‘This is Existential’: PENN Sees Prediction Markets as ‘Major Threat’

The chief executive officer of PENN Entertainment Inc. sees a major problem looming with prediction markets, particularly if those federally regulated exchanges begin dabbling in casino-like products.

PENN CEO Jay Snowden voiced those concerns about prediction markets during his company's quarterly earnings call on Thursday, much of which was dedicated to a “mutual decision” to end a sports betting partnership with ESPN.

“This is a major threat to the industry,” Snowden said. 

Federally regulated prediction markets continue to gain traction across the U.S., including in states that have not legalized any forms of gambling at all.

Those gains are coming in large part from offering sports event contracts that allow users to bet “yes” or “no” on the same sort of things they could wager on at state-regulated sportsbooks. This makes prediction markets competition for those state-regulated sportsbook operators, Wyomissing, Pa.-based PENN included. 

The best defense: a good offense?

While the legality of sports event contracts is being fought over in the courts, they are, for now, legal and available in all 50 U.S. states. That has put the operators of state-regulated online sports betting sites in the U.S. in a bind, as they’d love the same sort of access, but have state-level gambling regulators cautioning them not to go there.

“We're going to very clearly take our direction from our state regulators,” Snowden said on Thursday. “We always have, we always will. That doesn't change. With all that said, I do think as an industry, that we've got to play some offense here.”

PENN’s new online sports betting approach post-ESPN BET is more of an iCasino approach, which makes sense given PENN’s casinos. PENN also “retains a database of 2.9 million digital users acquired during the ESPN relationship, including 300 thousand acquired this football season.” pic.twitter.com/jYIaIqsLdR

— Geoff Zochodne (@GeoffZochodne) November 6, 2025

Snowden said they feel they can “outperform” prediction markets if they are in the same states offering the same products, such as online sports betting. The trouble is, PENN and others don’t have the same opportunities at the moment.

Moreover, while prediction markets are facing pushback through the courts, a final determination about their products could still take months or years. In the meantime, Snowden believes the more traditional gambling industry needs to "come together" and take the initiative back.

“So I would say stay tuned,” Snowden said, adding that he thinks “sitting around and monitoring what's happening” is “not going to be a viable strategy.”

Prediction Pai Gow?

PENN and other online gambling operators are also wary about prediction markets expanding their offerings even further, perhaps even into something like casino-related event contracts.

Snowden was asked about prediction markets dabbling in products similar to what Hard Rock Bet has done in Florida, with old motor races powering slot-like games.

The PENN CEO’s answer suggested he’s already given a good deal of thought to that possibility, which makes sense given his company operates casinos, racetracks, and online gambling in 28 jurisdictions across North America.

“I would be shocked if prediction market operators, as they're raising money at significant valuations and seem to be doubling every few months, aren't talking about this,” Snowden said. “And if you can move forward with prediction markets and sports gambling, what would stop you from offering prediction markets and contracts on the next spin of a slot machine, the next hand of blackjack, the next spin of the ball for a roulette table?”

If prediction markets were to go there, PENN and Snowden would then have online casino gambling in all 50 states to worry about, in addition to nationwide sports betting. 

More details on ESPN BET termination:

- PENN paying $38 million to Disney to close out remaining fees ahead of Dec. 1 sportsbook shutdown
- Another $5 million going to ESPN after Dec. 1 for traditional media to promote theScore Bet sportsbook and/or PENN's Hollywood iCasino
-…

— Ryan Butler (@ButlerBets) November 6, 2025

PENN reported on Thursday total revenue of more than $1.7 billion for the three months ended Sept. 30, roughly $298 million of which stemmed from its interactive division. That was less than half of what it generated from its casinos in the Northeast U.S., highlighting the ongoing importance of its brick-and-mortar operations.

A prediction market-related threat to PENN’s brick-and-mortar casinos is now something the company thinks could happen sooner rather than later.

“This is existential,” Snowden said. “We're going to be talking about this, I think, in a matter of months, not years. And I think as an industry, we got to play offense and figure out, how do we stay ahead of this? And we've got to come together quickly, though. We don't have a lot of time here, and I think there's some natural opportunities and some natural potential solutions here.”

Those solutions could mean a prediction market launch by PENN, Snowden suggested, but he also hinted at other, possibly more effective options. Even so, it sounds like there would need to be lawmakers and regulators that would have to get on board first.

“Should we be looking at a prediction model launch along those lines? Maybe,” Snowden said. “I think there's other paths that could be a lot more effective, that would more level the playing field and allow us to do what we do best and offer great products and experiences that would be better than what they can offer, but we do need to work with the other constituencies in the space.”

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