Published on: November 6, 2025, 01:20h.

Updated on: November 6, 2025, 01:20h.

• Penn Entertainment has declared it will end its collaboration with ESPN due to unsatisfactory outcomes.
• DraftKings is set to take over the role once held by Penn.
• The ESPN Bet app is anticipated to persist, maintained by DraftKings’ technology and odds.

In an announcement made today, Penn Entertainment (NASDAQ: PENN) confirmed the termination of its partnership with ESPN, effective December 1. DraftKings (NASDAQ: DKNG) is expected to step in and fill the gap left by the casino operator’s exit from the ESPN Bet venture.

Penn revealed this shift coinciding with its quarterly earnings report, prompting speculation that DraftKings would replace Penn in the ESPN Bet framework. While specific financial details remain undisclosed, DraftKings is anticipated to announce its third-quarter results later today, possibly shedding light on the new partnership with ESPN.

David Katz, an analyst at Jefferies, indicated in a message to clients, “We perceive this deal as advantageous for DKNG, as the enormous audience within the ESPN ecosystem is a significant advantage. We believe that, with DKNG’s operational benefits, ESPNBet’s market share could potentially see considerable growth. Initial reports suggest that ESPNBet Live will continue broadcasting, likely featuring DraftKings branding.”

Katz further remarked that the ESPN Bet brand will endure, and the mobile platform would utilize DraftKings’ odds.

DraftKings to Make Substantial Investment for ESPN Partnership

Details on the financial implications of the DraftKings/ESPN collaboration remain vague. However, it’s known that Penn had invested heavily, arguably more than necessary according to some analysts, to secure the sports network’s branding.

“PENN will owe ESPN $38.1 million in Q4 concerning all outstanding fees, and will pay an extra $5 million to ESPN after the termination date to aid in theScore Bet and/or Hollywood iCasino,” explained Barry Jonas from Truist Securities. “Additionally, ESPN will maintain vested warrants allowing it to acquire approximately 8 million shares at a weighted strike price of $28.95, though all unvested and performance-based warrants will be forfeited. PENN’s non-cash expense related to the vested warrants is projected to be around $14 million in Q4.”

It’s possible that owing to its well-established brand and status as a leading online sportsbook in the U.S., DraftKings may not have to invest as much to secure ESPN’s partnership compared to Penn, which may ease concerns for DraftKings investors as the company already grapples with a declining stock price while financing other investments.

Penn’s Strategic Shift

Penn plans to redirect its North American online sports betting efforts under theScore brand, previously acquired for $2 billion in August 2021, to establish a presence in Canada. The casino operator intends to leverage this transition to enhance its focus on its burgeoning iGaming division, utilizing sports wagering to drive traffic to its online casino platform.

While theScore lacks the brand recognition of ESPN, no company in the sports media realm can compete on that level, but Penn is positioned to benefit nonetheless.

“Significantly, theScore boasts around 4 million active monthly users across North America, and PENN will retain a database of 2.9 million digital users acquired through the ESPN partnership (including 300,000 accumulated during this football season,” added Jonas. “Moreover, PENN reported that its iCasino segment achieved its highest quarterly gaming revenue ever in Q3, driven by record cross-sells from online sports betting and growth in standalone applications.”