Churchill Downs Inc

Previous wording

•changes in, or new interpretations of, applicable tax laws or rulings that could result in additional tax liabilities;

Current wording

•changes in, or new interpretations of, applicable tax law or rulings that could result in additional tax liabilities;

Previous wording

•cybersecurity risk, including cyber-security breaches, or loss or misuse of our confidential information as a result of a breach including customers’ personal information, or IT system operational disruptions, could lead to government enforcement actions or other litigation;

Current wording

•cybersecurity risk, including cybersecurity breaches, or loss or misuse of our confidential information as a result of a breach including customers’ personal information, or IT system operational disruptions, could lead to government enforcement actions or other litigation;

Previous wording

•increase in our insurance costs, or inability to obtain similar insurance coverage in the future, and any inability to recover under our insurance policies for damages sustained at our properties in the event of inclement weather and casualty events; and

Current wording

•increase in our insurance costs, or inability to obtain similar insurance coverage in the future, and any inability to recover under our insurance policies for damages sustained at our properties in the event of inclement weather and casualty events;

Previous wording

For segment reporting, Adjusted EBITDA includes intercompany revenue and expense totals that are eliminated in the Condensed Consolidated Statements of Comprehensive Income. See the Reconciliation of Comprehensive Income to Adjusted EBITDA included in this section for additional information.

Current wording

For segment reporting, Adjusted EBITDA includes intercompany revenue and expense totals that are eliminated in the Condensed Consolidated Statements of Comprehensive Income. See the Reconciliation of Net Income to Adjusted EBITDA included in this section for additional information.

Previous wording

•Net income attributable to Churchill Downs Incorporated increased $6 million. The following impacted the comparability of the Company's net income for the three months ended March 31, 2026 compared to the three months ended March 31, 2025: a $3 million after-tax decrease in other recoveries, partially offset by a $2 million after-tax increase in transaction, pre-opening, and other expenses. Excluding these items, net income increased $5 million primarily due to a $3 million after-tax increase from the results of our operations, and a $2 million after-tax increase in equity income from our unconsolidated affiliates.

Current wording

•Net income attributable to Churchill Downs Incorporated increased $24 million. The following impacted the comparability of the Company's net income for the three months ended June 30, 2026 compared to the three months ended June 30, 2025: a $4 million after-tax decrease in transaction, pre-opening, and other expenses and a $2 million after-tax decrease related to an impairment charge in the prior year quarter related to a write-off of obsolete HRMs in Virginia. Excluding these items, net income increased $18 million due to a $10 million after-tax increase primarily driven by the results of our operations, a $4 million after-tax increase in equity income from our unconsolidated affiliates, and a $4 million after-tax decrease in interest expense.

Previous wording

•Adjusted EBITDA increased $12 million driven by a $11 million increase from the Live and Historical Racing segment and a $4 million increase from the Wagering Services and Solutions segment. These increases were partially offset by a $1 million decrease from the Gaming segment and a $2 million decrease in All Other.

Current wording

•Net revenue increased $66 million driven by a $57 million increase from the Live and Historical Racing segment primarily due to a record-breaking Derby Week at Churchill Downs Racetrack, and an $11 million increase from the Wagering Services and Solutions segment. These increases were partially offset by a $2 million decrease from the Gaming segment.

Previous wording

•Operating income increased $8 million driven by a $15 million increase from the Live and Historical Racing segment and a $1 million increase in the Wagering Services and Solutions segment. These increases were partially offset by a $2 million decrease in the Gaming segment operating income, a $1 million increase in All Other operating expenses, a $4 million increase in selling, general and administrative expenses, and a $1 million increase in transaction expenses.

Current wording

•Operating income increased $38 million driven by an $36 million increase from the Live and Historical Racing segment primarily due to a record-breaking Derby Week at Churchill Downs Racetrack, a $5 million increase from the Wagering Services and Solutions segment, a $1 million increase from the Gaming segment, and a $2 million increase attributable to the non-cash impairment charge of Virginia HRMs that did not recur in the current period. These increases were offset by a $4 million increase in selling, general and administrative expenses and a $2 million decrease from All Other.

