PENN Entertainment and ESPN have officially ended their sports betting partnership, closing a deal originally valued at $2 billion and meant to last a decade. The two companies confirmed on Thursday, November 6, that their collaboration will end effective December 1, 2025, marking an early termination of what was once seen as a groundbreaking union between gaming and sports media.

ESPN Bet Winds Down After Less Than Three Years

The partnership, announced in 2023, rebranded Penn’s former Barstool Sportsbook as ESPN Bet, giving the operator exclusive rights to use ESPN’s name and access its media and marketing platforms. However, after just over two years, both sides agreed to exit the deal under a mutual termination clause allowing either party to withdraw after the third year if market performance goals were not met.

“When we first announced our partnership with ESPN, both sides made it clear that we expected to compete for a podium position in the space,” said PENN Entertainment President and CEO Jay Snowden. “Although we made significant progress in improving our product offering and building a cohesive ecosystem with ESPN, we have mutually and amicably agreed to wind down our collaboration.”

Under the agreement, Penn was paying $150 million annually in cash to ESPN. The decision to terminate the contract early came amid mounting losses for the ESPN Bet app, which struggled to gain traction against major competitors like DraftKings and FanDuel. According to state revenue reports, ESPN Bet’s handle share stood at 2.8%, with a 2.6% revenue share year-to-date, down from 3.3% and 2.5% respectively in 2024.

The app’s poor performance led Penn to report significant digital losses. In its third-quarter financial statement for 2025, the company posted an $865.1 million net loss, largely tied to its interactive division. While overall revenues reached $1.7 billion, digital gaming volumes fell short of expectations.

Snowden said PENN will redirect its efforts toward its growing iCasino operations and the Canadian market. “We plan to refocus our digital strategy on our growing iCasino business, while continuing to capitalize on our omnichannel advantage as the nation’s leading regional retail casino operator,” he stated, as reported by Fox Business.

ESPN Pursues New Direction With DraftKings

As Penn winds down ESPN Bet, ESPN Chairman Jimmy Pitaro confirmed that the network will explore new opportunities in the gaming space. “Together, ESPN and PENN created a truly unique offering with unparalleled integrations across our various media assets,” Pitaro said. “ESPN drove over 2.9 million new users into the PENN ecosystem, with a strong uptick in first time bettors this fall. We appreciate the collaboration we had with PENN and are now pursuing other media and marketing opportunities within this space.”

Sources told Front Office Sports that ESPN is set to sign a major sponsorship deal with DraftKings, which will become its exclusive sportsbook and odds provider starting December 2025. The full rollout, including branding across ESPN’s digital and television platforms, is expected next year.

Under the termination agreement, all cash payments to ESPN will end in the fourth quarter of 2025. ESPN retains vested warrants to purchase nearly 8 million PENN shares at a weighted strike price of $28.95, while all unvested and performance-based warrants will be forfeited. Penn must cease using the ESPN brand by December 15, 2025, though an extension is possible during the transition.

Penn will pay $38.1 million to ESPN in the fourth quarter of 2025 and allocate another $5 million toward marketing support for its next venture. Disney, ESPN’s parent company, agreed not to launch or license another ESPN-branded sportsbook for 15 months following the contract’s expiration.

Looking ahead, Penn will revive its previously shuttered U.S. brand theScore Bet to replace ESPN Bet. The rebrand is planned for December 1, 2025, to align with the anticipated launch of sports betting in Missouri, pending regulatory approval. TheScore Bet will serve as Penn’s unified online sportsbook across the U.S. and Canada, integrated with the theScore media app, which boasts about 4 million monthly active users in North America.

“Our OSB product across both the U.S. and Canada will now leverage connectivity with the theScore media app,” Snowden explained, adding that the integration will enhance cross-sell opportunities for Penn’s Hollywood-branded iCasino, available both as a standalone and integrated app in regulated states.

With the exit from ESPN Bet, Penn hopes to reduce fixed media costs, replace them with performance-based marketing, and strengthen its position in digital casino gaming—a sector it believes offers stronger long-term profitability.