PENN and ESPN End Sports Betting Partnership Early

PENN Entertainment and ESPN have agreed to end their exclusive US online sports betting partnership ahead of schedule, effective Dec. 1.

The 10-year agreement, announced in August 2023, initially granted PENN exclusive rights to use the ESPN BET brand in the US in exchange for $150 million in annual payments and warrants to purchase PENN stock. Either company could terminate the deal after 3 years if specific market-share goals were not met.

PENN Entertainment CEO Jay Snowden said that while the partnership helped enhance the company's sportsbook product and ecosystem, both sides decided to end the collaboration on amicable terms. He said PENN will shift its focus to its growing iCasino segment and leverage its nationwide strong retail casino network.

PENN plans to rebrand its sportsbook as theScore Bet on Dec. 1, in alignment with a potential launch of the legal Missouri sports betting market, pending regulatory approval. The rebranding is meant to bring together PENN's US and Canadian sportsbooks under the theScore brand, which already has about four million active users.

ESPN Chairman Jimmy Pitaro noted that ESPN BET successfully attracted more than 2.9 million new users to PENN's ecosystem, contributing to strong engagement this fall. He added that ESPN would work closely with PENN through the transition period while continuing its collaboration on advertising initiatives.

ESPN already has a new sports betting partner

Following the PENN and ESPN Bet announcement, ESPN confirmed a new online gambling partnership with DraftKings. The financial terms of the deal have not been disclosed, but the Hollywood Reporter, citing sources close to the matter, indicated that it will be more profitable for ESPN than its prior arrangement.

Under the now-ending PENN deal, ESPN received $150 million annually, plus stock warrants, in exchange for use of the ESPN Bet trademark and related media integrations. That partnership lasted roughly two years before the companies chose to part ways.

The new agreement with DraftKings will include deeper integration between the sportsbook and ESPN's digital platforms. The redesigned app, slated for release in 2026, will feature a betting tab powered by DraftKings.

Industry experts say that working with DraftKings represents a significant step forward for ESPN's plans to get into digital betting. DraftKings remains one of the biggest and most established companies in the US sports betting market.

ESPN's wide reach and DraftKings' technical skills will be leveraged by both companies to make betting possible on TV, streaming, and mobile devices.