Casino operator MGM Resorts (MGM) beat expectations for first-quarter net income and revenue as the company benefited from higher traffic in its Las Vegas and Macau resorts.
The company reported net income of $466.8 million, or $1.24 per share, far exceeding analysts’ estimates of one cent per share. Revenue surged 35.7% from the year-ago quarter to $3.87 billion, above projections of $3.6 billion, with casino revenue up 32.4% to $1.88 billion.
- The company reported net income of $466.8 million, or $1.24 per share, far exceeding analysts’ estimates of one cent per share.
- Revenues surged 35.7% from the year-ago quarter to $3.87 billion, above projections of $3.6 billion, with casino revenues up 32.4% to $1.88 billion.
- Rising traffic and spending at the company’s flagship Las Vegas and Macau resorts lifted revenue.
Higher traffic and business volume at the company’s MGM China resort in Macau and Las Vegas Strip Resorts propelled the casino operator’s revenue growth. The loosening of pandemic restrictions in China and a rebound in tourism spending there helped boost traffic at the former resort.
"MGM Resorts is executing across all of its geographies and channels with record first quarter Las Vegas Strip Adjusted Property EBITDAR, consistently strong regional operations profit, and MGM China's swift return to profitability," said Bill Hornbuckle, MGM president and CEO.
Expansion efforts are underway, with the company recently gaining approval for a new development plan in Osaka, Japan, and the application process for another resort in New York underway.
The company could also potentially benefit from the Oakland A’s Major League Baseball team moving to Las Vegas, which Hornbuckle believes could bring 400,000 more tourists to the area annually and increase casino and resort traffic.
Despite the positive earnings surprise, MGM Resorts shares fell 5% this week. They’re up almost 29% year-to-date, outperforming a 14% gain in the broader S&P 500 consumer discretionary sector over the same period.