Penn National Gaming stock drops after profit misses while revenue beats, as gaming expenses jump

Shares of Penn National Gaming Inc.
PENN,
-3.32%
slumped 3.2% in premarket trading Thursday, after the gaming and esports company and Barstool Sports Inc. partner reported fourth-quarter profit that was well below expectations even as revenue topped forecasts, as gaming costs jumped and amid a “frenzied competitive environment.” Net income rose to $44.8 million, or 26 cents a share, from $12.7 million, or 7 cents a share, in the year-ago period. The FactSet consensus was for earnings per share of 52 cents. Revenue grew 45.4% to $1.57 billion, above the FactSet consensus of $1.51 billion. Operating expense growth outpaced revenue growth at 48.3% to $1.35 billion, as gaming expenses jumped 72.2% to $739.6 million. The company said in early 2023, it plans to acquire the remainder of BarStool Sports that it doesn’t already own. The stock has tumbled 37.2% over the past three months through Wednesday, while the S&P 500
SPX,
+0.94%
has ticked down 0.9%.