Churchill Downs tops Q3 profit estimates, misses on revenue

Churchill Downs Inc. (CHDN) said on Oct. 28 that adjusted diluted earnings per share for the third quarter rose to $1.23 from $1.09 a year earlier, topping the $1.18 consensus estimate compiled by Finnhub. Revenue of $696 million was below the $710.81 million estimate.

Churchill Downs Incorporated runs Churchill Downs Racetrack, the home of the Kentucky Derby, and operates live and historical racing venues, online wagering and regional casino gaming properties.

Here's how the company did:

• Adjusted diluted EPS: $1.23 vs. $1.09 a year earlier, above the $1.18 consensus estimate compiled by Finnhub
• Revenue: $696 million vs. $683 million a year earlier, below the $710.81 million estimate
• Diluted EPS, GAAP: $1.15 vs. 54 cents a year earlier
• Net income attributable to CDI: $80 million vs. $38 million a year earlier

The company said revenue rose 2% from a year earlier, to a record $696 million. Net income attributable to CDI was $80 million, up $42 million, but the year-earlier quarter included a one-time, non-cash impairment and an insurance recovery.

Excluding those items, net income attributable to CDI rose $10 million, or 26%. Adjusted EBITDA reached a record $264 million, up $2 million, or 1%, according to the release.

Net income has risen in each of the last three quarters, from $38.1 million in the third quarter of 2025 to $241.0 million in the second quarter of 2026, according to its SEC filings.

Segment results

Live and Historical Racing revenue was $315 million, up from $305 million, while its adjusted EBITDA fell to $111 million from $116 million. The company said the Virginia historical racing venues were hit by increased competition and a new tax under the state's racing tax structure.

Wagering Services and Solutions revenue slipped to $126 million from $127 million, while adjusted EBITDA rose to $48 million from $46 million.

Gaming revenue was $273 million, up from $266 million, and adjusted EBITDA was $128 million, up from $123 million. The company said its equity investments added $3 million to that gain.

Capital returns and financing

The board declared an annual dividend of 46.9 cents per share, a 7% increase, payable Jan. 5, 2027, to shareholders of record as of Dec. 4. The company said it is the 16th consecutive year it has raised the dividend.

On Oct. 27 the board approved a new share repurchase program of up to $750 million. The company said the program includes and is not in addition to the $306 million remaining under its July 2025 program. In the third quarter it repurchased 570,169 shares for $48 million.

The company closed a $500 million Term Loan B due Sept. 25, 2033, issued at 99.875% of principal and bearing interest at SOFR plus 175 basis points. Proceeds were used partly to repay its 2028 Term Loan B and 2031 Revolver. The company redeemed its 2027 Senior Notes on Oct. 19 with revolver borrowings.

The company ended the quarter with net bank leverage of 3.8 times.

Other developments

The company closed its acquisition of 49% of United Tote Company from a subsidiary of the New York Racing Association on Aug. 3. NYRA agreed to extend its tote services agreement with United Tote through 2035.

The company also said it will begin a Thoroughbred Championship Series with NYRA starting with the 2027 Kentucky Oaks and Kentucky Derby.