MGM Resorts Tops Estimates on Gains in Vegas, Macau

2023-05-10 01:57

MGM Resorts International, the largest operator of casinos on the Las Vegas Strip, reported first-quarter results that beat

MGM Resorts International, the largest operator of casinos on the Las Vegas Strip, reported first-quarter results that beat Wall Street estimates, crediting growth in Nevada and a rebound in Macau.

Earnings soared to 44 cents a share, excluding some items, Las Vegas-based MGM said Monday, beating the 10-cent average of analysts’ estimates. Revenue grew by more than a third to $3.87 billion and beat Wall Street projections of $3.59 billion.

MGM’s business in Las Vegas, its largest market, is booming, with revenue up 31% to $2.2 billion. Adjusted earnings increased 41% to $836 million from a year earlier, when resorts were hurt by the Covid-19 omicron variant. The company’s hotels were 92% full during the quarter, taking in an average of $258 a night.

China is on the mend, too. Business in Macau more than doubled, reflecting the recovery that’s followed the lifting of Covid-19 travel restrictions. Adjusted property earnings came to to $169 million, following a year-earlier loss. Last year, MGM got around 5% of its revenue from Macau, down from almost 25% before the pandemic.

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Shares of MGM rose 2.5% to $46.04 at the close in New York. They have gained 37% this year.

Earlier Monday, MGM announced the purchase of a majority stake in Push Gaming Holding Ltd., a maker of online and mobile slot machine games, through it LeoVegas unit.

MGM has been expanding into digital products, with the market for land-based casinos already built out and new licenses hard to win.

That effort has accelerated since Barry Diller’s IAC Inc. began acquiring shares three years ago and more states began legalizing online betting. IAC is now the largest investor in MGM, with a 17% stake.

The company expects to make more online acquisitions internationally. Domestically it operates BetMGM, a joint venture with Entain Plc.

MGM is also pressing ahead with efforts to develop casinos in Japan and New York. Management aims to open a resort in Osaka in early 2030, and MGM is one of several companies vying to operate a casino-resort in the New York City area.

(Corrects projected Osaka opening date in last paragraph of story published on May 1.)