 507 |
| Free cash flow on this basis, calculated | 350 | 435 |
| Net cash used by all investing activities | 416 | 596 |
| Operating cash remaining after all investing activities, calculated | 582 | 346 |
Source: 2026 Form 10-Q, cash-flow statement, p. 7. Free cash flow here means operating cash flow less cash purchases of property and equipment. It excludes asset acquisitions, separate intangible purchases and sale proceeds, and is not a GAAP measure.
The distinction between the two cash remainders matters. Caesars paid $98 million for asset acquisitions in 2026, versus none in the comparable period, and $12 million for separate intangible assets, versus $1 million. Proceeds from selling trademarks and property fell from $217 million to $20 million. Consequently, cash left after all investing activities declined even though the narrower free-cash-flow measure improved.
A reported loss did not prevent positive operating cash flow because several large expenses did not require current cash payments. Depreciation and amortization, which spread past asset costs across their useful lives, added back $1.068 billion. Other adjustments included financing-cost amortization and stock compensation. The complete profit-to-cash calculation is in the notes.
Collections and payments did not supply a large net windfall. Changes in operating assets and liabilities used $146 million, compared with $140 million a year earlier. The line covering supplier bills, accrued expenses and other liabilities used $81 million, versus $39 million. Lower cash income taxes—$14 million versus $61 million—helped offset the pressure.
Source: 2026 Form 10-Q, cash-flow statement and supplemental cash disclosures, pp. 7–8.
Management identifies the purposes of its capital spending directly. Of the $507 million spent, $277 million went to maintenance, $178 million to growth and renovation, and $52 million to Digital. For the final three months of 2026, management estimated another $160 million to $205 million, implying calculated full-year spending of $667 million to $712 million if the plan is met.
The $66 million Grand Bazaar purchase, including $10 million of deferred consideration, gave Caesars control of the remaining ownership in the shopping and entertainment property beside its Las Vegas operations. Higher rental revenue is already visible in the segment results, but the filing does not isolate the acquisition’s net earnings contribution. Caesars continues to invest in both its destinations and online services, while a lower overall capital program frees cash for financing needs.
Source: 2026 Form 10-Q, Note 1, p. 11; Las Vegas discussion, p. 37; capital spending plan, p. 42.
After all investing activities, the $346 million cash remainder nearly covered $353 million of net financing outflows. These included $246 million of net debt repayment, $29 million of financing-obligation payments, $65 million distributed to the minority partner in Caesars Virginia, and $13 million of taxes paid when employee share awards settled. No common-share repurchases or common dividends were paid in the period. In the comparable 2025 period, share buybacks used $179 million and net debt repayments used $371 million. Total cash, including restricted amounts, fell only $7 million in 2026. The company funded a meaningful debt reduction, but it did not build a larger cash reserve.
Source: 2026 Form 10-Q, cash-flow statement, pp. 7–8; Note 11, p. 25.
6. Liquidity provides time, while debt and property payments limit flexibility
Caesars has substantial available financing, but recurring property payments absorb cash before debt can be reduced. Borrowing principal fell from $11.905 billion at year-end to $11.659 billion on September 30. The company also carried $13.188 billion of long-term financing obligations, a separate balance dominated by its property arrangements.
The accounting is important. Caesars continues to record assets from certain property sale-and-leaseback arrangements and classifies the related obligation as financing. Payments are largely treated as interest. In the early lease years, recognized interest exceeds cash payments, which can increase the obligation even while Caesars pays its landlords. This helps explain why financing obligations rose while ordinary borrowing declined.
Sources: 2026 Form 10-Q, balance sheet, p. 2, and Note 6, p. 16; 2025 Form 10-K, Note 7, pp. 70–71.
During the first nine months, Caesars paid $1.030 billion of rent classified as interest under its VICI and GLPI property agreements, compared with $1.009 billion a year earlier. Cash interest on borrowing fell from $652 million to $580 million. Thus, lower borrowing costs helped, but landlord payments moved in the other direction. Management’s Adjusted EBITDA excludes this property-interest expense; operating cash flow already includes the cash interest payments.
Available resources were $864 million of cash and $2.083 billion of unused revolving credit after identified reservations, totaling $2.947 billion. Another $113 million of restricted cash was excluded. Revolving credit is capacity to borrow, not cash already earned, and some cash on hand is needed for gaming operations.
