PENN Entertainment, Inc.

Note 9—Commitments and Contingencies

The Company is subject to various legal and administrative proceedings relating to personal injuries, employment matters, commercial transactions, development agreements and other matters arising in the ordinary course of business. Although the Company maintains what it believes to be adequate insurance coverage to mitigate the risk of loss pertaining to covered matters, legal and administrative proceedings can be costly, time-consuming, and unpredictable. The Company does not believe that the final outcome of these matters will have a material adverse effect on its financial position, results of operations, or cash flows.

ESPN Sportsbook and Investment Agreements

On August 8, 2023, PENN entered into the Sportsbook Agreement (the “Sportsbook Agreement”) with ESPN relating to online sports betting in the U.S. Pursuant to the Sportsbook Agreement, PENN received the exclusive right to use the ESPN BET trademark for online sports betting in the U.S.

The Sportsbook Agreement had an initial 10-year term, with the right for either party to terminate the agreement after the third year if specific market share performance thresholds were not met. In consideration for the media marketing services and brand and other rights provided by ESPN, PENN agreed to pay $150.0 million per year in cash pursuant to the Sportsbook Agreement.

In connection with the Sportsbook Agreement, PENN and ESPN also entered into an Investment Agreement (the “Investment Agreement”) on August 8, 2023. The Investment Agreement provided for the issuance to ESPN of certain warrants to purchase shares of PENN common stock, par value $0.01 per share, and set forth certain other governance rights of ESPN.

Pursuant to the Investment Agreement, PENN issued ESPN warrants to purchase approximately 31.8 million shares of PENN common stock, subject to vesting (“Initial Warrants”). The warrants are classified as equity and contain three separate tranches.

Subsequent to quarter end, on November 5, 2025, PENN and ESPN entered into the Termination Agreement to terminate the Sportsbook Agreement, effective December 1, 2025 (the “Termination Date”). Pursuant to the Termination Agreement, PENN’s exclusive right to use the ESPN BET trademark for online sports betting in the U.S. will end on the Termination Date. The Termination Agreement provides that PENN will pay ESPN a total of $38.1 million in the fourth quarter of 2025 in respect of all remaining fees owed through the Termination Date. In addition, PENN has agreed to pay ESPN a total of $5.0 million following the Termination Date for traditional media to support theScore Bet and/or Hollywood iCasino offerings. The Termination Agreement provides that these payments will settle all outstanding payment obligations from PENN to ESPN under the Sportsbook Agreement.

On November 5, 2025, in connection with the Termination Agreement, PENN and ESPN entered into Amendment No. 1 to the Investment Agreement (the “Investment Agreement Amendment”) to amend certain terms of the Investment Agreement. Pursuant to the Investment Agreement Amendment, effective November 5, 2025, the Initial Warrants were deemed vested through and including February 8, 2026, the unvested portion of each of the Initial Warrants held by ESPN was forfeited and cancelled for no consideration, and PENN will have no obligation to issue any Bonus Warrants (as defined within the Investment Agreement). As of November 5, 2025, ESPN holds (i) a warrant to purchase 3,177,610 shares of PENN common stock with an expiration date of February 8, 2033 and an exercise price of $26.08; (ii) a warrant to purchase 3,200,930 shares of PENN common stock with an expiration date of February 8, 2034 and an exercise price of $29.99; and (iii) a warrant to purchase 1,578,670 shares of PENN common stock with an expiration date of February 8, 2035 and an exercise price of $32.60.

During the three and nine months ended September 30, 2025, the Company recognized $37.5 million and $112.5 million of expense, respectively, related to the Sportsbook Agreement, and $14.5 million and $43.0 million, respectively, related to the Investment Agreement. For the three and nine months ended September 30, 2024, the Company recognized $41.7 million and $141.7 million of expense, respectively, related to the Sportsbook Agreement, and $15.9 million and $53.4 million, respectively, related to the Investment Agreement. Expenses related to the Sportsbook Agreement and the Investment Agreement are recorded within “Gaming” expenses on the unaudited Consolidated Statements of Operations and recognized in accordance with our policies. See Note 2, “Significant Accounting Policies and Basis of Presentation” for further information.

