Churchill Downs Inc., the gaming and horse racing powerhouse, is abandoning the online casino and sports betting operations, Chief Executive Officer William Carstanjen announced Thursday during a conference call with investors. 

Competitive market forces Churchill Downs out

However, the Kentucky Derby operator will continue to operate its web-based horse betting business. The online sports betting and online casino markets are extremely competitive, with an ever-growing number of participants regulated by the states. According to Bloomberg, Carstanjen stated. Numerous companies are targeting maximal market share in each state with little concern for short- or even long-term profitability.

According to business officials, CDI will exit the sports gambling vertical within the next six months. The company will continue to operate retail sportsbooks in its casinos and will seek to offer market access rights to other operators when possible. For some time now, the rumor that CDI was considering selling its sports and iGaming businesses has grown. Bloomberg reported in December that the corporation was “working with an adviser” to elicit interest in its sportsbook offering. At the time, TwinSpires was estimated to be worth approximately $1.5 billion in a sale.

Churchill Downs Inc. CEO Bill Carstanjen stated during a Feb. 24 conference call with analysts and investors that the company’s continued efforts in online sports betting and iGaming make economic sense because he sees little opportunity for growth or return for shareholders in the highly competitive market. CDI first began its sports betting operations under the BetAmerica brand but rebranded them as TwinSpires in January 2021. Now, the business will discontinue operations in Arizona, Colorado, Indiana, Michigan, New Jersey, Pennsylvania, and Tennessee, where it operated online sports betting sites.

The company’s decision to depart the sports betting sector coincides with industry and analyst concern over the segment’s profitability. To increase their market share, businesses have launched extensive marketing efforts and begun offering huge -and expensive- sign-up bonuses and free bets. Media reports earlier indicated that Wynn Resorts was also considering a “fire sale” of its Wynn Interactive subsidiary, which operates the WynnBet app. Caesars announced earlier this week that it would reduce its sportsbook advertising investment and Bally’s Corp. CEO Lee Fenton stated on Thursday that he wanted to avoid “continuing illogical spending” on sports betting.

About Churchill Downs

Churchill Downs is a horse racing complex in south Louisville, Kentucky, United States. It is best known for holding the annual Kentucky Derby. It was dedicated in 1875 and was named for Samuel Churchill, a prominent member of the Churchill family in Kentucky for many years. The first Kentucky Derby, a Thoroughbred race and a component of today’s horse racing Triple Crown, was staged in the same year as the inaugural Kentucky Oaks. Churchill Downs has also hosted nine editions of the prestigious Breeders’ Cup, most recently on November 2 and 3, 2018.