Source: 2026 Form 10-Q, cash interest, p. 8; cash policy, p. 12; liquidity table, p. 41.
| Borrowing obligations at September 30, 2026, USD millions | Remaining 2026 | 2027 | 2028 | 2029 | 2030 | Thereafter |
|---|---|---|---|---|---|---|
| Principal scheduled for repayment | 28 | 114 | 646 | 1,574 | 3,962 | 5,335 |
| Estimated contractual interest | 160 | 780 | 740 | 700 | 440 | 300 |
Source: 2026 Form 10-Q, Note 6, p. 16. Interest uses the filing’s assumptions, including forward interest-rate curves where relevant. These amounts exclude the separate landlord obligations.
The immediate principal requirement is modest relative to available liquidity. The larger refinancing task arrives later, particularly in 2030. The main $2.25 billion revolving facility and Term Loan A mature in January 2028, so preserving bank access matters before the largest debt repayments fall due.
About half of borrowing carried variable rates. At September 30, weighted average rates were 6.12% on variable-rate debt and 6.18% on fixed-rate debt; no interest-rate hedges were outstanding. As an illustrative calculation, a one-percentage-point increase applied to the $5.820 billion variable-rate principal would add about $58 million of annual interest before tax, assuming unchanged balances and a full-year rate change.
Source: 2026 Form 10-Q, Notes 2 and 6, pp. 13 and 16–19; market risk, p. 43. The sensitivity is a calculation, not management guidance.
Caesars reported compliance with its debt and lease covenants. Its main bank agreements limit net debt relative to contract-defined earnings to 6.50 times and require earnings to cover specified fixed charges at least 2.0 times. These tests use definitions in the lending agreements. Caesars Virginia has separate limits of 4.0 times for net debt relative to earnings and 1.05 times for coverage of fixed charges. The property agreements also require minimum investment, and GLPI requires a minimum adjusted-revenue-to-rent ratio of 1.20 times. Compliance supports current access to funding, but the filing does not disclose the actual ratios needed to measure the remaining cushion.
For the rest of 2026, management estimated $188 million of borrowing principal and interest payments, plus $345 million of VICI and GLPI payments. VICI rent escalates each November, with another revenue-based adjustment scheduled for the lease year beginning November 2027. Lower capital spending helps Caesars meet these obligations; a recovery in operating earnings would make further debt repayment easier without relying as heavily on spending restraint.
Source: 2026 Form 10-Q, liquidity, covenants and property payments, pp. 41–43.
7. Losses reduced equity, while claims and asset commitments remain important
The balance sheet became smaller, but its ability to absorb losses also weakened. Total assets declined $268 million to $31.371 billion. Liabilities—the amounts the business owes—fell only $28 million. Equity, the amount left on the books after subtracting liabilities from assets, therefore fell $240 million to $3.446 billion.
| Consolidated balance sheet, USD millions | December 31, 2025 | September 30, 2026 |
|---|---|---|
| Cash and cash equivalents | 887 | 864 |
| Accounts receivable, net | 476 | 459 |
| Inventory | 43 | 48 |
| Property and equipment, net | 14,358 | 13,941 |
| Goodwill | 10,441 | 10,441 |
| Other intangible assets | 3,985 | 3,938 |
| Other long-term assets | 852 | 1,042 |
| Total assets | 31,639 | 31,371 |
| Total liabilities | 27,953 | 27,925 |
| Total equity, including minority interests | 3,686 | 3,446 |
Source: 2026 Form 10-Q, consolidated balance sheet, p. 2. Selected asset rows do not constitute a complete asset sum; the full balance checks appear in the calculation notes.
The decline in property and equipment does not mean Caesars stopped investing. Its gross recorded property cost increased $421 million, while accumulated depreciation increased $838 million. The net balance therefore fell $417 million. Construction in progress declined from $153 million to $90 million, and management linked higher quarterly depreciation to completed Lake Tahoe work and the Windsor and Las Vegas acquisitions.
Intangible assets include rights and brands rather than physical buildings or equipment. Their recorded value fell $47 million as the expense for using these assets over time exceeded additions, including acquired tenant leases and gaming rights. Goodwill—the extra acquisition cost recorded beyond separately identified net assets—did not change. Goodwill and other intangibles together represented a calculated 45.8% of total assets. These balances are not funds available to pay debt; weaker future earnings could also make their recorded amounts harder to support.
Source: 2026 Form 10-Q, Notes 3–4, pp. 14–15; depreciation discussion, p. 35.