Note 10—Stockholders’ Equity and Stock-Based Compensation

Common and Preferred Stock

In connection with the acquisition of Score Media and Gaming, Inc. (“theScore”) in October 2021, the Company issued 12,319,340 shares of common stock with a par value of $0.01, and 697,539 exchangeable shares, par value $0.01 (“Exchangeable Shares”) through the capital of an indirect wholly-owned subsidiary of PENN, in addition to cash consideration. Each Exchangeable Share is exchangeable intoone share of PENN common stock at the option of the holder, subject to certain adjustments. Upon the acquisition of theScore, certain employees of theScore elected to have their outstanding equity awards, which were assumed under theScore plan (as defined below), issued as Exchangeable Shares, once the shares vest or are exercised. In addition, the Company may redeem all outstanding Exchangeable Shares in exchange for shares of PENN common stock at any time following the fifth anniversary of the closing, or earlier under certain circumstances.

We didnot issue any Exchangeable Shares during the three months ended September 30, 2025 and 2024, or during the nine months ended September 30, 2025. During the nine months ended September 30, 2024, we issued 68,048 Exchangeable Shares. As of both periods ended September 30, 2025 and December 31, 2024, there were 768,441 Exchangeable Shares authorized, of which 379,941 shares and 466,534 shares were outstanding, respectively.

Share Repurchase Authorization

On December 6, 2022, the Board of Directors approved a share repurchase authorization for $750.0 million (the “December 2022 Authorization”), which expires on December 31, 2025.

On October 30, 2025, the Board of Directors approved a new $750.0 million share repurchase program (the “October 2025 Authorization”), subject to the finalization of and entry into the Termination Agreement and the Investment Agreement Amendment, as discussed in Note 9, “Commitments and Contingencies.” The October 2025 Authorization commences on January 1, 2026 and expires on December 31, 2028 and will take effect after the Company’s existing $750.0 million share repurchase program expires on December 31, 2025.

Repurchases by the Company are subject to available liquidity, general market and economic conditions, alternate uses for the capital, and other factors. Share repurchases may be made from time to time through a Rule 10b5-1 trading plan, open market transactions, block trades or in private transactions in accordance with applicable securities laws and regulations and other legal requirements. There is no minimum number of shares that the Company is required to repurchase and the repurchase authorization may be suspended or discontinued at any time without prior notice.

During the three and nine months ended September 30, 2025, respectively, the Company repurchased 7,965,282 and 15,214,631 shares of its common stock in open market transactions for $154.1 million and $269.4 million at an average price of $19.34 and $17.70 per share. No shares of the Company’s common stock were repurchased during the three and nine months ended September 30, 2024.

The cost of all repurchased shares is recorded as “Treasury stock” within the unaudited Consolidated Balance Sheets.

Subsequent to the quarter ended September 30, 2025, the Company repurchased 4,876,200 shares of its common stock at an average price of $17.44 per share for an aggregate amount of $85.0 million. As of November 5, 2025, the remaining availability under our December 2022 Authorization was $395.4 million.

2022 Long Term Incentive Compensation Plan

On June 7, 2022, the Company’s shareholders, upon the recommendation of the Company’s Board of Directors, approved the Company’s 2022 Long Term Incentive Compensation Plan (the “2022 Plan”). The 2022 Plan authorizes the Company to issue stock options (incentive and/or non-qualified), stock appreciation rights (“SARs”), restricted stock (shares and/or units), performance awards (shares and/or units), and cash awards to executive officers, non-employee directors, other employees, consultants, and advisors of the Company and its subsidiaries. Non-employee directors and consultants are eligible to receive all such awards, other than incentive stock options. Pursuant to the 2022 Plan, an initial 6,870,000 shares of the Company’s common stock were reserved for issuance, plus any shares of common stock subject to outstanding awards under both the previous 2018 Long Term Incentive Compensation Plan, as amended (“2018 Plan”) and Score Media and Gaming Inc. Second Amended and Restated Stock Option and Restricted Stock Unit Plan (the “theScore Plan”) as of June 7, 2022, and outstanding awards that are forfeited or settled for cash under each of the prior plans.

On June 6, 2023, the Company’s shareholders, upon the recommendation of the Company’s Board of Directors, approved an amendment to the 2022 Plan (as amended, the “2022 Amended Plan”), which increased the number of shares reserved for issuance under the plan by 7,000,000 shares.

