Caesars Floats Plan to Spin Off Digital Operations into Separate Company

Caesars Entertainment CEO Thomas Reeg says that the company may consider transitioning Caesars Digital into its own publicly traded company to take advantage of the growth of its online gambling operations.

Reeg made those comments during Caesars’ Q4 earnings call, which took place on Wednesday, Feb. 26.

Investors See Unexploited Value in Digital Assets

The discussion of that possibility took place during a question-and-answer segment during the call. Deutsche Bank analyst Carlo Santarelli asked Reeg how Caesars might think about ways to “unlock some of the value that’s presumably within the digital segment and maybe not reflected in the stock.”

“We see the same thing that you see,” Reeg responded. “Operationally, it makes the most sense to keep everything together as one. But when the dichotomy is such that it’s been and is today…we look to drive as much shareholder value as we can.”

“If the market dynamics remain the same and the business continues to grow as it has, you should expect that we would look at any and all avenues in terms of how we can drive the most value to our shareholders,” Reeg continued.

Those comments come as Caesars Digital wrapped up its best ever year for the company. Caesars reported that 2024 saw iGaming bring in the largest net revenues ($1.2 billion) and EBITDA ($117 million) the company has seen from its digital segment. Net revenues were up 20 percent year-over-year, while EBITDA more than tripled compared to the $38 million in adjusted earnings seen in 2023.

As a result, Caesars has also been investing significant resources into its digital operations, as CFO Eric Hession spoke to in the earnings call.

“In January, we announced the launch of our first branded online Caesars Casino live dealer studio in Pennsylvania, and we plan to roll out similar branded studios in New Jersey and Michigan later in the first half,” Hession said. “Continued improvements in technology, structural hold, and customer experience will drive another strong year of revenue and EBITDA growth in 2025 and keep us on track for a $500 million EBITDA goal.”

Caesars Focusing on Core Business, Open to Selling Assets

If Caesars were to turn its digital operations into their own company, Reeg told investors that the $500 million EBITDA goal would still stand, though there might be some added costs as the iGaming side unwound from Caesars proper.

“There would be some modest dissynergies associated with that because digital does rely on our centralized functions as they sit here today,” Reeg said. “I don’t think that would be a determinative piece of the puzzle, but it would be something you’d consider.”

These comments come at a time when Caesars has already pivoted towards focusing on its core land-based business. In August 2024, the company sold the World Series of Poker brand to NSUS for $500 million. Later in the year, Caesars announced that it was also selling the Linq Promenade in Las Vegas.

During the earnings call, Reeg told investors that Caesars may continue to sell off assets – especially those considered non-core – and that it is getting plenty of interest from potential buyers. 

“You’ve heard me say many times we’re a public company. Everything’s for sale every day,” Reeg said. “I would say since the fourth quarter, we’ve seen an increase in incoming calls in terms of somebody saying ‘Hey, what about this asset? What about that asset?’ I wouldn’t tell you that that’s transitioned into any particular trades that I think are imminent or even highly likely. But that’s after a couple of years where nobody was making calls at all. So that’s a step in the right direction.”

(Image: Piotr Swat / SOPA / Zuma)