Previous wording

•Gaming revenue decreased $5 million due to a $9 million decrease primarily from the cessation of HRM operations in Louisiana in May 2025 and a $2 million decrease primarily from our Florida and Mississippi properties. These decreases were partially offset by a $6 million increase primarily from our New York, Indiana, and Maryland properties.

Current wording

•Gaming revenue increased $4 million primarily due to an $8 million increase primarily from our New York, Indiana, and Maryland properties, partially offset by a $4 million decrease primarily from the cessation of HRM operations in Louisiana in May 2025.

Previous wording

•Live and Historical Racing revenue increased $24 million due to a $17 million increase from our Kentucky HRM venues, a $5 million increase from our Virginia HRM venues, and a $3 million increase from our New Hampshire venues, partially offset by a $1 million decrease from Churchill Downs Racetrack. The Kentucky HRM increase was due to a $6 million increase from our Western Kentucky venues, a $4 million increase from our Northern Kentucky venues, a $4 million increase from our Southwestern Kentucky venues, and a $3 million increase from our Louisville venues. The Virginia HRM increase was primarily due to a $5 million net increase from our Northern Virginia venues and a $1 million increase from our Western Virginia venue, partially offset by a $1 million net decrease from our Central Virginia venues primarily from increased competition and unfavorable weather.

Current wording

•Live and Historical Racing revenue increased $58 million due to a $20 million increase from Churchill Downs Racetrack, a $29 million increase from our Kentucky HRM venues, a $6 million increase from our Virginia HRM venues, and a $3 million increase primarily from New Hampshire venues. The Churchill Downs Racetrack increase was primarily due to a record-breaking Derby Week, including increased NBC broadcast revenue, increased ticketing revenue, increased sponsorship and licensing revenue, and increased wagering revenue. The Kentucky HRM increase was primarily due to a $9 million increase from our Western Kentucky venues, an $8 million increase from our Southwestern Kentucky venues, an $8 million increase from our Northern Kentucky venues, and a $4 million increase from our Louisville venues. The Virginia HRM increase was primarily due to a $10 million net increase from our Northern Virginia venues and a $1 million increase from our Western Virginia venue, partially offset by a net $5 million decrease from Central Virginia venues primarily from increased competition.

Previous wording

•Wagering Services and Solutions Adjusted EBITDA increased $4 million primarily from lower legal expenses in our Horse Racing business and growth in our retail sports betting business.

Current wording

•Wagering Services and Solutions Adjusted EBITDA increased $4 million due to a $3 million increase from our Horse Racing business and a $1 million increase from our Exacta business.

Previous wording

•Gaming Adjusted EBITDA decreased $1 million. Our wholly-owned gaming properties decreased $3 million primarily from the cessation of HRMs in Louisiana in May 2025 that was partially offset by an increase from our New York property. Our equity investments increased $2 million from strong performance at Rivers Des Plaines in Illinois and Miami Valley Gaming in Ohio.

Current wording

•Gaming Adjusted EBITDA increased $6 million. Our equity investments increased $4 million from strong performance at Rivers Des Plaines in Illinois and Miami Valley Gaming in Ohio. Our wholly-owned gaming properties increased $4 million from strong performance at our New York venue, partially offset by a $2 million decrease primarily from the cessation of HRM operations in Louisiana in May 2025.

Previous wording

•Live and Historical Racing Adjusted EBITDA increased $11 million due to a $9 million increase from our Kentucky HRM venues, a $3 million net increase from our Virginia HRM venues, and a $1 million net increase from our New Hampshire venues, partially offset by $2 million decrease at Churchill Downs Racetrack. The Kentucky HRM increase was due to a $3 million increase from our Western Kentucky venues, a $3 million increase from our Northern Kentucky venues, and a $3 million increase from our Louisville venues. The Virginia HRM increase was primarily due to a $7 million net increase from our Northern Virginia venues, partially offset by a $4 million net decrease from our Central Virginia venues primarily from increased competition and unfavorable weather.

