During its 2023 Q1 earnings call on Tuesday, Caesars Entertainment announced plans to launch a standalone Pennsylvania online casino app in the third quarter of this year.
Caesars operates its sportsbook and Caesars Casino in Pennsylvania. The brand also launched Tropicana PA Casino under the Harrah’s Philadelphia license earlier this week.
The launch of a standalone casino app plans to attract a new customer base for Caesars. The company is trying to acquire more of a slot-based audience.
Caesars has been gaining ground on operators in Pennsylvania over the past several months. With new launches and rebrands resulting in improved products, Caesars is planning to compete with the bigger players in the space.
Caesars announces plans to launch standalone PA online casino app
Early in the 2023 Q1 earnings call, Eric Hession, President of Caesars Sports & Online Gaming, made this announcement in his opening remarks:
“First starting early in the third quarter, we will be launching a new standalone iCasino app. This exciting addition to our product offering will allow us to drive better customer engagement through a dedicated application with a focus on increased game content, which will include new proprietary offerings and improved marketing capabilities.”
President and CEO Tom Reeg said the company has not decided whether the new app would be Caesars branded. Caesars has no issues operating under other brands, especially in Pennsylvania.
Under Caesars Entertainment and the Harrah’s Philadelphia license, Caesars just launched Tropicana Casino in the Keystone State. It’s the second online casino Caesars operates in Pennsylvania.
Caesars currently has its own online casino, but it must be accessed through the Caesars Sportsbook PA app.
Online casino app to attract new customer base for Caesars
Caesars has a strong table games presence in Pennsylvania. It’s one of three licensees in the state to generate more than 30% of its online casino revenue through table games. Heisson said a large portion of Caesars’ customer base skews more toward males using the sportsbook app, which drives much of the table games revenue.
With the launch of Caesars’ new online casino app, the company wants to improve on its slot business.
To access Caesars’ current online casino, a player must download the sportsbook app. Heisson said on the call that the app is set up fine for a predominant sportsbook user. They want to appeal to the predominant online casino player with the standalone app.
“So we think that by giving that customer an option to go directly into the app, we’ll be able to provide them with something that’s more in line with what they’re expecting from their experience,” Heisson said. “I think it’s going to attract a higher percentage of the slot customer, which is our core customer from the land-based perspective.”
The app is going to feature a newly designed lobby that’s going to make it easy for Caesars to control. Caesars will have access to real-time marketing capabilities, which allows them to prioritize certain games in the lobby.
Caesars becoming major player in Pennsylvania market
The Caesars brand has made a number of changes and upgrades over the past several months. Here’s a roundup of improvements and news Caesars has made in Pennsylvania:
- Released premium games on current Caesars PA Casino app in partnership with Inspired Entertainment
- Caesars ranked fourth in handle after surpassing Barstool Sportsbook in March
- Launched Tropicana Casino PA for more market share
Caesars Q1 earnings call report
Here are some of the results and highlights from Caesars’ first quarter in 2023:
- GAAP net revenues of $2.8 billion versus $2.3 billion for the comparable prior-year period.
- GAAP net loss of $136 million compared to net loss of $680 million for the comparable prior-year period.
- Same-store Adjusted EBITDA of $958 million versus $296 million for the comparable prior-year period.
- Same-store Adjusted EBITDA, excluding the Caesars Digital segment, of $962 million versus $850 million for the comparable prior-year period.
- Caesars Digital same-store Adjusted EBITDA of $4 million versus $554 million for the comparable prior-year period.
Caesars stock price on May 1 ended at $46.51 and dropped slightly just before Tuesday’s call to $44.58. The price rebounded to $46.20 on May 3 at 11 a.m.
Zacks Equity Research, an independent research company, said Caesars has outperformed expectations in multiple areas over the past four quarters. They also offered this background:
“Ahead of this earnings release, the estimate revisions trend for Caesars Entertainment: mixed. While the magnitude and direction of estimate revisions could change following the company’s just-released earnings report, the current status translates into a Zacks Rank #3 (Hold) for the stock. So, the shares are expected to perform in line with the market in the near future.”
