Bally's Corp

6. REVENUE RECOGNITION

The Company recognizes revenue in accordance with ASC 606, which requires the revenue to be recognized when a

performance obligation is satisfied by transferring the control of promised goods or services and is measured at the transaction

price or the amount of consideration that the Company expects to receive through satisfaction of the identified performance

obligations.

The Company generates revenue fromsix principal sources: (1)gaming (which includes retail gaming, online gaming,

consumer lottery, sports betting and racing), (2)hotel, (3)food and beverage, (4)licensing, (5)technology services and (6)

retail, entertainment and other.

Sales tax and other taxes collected on behalf of governmental authorities are accounted for on a net basis and are not included in

revenue or operating expenses.

Gaming Revenue

Performance Obligations

Retail gaming service contracts involving our land-based casinos, each have an obligation to honor the outcome of a wager and

to pay out an amount equal to the stated odds, including the return of the initial wager, if the customer receives a winning hand.

These elements of honoring the outcome of the hand of play and generating a payout are considered one performance

obligation, with an additional performance obligation for those customers earning incentives under the Company’s player

loyalty program.

Online gaming and sports betting represent a single performance obligation for the Company to operate contests or games and

award prizes or payouts to users based on results of the arrangement. For certain state-authorized sports betting contracts, the

Company operates and manages wagering services as an agent of the applicable government authority. Additionally, the use of

incentives across the online gaming products create future customer rights and are a separate performance obligation.

Racing revenue is earned through advance deposit wagering, which consists of patrons wagering through an advance deposit

account. Each wagering contract contains a single performance obligation.

Consumer lottery revenue is earned from jurisdictions where the Company has a license from the applicable government

authority to operate games to provide game management services. Each consumer lottery contract contains a single

performance obligation to stand ready to operate games and lotteries in the specific jurisdiction.

Transaction Price

The Company applies a practical expedient to account for its gaming contracts on a portfolio basis as such wagers have similar

characteristics and the Company reasonably expects the impact on the consolidated financial statements of applying the revenue

recognition guidance to the portfolio would not differ materially from the application of an individual wagering contract. The

transaction price for a retail gaming, online gaming or sports betting wagering contract is the difference between wins and

losses, not the total amount wagered. In addition, in the event of a multi-stage contest, the Company will allocate transaction

price ratably from contest start to the contest’s final stage.

The transaction price for racing operations, inclusive of live racing events conducted at the Company’s racing facilities, is the

commission received from the pari-mutuel pool less contractual fees and obligations, primarily consisting of purse funding

requirements, simulcasting fees, tote fees and certain pari-mutuel taxes that are directly related to the racing operations.

For purposes of allocating the transaction price in a wagering contract between the wagering performance obligation and the

obligation associated with incentives earned under loyalty programs, the Company allocates an amount to the loyalty program

contract liability based on the stand-alone selling price of the incentive earned. The performance obligation related to loyalty

program incentives are deferred and recognized as revenue upon redemption by the customer.

For certain consumer lottery contracts, payments to the applicable government authority for the license to operate are not

considered consideration payable to a customer under ASC 606. Accordingly, such payments are recognized as operating

expenses and are not presented as a reduction of revenue.

Revenue Recognition

The allocated revenue for retail gaming wagers is recognized when the wagering occurs as all such wagers settle immediately.

Online gaming revenue is recognized at the point in time when the player completes a gaming session and payout occurs.

Sports betting involves a player wagering money on an outcome or series of outcomes. If a player wins the wager, the Company

pays the player a pre-determined amount known as fixed odds, and its revenue is recognized as total wagers net of payouts

made and incentives awarded to players. Racing revenue includes several of our casinos and resorts’ share of wagering from

live racing and the import of simulcast signals, and is recognized upon completion of the wager based upon an established take-

out percentage. Consumer lottery revenue is recognized as tickets are sold and the variability is resolved.

Certain operations within the Company’s Casinos & Resorts and North America Interactive reportable segment act as an agent

in operating gaming services on behalf of the state in which they are licensed. At these respective casino properties, gaming

revenue is recognized when the wager is settled, which is when the customer has received the benefits of the Company’s

gaming services and the Company has a present right to payment. The Company recorded revenue from its operations in these

states on a net basis, which represents the percentage share entitled to the Company. Additionally, certain operations within the

Company’s B2C reportable segment act as an agent in providing virtual sports betting services on behalf of the applicable

government authority. The Company collects wagers from players, remits net proceeds to the applicable government authority

after payment of prizes, and retains a commission. As the Company does not control the underlying wagering activity, revenue

is recognized on a net basis in an amount equal to the commission to which the Company is entitled. Revenue is recognized

over time as wagering activity occurs and the outcome of the underlying bets is resolved.

