Penn Entertainment recently announced that it will be laying off approximately 100 employees as it shifts its focus towards the growth of ESPN Bet. This decision comes as the company looks to enhance operational efficiencies following its acquisition of the Canadian media and gaming giant, theScore, in 2021. With a workforce of around 20,000 employees, this move is aimed at streamlining operations and driving growth in the interactive business sector.
CEO Jay Snowden communicated these changes to staff members through an internal email, highlighting the company’s commitment to its proprietary tech stack and the migration of its sportsbook to theScore’s platform. The goal is to leverage the partnership with theScore and integrate it further into Penn’s operations. These strategic initiatives also include product enhancements and a deeper integration into ESPN’s ecosystem, as part of the $2 billion branding partnership with Disney’s ESPN.
Despite these efforts, investors are growing impatient with Penn Entertainment’s performance, with shares plummeting 25% year to date. The company has missed earnings expectations in the last two quarters and lowered its guidance, prompting activist investor Donerail Group to call for a sale of the casino company. Rumors of potential interest from other online gaming and brick-and-mortar casino companies have also been circulating, but analyst Barry Jonas believes that a sale is unlikely in the near term due to the complexity of such a transaction.
Looking ahead, Penn Entertainment is set to release new features for ESPN Bet this fall, coinciding with the start of football season. Analysts anticipate that these enhancements will significantly improve the product and demonstrate the company’s commitment to driving results from its investments. Despite the challenges and pressure from investors, Penn remains focused on its growth strategy and aims to showcase the success of ESPN Bet in the competitive gaming market.
Penn Entertainment’s decision to lay off employees and refocus its efforts on the growth of ESPN Bet marks a significant shift in its strategic direction. As the company navigates through challenges and pressures from investors, it remains committed to driving growth and delivering value to its shareholders. The upcoming release of new features for ESPN Bet is a testament to Penn’s determination to succeed in the competitive gaming industry, despite the hurdles it faces.