On June 17, 2025, upon the recommendation of the Company’s Board of Directors, shareholders approved a second amendment to the 2022 Plan (as amended, the “2022 Plan – Second Amendment”). Among other changes, this amendment increased the total number of shares reserved for issuance to 22,067,275 shares. For purposes of determining the number of shares available for issuance under the 2022 Plan – Second Amendment, stock options, restricted stock, and all other equity settled awards count against the 22,067,275 share limit asone share of common stock for each share granted. Any awards that are not settled in shares of common stock are not counted against the share limit. As of September 30, 2025, there are 8,217,921 shares available for future grants under the 2022 Plan – Second Amendment.

Performance Share Program

The Company’s performance share programs were adopted to provide our NEOs and certain other key executives with stock-based compensation tied directly to the Company’s performance, which further aligns their interests with our shareholders and provides compensation only if the designated performance goals are met for the applicable performance periods.

The Company granted 1,254,323 and 1,317,269 restricted units with performance-based vesting conditions, at target, during the nine months ended September 30, 2025 and 2024, respectively. The restricted performance units were granted under the 2022 Amended Plan, and each grant consists ofone three-year performance period over athree-year service period. The awards have the potential to be earned at between 0% and 200% of the number of shares granted depending on achievement of the performance goals and remain subject to vesting for the full three-year service period.

Stock-based Compensation Expense

Stock-based compensation expense pertains to our stock options and restricted stock, including restricted stock with performance conditions. The Company recognized stock-based compensation expense of $16.8 million and $12.9 million for the three months ended September 30, 2025 and 2024, respectively, and $48.5 million and $39.0 million for the nine months ended September 30, 2025 and 2024, respectively, which is included in “General and administrative” expense within the unaudited Consolidated Statements of Operations.

Note 11—Loss per Share

We recorded a net loss attributable to PENN for the three and nine months ended September 30, 2025 and 2024. As such, the dilution from potential common shares was anti-dilutive, and therefore, we used basic weighted-average common shares outstanding rather than diluted weighted-average common shares outstanding when calculating diluted loss per share. Stock options, restricted stock, and convertible debt that could potentially dilute basic EPS in the future, that were not included in the computation of diluted loss per share, are as follows:

As we recorded a net loss for the three and nine months ended September 30, 2025 and 2024, there are no reconciling items between the weighted-average common shares outstanding for basic and diluted EPS calculations.

Restricted stock with performance and market based vesting conditions that have not been met as of September 30, 2025 were excluded from the computation of diluted EPS.

Anti-dilutive equity-based awards are excluded from the computation of diluted EPS, and primarily consists of stock options awarded under the Company’s previous and current long-term incentive compensation plans and warrants previously issued under the terms of the Investment Agreement. Pursuant to the Investment Agreement Amendment, the Initial Warrants will be deemed vested through and including February 8, 2026, and the remaining unvested warrants will be forfeited and cancelled for no consideration. See Note 9, “Commitments and Contingencies.”

Anti-dilutive options and warrants to purchase 37.0 million shares were outstanding for both the three and nine months ended September 30, 2025, and 35.3 million and 35.1 million for the three and nine months ended September 30, 2024, respectively.

The Company’s calculation of weighted-average common shares outstanding includes the Exchangeable Shares issued in connection with theScore acquisition, as discussed in Note 10, “Stockholders’ Equity and Stock-Based Compensation.” The following table presents the calculation of basic and diluted loss per share for the Company’s common stock for the three and nine months ended September 30, 2025 and 2024:

Note 12—Fair Value Measurements

ASC Topic 820, “Fair Value Measurements and Disclosures,” establishes a hierarchy that prioritizes fair value measurements based on the types of inputs used for the various valuation techniques (market approach, income approach, and cost approach). The levels of the hierarchy are described below:

•Level 1: Observable inputs such as quoted prices in active markets for identical assets or liabilities.

•Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly; these include quoted prices for similar assets or liabilities in active markets, such as interest rates and yield curves that are observable at commonly quoted intervals.

•Level 3: Unobservable inputs that reflect the reporting entity’s own assumptions, as there is little, if any, related market activity.

The Company’s assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the valuation of assets and liabilities and their placement within the fair value hierarchy. The following methods and assumptions are used to estimate the fair value of each class of financial instruments for which it is practicable to estimate. The fair value of the Company’s trade accounts receivable and payable approximates the carrying amounts.