Current wording

•Live and Historical Racing Adjusted EBITDA increased $32 million due to a $14 million increase from Churchill Downs Racetrack, a $15 million increase from our Kentucky HRM venues, and a $4 million increase from our Virginia HRM venues, partially offset by a $1 million decrease at our New Hampshire venues primarily due to the planned closure of our temporary Casino Salem venue during the construction of the Rockingham Grand Casino venue. The Churchill Downs Racetrack increase was primarily due to a record-breaking Derby Week, including increased NBC broadcast revenue, increased ticketing revenue, increased sponsorship and licensing revenue, and increased wagering revenue, partially offset by higher operating expenses. The Kentucky HRM increase was due to a $6 million increase from our Northern Kentucky venues, a $5 million increase from our Western Kentucky venues, a $2 million increase from our Southwestern Kentucky venues, and a $3 million increase from our Louisville venues. The Virginia HRM increase was primarily due to an $11 million net increase from our Northern Virginia venues, and a $2 million net increase from our Western Virginia and Southern Virginia venues, partially offset by a $9 million net decrease from our Central Virginia venues primarily from increased competition.

Previous wording

•All Other Adjusted EBITDA decreased $2 million primarily due to claim development within our captive insurance company.

Current wording

•All Other Adjusted EBITDA decreased $7 million primarily due to a reduction of corporate legal-related fees in the prior year and claim development within our captive insurance company.

Previous wording

Reconciliation of Comprehensive Income to Adjusted EBITDA

Current wording

Reconciliation of Net Income to Adjusted EBITDA

Previous wording

•Total equity increased $86 million driven by net income.

Current wording

•Total equity increased $331 million driven by net income.

Previous wording

•Cash flows provided by operating activities increased $48 million driven primarily by a decrease in cash used for working capital and an increase in net income and deferred taxes. We anticipate that cash flows from operations and availability of borrowings under our credit facility over the next twelve months will be adequate to fund our business operations and capital expenditures.

Current wording

•Cash flows provided by operating activities increased $25 million driven primarily by an increase in net income and deferred taxes, partially offset by a decrease in income taxes. We anticipate that cash flows from operations and availability of borrowings under our credit facility over the next twelve months will be adequate to fund our business operations and capital expenditures.

Previous wording

•Cash flows used in investing activities decreased $19 million primarily driven by decreased capital expenditures in 2026.

Current wording

•Cash flows used in investing activities decreased $47 million primarily driven by decreased capital expenditures in 2026.

Previous wording

•Cash flows used in financing activities increased $84 million primarily driven by an increase in paydowns of the Revolver offset by the reduction of share repurchases in 2026.

Current wording

•Cash flows used in financing activities increased $100 million primarily driven by an increase in paydowns of the Revolver offset by the reduction of share repurchases in 2026.

Previous wording

We have announced several project capital investments, including the following: Finish Line Suites, The Mansion, and Victory Run at Churchill Downs Racetrack, and plans to redevelop Casino Salem into Rockingham Grand Casino in New Hampshire. We currently expect our project capital to be approximately $180 to $220 million in 2026, although this amount may vary significantly based on the timing of work completed, unanticipated delays, and timing of payments to third parties.

Current wording

We have announced several project capital investments, including the following: Rockingham Grand Casino in New Hampshire and Victory Run at Churchill Downs Racetrack. We currently expect our project capital to be approximately $180 to $220 million in 2026, although this amount may vary significantly based on the timing of work completed, unanticipated delays, and timing of payments to third parties.

Previous wording

On July 22, 2025, the Board of Directors of the Company approved a common stock repurchase program of up to $500 million (the "July 2025 Stock Repurchase Program"). The July 2025 Stock Repurchase Program includes and is not in addition to the $169 million previously remaining under the prior March 2025 Stock Repurchase Program. Share repurchases may be made at management’s discretion from time to time in the open market (either with or without a 10b5-1 plan) or through privately negotiated transactions. The repurchase program has no time limit and may be suspended or discontinued at any time. We had approximately $430 million of repurchase authority remaining under the July 2025 Stock Repurchase Program at March 31, 2026, based on trade date.

