Churchill Downs posts record $163.2m in Q3 adjusted EBITDA but net revenue falls


Churchill Downs Incorporated (CDI) has reported a 4.5% increase in adjusted EBITDA for Q3, despite a modest 2.5% decrease in net revenue.

The company’s top-line has declined by approximately $10m year-on-year, dropping from $393m to $383.1m.

As a result, Churchill’s profitability was negatively impacted to the tune of $4.4m. The company’s third quarter net income fell from $61.4m to $57m, a 7% decrease.

Churchill’s TwinSpires business produced $107.4m, $1.6m fewer than in the prior-year quarter. This, the company said, was primarily due to a $3.4m decrease from ‘Sports and Casino’ and a $1.8m increase from ‘Horse Racing.’

Adjusted EBITDA for the segment, meanwhile, experienced a $9m increase year-on-year, climbing to $31.1m. Churchill attributed this to a decrease in online marketing and promotional activities.

Gaming’s net revenue remained relatively flat year-on-year, rising by $0.3m to $185.9m, while adjusted EBITDA increased by $0.9m.

The company’s live and historical racing business recorded a more significant, 26% revenue increase. For Q3, this segment produced $102.4m, up from $81.5m. The segment also recorded a $6.8m increase in adjusted EBITDA.

Overall, Churchill reported record third quarter adjusted EBIDTA. This climbed to $163.2m from the $156.1m reported for the same period in 2021.

But this increase is likely connected to the exclusion of Arlington’s operating results. As Churchill noted: “All other revenue and adjusted EBITDA decreased primarily as a result of Arlington not conducting live racing in the third quarter of 2022 as we ceased racing and simulcast operations at the end of 2021.

“We are excluding Arlington’s operating results from adjusted EBITDA in 2022 pending the sale of the property to the Chicago Bears.”

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