Long-Term Debt

The fair value of our Amended Credit Facilities, 5.625% Notes,4.125% Notes, and the Convertible Notes is estimated based on quoted prices in active markets. Due to their trading frequency, these long-term debt instruments are classified as Level 2 measurements.

Other long-term obligations as of September 30, 2025 and December 31, 2024 included the repayment obligation of the hotel and event center located near Hollywood Casino Lawrenceburg. The fair value of the Lawrenceburg repayment obligation is estimated based on rates consistent with the Company’s credit rating for comparable terms and debt instruments and is classified as a Level 2 measurement.

As discussed in Note 6, “Long-Term Debt,” other long-term obligations as of December 31, 2024 included a third-party financing arrangement entered into in February 2021. This financing arrangement provided the Company with upfront and non-refundable cash proceeds while permitting us to participate in future proceeds on certain claims. The financing obligation was classified as a Level 3 measurement and as of December 31, 2024 was included within the Consolidated Balance Sheets in “Long-term debt, net of current maturities, debt discounts, and debt issuance costs.”

Other Liabilities

As of both periods ended September 30, 2025 and December 31, 2024, other liabilities include a $39.5 million tax indemnification, as described in Note 2, “Significant Accounting Policies and Basis of Presentation.” Liabilities associated with the indemnification are recorded in “Other long-term liabilities” within the unaudited Consolidated Balance Sheets. The indemnity has been classified as a Level 3 measurement. Key assumptions used to estimate the fair value of the indemnification include the expected tax rate and the probability of potential outcomes based on valuation methods that utilize unobservable inputs that are significant to the overall fair value as of September 30, 2025 and December 31, 2024.

The carrying amounts and estimated fair values by input level of the Company’s financial instruments were as follows:

(1)During the nine months ended September 30, 2025, the Company sold its equity securities for$12.0 million and recognized a gain of $0.6 million.

The following table summarizes the changes in fair value of our Level 3 assets and liabilities measured on a recurring basis:

(1)Primarily relates to the interest expense andnon-cash gain on financing arrangement. See Note 6, “Long-Term Debt.”

The following table summarizes the significant unobservable inputs used in calculating fair value for our Level 3 assets and liabilities on a recurring basis as of September 30, 2025:

The following table sets forth the assets measured at fair value on a non-recurring basis during the nine months ended September 30, 2025:

As discussed in Note 5, “Goodwill and Other Intangible Assets,” we recorded an impairment on our ACB trademark at the ACB reporting unit as a result of our strategic decision to rebrand the anticipated new facility as Hollywood Casino Council Bluffs. The following table presents quantitative information about the significant unobservable inputs used in the fair value measurement of the trademark as of the valuation date below:

Note 13—Segment Information

We have five reportable segments: Northeast, South, West, Midwest, and Interactive. Our gaming and racing properties are grouped by geographic location, and each is viewed as an operating segment with the exception of ourtwo properties in Jackpot, Nevada, which are viewed asone operating segment. We consider our combined VGT operations, by state, to be separate operating segments.

The retail segments primarily generate revenue from gaming operations (such as slot machines and table games), food and beverage offerings, and hotel visitation. The accounting policies of our retail segments are the same as those described in our significant accounting policies. See Note 2, “Significant Accounting Policies and Basis of Presentation” for further information.

The Interactive segment includes all of our online gaming operations, management of retail sports betting, and media operations. The accounting policies of our Interactive segment are the same as those described in our significant accounting policies. See Note 2, “Significant Accounting Policies and Basis of Presentation” for further information.

The Other category, included in the tables to reconcile the segment information to the consolidated information, consists of our stand-alone racing operations, namely Sanford-Orlando Kennel Club, Sam Houston and Valley Race Park, the Company’sjoint venture interests in Freehold Raceway (which ceased operations on December 28, 2024), and our management contract for Retama Park Racetrack. The Other category also includes corporate overhead expenses, which consist of certain expenses, such as: payroll, professional fees, travel expenses, and other general and administrative expenses that have not otherwise been allocated.

The Company’s chief operating decision maker (“CODM”) is the Chief Executive Officer and President. Segment Adjusted EBITDAR (as defined below) is our measure of segment profit or loss for each segment and is utilized by the CODM as follows:

•within the annual budget and forecasting process when making decisions about the allocation of operating and capital resources to each segment;

•to evaluate monthly budget-to-actual variances which are used in assessing segment performance;

•to determine whether to reinvest profits into the segment or into other parts of the Company, such as new development projects, return generating investments in our retail operations and Interactive segment; and

•to determine various capital allocation initiatives such as mergers and acquisitions, share repurchases, and delevering.

