Dive Brief:
- MGM Resorts International reported $4.4 billion in net revenues in the fourth quarter of 2023, a 22% increase year over year.
- In Las Vegas, the operator saw $2.4 billion in net revenues in Q4, up 3% year over year and 14% compared to the third quarter of 2023, when MGM experienced a significant cyber threat that affected its performance growth.
- In the company’s Q4 earnings report, MGM attributed growth in Las Vegas in the quarter to an increase in ADR, partially during Formula 1’s inaugural Las Vegas Grand Prix in November. MGM President and CEO Bill Hornbuckle said in the report that “2024 is off to a strong start” in the market due to Super Bowl LVIII and the launch of MGM’s strategic partnership with Marriott International.
Dive Insight:
Despite a rocky Q3 due to a ransomware attack in September and the threat of worker strikes at MGM’s Las Vegas resorts — which were later averted — the resort operator saw strong performance growth in the market in the fourth quarter, particularly in the luxury segment.
“The strength and resiliency of the Las Vegas market has been particularly impressive,” Hornbuckle said during a Tuesday earnings call with analysts. He shared that MGM’s Bellagio, in particular, saw “its best quarter and its best year” in its 25-year history.
Hornbuckle attributed the company’s Las Vegas results partially to Formula 1, which CoStar has estimated generated Las Vegas hotels some $220 million in room revenue between the Wednesday and Sunday of the event week.
Performance growth has continued into 2024, Hornbuckle noted in the earnings report, highlighting Las Vegas’ first-ever Super Bowl this month as a driver of “incremental profit.”
Leading up to the big game, CoStar forecasted Las Vegas ADR would reach $573, the highest level for any Super Bowl weekend on record.
For MGM hotels in the market, ADR climbed closer to $1,000 for Super Bowl weekend, Hornbuckle shared during the call. He added that the gameday weekend represented “three of the top five room revenue days ever recorded” by the company.
Another future growth driver for MGM will be its loyalty program partnership with Marriott International, which officially launched last month. The partnership allows Marriott Bonvoy members to earn and spend points on stays at select MGM properties.
The partnership is driving “impressive early results,” Hornbuckle said during the call, adding that MGM’s “transient segment will grow as a result of the Marriott relationship, which will bring a new customer base.”
MGM’s competitor Wynn Resorts posted record fourth-quarter performance results last week. Wynn attributed the results, in part, to Formula 1 and similarly touted Super Bowl LVIII as a growth driver.
