Up 21% from prior year

MGM revenue reaches all-time high of $3.9B in Q2, driven by Macau rebound

Reading time 2:55 min

Casino-entertainment giant MGM Resorts International has reported financial results for the second quarter of the year. Net revenues for the period achieved an all-time record of $3.9 billion, an increase of 21% compared to the prior year, partly driven by the removal of COVID-19-related entry restrictions in Macau.

Bill Hornbuckle, CEO and President of MGM Resorts, said: "Beyond MGM's outstanding second quarter performance, we also cemented a long-term agreement with Marriott which will provide us with an expansive customer booking channel to further bolster our profitability."

Additionally, in Q2 BetMGM, the company's online gaming joint venture with Entain, reported that it achieved its first positive EBITDA quarter and remains on track to achieve its next milestone of second-half profitability.

MGM CEO Bill Hornbuckle

While revenue for the quarter was up, income was dramatically off. The Las Vegas-based giant reported an operating income of $371 million, a net income of $201 million, and a loss of $0.77 per share. In the same quarter a year ago, the company had an operating income of $2.3 billion, a net income of $1.8 billion, and $4.20 a share.

Officials for the casino operator said the drop in income was because the company was wrapping up its sale of land beneath its resorts from MGM Growth Properties to Vici Properties in that quarter of 2022.

Breaking down figures by geographical region finds Las Vegas Strip Resorts posted net revenue of $2.1 billion in Q2, which was flat from the prior year. Regional operations posted net revenues of $926 million in the current quarter compared to $960 million in the prior year quarter, a decrease of 3%.

However, Asia saw a dramatic shift as MGM China recorded net revenues of $741 million, compared to $143 million in the prior, an increase of 418%, and an increase of 5% compared to the second quarter of 2019. MGM China outperformed the rest of the market at the Macau gambling hub.

"Looking forward to the rest of 2023 and beyond, we are encouraged by the pacing of both Formula 1 and the Super Bowl and the announced relocation of the A's, which will further solidify Las Vegas as the sports and entertainment capital of the world," the company's CEO added.

The company has big plans for the remainder of the year. During the earnings call, Hornbuckle told investors that MGM wants to build better connectivity with the Oakland Athletics' planned stadium in the Strip since MGM owns the resort properties on three corners at Tropicana Avenue and Las Vegas Boulevard, as reported by the Las Vegas Review-Journal.

The proposed stadium, estimated to cost $1.5 billion, will occupy at least 9 acres of the 35-acre Tropicana site, necessitating the demolition of the decades-old resort. It will have a minimum capacity of at least 30,000. Bally’s Corp., which operates the Tropicana, and Gaming & Leisure Properties, are considering stadium construction plans in advance of the team's seeking permission from Major League Baseball to relocate to Las Vegas.

According to Hornbuckle, the proposed stadium would drive over 400,000 new tourists and focus on midweek business. Hornbuckle made the remarks after describing the sports and entertainment pipeline that is expected to bring thousands of people to Southern Nevada in the next seven months. 

Rendering for Oakland Athletics' Ballpark in Las Vegas

As for Formula One, the CEO said the company already has twice the occupancy on the books at four times the average (room) rate compared to last year and with more than 70% of ticket inventory already committed. 

"Our pace into the first quarter of 2024 is also setting up quite well, highlighted by the Super Bowl at Allegiant Stadium in February. We’re already seeing stronger rates than a typical Super Bowl weekend with exceptional early business from sponsors and media that’s led to three to four times higher room rates on the books," the executive noted, according to the above-mentioned media.

Last month, the company signed a strategic 20-year licensing agreement with Marriott International, aimed at attracting customers of Marriott to MGM properties across the US. Under the deal, the two companies have formed the new “MGM Collection with Marriott Bonvoy” brand, which will launch in October and include a total of 17 MGM resorts.

Access MGM's full Q2 report here.

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