Wynn Resorts has made significant strides in its financial performance for the third quarter of the year, showcasing resilience and growth, particularly in its Macau operations. The Las Vegas-based gaming and hospitality leader reported a reduced net loss of $32.1 million during this quarter, a notable recovery from the more substantial $116.7 million loss recorded in the same timeframe last year. As revenues edged up to $1.69 billion compared to $1.67 billion in 2022, however, it fell short of analysts’ expectations that pegged revenues at $1.73 billion. The adjusted earnings per share stood at 90 cents, missing the forecasted $1.04 suggested by FactSet.
Macau Operations: The Key Revenue Engine
Central to Wynn’s improved quarterly results is its performance in Macau. According to MarketWatch, Wynn Macau reported an impressive 6.3% year-on-year revenue increase, totaling $871.7 million, driven largely by robust demand and heightened activity in the mass gaming segment. Notably, casino revenue at Wynn Macau surged nearly 29%, hitting $296.8 million.
In contrast, Wynn Palace, located on the Cotai Strip, showed more stable performance with casino revenue maintaining at $418 million. CEO Craig Billings underlined the critical role of Macau’s mass gaming sector, attributing the solid performance to “healthy demand across our resorts” and signaling that the company’s strategic investments are bearing fruit.
The quarterly metrics also revealed contrasting trends in video lottery operations. At Wynn Palace, VIP rolling chip turnover rose by 11.6%, reaching $3.2 billion, while mass-market table drop dipped 1.8% to $1.69 billion. Conversely, Wynn Macau experienced a 9.5% rise in mass-market table drop to $1.51 billion, with VIP turnover remaining steady at $1.2 billion. Slot revenue proved exceptionally strong, with a 43% year-on-year increase, as Wynn Palace reported $577.3 million and Wynn Macau achieved $815.3 million.
These favorable results translated into increased earnings before interest, tax, depreciation, amortization, and rent (EBITDAR) for Wynn Macau, which soared 29% year-over-year to $100.6 million. However, the EBITDAR at Wynn Palace saw a decline of 8.3%, totaling $162.3 million.
Mixed Performance in the U.S. Operations
While Wynn’s international operations thrived, results in the U.S. were mixed. The company’s Las Vegas operations reported a 13.6% decline in casino revenue, which settled at $145.2 million. This downturn was mainly attributed to a 14.3% decrease in table drop, amounting to $580.8 million. Nevertheless, the slot machine handle showed some resilience, rising 3.5% to $1.69 billion. Adjusted EBITDAR for the Las Vegas segment also saw a slight decline to $202.7 million, alongside a reduced occupancy rate of 89% for the property.
In contrast, Encore Boston Harbor in Massachusetts contributed positively, achieving a 1.8% increase in total casino revenue, which reached $158.7 million. Growth was evident in both table games and slots, which saw respective increases of 1% and 3.1%. Occupancy rates at Encore Boston Harbor climbed to an impressive 96.9%, with adjusted property EBITDAR rising to $63 million.
Future Developments and Strategic Moves
Looking ahead, Wynn Resorts is gearing up for future growth with the ongoing development of Wynn Al Marjan Island, a luxury resort set to debut in Ras Al Khaimah, UAE, in 2027. The company has committed $532.6 million to the project thus far, including $18.2 million in the third quarter alone. Billings expressed optimism about the resort’s potential, describing it as a “must-see tourism destination” anticipated to generate substantial cash flow over the long term.
In line with its commitment to shareholder value, Wynn’s board has expanded its stock buyback program by an additional $1 billion. In the third quarter, the company repurchased 1.46 million shares at an average price of $80.37, bringing the total for the first nine months of the year to $185.7 million for 2.21 million shares.
Conclusion
Reflecting on the quarter’s performance, CEO Craig Billings acknowledged the significance of the firm’s continued investment in its workforce and unique property assets. His assertion that “our third quarter results reflect healthy demand across our resorts” underscores Wynn’s strategic position in the gaming market. The robust mass gaming performance in Macau, combined with steady growth in non-gaming activities in Las Vegas, illustrates Wynn Resorts’ determination to solidify its market leadership amid fluctuating economic conditions. As the company navigates the complexities of the gaming industry, its focus on innovation and resilience appears to be setting the stage for a promising future.