Other long-term assets rose $190 million, while other long-term liabilities rose $187 million. The cash-flow supplement records $203 million of new rights to use leased assets with matching lease liabilities, and Windsor added a 20-year property lease. These are substantial new noncash commitments, rather than cash generated by operations; the filing does not allocate every remaining movement in those broad balance-sheet lines.
Customer receivables fell, led by lower casino receivables, while food, beverage and hotel receivables increased. That balance-sheet decline should not be read as a $17 million cash collection benefit: the cash-flow statement shows an $8 million use from receivables after its other adjustments, and adds back a $38 million expense for estimated customer credit losses. Inventory remained small. Supplier payables declined from $297 million to $237 million, reducing one source of short-term funding.
Source: 2026 Form 10-Q, balance sheet, p. 2; cash flows, pp. 7–8; receivables, p. 20.
The principal equity movement was the $283 million loss belonging to Caesars, which increased the total past losses recorded as its accumulated deficit. Stock compensation partly offset that accounting decline through paid-in capital, the equity account that includes contributions and share awards. Those awards can also add shares. Nine-month weighted average shares fell from 209 million to 204 million, reflecting the smaller share base after earlier repurchases. With a loss, fewer shares make the loss per share larger. No shares were repurchased in 2026; program repurchases are retired, rather than retained as treasury shares. Six million potential shares were excluded from diluted EPS because including them would reduce the reported loss per share.
Source: 2026 Form 10-Q, equity statement, p. 5; Notes 8–9, pp. 21–23. The complete equity reconciliation is in the notes below.
Claims costs are an immediate operating issue. Caesars’ self-insurance liability increased from $212 million to $244 million, consistent with the disclosed pressure from general liability claims. Separately, the annual filing identifies reasonably possible losses from litigation and regulatory inquiries over the 2023 customer-data breach, without an estimable loss range. The current quarter refers back to that annual disclosure. The unquantified exposure remains relevant to a business built partly around its customer loyalty network.
Sources: 2026 Form 10-Q, Note 5, p. 15; corporate costs, p. 35; legal proceedings, p. 45; 2025 Form 10-K, Note 8, pp. 72–73.
Tax assets add another earnings sensitivity. At December 2025, Caesars had approximately $1.4 billion of deferred tax assets associated mainly with long-term financing obligations whose use depends on sufficient future taxable income. These are underlying tax balances, not the much smaller net deferred-tax-asset line on the current balance sheet. Further allowances could raise tax expense. Together with claims costs, this makes stronger operating earnings important both for cash generation and for supporting the assets already recorded.
Source: 2026 Form 10-Q, Note 10, p. 24.
8. The Fertitta combination offers a broader customer network, with execution still ahead
The proposed acquisition changes Caesars’ strategic path, but it has not yet changed ownership or removed its operating obligations. The companies describe the combination as a way to connect more gaming, hospitality and restaurant destinations through Caesars Rewards. Existing Caesars executives and property teams were expected to continue operating the business. That could widen the places where customers earn and use rewards, although the reviewed announcement does not quantify the resulting operating savings or additional earnings.
The May announcement described financing through Fertitta equity, assumed Caesars debt and new committed borrowing. The agreement has no financing condition. The combined business would remain responsible for the assumed debt alongside the new borrowing.
Source: Caesars’ May 28, 2026 acquisition announcement, operating rationale, management continuity and transaction-financing sections.
Shareholders approved the transaction on September 22. At the October 27 filing, completion still required antitrust clearance and gaming regulatory approvals. The agreement’s initial end date is May 27, 2027, with conditional extensions to August and November 2027; these are termination deadlines, not promised closing dates.
Until completion, Caesars must generally operate in the ordinary course and obtain the buyer’s consent for specified activities. These limits can constrain management’s response to competition or new opportunities. Transaction costs are already being incurred, and the filing identifies litigation relating to the deal. Under specified termination circumstances, Caesars could owe $200 million, or Fertitta could owe Caesars a $450 million reverse termination fee. Neither amount is an unconditional payment.
Source: 2026 Form 10-Q, Note 1, pp. 9–11; merger risk factors, pp. 47–49.
The pending transaction has also changed cash allocation. Caesars expects no further share repurchases for now, despite $221 million of unused authorization. That preserves cash during the approval period. The near-term business task remains to improve property earnings, control claims costs and fund existing obligations while preparing for a combination whose timing and final operating effects remain conditional.
Source: 2026 Form 10-Q, Note 9, p. 23; share repurchase discussion, p. 43.
