- Churchill Downs is marketing nine regional casinos in eight states and has engaged Macquarie Capital to assist.
- The gaming segment holding those casinos added $4 million of revenue in the quarter, against $34 million for racing.
- Second-quarter net revenue set a company record at $980 million, with adjusted EBITDA at a record $477 million.
- Proceeds would cut leverage from 3.7 times, pay for racetrack projects and restart buybacks that have been zero in 2026.
LOUISVILLE, Ky. – Churchill Downs Incorporated is exploring the sale of nine wholly owned regional casinos in eight states while keeping its racetracks and historical racing machines, the company said in a July 29 securities filing. It disclosed the plan the same day it reported the largest quarter in its history, $980 million in net revenue.
Nine Casinos, Eight States, No Timetable
The Form 8-K filed July 29 names all nine of the wholly owned regional gaming properties the company would consider selling.
Mississippi accounts for two of them, Harlow’s Casino Resort and Spa and Riverwalk Casino Hotel. The other seven states have one each, and they are Calder Casino in Florida, Terre Haute Casino Resort in Indiana, the Hard Rock Hotel & Casino in Iowa, Oxford Casino Hotel in Maine, Ocean Downs Casino and Racetrack in Maryland, del Lago Resort and Casino in New York and Presque Isle Downs and Casino in Pennsylvania.
The filing sets no deadline and carries no commitment. Churchill Downs said it can give no assurances that the exploration will lead it to pursue a transaction, or that any transaction it does pursue will be completed at all.
Bill Carstanjen, the company’s chief executive officer, told analysts on the second-quarter earnings call that Macquarie Capital has been engaged to assist, and that a sale would most likely be handled individually or in small groups to maximize value for shareholders. He said the company is working to execute the process over the coming months.
The nine properties sit in eight of the states with legal gambling, from Calder Casino in Miami Gardens, Florida, to Presque Isle Downs in Erie, Pennsylvania.
The Gaming Segment Grew The Least
The gaming segment that holds the nine casinos produced $270 million of revenue in the second quarter, up from $266 million a year earlier, and $133 million of adjusted EBITDA, up from $127 million. Live and historical racing, the segment built around Churchill Downs Racetrack and the historical racing machine venues, went from $541 million of revenue to $575 million and from $297 million of adjusted EBITDA to $318 million.
The segment also carries the Louisiana operations the company is keeping, which brought in $29 million of revenue in the quarter. Two-thirds of its earnings growth came from assets that are not for sale at all. The company attributed $4 million of the segment’s $6 million adjusted EBITDA increase to its equity investments in Rivers Des Plaines in Illinois and Miami Valley Gaming in Ohio, neither of which appears on the 8-K list.
Wholly owned gaming properties added $4 million, driven by the New York venue, against a $2 million decrease tied to the end of historical racing machine operations in Louisiana in May 2025. On the revenue line, an $8 million gain from the New York, Indiana and Maryland properties was partly erased by a $4 million decline from that same Louisiana shutdown.
Record Quarter, Record Derby Week
Company-wide net revenue set a record at $980 million and adjusted EBITDA reached a record $477 million. Net income attributable to Churchill Downs rose 11% to $241 million, and diluted earnings per share reached $3.42, up from $2.99.
The 152nd Kentucky Derby delivered record all-sources wagering for Derby Week and peak television viewership of 24.4 million, a 12% increase. Through six months, net revenue stands at $1.64 billion against $1.58 billion a year ago.
Proceeds Are Earmarked For Debt, The Track And Buybacks
Carstanjen said the intention is to use sale proceeds to significantly reduce leverage, reinvest selectively in Churchill Downs Racetrack and other high-return projects, and fund share repurchases. He added that “our recent share price performance has not reflected the quality, durability, and cash-generating characteristics of our properties.”
Buybacks have stopped. Churchill Downs repurchased no stock in the first six months of 2026 after spending $341 million on repurchases in the same period of 2025, while dividend payments came to $31 million. Net bank leverage closed the quarter at 3.7 times.
Capital spending is planned at $180 million to $220 million this year, including $25 million to $30 million on the Victory Run project at the racetrack, targeted for April 2028, and $70 million to $80 million on the Rockingham Grand Casino historical racing venue in New Hampshire, targeted for mid-2027.
What The Company Is Keeping
Carstanjen said the company does not intend to sell its historical racing machine properties in Kentucky, Virginia or New Hampshire. Those venues run machines built on past race results and report inside the racing segment rather than the gaming segment, alongside Churchill Downs Racetrack itself. TwinSpires, the company’s entry among USA gambling sites, belongs to the wagering services and solutions segment, which grew from $168 million of revenue to $178 million.
The racing carve-out does not cover everything with a track attached. Two of the nine properties on the block run live racing. Presque Isle Downs and Casino in Erie, Pennsylvania, stages about 80 thoroughbred racing days a year, and Ocean Downs Casino and Racetrack in Berlin, Maryland, about 45 harness days, according to the company’s most recent annual report.
Marcia Dall, the chief financial officer, told analysts the company expects bank covenant net leverage to hold between 3.6 and 3.8 times through the end of the year, and to fall in 2027 based on cash flow projections and if and when any regional gaming asset sales close.