Current wording

On July 22, 2025, the Board of Directors of the Company approved a common stock repurchase program of up to $500 million (the "July 2025 Stock Repurchase Program"). The July 2025 Stock Repurchase Program includes and is not in addition to the $169 million previously remaining under the March 2025 Stock Repurchase Program. Share repurchases may be made at management’s discretion from time to time in the open market (either with or without a 10b5-1 plan) or through privately negotiated transactions. The repurchase program has no time limit and may be suspended or discontinued at any time. We had approximately $430 million of repurchase authority remaining under the July 2025 Stock Repurchase Program at June 30, 2026, based on trade date.

Previous wording

On March 12, 2025, the Board of Directors of the Company approved a common stock repurchase program of up to $500 million (the "March 2025 Stock Repurchase Program"). The March 2025 Stock Repurchase Program included and was not in addition to any unspent amount remaining under the prior authorization. As described above, the March 2025 Stock Repurchase Program has since been replaced by the July 2025 Stock Repurchase Program.

Current wording

On March 12, 2025, the Board of Directors of the Company approved a new common stock repurchase program of up to $500 million (the "March 2025 Stock Repurchase Program"). The March 2025 Stock Repurchase Program included and was not in addition to any unspent amount remaining under the prior authorization. As described above, the March 2025 Stock Repurchase Program has since been replaced by the July 2025 Stock Repurchase Program.

Previous wording

At March 31, 2026, the Company’s senior secured credit facility (as amended from time to time, the "Credit Agreement") consisted of a $1.2 billion revolving credit facility (the "Revolver"), $285 million senior secured term loan B-1 (the "Term Loan B-1"), $1.1 billion senior secured term loan A (the "Term Loan A"), and $100 million swing line commitment. On July 3, 2024, the Company closed an amendment of the Credit Agreement to (i) extend the maturity date of the Revolver and Term Loan A from 2027 to 2029 and (ii) amend certain other provisions to the Credit Agreement.

Current wording

At June 30, 2026, the Company’s senior secured credit facility (as amended from time to time, the "Credit Agreement") consisted of a $1.2 billion revolving credit facility (the "Revolver"), $284 million senior secured term loan B-1 (the "Term Loan B-1"), $1.1 billion senior secured term loan A (the "Term Loan A"), and $100 million swing line commitment. On July 3, 2024, the Company closed an amendment of the Credit Agreement to (i) extend the maturity date of the Revolver and Term Loan A from 2027 to 2029 and (ii) amend certain other provisions to the Credit Agreement.

Previous wording

Term Loan B-1 requires quarterly payments of 0.25% of the original $300 million balance. The Term Loan B-1 may be subject to additional mandatory prepayment from excess cash flow on an annual basis per the provisions of the Credit Agreement.

Current wording

The Term Loan B-1 requires quarterly payments of 0.25% of the original $300 million balance. The Term Loan B-1 may be subject to additional mandatory prepayment from excess cash flow on an annual basis per the provisions of the Credit Agreement.

Previous wording

The Revolver and Term Loan A bear interest at SOFR plus 10 basis points, plus a variable applicable margin which is determined by the Company's net leverage ratio. As of March 31, 2026, that applicable margin was 150 basis points, which was based on the pricing grid in the Credit Agreement. The Company had $722 million available borrowing capacity under the Revolver, after consideration of $8 million in outstanding letters of credit, as of March 31, 2026.

Current wording

The Revolver and Term Loan A bear interest at SOFR plus 10 basis points, plus a variable applicable margin which is determined by the Company's net leverage ratio. As of June 30, 2026, that applicable margin was 150 basis points which was based on the pricing grid in the Credit Agreement. The Company had $861 million available borrowing capacity, after consideration of $10 million in outstanding letters of credit, under the Revolver as of June 30, 2026.