The tables below provide information about our revenues, expenses, and Segment Adjusted EBITDAR and provide a reconciliation to net loss.

(1)Revenues and gaming taxes expense within the Interactive segment are inclusive of gaming tax reimbursement amounts related to third-party online sports betting and/or iCasino partners for online sports betting and iCasino market access of$139.5 million for the three months ended September 30, 2025.

(3)Includes advertising expenses of$37.5 million related to the Sportsbook Agreement and$14.5 million related to the Investment Agreement with ESPN. Also, includes advertising and media expenses (including such expenses associated with theScore) across various platforms, including television, radio, out-of-home, social media, and both paid and organic search, and sponsorships and media costs associated with partnerships with major sports leagues, and other professional sports teams.

a. Northeast segment - cost of goods sold, professional services, legal expenses, facility maintenance, utilities, supplies, property and liability insurance, advertising and promotional expenses, property taxes, sales and use taxes, other taxes and fees, non-REIT lease expenses, and allocated corporate expenses.

b. South segment - cost of goods sold, professional services, legal expenses, facility maintenance, utilities, supplies, property and liability insurance, advertising and promotional expenses, property taxes, sales and use taxes, other taxes and fees, non-REIT lease expenses, allocated corporate expenses, and third-party revenue share fees.

c. West segment - cost of goods sold, professional services, legal expenses, facility maintenance, utilities, supplies, property and liability insurance, advertising and promotional expenses, property taxes, sales and use taxes, other taxes and fees, non-REIT lease expenses, and allocated corporate expenses.

d. Midwest segment - cost of goods sold, professional services, legal expenses, facility maintenance, utilities, supplies, property and liability insurance, advertising and promotional expenses, property taxes, sales and use taxes, other taxes and fees, non-REIT lease expenses, allocated corporate expenses, and third-party revenue share fees.

e. Interactive segment - professional services, legal expenses, software subscriptions and maintenance fees, software development costs, utilities, supplies, property and liability insurance, other taxes and fees, lease expense, allocated corporate expenses, and third-party revenue share fees.

(5)We define Segment Adjusted EBITDAR as earnings before interest expense, net, interest income, income taxes, depreciation and amortization, rent expense associated with triple net operating leases (see footnote (7) below), stock-based compensation, debt extinguishment charges, impairment losses, insurance recoveries, net of deductible charges, changes in the estimated fair value of our contingent purchase price obligations, gain or loss on disposal of assets, the difference between budget and actual expense for cash-settled stock-based awards, pre-opening expenses, loss on disposal of a business, non-cash gains/losses associated with REIT transactions, and other. Segment Adjusted EBITDAR is also inclusive of income or loss from unconsolidated affiliates, with our share of non-operating items (see footnote (9) below) added back for our Kansas Entertainment joint venture.

(6)Primarily represents corporate overhead expenses of$34.0 million for the three months ended September 30, 2025, which is inclusive of $3.9 million of legal and advisory costs related to activist activity in connection with our 2025 annual meeting of shareholders.

(8)Includes an impairment charge of $825.0 million in the Interactive segment. See Note 5, “Goodwill and Other Intangible Assets.”

(9)Consists primarily of depreciation expense associated with our Kansas Entertainment joint venture.

(1)Revenues and gaming taxes expense within the Interactive segment are inclusive of gaming tax reimbursement amounts related to third-party online sports betting and/or iCasino partners for online sports betting and iCasino market access of$104.1 million for the three months ended September 30, 2024.

(3)Includes advertising expenses of$41.7 million related to the Sportsbook Agreement and$15.9 million related to the Investment Agreement with ESPN. While the Sportsbook Agreement and Investment Agreement commenced on August 8, 2023, the Company began recognizing advertising expense, specific to the initial annual period, during the fourth quarter of 2023. Also, includes advertising and media expenses (including such expenses associated with theScore) across various platforms, including television, radio, out-of-home, social media, and both paid and organic search, and sponsorships and media costs associated with partnerships with major sports leagues, and other professional sports teams.

