Churchill Downs: How a Louisville Racetrack Became a Multi-Billion-Dollar Gaming Empire

Churchill Downs Incorporated is a publicly traded Louisville company (NASDAQ: CHDN) that owns the Churchill Downs Racetrack and the Kentucky Derby, the TwinSpires online wagering platform, a network of historical racing machine venues in Kentucky, Virginia and New Hampshire, and a portfolio of regional casinos. It was founded in 1875 by Meriwether Lewis Clark Jr., and in fiscal 2025 it generated a record $2.93 billion in net revenue and $1.21 billion in adjusted EBITDA (Churchill Downs Incorporated, 2026).

The Kentucky Derby has been run every year since 1875 and makes Churchill Downs one of the most recognizable names in American sport. But the race is the smallest part of the business. The Derby is the brand. The business is gaming.

This is the story of how a single Louisville horse track nearly went broke, was rescued by a tailor, and grew into a multi-billion-dollar gaming company that is now deciding which of its casinos to keep.

The Founder: Meriwether Lewis Clark Jr. and the Louisville Jockey Club

Churchill Downs was founded by Meriwether Lewis Clark Jr., grandson of William Clark of the Lewis and Clark expedition. He had toured the racecourses of England and France and wanted that model in Louisville.

In June 1874 he incorporated the Louisville Jockey Club and Driving Park Association. He leased about 80 acres south of downtown from his uncles, John and Henry Churchill, and financed construction by selling 320 subscriptions at $100 each, roughly $32,000 in startup capital (Encyclopedia.com company history). The track later took the Churchill family name.

On May 17, 1875, the track opened with the first Kentucky Derby, won by a colt named Aristides before a crowd of about 10,000 (Kentucky Derby history). The Twin Spires atop the grandstand were added in 1895 and became the symbol of both the venue and the race (Kentucky Derby Museum).

The business struggled for decades. A new ownership group reorganized it as the New Louisville Jockey Club in 1894, but by 1900 it was still losing money and faced closure.

Matt Winn's Rescue

In 1902 a Louisville merchant tailor named Matt Winn was asked to help reorganize the track. Leading a syndicate of investors, Winn bought Churchill Downs for $40,000, with former Louisville mayor Charles Grainger as president and Winn as vice president (National Museum of Racing Hall of Fame). The track, which had not made money in its first 28 years, turned its first annual profit in 1903.

Winn's most important business decision came in 1908. After Louisville banned bookmaking, he brought in pari-mutuel betting machines, which pool wagers and pay winners from the pool minus a house take. Five times more money was wagered on the 1908 Derby than on the year before (Encyclopedia.com). Pari-mutuel wagering became the legal and financial foundation of American racing, and over a century later it is still the legal basis for the company's most profitable machines.

Winn led the track until his death in 1949 and turned the Derby into a national event. In 1942 the company, then called Churchill Downs-Latonia Inc., sold the Latonia track in Northern Kentucky and became Churchill Downs Incorporated, the name it still uses.

Diversification: From One Track to a Racing Company (1990s–2000s)

For most of the 20th century Churchill Downs was one racetrack with one famous race. In the 1990s it began buying other tracks:

• 1994: Majority interest in Hoosier Park in Anderson, Indiana
• 1998: Ellis Park in Henderson, Kentucky
• 1999: Calder Race Course in Miami and Hollywood Park in Inglewood, California
• 2000: Arlington Park outside Chicago, through a merger
• 2004: Fair Grounds Race Course in New Orleans

Not every purchase stayed. Hollywood Park was sold in 2005 for $257.5 million, and the Arlington property was sold to the Chicago Bears in February 2023 for $197.2 million, producing a $114.0 million gain (GlobeNewswire).

The bigger shift came when Churchill Downs moved into casinos. It bought Harlow's Casino Resort in Greenville, Mississippi, for $138 million in 2010, Riverwalk Casino in Vicksburg in 2012, and Oxford Casino in Maine in 2013. Ocean Downs, Presque Isle Downs, a 50% stake in Miami Valley Gaming and a majority stake in Rivers Casino Des Plaines followed.

TwinSpires and the Shift to Online Wagering

On May 2, 2007, Churchill Downs launched TwinSpires, its advance-deposit wagering (ADW) platform, in time for the 133rd Kentucky Derby (BloodHorse). ADW lets customers fund an account and bet on races from a phone or computer.

The company grew the platform through acquisition. In 2010 it bought Youbet.com in a deal valued at about $126.8 million and folded Youbet's customers into TwinSpires (Churchill Downs Incorporated).

When states legalized sports betting, Churchill Downs launched TwinSpires Sportsbook and online casino products. In 2022 it pulled back from that business, exiting online sports betting and iGaming and refocusing TwinSpires on horse racing rather than spending heavily against much larger sportsbook operators (Legal Sports Report, 2022). TwinSpires now sits in the Wagering Services and Solutions segment, which earned $526.3 million in revenue and $177.3 million in adjusted EBITDA in 2025.

The Big Fish Games Detour

The most unusual chapter in the company's history is Big Fish Games, a Seattle maker of casual and social casino games. Churchill Downs bought it in 2014 for up to $885 million, betting that mobile social gaming would be a growth market.

