Caesars Entertainment is evaluating whether to renew Penn & Teller’s contract at the Rio Hotel. The case analyzes the show’s profitability, considering revenues ($22.8M/year), costs ($4.8M/year), and an 80% profit margin. It explores options to increase profitability through pricing, seating adjustments, and additional revenue streams. The case also compares Penn & Teller to a potential replacement act from America’s Got Talent, examining the financial implications of switching shows. Key considerations include the $2.4M upfront cost for a new show, a 4-year payback period, and the competitive nature of the Las Vegas entertainment market. The final recommendation weighs the proven profitability of Penn & Teller against the potential benefits of a fresh act.