Churchill Downs net income falls 10.3 percent in 2025

Sharp growth at its casinos in Kentucky and Virginia led Churchill Downs Inc. to post net income of $383.5 million in 2025, according to financial statements released Wednesday night, though returns at its casinos in other jurisdictions have begun to decline.

Total revenue for CDI’s live racing operations and historical horse racing machines – which are slot machine-like devices operated at its casinos in Kentucky and Virginia – was up 13.7 percent over last year, largely due to the opening of new facilities in Virginia. Total revenue for casinos in other states, however, was static compared to last year, and expenses at all of its casinos increased faster than the rate of growth.

Net income for 2025 was down 10.3 percent compared to 2024, when net income was $426.8 million. The drop reflected the increases in expenses and a one-time charge to devalue an asset the company bought in New Hampshire.

Stock in CDI dropped 5.8 percent on Thursday.

On a conference call Thursday morning, CDI chief executive Bill Carstanjen said that 2025 opened with some uncertainty due to trade measures adopted by the administration of President Donald Trump that sent tariffs up sharply. He said that the company’s casinos would likely benefit from “tailwinds” in 2026 related to tax measures passed in 2025 that are designed to increase the tax refunds for some wage workers and senior citizens.

Carstanjen also said that the company expects a significant gain in revenue from this year’s Kentucky Derby and Derby week overall, citing strong ticket demand and the addition of a live-racing day to Derby week on the Sunday prior to the big race.

“We have the interest, we have the horse stock, we have the customer base,” Carstanjen said, in reference to the new day. “We need to give our fans more of what they are asking for.”

Marcia Dall, the company’s chief financial officer, said that CDI expects to increase its earnings before income taxes, depreciation, and amortization on Derby week operations by $15 million to $20 million.

“The Derby is firing on all cylinders,” Carstanjen said.

Dall said profit margins on average at the company’s casinos outside of Kentucky and Virginia dropped 0.8 points during 2025, but she also referenced the 2025 tax changes as providing an impetus for growth in 2026.

Churchill’s casinos in Kentucky and Virginia both operate devices manufactured by Churchill and run on an operating system owned by the company. Revenues from those casinos have been increasing sharply over the past several years, in contrast with weakness in other markets.

For 2025, the Virginia casinos had growth of $88.3 million, while the Kentucky casinos had growth of $72.6 million, according to the financial statements.

CDI is currently working on the development of new “electronic table games” at the Kentucky properties that will include roulette, blackjack, and craps, Carstanjen said, but the rollout of those games will take some time following the approval last year of the state’s regulatory body, the Kentucky Horse Racing and Gaming Corporation.

Carstanjen characterized the development of the electronic table games as a “responsible, careful, thoughtful rolling out of something that’s new.”

In addition to higher expenses for its core business operations, Churchill’s general and administrative expenses climbed 3.5 percent. Interest expense jumped 2.7 percent. The company’s long-term debt ended 2025 up 12.3 percent.

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