The bet did not last long. In November 2017 the company agreed to sell Big Fish to Australia's Aristocrat Technologies for $990 million in cash, and the sale closed on January 9, 2018 (Churchill Downs Incorporated). The company left the app business at a profit and refocused on racing and gaming assets where its licenses gave it an edge.

Historical Racing Machines: The Real Growth Engine

The most important product in the modern company is the historical racing machine (HRM). An HRM looks and plays like a slot machine, but the outcome is tied to the results of previously run, anonymized horse races. Because the wagering is pari-mutuel, HRMs can be legal in states such as Kentucky that do not allow conventional casinos.

Churchill Downs opened Derby City Gaming on Poplar Level Road in Louisville on September 14, 2018, a $65 million facility with about 1,000 HRMs (Churchill Downs Incorporated). The format's legal footing was tested in 2020, when the Kentucky Supreme Court ruled that one HRM system did not meet the state's definition of pari-mutuel wagering. In February 2021 the General Assembly passed Senate Bill 120, which wrote historical racing into state law and protected the industry (WKYU).

With that settled, the company kept building in Louisville:

• 2023: a $76 million expansion at Derby City Gaming added a 123-room hotel, more gaming positions, a restaurant and a live entertainment stage, and the venue became Derby City Gaming & Hotel
• December 6, 2023: Derby City Gaming Downtown opened, a $90 million venue with about 500 HRMs (The Lane Report)

The newest Kentucky venue, Marshall Yards Racing & Gaming in Calvert City, opened on February 25, 2026, and Roseshire Gaming Parlor in Henrico County, Virginia, opened in September 2025.

The numbers explain why. In fiscal 2025 the Live and Historical Racing segment, which includes the Derby and the HRM venues, produced $1.44 billion in revenue and $637.0 million in adjusted EBITDA, up $62.4 million from the year before. The Gaming segment, by contrast, earned $483.0 million in adjusted EBITDA, down $23.9 million.

Peninsula Pacific and Exacta: Buying the Whole HRM Stack

Two acquisitions in 2022 and 2023 made historical racing the center of the company.

In February 2022 the company agreed to buy substantially all the assets of Peninsula Pacific Entertainment (P2E) for $2.485 billion. When P2E did not sell its Sioux City casino to a third party, the casino was added to the deal and the price rose to $2.75 billion. The acquisition closed on November 1, 2022 (CDC Gaming). It brought in Colonial Downs Racetrack, six Rosie's venues in Virginia with about 2,700 HRMs, del Lago in New York, and the Sioux City Hard Rock.

In August 2023 Churchill Downs completed the $250 million acquisition of Exacta Systems, the technology provider that runs the HRM wagering systems used in Virginia, Kentucky, Wyoming and New Hampshire (GlobeNewswire).

The next HRM project is the Rockingham Grand Casino in Salem, New Hampshire, a $180 million to $200 million investment announced in January 2026 and targeted to open in mid-2027.

Investing in the Crown Jewel

While gaming funds the company, Churchill Downs keeps spending on the Louisville track that gives it its brand. In July 2021 it announced three projects: a $45 million Homestretch Club, a $90 million first-turn project, and a redesigned paddock. The paddock project grew to about $200 million and opened for the 150th Kentucky Derby in 2024 (Churchill Downs).

In early 2025 the company unveiled about $920 million of further projects, including permanent infield structures, targeted for the 2028 Derby. In late April 2025 it paused them, citing construction cost uncertainty tied to tariffs, and instead spent $25 million to $30 million renovating the Finish Line Suites and The Mansion for 2026 (ConstructConnect).

In October 2025 it announced a narrower replacement: Victory Run, a four-story, $280 million to $300 million building on the first turn with about 7,800 premium seats, replacing roughly 6,400 existing seats. Construction was scheduled to start after the 2026 Derby, with completion targeted for the 2028 Derby (GlobeNewswire).

The spending is tied to results. The company reported all-time record all-sources wagering for Derby Week 2026, and the 152nd Derby drew a peak television audience of 24.4 million viewers. Derby week also fills Louisville hotels, restaurants and distilleries, a boost for the city's bourbon economy.

Churchill Downs Casino and Property Locations

As of its fiscal 2025 annual report, Churchill Downs Incorporated operated the properties below (Form 10-K, 2026). Properties marked "for sale review" are the nine casinos named in the company's July 29, 2026 filing.

The company also owns TwinSpires (online horse racing wagering), Exacta Systems (HRM technology), and a 51% stake in United Tote, the pari-mutuel systems provider, after selling 49% to NYRA's content company in April 2024.

2026: Exploring a Sale of Nine Regional Casinos

On July 29, 2026, Churchill Downs disclosed in an SEC filing that it had completed a review of its portfolio and capital allocation priorities and was "exploring various options to sell" nine wholly owned regional gaming properties in Florida, Indiana, Iowa, Maine, Maryland, Mississippi, New York and Pennsylvania, marked in the table above (Form 8-K, 2026).