Non-gaming Revenue

Performance Obligations

Hotel, food and beverage, licensing, andretail, entertainment and other services have been determined to be separate, stand-

alone performance obligations and revenue is recognized as the good or service is transferred at the point in time of the

transaction.

Technology services contracts involve the Company using its software to provide services related to customers’ lottery, VLT,

and sports betting operations. The Company will also provide related hardware and support services. Technology services

contracts can contain multiple performance obligations, including a performance obligation to stand ready to provide access to

the software throughout the contract term and distinct performance obligations for sales of related hardware and

implementation, customization, maintenance, and technical support services.

Transaction Price

The transaction price forhotel, food and beverage, licensing, andretail, entertainment and other, is the net amount collected

from the customer for such goods and services or under the license agreement. The estimated standalone selling price of hotel

rooms is determined based on observable prices. The standalone selling price of these goods and services are determined based

upon the actual retail prices charged to customers for those items.

The transaction price fortechnology services contracts is primarily variable and is generally based on either (i) a monthly fee

per enrolled machine, (ii) a percentage of gross revenue, or (iii) a percentage of net drop, which represents total amounts

wagered less winnings and payouts to players.

Revenue Recognition

Hotel revenue is recognized when the customer obtains control through occupancy of the room over their stay at the hotel.

Advance deposits for hotel rooms are recorded as liabilities until revenue recognition criteria are met. Food, beverage and retail

revenues are recognized at the time the goods are sold from Company-operated outlets. Licensing revenue is recognized under

the sales-and usage-based royalty exception available in ASC 606 for licenses of intellectual property whereby revenue is

recognized in the period that the underlying sale or usage occurs as the fees due to the Company are contingent and based on

the customer’s usage of the intellectual property. Technology services revenues from the use of the Company’s software to

provide services to customers are recognized over time as the variability is resolved. Other revenue includes cancellation fees

for hotel and meeting space services, which are recognized upon cancellation by the customer, and golf revenues from the

Company’s operations of Bally’s Golf Links, which are recognized at the time of sale. Additionally, other revenue includes

market access and business-to-business service revenue generated by the Bally's Intralot B2B and North America Interactive

reportable segments, which is recognized at the time the goods are sold or the service is provided, and are included in Non-

gaming revenue within our consolidated statements of operations.

The following table provides a disaggregation of total revenue by segment (in thousands):

Contract Assets and Contract Related Liabilities

The Company’s receivables related to contracts with customers are primarily comprised of marker balances, interactive

platform business-to-business service receivables, other amounts due from gaming activities, amounts due for hotel stays and

amounts due from tracks and OTB locations. The Company’s receivables related to contracts with customers were$57.5

million and$41.3 million as of December 31, 2025 (Successor) and 2024 (Predecessor), respectively.

The Company has the following liabilities related to contracts with customers: liabilities for loyalty programs, advance deposits

made for goods and services yet to be provided and unpaid wagers. All of the contract liabilities are short-term in nature and are

included in “Accrued and other current liabilities” in the consolidated balance sheet.

Loyalty program incentives earned by customers are typically redeemed withinone year from when they are earned and expire

if a customer’s account is inactive for more than 12 months; therefore, the majority of these incentives outstanding at the end of

a period will either be redeemed or expire within the next 12 months.

Advance deposits are typically interactive player deposits and customer deposits for future banquet events, hotel room

reservations, and gift cards. The Company holds restricted cash for interactive player deposits and records a corresponding

withdrawal liability.

Unpaid wagers include the Company’s outstanding chip liability and unpaid slot, pari-mutuel and sports betting tickets.

Liabilities related to contracts with customers as of December 31, 2025 (Successor) and 2024 (Predecessor) were as follows:

The Company recognized$21.0 million,$2.2 million, and$30.5 million of revenue related to loyalty program redemptions for

theperiod from February 8, 2025 to December 31, 2025 (Successor), theperiod from January 1, 2025 to February 7, 2025

(Predecessor) and the year ended December 31,2024 (Predecessor), respectively.