a. Northeast segment - cost of goods sold, professional services, legal expenses, facility maintenance, utilities, supplies, property and liability insurance, advertising and promotional expenses, property taxes, sales and use taxes, other taxes and fees, non-REIT lease expenses, and allocated corporate expenses.

b. South segment - cost of goods sold, professional services, legal expenses, facility maintenance, utilities, supplies, property and liability insurance, advertising and promotional expenses, property taxes, sales and use taxes, other taxes and fees, non-REIT lease expenses, allocated corporate expenses, and third-party revenue share fees.

c. West segment - cost of goods sold, professional services, legal expenses, facility maintenance, utilities, supplies, property and liability insurance, advertising and promotional expenses, property taxes, sales and use taxes, other taxes and fees, non-REIT lease expenses, and allocated corporate expenses.

d. Midwest segment - cost of goods sold, professional services, legal expenses, facility maintenance, utilities, supplies, property and liability insurance, advertising and promotional expenses, property taxes, sales and use taxes, other taxes and fees, non-REIT lease expenses, allocated corporate expenses, and third-party revenue share fees.

e. Interactive segment - professional services, legal expenses, software subscriptions and maintenance fees, software development costs, utilities, supplies, property and liability insurance, other taxes and fees, lease expense, allocated corporate expenses, and third-party revenue share fees.

(5)We define Segment Adjusted EBITDAR as earnings before interest expense, net, interest income, income taxes, depreciation and amortization, rent expense associated with triple net operating leases (see footnote (7) below), stock-based compensation, debt extinguishment charges, impairment losses, insurance recoveries, net of deductible charges, changes in the estimated fair value of our contingent purchase price obligations, gain or loss on disposal of assets, the difference between budget and actual expense for cash-settled stock-based awards, pre-opening expenses, loss on disposal of a business, non-cash gains/losses associated with REIT transactions, and other. Segment Adjusted EBITDAR is also inclusive of income or loss from unconsolidated affiliates, with our share of non-operating items (see footnote (8) below) added back for our Kansas Entertainment joint venture.

(6)Primarily represents corporate overhead expenses of$29.1 million for the three months ended September 30, 2024.

(8)Consists primarily of depreciation expense associated with our Kansas Entertainment joint venture.

(1)Revenues and gaming taxes expense within the Interactive segment are inclusive of gaming tax reimbursement amounts related to third-party online sports betting and/or iCasino partners for online sports betting and iCasino market access of$405.6 million for the nine months ended September 30, 2025.

(3)Includes advertising expenses of$112.5 million related to the Sportsbook Agreement and$43.0 million related to the Investment Agreement with ESPN. Also, includes advertising and media expenses (including such expenses associated with theScore) across various platforms, including television, radio, out-of-home, social media, and both paid and organic search, and sponsorships and media costs associated with partnerships with major sports leagues, and other professional sports teams.

a. Northeast segment - cost of goods sold, professional services, legal expenses, facility maintenance, utilities, supplies, property and liability insurance, advertising and promotional expenses, property taxes, sales and use taxes, other taxes and fees, non-REIT lease expenses, and allocated corporate expenses.

b. South segment - cost of goods sold, professional services, legal expenses, facility maintenance, utilities, supplies, property and liability insurance, advertising and promotional expenses, property taxes, sales and use taxes, other taxes and fees, non-REIT lease expenses, allocated corporate expenses, and third-party revenue share fees.

c. West segment - cost of goods sold, professional services, legal expenses, facility maintenance, utilities, supplies, property and liability insurance, advertising and promotional expenses, property taxes, sales and use taxes, other taxes and fees, non-REIT lease expenses, and allocated corporate expenses.

d. Midwest segment - cost of goods sold, professional services, legal expenses, facility maintenance, utilities, supplies, property and liability insurance, advertising and promotional expenses, property taxes, sales and use taxes, other taxes and fees, non-REIT lease expenses, allocated corporate expenses, and third-party revenue share fees.

e. Interactive segment - professional services, legal expenses, software subscriptions and maintenance fees, software development costs, utilities, supplies, property and liability insurance, other taxes and fees, lease expense, allocated corporate expenses, and third-party revenue share fees.