The filing named no buyer, price or timeline, and said the company "can provide no assurances" that the review will lead to a transaction. As of early October 2026, no sale had been announced. Not on the list: the Kentucky and Virginia HRM businesses, TwinSpires, Fair Grounds, and the equity stakes in Rivers Des Plaines and Miami Valley.

The casinos for sale sit in the Gaming segment, whose adjusted EBITDA fell in 2025 while the HRM business grew. Selling them would leave a company built around the Derby, historical racing and wagering. The company has said it will update investors only when disclosure is appropriate or required.

Churchill Downs Incorporated by the Numbers

• Founded: 1875 (Louisville Jockey Club incorporated June 1874) by Meriwether Lewis Clark Jr.
• Headquarters: Louisville, Kentucky
• Public listing: NASDAQ (ticker CHDN)
• CEO: Bill Carstanjen
• Net revenue: $2.93 billion in fiscal 2025, a record, up 7% from 2024
• Adjusted EBITDA: $1.21 billion in fiscal 2025, a record
• Net income: $383.0 million in fiscal 2025
• First half 2026: $1.64 billion in net revenue and $734 million in adjusted EBITDA (Q2 2026 release)
• Market capitalization: about $5.5 billion on October 5, 2026; enterprise value about $10.2 billion (StockAnalysis)
• Employees: about 9,000 team members, about 6,600 full-time, as of December 31, 2025

(Financial figures are from the company's fiscal 2025 results and Form 10-K unless noted. Market value moves daily.)

Churchill Downs belongs on any list of the biggest companies built in Louisville, alongside names like Brown-Forman and Humana that grew into national companies without leaving the city.

What Founders and Operators Can Learn

Treat a famous brand as a platform. Churchill Downs used the Derby's brand and cash to build businesses in adjacent markets. The Derby became the marketing engine for TwinSpires and the gaming venues.

Find the recurring revenue beneath the headline event. One big weekend a year is a fragile business. Historical racing and online wagering earn revenue every day. Founders with a "hero product" should ask where the everyday revenue lives.

Own the layer that matters. Buying Exacta Systems put the HRM technology under the same roof as the venues. When one product drives your growth, owning its supplier can beat adding another location.

Sell what no longer fits. Big Fish was sold after about three years for more than the company paid. Now nine casinos are under review.

Churchill Downs started as one Louisville horse track financed by 320 subscribers. A century and a half later it is a multi-billion-dollar company that still calls Louisville home and is reshaping itself again.

Frequently Asked Questions

Who founded Churchill Downs?

Churchill Downs was founded by Meriwether Lewis Clark Jr., grandson of explorer William Clark. He incorporated the Louisville Jockey Club in 1874, leased land from his uncles John and Henry Churchill, financed construction by selling 320 subscriptions at $100 each, and opened the track with the first Kentucky Derby on May 17, 1875.

Who owns Churchill Downs?

Churchill Downs Racetrack is owned by Churchill Downs Incorporated, a publicly traded company headquartered in Louisville, Kentucky, and listed on the NASDAQ under the ticker CHDN. The company is owned by its shareholders, with about 69.7 million shares outstanding as of February 2026, and is led by CEO Bill Carstanjen.

What casinos does Churchill Downs own?

Churchill Downs Incorporated wholly owns Calder Casino (Florida), Terre Haute Casino Resort (Indiana), Hard Rock Hotel & Casino Sioux City (Iowa), Oxford Casino Hotel (Maine), Ocean Downs (Maryland), Harlow's and Riverwalk (Mississippi), del Lago (New York), Presque Isle Downs (Pennsylvania) and Fair Grounds Race Course & Slots (Louisiana). It also owns 61.3% of Rivers Casino Des Plaines and 50% of Miami Valley Gaming, plus historical racing venues in Kentucky, Virginia and New Hampshire.

How much is Churchill Downs Incorporated worth?

Churchill Downs Incorporated had a stock market value of about $5.5 billion on October 5, 2026, and an enterprise value of about $10.2 billion including debt. In fiscal 2025 it reported record net revenue of $2.93 billion, adjusted EBITDA of $1.21 billion, and net income of $383.0 million.

Is Churchill Downs Inc. selling its casinos?

Churchill Downs Incorporated said in a July 29, 2026 SEC filing that it is exploring options to sell nine wholly owned regional casinos in Florida, Indiana, Iowa, Maine, Maryland, Mississippi, New York and Pennsylvania. It named no buyer, price or timeline and said a transaction is not assured. Its Kentucky Derby, historical racing venues and TwinSpires are not part of the review.

What are historical racing machines?

Historical racing machines (HRMs) are slot-style terminals whose outcomes are based on the results of previously run, anonymized horse races. Because the betting is pari-mutuel, they are legal in states such as Kentucky and Virginia that do not allow conventional casinos. Kentucky's Senate Bill 120, passed in 2021, wrote them into state law.

Does Churchill Downs offer sports betting?

Churchill Downs exited online sports betting and online casino gaming in 2022 and refocused its TwinSpires platform on online horse race wagering. It still has limited retail sports betting and third-party partnerships in some states.

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