Churchill Downs Reports $696 Million in Revenue, Cuts Earnings Outlook as Segments Diverge
Key Facts
Churchill Downs reported revenue of $696 million in the third quarter of 2026 and net income of $80 million, according to company results cited by the Associated Press. Reported earnings were $1.15 per share, or $1.23 excluding nonrecurring costs. Results compared differently with analyst estimates depending on the survey used; Investing.com said adjusted earnings per share beat its estimate of $1.19 by $0.04. Revenue, by contrast, came in below the consensus estimate of $699.11 million it cited. A Zacks survey of three analysts showed an average estimate of $1.23 per share, while forecasting revenue of $694.2 million, below the reported figure.
The figures reflect differing pictures of results across earnings and revenue measures, as well as among the institutions’ own estimates. According to Zacks, adjusted earnings per share matched the average forecast, while revenue exceeded the survey’s estimate of $694.2 million. The Investing.com comparison, meanwhile, showed adjusted earnings beating expectations while revenue came in below its consensus estimate of $699.11 million. The quarter’s performance therefore does not support a single description of the results surprise; the comparison changed with the benchmark estimate. The company’s reported figures remain revenue of $696 million and adjusted earnings of $1.23 per share.
Segment contributions varied. Gaming revenue rose to $273 million in the third quarter of 2026, from $266 million a year earlier, while its adjusted earnings before interest, taxes, depreciation and amortization increased to $128 million from $123 million. In live and historical racing, revenue climbed to $315 million from $305 million. But the segment’s adjusted earnings before interest, taxes, depreciation and amortization fell to $111 million from $116 million. The divergence indicates that revenue growth did not bring a corresponding increase in live and historical racing earnings, unlike the result in gaming.
The company attributed lower adjusted earnings at its central Virginia facilities to increased competition and a new $5 million tax on live racing days. The new tax structure took effect on July 1, 2026, according to the company’s disclosure. This places the segment’s pressure in the context of a specific expense and a dated regulatory change, alongside stronger competition. The increase in live and historical racing revenue from $305 million to $315 million did not prevent adjusted segment earnings from falling to $111 million from $116 million. Gaming, by contrast, posted year-over-year increases in revenue and adjusted earnings.
Second-quarter results provide background for comparing the company’s performance over the year. In the second quarter of 2026, revenue was $980 million and operating income was $357 million, for an operating margin of 36%. In the corresponding period of 2025, the company reported revenue of $934 million and operating income of $327 million, with a margin of 35%. The company said the $46 million year-over-year revenue increase in the second quarter was driven mainly by a $33 million increase in live and historical racing. It linked that increase to a record Derby week at Churchill Downs racetrack. These earlier figures show the segment’s role in second-quarter growth, while third-quarter results showed its revenue rising as adjusted earnings declined.
On shareholder returns, the company announced an annual cash dividend of $0.469 per share, up 7% from the previous year. The dividend is payable to shareholders of record at the close of business on December 4, 2026, and will be paid on January 5, 2027. The company also approved a share repurchase program of up to $750 million. The authorization includes, rather than adds to, the $306 million remaining under the July 2025 program, according to the company’s disclosure. The announcement combines a higher cash dividend with a share repurchase authorization, specifying the record and payment dates and the amount of the prior balance included in the program.
CHDN shares closed at $81.52 on October 27, 2026, after closing at $84.04 on October 26 and $83.73 on October 23, according to EL7 data. The three closing prices place the stock’s performance in the days before the company’s announcement within a limited time frame, without identifying the cause of the daily moves on their own. Upcoming dates for shareholders include the December 4 record date for the announced dividend, followed by payment on January 5, 2027. The annual dividend is $0.469 per share after a 7% increase, while the share repurchase program has a maximum value of $750 million, including the balance remaining from the previous authorization.