(5)We define Segment Adjusted EBITDAR as earnings before interest expense, net, interest income, income taxes, depreciation and amortization, rent expense associated with triple net operating leases (see footnote (7) below), stock-based compensation, debt extinguishment charges, impairment losses, insurance recoveries, net of deductible charges, changes in the estimated fair value of our contingent purchase price obligations, gain or loss on disposal of assets, the difference between budget and actual expense for cash-settled stock-based awards, pre-opening expenses, loss on disposal of a business, non-cash gains/losses associated with REIT transactions, and other. Segment Adjusted EBITDAR is also inclusive of income or loss from unconsolidated affiliates, with our share of non-operating items (see footnote (9) below) added back for our Kansas Entertainment joint venture.

(6)Primarily represents corporate overhead expenses of$108.7 million for the nine months ended September 30, 2025, which is inclusive of $21.0 million of legal and advisory costs related to activist activity in connection with our 2025 annual meeting of shareholders.

(8)Includes impairment charges of $15.0 million in the Midwest segment and$825.0 million in the Interactive segment. See Note 5, “Goodwill and Other Intangible Assets.”

(9)Consists primarily of depreciation expense associated with our Kansas Entertainment joint venture.

(10)Relates to the$215.1 million non-cash gain on financing arrangement. See Note 6, “Long-Term Debt.”

(1)Revenues and gaming taxes expense within the Interactive segment are inclusive of gaming tax reimbursement amounts related to third-party online sports betting and/or iCasino partners for online sports betting and iCasino market access of$302.8 million for the nine months ended September 30, 2024.

(3)Includes advertising expenses of$141.7 million related to the Sportsbook Agreement and$53.4 million related to the Investment Agreement with ESPN. While the Sportsbook Agreement and Investment Agreement commenced on August 8, 2023, the Company began recognizing advertising expense, specific to the initial annual period, during the fourth quarter of 2023. Also, includes advertising and media expenses (including such expenses associated with theScore) across various platforms, including television, radio, out-of-home, social media, and both paid and organic search, and sponsorships and media costs associated with partnerships with major sports leagues, and other professional sports teams.

a. Northeast segment - cost of goods sold, professional services, legal expenses, facility maintenance, utilities, supplies, property and liability insurance, advertising and promotional expenses, property taxes, sales and use taxes, other taxes and fees, non-REIT lease expenses, and allocated corporate expenses.

b. South segment - cost of goods sold, professional services, legal expenses, facility maintenance, utilities, supplies, property and liability insurance, advertising and promotional expenses, property taxes, sales and use taxes, other taxes and fees, non-REIT lease expenses, allocated corporate expenses, and third-party revenue share fees.

c. West segment - cost of goods sold, professional services, legal expenses, facility maintenance, utilities, supplies, property and liability insurance, advertising and promotional expenses, property taxes, sales and use taxes, other taxes and fees, non-REIT lease expenses, and allocated corporate expenses.

d. Midwest segment - cost of goods sold, professional services, legal expenses, facility maintenance, utilities, supplies, property and liability insurance, advertising and promotional expenses, property taxes, sales and use taxes, other taxes and fees, non-REIT lease expenses, allocated corporate expenses, and third-party revenue share fees.

e. Interactive segment - professional services, legal expenses, software subscriptions and maintenance fees, software development costs, utilities, supplies, property and liability insurance, other taxes and fees, lease expense, allocated corporate expenses, and third-party revenue share fees.

(5)We define Segment Adjusted EBITDAR as earnings before interest expense, net, interest income, income taxes, depreciation and amortization, rent expense associated with triple net operating leases (see footnote (7) below), stock-based compensation, debt extinguishment charges, impairment losses, insurance recoveries, net of deductible charges, changes in the estimated fair value of our contingent purchase price obligations, gain or loss on disposal of assets, the difference between budget and actual expense for cash-settled stock-based awards, pre-opening expenses, loss on disposal of a business, non-cash gains/losses associated with REIT transactions, and other. Segment Adjusted EBITDAR is also inclusive of income or loss from unconsolidated affiliates, with our share of non-operating items (see footnote (8) below) added back for our Kansas Entertainment joint venture.

(6)Primarily represents corporate overhead expenses of $78.5 million for the nine months ended September 30, 2024.

(8)Consists primarily of depreciation expense associated with our Kansas Entertainment joint venture.

The table below presents capital expenditures by segment:

The table below presents investment in and advances to unconsolidated affiliates and total assets by segment:

(1)The real estate assets subject to the Master Leases, which are classified as either property and equipment, net, operating lease ROU assets, or finance lease ROU assets, are included within the Other category.