MGM Resorts Surpasses Wall Street Expectations in Q1 Due to Strong Operations in China and Robust Performance in Macau
On Wednesday, MGM Resorts International reported first-quarter earnings that surpassed Wall Street expectations, primarily due to the strength of its operations in China. The casino operator has been benefiting from the relaxation of post-pandemic entry restrictions.
Shares of the company rose approximately 3.14% in after-hours trading. MGM, along with other casino operators like Wynn, has seen an increase in traffic at their gaming hubs in Macau thanks to the resurgence of travel and tourism spending in China, the world’s second-largest economy.
MGM China reported a 78% increase in adjusted property EBITDAR in the first quarter compared to the previous year. CEO Bill Hornbuckle credited the record results to the strong performance of MGM China and luxury resort properties in Las Vegas.
While regional operations in the U.S. were impacted by poor winter weather in January, they quickly recovered in February and accelerated in March. CFO Jonathan Halkyard mentioned the company’s exciting pipeline of limited license development projects in New York, Japan, and potentially the United Arab Emirates that will drive free cash flow growth over the next decade.
MGM’s total revenue for the quarter rose by 13% to $4.38 billion, surpassing analysts’ expectations of $4.24 billion. The company’s adjusted profit per share of 74 cents also exceeded Wall Street estimates of 56 cents.
