Jay A. Snowden
Chief Executive Officer and President at PENN Entertainment
Thanks, Joe. Good morning, everyone. Joining me today is our Chief Financial Officer, Felicia Hendrix; and our Head of Operations, Todd George as well as other members of our executive team. As usual, we have provided a link to our investor deck in our earnings release, which we'll be referring to in our prepared remarks. So I'm sure you no doubt noticed our company's new logo and name change to Penn Entertainment. Over the past few years, Penn has transformed our business through a highly differentiated strategy, focused on organic cross-sell opportunities, which is reinforced by our investments in our market-leading retail casinos, sports media assets, owned technology, including a state-of-the-art fully integrated digital sports and online casino betting platform and an in-house iCasino content studio.
Our new name maintains ties to our legacy while better reflecting our evolution into North America's leading provider of integrated entertainment, sports content and casino gaming experiences. Next month, we'll also be celebrating the 50th anniversary of Penn National Race Course, which is where our company's story began. We're all proud of our heritage and how Peter Carlino took over from his father and grew the company from that single race track into one of the top regional gaming companies in the country. I'm honored to follow in his and Tim Wilmott footsteps and to help write this next chapter in our company's growth story. In terms of our results, as you'll see on Slide six and seven, we had a good quarter with consistent performance across the portfolio. We beat consensus on both revenues and EBITDAR and generated sequential upside over last quarter, Thanks in part to the performance of our Interactive segment and strong results at our retail operations despite a tough comp against the second quarter last year. As highlighted on Slide 10, our destination properties, which benefited from hotel remodels, new restaurants, entertainment and Barstool-branded sports books performed particularly well in the second quarter.
Our mychoice database has increased by over 1.2 million registrations over the last four quarters, driven by both our retail properties and our new interactive offerings, which provides significant opportunities for future growth. We are encouraged by the ongoing visitation and engagement growth in the VIP segment of our database. In addition to year-over-year increases in rated theoretical across all segments, except those at the age 65 and above, which is highlighted on Slide 11. Our unrated segment trends, though down in the second quarter year-over-year, partly due to federal stimulus payments last year and more entertainment options outside of our casino offerings and online offerings available this year also reflects strong conversion of nonrated players into our mychoice Loyalty program. Turning to Slide 12. Our three Cs, cardless, cashless and contactless technology and omnichannel engagement also continue to drive our growth. Our mywallet cashless experience is now available at nine properties in three states and we expect to roll the technology out to 12 additional properties by the end of this calendar year pending regulatory approvals. Guests that use our mobile wallet and who engage with us via online offerings are not only more loyal, but they also play at a higher spend level when visiting a property and generate a higher total value in engaging with us across multiple channels.
Given our second quarter results and strong volumes in July, we've decided to maintain our current 2022 guidance range, which we notably increased last quarter to between $6.15 billion to $6.55 billion in revenue, and EBITDAR of $1.875 billion to $2 billion. We believe that our property level EBITDAR margins are sustainable in this current revenue environment at approximately 37%. Turning to our Interactive segment. We experienced nearly 100% year-over-year revenue growth this quarter, excluding the impact of gaming tax reimbursements to third-party skin partners. We remain on track to deliver EBITDA losses of approximately $50 million for the year. The largest portion of the loss will occur in the third quarter due to our contribution to the California sports betting ballot initiative along with the start of football season in new markets like Ontario and Kansas, and we remain on track to be profitable starting in the fourth quarter of this year. As highlighted on Slide 13, our Barstool-branded retail sports books are really resonating with the younger demographics and creating meaningful cross-sell opportunities.
Our recently converted Barstool Sports book in Lake Charles, Louisiana, set a new standard for retail sports book experiences, and we are seeing very encouraging results from the edition. We are on track to open the Barstool Sports book at L'Auberge Baton Rouge this fall. And based on our ongoing success in Louisiana, we are optimistic about our upcoming Sports book launches in Kansas and Ohio where we have similar market-leading properties bolstered by large casino databases. And with the legislature recently approving Sports betting in Massachusetts, the birth place of Barstool Sports and also home to our Plainridge Park Casino, we're excited to add yet another possible retail launch by the end of this year, and mobile wagering is anticipated in 2023. Turning to Slide 14. Our early results following the successful launch of theScore Bet mobile app in Ontario on April 4, demonstrates the strength of the brand in Canada and the benefits of our fully integrated media and betting ecosystem. This allows us to drive significantly stronger results and a greater than 50% cross-sell into iCasino. When we acquired this -- we discussed an interactive road map that included theScore Bet working towards transitioning to a proprietary risk and trading platform in the summer of 2022. I'm extremely pleased to share that last month we successfully deployed our risk and trading platform on theScore Bet, which completed the vertical integration of our sports book operations in Ontario.
I want to thank all of our team members at theScore who worked so diligently on this project over the last couple of years and executed this launch on schedule, allowing us to be live in Ontario with a significantly enhanced product ahead of the fall season. Custom building all components of a sportsbook infrastructure is a massive undertaking, which clearly demonstrates the industry-leading technology, engineering and product expertise that we have in-house at Penn between the score, Penn Interactive and our corporate product and engineering teams. This sets us up very well for the future. As we talked about previously, the benefits of a vertically integrated online betting operation are numerous. You'll see on Slide 16, we've broadened theScore Bet offerings and increased event props and in-game wagering options. Second, owning all components of this platform unlocks greater personalization and media and betting integration capabilities, allowing us to create the spoke user experiences that are meaningfully engaged and subsequently retained customers. Third, we will realize valuable savings over the next 18 months on third-party platform costs while driving wider margins. And finally, we're operating on a faster, more reliable platform that provides shorter time frames to build and launch new features.
We also remain on track to transition the Barstool Sports book in the U.S. to the Scores player account management and trading platform in the third quarter of 2023, and we are working with our existing providers here in the U.S. to ensure a smooth transition process. Post migration, we'll begin to realize the full benefits of our in-house technology stack including meaningful cost synergies and improved marketing and promotional capabilities. Turning to Slide 17 and 18, our Penn Game Studios continues to develop highly engaging content. This quarter, we also introduced 97 new third-party slot and table game offerings across our iCasino platform. And we have a deep pipeline of future customized and third-party iCasino content for both Barstool and theScore Bet. As you'll see on Slide 19, we continue to build momentum on the media front as well with theScore growing revenues year-over-year in the second quarter, double digits and monthly sessions were up 20%.
Barstool has also continued to expand its audience and reach while always looking for new outside-of-the-box growth opportunities. Looking forward, we believe there is upside for the media business as we begin to realize the benefits of cross promotion with Barstool Sports and additional monetization opportunities. Before I turn it over to Felicia, I also want to note, as highlighted in our deck that we were once again very active on the ESG front this quarter, particularly with our ongoing diversity, equity and inclusion efforts. We recently came in fourth out of 40 gaming companies in the all-in diversity projects, benchmark DE&I survey. In addition, recently, Forbes Magazine rated us 139 out of 500 of America's Best Employers for Diversity, which is the highest ranking of any publicly traded gaming company.
With that, I'll turn it over to Felicia.