This upgrade is based upon the expectation that there will be improved leverage in 2023, as Caesars moderates digital losses.
S&P Global Ratings predicts that Caesars casino EBITDA will rise by 4% to 6% in 2023, according to S&P Global Ratings
Caesars’ digital segment was a significant drag on EBITDA for the past 18 months. However, Caesars has seen a decrease in this segment in recent quarters due to its scaling up digital revenue in new States and leveraging player loyalty data to better target its marketing efforts towards customers.
The company also expects to see lower customer acquisition costs and advertising spending, as there are less states who are set to launch digital sports betting in 2023 than previous years.
Inflationary pressures will be offset by Caesars’ investments into its regional portfolio, and in Las Vegas convention and group recovery. Caesars has maintained margins above pre-pandemic levels, despite the return to a more normal competitive climate and the removal of any restrictions on operating during pandemics.
Additionally, the company will benefit from the continuing recovery in group and convention in Las Vegas which will likely support margin. S&P Global Ratings predicts that Caesars casino EBITDA will rise 4% to 6% by 2023.
While the shift to experiences from products will likely continue for some time, the increase in leisure spending in Las Vegas may slow down if consumers’ willingness and ability to spend on entertainment and travel in 2023 is affected by lower accumulated savings, high inflation and higher unemployment.
Caesars Partners With Bakkt to Offer Loyalty Program Members Crypto Rewards
Bakkt Holdings has announced a partnership with Caesars Entertainment to enable Caesars Rewards members redeem their rewards credits via Bakkt Crypto Rewards. The collaboration is still subject to regulatory approval. It also includes plans for the renaming of the Planet Hollywood Resort & casino’s live entertainment venue Bakkt Theatre.
Both companies will explore and innovate within Bakkt’s current suite of cryptocurrency solutions. Bakkt will soon share details about future crypto offerings with Caesars. This move is happening as the digital economy evolves rapidly. Bakkt, Caesars and their customers are committed to offering seamless experiences.
Caesars Rewards is a highly regarded loyalty program with over 60 million members. Bakkt will collaborate with Caesars to discover how Bakkt’s crypto offerings can differentiate Caesars Rewards from the rest and allow the company to remain a leader in the gaming sector.
