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MGM Resorts’ 2023 Earnings Boosted By Macau And Las Vegas Grand Prix

Written By Marc Meltzer on February 14, 2024
Lunar NY Ad On MGM Resorts Billboard

MGM Resorts International’s fourth quarter and full-year earnings were boosted due to performance in Macau and Las Vegas. The company reported an increase of more than 20% for the quarter and year.

The company credits MGM China for much of the boost thanks to COVID-19 entry restrictions in Macau being removed. While MGM Resorts’ regional properties saw a slowdown, Macau operations, and its Las Vegas casinos helped push revenue forward.

The company isn’t resting on its laurels after a year of revenue growth. The first Super Bowl in Las Vegas was a boon for MGM Resorts. The company is planning upgrades at numerous Las Vegas properties.

MGM Resorts’ Q4 net revenue hits $2.4 billion for Las Vegas casinos

MGM Resorts reported net revenue of $4.4 billion in the final quarter of 2023. This was good for a 22% increase compared to the period in 2022.

Operating income for MGM Resorts in the fourth quarter was $419 million compared to a loss of $2 million during the same period last year.

MGM China had a net revenue of $983 million in the fourth quarter of last year. This was a massive 462% increase compared to $175 million the prior year.

The major reason for the increase was the removal of COVID-19-related entry restrictions in Macau. This provided an increase in visitation. Additionally, MGM was allowed to increase the number of tables for players.

MGM Resorts reported net revenue of $2.4 billion in the fourth quarter for its Las Vegas properties. This was a 3% increase from the $2.3 billion reported in the fourth quarter of the previous year. The company says the increase in Las Vegas was partially due to the Las Vegas Grand Prix F1 race.

Not everything was rosy for MGM Resorts in the fourth quarter. The company reported net revenue of $873 million for its regional properties. This was a 12% dip when compared to $991 million in 2022.

The drop in revenue was affected by the union strike at MGM Grand Detroit and a decrease in high-end table game volume at MGM National Harbor.

MGM Resorts full-year earnings

MGM Resorts revenue for the year was also up. The company reported net revenue of $16.2 billion. This is a 23% increase from 2022 when the company reported full-year earnings of $13.1 billion.

The reasons for the increased revenue mirror the fourth quarter.

Additionally, MGM Resorts received a boost from a full year of revenue from The Cosmopolitan. This helped boost revenue in Las Vegas to $8.8 billion for the year. This was a 5% increase compared to $8.4 billion in the prior year.

Net revenue for MGM China was $3.2 billion in 2023. This was a 368% increase from $674 million in 2022. It was also an increase of 9% compared to 2019 – before the Covid-19 pandemic.

In its 2023 full-year earnings press release, MGM Resorts’ Chief Executive Officer and President Bill Hornbuckle said:

“Our Las Vegas Strip Resorts and MGM China set new all-time records for full year and fourth quarter Adjusted Property EBITDAR.

Our premium positioning and offerings in Las Vegas enable us to capture incremental profit during major events such as the inaugural Formula 1 race and our first Super Bowl.

2024 is off to a winning start with the launch of our Marriott relationship as well as opportunities to increase our convention room nights and international mix.”

MGM Resorts Las Vegas news

Las Vegas is important to MGM Resorts. Revenue from its Las Vegas properties accounts for about 70% of its US retail revenue.

The company had solid results last year and has plans for a bigger 2024.

Sky-high Super Bowl room rates

This year got off to a hot start with the first Super Bowl being played in Las Vegas. During the MGM Resorts earnings call, Hornbuckle said:

“The game was another strong hotel and casino event for us with ADRs (average daily hotel room rate) near a thousand, and posting three of the top five room revenue days ever recorded and near-record event gaming volumes.”

Las Vegas is always busy for the Super Bowl but the game being played in Las Vegas was a boost for MGM Resorts. Hotel room rates approaching $1,000 could be a high point for the company.

Las Vegas Grand Prix was good, but not great

While the Las Vegas Grand Prix F1 race helped boost revenue in the fourth quarter it doesn’t seem to have had the huge impact the company expected. ADR for the fourth quarter of 2023 was $295. This was only a 14% increase from the previous year.

For comparison, the ADR at Wynn Las Vegas during the fourth quarter of last year was $641. This was a huge increase of 28.3% from the same period in the previous year.

Hornbuckle said the company learned a lot about how to price rooms for the event. Visitors should expect to see normal weekend rates for hotels like Mandalay Bay that are away from the F1 course.

Las Vegas hotel upgrades

The F1 race appears to have supercharged MGM Resorts’ focus on the luxury market. This year the company will focus on upgrading its “luxury-oriented offerings” in Las Vegas. The company will remodel some rooms in three hotels:

  • Bellagio: Tower Suites
  • The Cosmopolitan: Chelsea Tower Penthouses
  • MGM Grand: Main tower rooms

Last year MGM Resorts renovated hotel rooms at Bellagio, MGM Grand, and New York-New York.

Marriott partnership underway

The MGM Resorts partnership with Marriott which was supposed to debut last year is now accessible for guests. This is different than the previous worldwide hotel partnership with Hyatt. The new partnership is mostly an improvement for Marriott Bonvoy members.

When discussing the relationship with stock analysts, Hornbuckle said:

“our transient segment will grow as a result of the Marriott relationship, which will bring a new customer base that will be acquired at lower acquisition costs, higher rates and more spend on property.”

More MGM Grand upgrades are being considered

MGM Grand could see some additional upgrades over the next few years if the Oakland A’s move to Las Vegas and build a stadium where the Tropicana will operate until April 2.

Hornbuckle said he’s seen three sets of renderings and expects to hear more about the stadium in 30-60 days.

Photo by Andy Bao / AP Photo
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Marc Meltzer

Marc grew up on the mean streets of the South Bronx. He's the rare combination of Yankees and Jets fan which explains his often contrarian point of view. Marc is a freelance writer and social media consultant. Writing about steak, booze, gambling and Las Vegas is a tough job but somebody has to do it.

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