9. Caesars has room to fund its plans, but needs a broader earnings recovery
Current liquidity supports Caesars’ plans, but lower spending is doing more than earnings growth to free cash. Regional investments and online operations are contributing more earnings, and lower capital spending allowed debt repayment without a large cash decline. Available credit and reported covenant compliance provide time to improve the business.
The constraint is that weaker Las Vegas hospitality sales and rising overhead still outweigh those operating gains. Large property payments continue regardless of whether hotel demand improves, while a portion of Digital’s better result came from higher hold. A stronger outlook would require regional and online growth to translate into more earnings after costs, together with a recovery in Las Vegas room and dining sales. If those improvements emerge, Caesars could reduce debt with less dependence on lower investment spending. The Fertitta combination may broaden its customer network, but the current evidence supports treating that benefit as a plan still to be executed.
Sources: 2026 Form 10-Q, segment results and liquidity, pp. 34–43; May 28 acquisition announcement, operating rationale.
Reporting basis and calculation notes
Reporting basis: Caesars Entertainment, Inc., ticker CZR, CIK 0001590895; unaudited consolidated US GAAP Form 10-Q, accession 0001590895-26-000033, filed October 27, 2026, for the quarter ended September 30, 2026. Quarter comparisons use July–September; nine-month comparisons use January–September. Balance-sheet comparisons use December 31, 2025 and September 30, 2026. Subsidiaries and controlled entities are consolidated after internal transactions are eliminated. Caesars Virginia is fully consolidated despite Caesars’ 50% ownership, with the partner’s earnings and distributions separately identified; the 50%-owned Pompano venture is accounted for through Caesars’ share of its results.
Sources: SEC submissions record; 2026 Form 10-Q, cover, Note 2 and Note 11. Supporting historical annual filing: 2025 Form 10-K, filed February 17, 2026, accession 0001590895-26-000011.
Reporting basis: The research cutoff is October 28, 2026, New York time. Caesars-specific financial results and merger status are supported through its October 27 filing and release. The later primary-source operating update used is MGM’s October 28 release. The retrieved LVCVA monthly report covers August. This analysis does not assert that every development through the cutoff was independently verified. Management plans are identified as estimates; calculations below use reported amounts rounded to millions, so small differences from calculations using unrounded figures are possible.
A. What management removes to calculate Adjusted EBITDA
Calculation notes: Each signed adjustment is added to the loss attributable to Caesars. The tax-benefit row is negative because the reconciliation removes the benefit. Adding back the partners’ income restores the full consolidated scope. This is a pretax performance measure, not adjusted after-tax profit or cash flow.
| Reconciliation, USD millions | Third quarter 2025 | Third quarter 2026 | First nine months 2025 | First nine months 2026 |
|---|---|---|---|---|
| Reported net loss attributable to Caesars | −55 | −123 | −252 | −283 |
| Add income attributable to minority owners | 16 | 16 | 50 | 52 |
| Remove income tax benefit | −25 | −10 | −1 | −10 |
| Remove other income or loss | −3 | 4 | −3 | −1 |
| Add debt-extinguishment loss | 4 | 0 | 4 | 0 |
| Add net interest expense | 576 | 570 | 1,729 | 1,712 |
| Add depreciation and amortization | 352 | 366 | 1,073 | 1,068 |
| Transaction costs and other adjustments, net | −3 | 19 | 51 | 64 |
| Add stock compensation | 22 | 23 | 72 | 70 |
| Management’s Adjusted EBITDA | 884 | 865 | 2,723 | 2,672 |
Source: 2026 Form 10-Q, Note 12, p. 29. “Transaction costs and other adjustments” includes items from multiple accounting lines, such as asset write-downs and recoveries, litigation reserves, transaction services, contract exits, pre-opening costs and equity-method investment changes. It therefore differs from the income statement’s transaction-and-other-cost line. The measure still includes operating costs such as gaming taxes and the segment expenses management retains in its calculation.
Calculation notes: The quarterly adjusted earnings change reconciles as $884 million, less $36 million from Las Vegas, plus $18 million from Regional, plus $16 million from Digital, less $1 million from Managed and Branded, and less $16 million from Corporate and Other, equaling $865 million. Corporate and Other includes internal eliminations. These are the company’s consolidated segment contributions, not an unadjusted sum of separate subsidiaries’ profits.
