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A month has gone by since the last earnings report for MGM Resorts (MGM). Shares have added about 1.4% in that time frame, underperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is MGM due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
MGM Resorts' Q3 Earnings Miss Estimates, Revenues Increase Y/Y
MGM Resorts reported third-quarter 2024 results, with earnings and revenues missing the Zacks Consensus Estimate. The top line increased year over year while the bottom line declined from the prior-year's quarter figure.
During the quarter, the company reported sequential improvements in Las Vegas, driven by growth in Average Daily Rate and occupancy levels. The company emphasized advancements in digital investments and an impressive pipeline of integrated resort developments in Japan, New York and other markets to drive growth in the upcoming periods.
Earnings & Revenue Discussion
MGM Resorts reported earnings per share (EPS) of 54 cents, missing the Zacks Consensus Estimate of 58 cents. In the prior-year quarter, it incurred an adjusted EPS of 64 cents.
Total revenues were $4.18 billion, missing the Zacks Consensus Estimate of $4.22 billion by 0.9%. The top line increased 5.3% year over year on the back of strong contributions from MGM China.
MGM China
During the third quarter, MGM China's net revenues surged 14% year over year to $929.5 million. The upside can be attributed to the ramp-up of operations following the removal of COVID-19-related travel and entry restrictions in the first quarter of 2023. MGM China casino revenues were up 12% year over year to $800 million.
MGM China's adjusted property earnings before interest, taxes, depreciation, amortization and restructuring or rent costs (EBITDAR) amounted to $237.4 million compared with 226.1 million reported in the prior-year quarter.
Domestic Operations
Net revenues at Las Vegas Strip Resorts were $2.13 billion, up 1.3% year over year. The upside was driven by a rise in non-gaming revenues.
Adjusted property EBITDAR increased 2% year over year to $731 million. Casino revenues were $476 million, down 13% year over year.
Net revenues from Regional operations totaled $952.1 million, compared with $925 million reported in the prior year quarter. Adjusted property EBITDAR was approximately $300 million, compared with $293.3 reported in the prior-year quarter.