Just another billion-dollar deal down the drain.
Penn Entertainment announced Thursday its opting out of its sports betting partnership contract with ESPN, ending a 10-year, $1.5 billion deal.
ESPN will now become the new official betting partner of DraftKings Sportsbook, as first reported by Front Office Sports.
“We will operate with a more efficient cost structure, including replacing fixed media spending … the realignment will free up resources to strategically invest in the North American markets,” Penn announced in a statement.
Penn and ESPN’s partnership fizzling comes a little more than two years after they partnered in August 2023 to bring the betting community ESPN Bet.
The deal ends with over $300 million sent from Penn to the WorldWide Leader, though the results were mostly a disaster in terms of market share gains.
Penn publicly stated a goal of 20 percent market share in the U.S. online sports betting market by 2027.
However, it achieved only 4.7 percent as of 2025, up only marginally from the 2.2 percent held by Barstool Sportsbook in partnership with Penn.
Barstool Sportsbook was the first time that PENN attempted to use an established media brand as a licensing opportunity to drive user acquisition and engagement.
The endeavor was mainly a disaster: PENN bought a controlling stake in Barstool Sports for $388 million beginning in 2020, only to sell it back to founder Dave Portnoy for $1 in Aug. 2023, as part of the announcement of PENN’s deal with ESPN.
“Although we made significant progress in improving our product offering and building a cohesive ecosystem with ESPN, we were unable to establish ESPN BET as a scale player,” Penn CEO Jay Snowden said in the company’s Thursday earnings call.
Snoweden added that he expects to invest in their retail casino business, the company’s Canadian online betting business, as well as a rebranded U.S. online betting business.
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The app formerly known as ESPN BET will be rebranded as The ScoreBet, and to additional sign-up or activations will be required.
ESPN’s union with DraftKings begins Dec. 1.
“Our betting approach has focused on offering an integrated experience within our products,” ESPN chairman Jimmy Pitaro said in a release. “Working with DraftKings, a leader in the space, will allow us to build upon that foundation, continue to super-serve passionate sports fans and grow our ESPN direct-to-consumer business. We are excited about this new collaboration with DraftKings.”