B. Why operating cash flow remained positive
| Profit-to-cash check, USD millions | First nine months 2025 | First nine months 2026 |
|---|---|---|
| Consolidated net loss, including minority owners | −202 | −231 |
| Total noncash and other profit-to-cash adjustments | 1,340 | 1,319 |
| Cash effect of receivables, prepayments, taxes and operating liabilities | −140 | −146 |
| Operating cash flow | 998 | 942 |
Calculation notes: The adjustments below explain the difference between an accounting loss and cash generated before customer collections and bill payments change the result. Positive amounts are added back; negative amounts remove gains or benefits already included in the loss.
| Noncash and other adjustments, USD millions | First nine months 2025 | First nine months 2026 |
|---|---|---|
| Depreciation and amortization of operating assets | 1,073 | 1,068 |
| Amortization of deferred financing costs and discounts | 135 | 135 |
| Expense for estimated customer credit losses | 31 | 38 |
| Loss from early debt repayment | 4 | 0 |
| Noncash lease amortization | 16 | 23 |
| Remove investment gains | −2 | −2 |
| Employee stock compensation | 72 | 70 |
| Asset-sale and disposal losses or gains | 11 | −7 |
| Deferred income taxes | −1 | −10 |
| Other noncash adjustments | 1 | 4 |
| Total adjustments | 1,340 | 1,319 |
| Cash effects of collection and payment timing, USD millions | First nine months 2025 | First nine months 2026 |
|---|---|---|
| Customer receivables | 9 | −8 |
| Prepaid expenses and other assets | −49 | −43 |
| Income taxes receivable and payable | −61 | −14 |
| Supplier payables, accrued expenses and other liabilities | −39 | −81 |
| Total timing effect | −140 | −146 |
Calculation notes: Net timing effects worsened by $6 million. The net-loss and adjustment subtotal worsened by $50 million. Together, they explain the $56 million decline in operating cash flow.
Calculation notes: Total cash reconciles from $984 million at the start of 2026, plus $942 million of operating cash, less $596 million of investing outflows and $353 million of financing outflows, to $977 million. The closing balance contains $864 million of cash and equivalents, $94 million of current restricted cash and $19 million of long-term restricted or escrow cash. The opening balance contains $887 million of cash and equivalents, $85 million of current restricted cash and $12 million of long-term restricted cash.
Calculation notes: For the first nine months of 2025, opening cash of $1,016 million plus operating cash of $998 million, less investing outflows of $416 million and financing outflows of $659 million, equals closing cash of $939 million.
Source: 2026 Form 10-Q, cash-flow statement and restricted-cash reconciliation, pp. 7–8. The opening 2026 long-term restricted amount is calculated as total opening cash less its separately disclosed cash and current restricted components.
C. How equity and borrowing balances reconcile
| Equity movement, USD millions | December 31, 2025 | Net change during first nine months 2026 | September 30, 2026 |
|---|---|---|---|
| Additional paid-in capital | 6,709 | 57 | 6,766 |
| Accumulated deficit | −3,303 | −283 | −3,586 |
| Accumulated other comprehensive income | 98 | −1 | 97 |
| Caesars shareholders’ equity | 3,504 | −227 | 3,277 |
| Minority owners’ equity | 182 | −13 | 169 |
| Total equity | 3,686 | −240 | 3,446 |
Calculation notes: Paid-in capital increased by $70 million of stock compensation less $13 million of shares withheld for employee tax settlement. Minority equity changed by $52 million of earnings less $65 million of distributions. Foreign-currency and other comprehensive changes reduced equity by $1 million. Common-stock value rounds to zero in millions, and treasury stock remained zero. These movements reconcile total equity without treating share awards as cash proceeds.
Calculation notes: At September 30, 2026, assets of $31,371 million equal liabilities of $27,925 million plus equity of $3,446 million. At December 31, 2025, assets of $31,639 million equal liabilities of $27,953 million plus equity of $3,686 million. Both comparisons include minority owners’ equity.
Calculation notes: Borrowing principal of $11,659 million less $101 million of borrowing discounts and financing charges not yet expensed equals $11,558 million recorded debt: $114 million current plus $11,444 million long-term. At year-end, $11,905 million less $121 million equals $11,784 million: $114 million current plus $11,670 million long-term. Principal declined by $246 million, matching cash borrowing proceeds of $1,335 million less repayments of $1,581 million. These checks exclude the separately reported long-term financing obligations.
Sources: 2026 Form 10-Q, balance sheet, equity statement, cash-flow statement and Note 6, pp. 2, 5, 7 and 16. SEC company XBRL facts were checked for the selected accession, USD units, consolidated scope, matching balance dates and separate quarterly/nine-month durations. Reported EPS uses unrounded underlying amounts and is retained as filed.
This report provides business and financial information for general understanding. It is not investment advice.