Churchill Downs Inc
Churchill Downs Incorporated (CHDN)
Executive Summary
Churchill Downs Incorporated (CDI) is a diversified gaming and entertainment company headquartered in Louisville, Kentucky, best known as the home of the Kentucky Derby. The company reported 2025 revenue of roughly $2.93 billion, up about 7.0% year over year, with trailing-twelve-month revenue near $2.99 billion (up 5.7%) and net income of approximately $412 million, giving it a market capitalization around $5.7 billion. As of December 31, 2025, CDI employed approximately 9,000 team members and had about 69.7 million shares outstanding as of February 2026. What began as a single iconic racetrack has grown into a three-legged business spanning live and historical racing, wagering technology, and regional casino gaming.
Core Business Model
Churchill Downs makes money across three interlocking revenue streams: admissions, sponsorships, and wagering handle from live thoroughbred racing (anchored by the Kentucky Derby); gaming revenue from historical racing machines (HRM) and traditional slot/table games at its casino properties; and technology/commission revenue from its wagering platforms. This diversification means CDI is no longer purely a seasonal racetrack operator — casino gaming and HRM venues generate revenue and cash flow year-round, smoothing out the concentrated timing of its marquee live-racing events.
Business Segments
- Live and Historical Racing — Operates Churchill Downs Racetrack in Louisville (about 80 live race days annually, headlined by the Kentucky Derby) along with historical racing machine venues across Kentucky, Virginia, and New Hampshire, which use HRM technology to offer casino-style gaming built on the outcomes of previously run horse races.
- Wagering Services and Solutions — Includes TwinSpires (online horse racing wagering), United Tote (pari-mutuel wagering systems sold to other tracks and operators), Exacta (HRM technology licensing), and sports betting delivered through retail locations and third-party partnerships.
- Gaming — Ten wholly-owned casino properties plus two equity-invested properties spread across Florida, Indiana, Iowa, Louisiana, Maine, Maryland, Mississippi, New York, Pennsylvania, Illinois, and Ohio, operating roughly 14,335 slot machines and video lottery terminals in total.
Competitors
CDI faces competition from traditional commercial and Native American casinos, state-run lotteries, other online and mobile gaming platforms, and the rapidly expanding legal sports betting industry. The company specifically flags continued iGaming expansion and the potential award of additional state gaming licenses in its existing markets as competitive threats that could pressure its regional casino properties or invite new entrants into markets where CDI currently holds an advantaged position.
Competitive Position
Churchill Downs' strongest and most durable asset is the Kentucky Derby itself — a cultural institution and one of the most recognizable annual sporting events in the world, which is effectively impossible for a competitor to replicate and which anchors CDI's brand, media rights, hospitality, and sponsorship revenue far beyond what a single racetrack's wagering handle alone would generate. Its historical racing machine business gives CDI a defensible, regulation-protected gaming format in states (Kentucky, Virginia, New Hampshire) where HRM technology has been used to introduce casino-style gaming without full casino licensing, a structural advantage tied to specific state regulatory frameworks that are hard for new entrants to replicate. Regional casino licenses are themselves a form of efficient-scale protection in many jurisdictions, since states typically cap the number of licenses issued in a given market, limiting direct new competition once CDI has an incumbent property. Risks include the capital intensity and regulatory complexity of expanding or maintaining casino and HRM properties across many state jurisdictions, exposure to discretionary consumer gaming and entertainment spending, and the ongoing threat that legalized iGaming could cannibalize retail casino visitation over time. With revenue and earnings both growing at healthy mid-to-high single-digit rates and a business model diversified well beyond the Derby weekend, Churchill Downs looks positioned to keep converting its brand and license-driven advantages into durable free cash flow.