Previous wording

The estimated contractual payments, including interest, under the Credit Agreement for the next twelve months are estimated to be $161 million assuming no change in the weighted average borrowing rate of 5.30%, which was in place as of March 31, 2026. During the three months ended March 31, 2026, we had repayments of principal and interest on the Credit Agreement of $475 million.

Current wording

The estimated contractual payments, including interest, under the Credit Agreement for the next twelve months are estimated to be $152 million assuming no change in the weighted average borrowing rate of 5.27%, which was in place as of June 30, 2026. During the six months ended June 30, 2026, we had repayments of principal and interest on the Credit Agreement of $1.1 billion.

Previous wording

As of March 31, 2026, we had a total of $700 million in aggregate principal amount of 4.750% senior unsecured notes (the "2028 Senior Notes") maturing on January 15, 2028. The 2028 Senior Notes consist of $500 million notes issued at par and $200 million notes issued at 103.25%. The 2028 Senior Notes were issued in a private offering to qualified institutional buyers, with interest payable in arrears on January 15th and July 15th of each year, commencing on July 15th, 2018. The 3.25% premium is being amortized through interest expense, net over the term of the notes. The Company may redeem some or all the 2028 Senior Notes at redemption prices set forth in the 2028 Indenture.

Current wording

As of June 30, 2026, we had a total of $700 million in aggregate principal amount of 4.750% senior unsecured notes (the "2028 Senior Notes") maturing on January 15, 2028. The 2028 Senior Notes consist of $500 million notes issued at par and $200 million notes issued at 103.25%. The 2028 Senior Notes were issued in a private offering to qualified institutional buyers, with interest payable in arrears on January 15th and July 15th of each year, commencing on July 15th, 2018. The 3.25% premium is being amortized through interest expense, net over the term of the notes. The Company may redeem some or all of the 2028 Senior Notes at redemption prices set forth in the 2028 Indenture.

Previous wording

As of March 31, 2026, we had $1.2 billion in aggregate principal amount of 5.750% senior unsecured notes that mature on April 1, 2030 (the "2030 Senior Notes"). The 2030 Senior Notes were issued at par in a private offering to qualified institutional buyers, with interest payable in arrears on April 1st and October 1st of each year, commencing on October 1st, 2022. The Company may redeem some or all the 2030 Senior Notes at redemption prices set forth in the 2030 Indenture.

Current wording

As of June 30, 2026, we had $1.2 billion in aggregate principal amount of 5.750% senior unsecured notes that mature on April 1, 2030 (the "2030 Senior Notes"). The 2030 Senior Notes were issued at par in a private offering to qualified institutional buyers, with interest payable in arrears on April 1st and October 1st of each year, commencing on October 1st, 2022. The Company may redeem some or all of the 2030 Senior Notes at redemption prices set forth in the 2030 Indenture.

Previous wording

The Company leases certain real estate and other property. Most of our building and land leases have terms of 2 to 10 years and include one or more options to renew, with renewal terms that can extend the lease term from 1 to 5 years or more. Certain of our lease agreements include lease payments based on a percentage of net gaming revenue and others include periodic rental payment adjustments for inflation. As of March 31, 2026, minimum rent payable under operating leases was $53 million, with $7 million due in the next twelve months. As of March 31, 2026, minimum rent payable accounted for as financing obligations was $33 million, with $4 million due in the next twelve months.

Current wording

The Company leases certain real estate and other property. Most of our building and land leases have terms of 2 to 10 years and include one or more options to renew, with renewal terms that can extend the lease term by 1 to 5 years or more. Certain of our lease agreements include lease payments based on a percentage of net gaming revenue and others include periodic rental payment adjustments for inflation. As of June 30, 2026, minimum rent payable under operating leases was $52 million, with $7 million due in the next twelve months. As of June 30, 2026, minimum rent payable accounted for as financing obligations was $32 million, with $4 million due in the next twelve months.

Previous wording

The Company has other contractual obligations with commitments of $11 million, $2 million of which is due within the next twelve months.

Current wording

The Company has other contractual obligations with commitments of $9 million, $2 million of which is due within the next twelve months.