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We all know Maryland’s sports betting industry is booming — and we mean, booming. That’s been the case since the legal betting industry went live in December 2021.
The official June numbers just hit. Maryland bettors wagered a little over $400 million during the month — which is usually quiet aside from NBA and NHL Finals betting. Still, the top betting apps in the state made around $50 in profit. Of that figure, $9 million was kicked back to the state in the form of taxes.
The tax number is interesting because it’s the first under a new tax rate. That’s right, Maryland — like many other states — recently increased its sports betting tax from 15 percent to 20. June 2025 was the first month it applied to.
But…. not all operators are walloping in the state’s success. There’s one sportsbooks that could be on the chopping block, not just in Maryland, but across the country. Keep on reading, and we’ll explain which sportsbook is on the ropes.
ESPN Bet’s Fate Is Up In The Air
Ever been to the Hollywood Casino in Perryville, Maryland? It’s one of six land-based casinos throughout the state. Besides having a great name, the casino features a flashy sportsbook — ESPN Bet. It’s owned by PENN Gaming, which pays ESPN handsomely to license its name for sports betting. For now, that is.
There is growing sentiment that PENN will abandon its current deal with ESPN worth $1.5 billion over 15 years. There’s an opt-out clause in 2026, which could terminate the deal early.
Stock analyst Jeffrey Stantial recently came out and said out loud what everyone in the industry is thinking. He mentioned PENN has new leadership, which could spur the change.
“On the Interactive front, we see increasing probability PENN exits the ESPN Bet relationship, though likely priced into shares already with overly conservative expectations for long-term iCasino market share,” Stantial said in a recent investor note.
Penn’s upcoming Q2 earnings call on August 7 will be a big tell on the state of the ESPN relationship. Analysts noticed the company downplayed sports betting on the last call and leaned harder into casino talk. If that tone continues this quarter, it could signal a looming exit from Disney and ESPN in late 2026, when that opt-out kicks in.
Of course, this is bigger than the Hollywood Casino or the state of Maryland. An exit would affect all Penn operations. By our count, ESPN Bet is live in 19 different states.
ESPN Bet Has Been A Big Failure
ESPN’s foray into the world of sports betting has been a disaster. If you remember, PENN previously licensed the Barstool brand for its sportsbooks. That was the case from 2020 to 2023. PENN bought the sports bro brand from Dave Portnoy in 2020, before divorcing it and going with ESPN instead in 2023.
Most industry experts believe ESPN badly misplaced its hand. By waiting an entire five years to get into sports betting — the industry was launched in 2018 after a Supreme Court ruling — ESPN lost its power. In that time they sat on the sidelines, most bettors got familiar with other brands like DraftKings or FanDuel, not the “worldwide leader in sports” as ESPN calls itself.
Just how bad is the ESPN Bet experiment? Industry insiders peg the platform’s online sports betting handle share at roughly 2.3 percent for April and May — a noticeable slide from the 2.7 percent it held in Q1. This is nationally, by the way. For context, Penn projected that figure to reach 4.7% by the end of this year, up from 3.7% to close 2024. That appears to be a gross overstatement.
Stantial pointed to cutbacks in promotional spending as a key reason for the decline. Compared to Q1, Penn’s reinvestment into promos — both overall and in states that publicly report those numbers — lagged behind the broader market. To no one’s surprise, less free money in the system typically means less love with bettors.
Ironically enough, the entire reason PENN licensed Barstool and ESPN was to lessen its free play promotion and advertising spend. The thought was that by leveraging those brands, they wouldn’t have to spend endlessly on promotions like the DraftKings of the world. Five years into this experiment, it’s become clear that PENN misplayed its hand. Badly.
Exec Shakeup Could Force The Issue
For what it’s worth, current PENN leadership — the ones who signed the ESPN deal — are already having cold feet. In a letter in April, CEO Jay Snowden and Chairman David Handler outright said that sports betting “has not met our expectations.”
Making matters worse, PENN is inserting new leadership into the equation. Penn shareholders officially elected Johnny Hartnett and Carlos Ruisanchez to the company’s board in June, ending a months-long tussle with activist investor HG Vora. The firm had pushed for three board nominations, but Penn capped it at two, filling the only open seats available.
Those board members don’t have any relationship with ESPN, which will make them more likely to cut the partnership. We certainly expect that to be the case. So yes, ESPN Bet is on borrowed time…
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