Wynn beat analysts’ Q3 expectations on both the top and bottom lines. Yet the casino juggernaut still reported a loss of $116.7 million, while a full rebound at Wynn Macau remained elusive.
Las Vegas continues to be a bright spot for Wynn. The Vegas properties set third-quarter revenue records for its gaming, food and beverage, and hotel segments. Overall, earnings before interest, taxes, depreciation, and amortization (EBITDA) were up 12 percent over the same quarter last year. And the outlook for Vegas continues to be strong.
While some worry whether next week’s F1 race is going to deliver as promised, Wynn is still expecting record-breaking results.
"F1’s really come in and nicely right now for all areas of our business," said Wynn’s COO of North America, Brian Gullbrants. The company expects to exceed its all-time hotel revenue by about 50 percent for the three-day-period.
Performance at Wynn’s Boston property was less encouraging. Revenue and EBITDA were down roughly a percent. While some of that can be blamed ongoing Sumner Tunnel construction, the company did suggest some of the softness might be due to “general macroeconomic uncertainty … impacting some of the regional gaming operators.”
But any concerns about Boston took a backseat to Macau – and specifically Wynn Macau. Wynn Macau bounced back since China reopened the region in February. The property had operating revenues of $295 million in the third quarter, up more that $250 million over the same period last year. Results at Wynn Macau, however, have yet to rebound to pre-pandemic levels.
Some speculate that Wynn is losing market share in the region. Wynn was a big player in the VIP and junket space, where China has placed more restrictions. And the company is having to play catchup in the mass market gambling space.
Wynn, however, is not putting all its international eggs in the Macau basket. The company is making good progress on its UAE property, expected to open in 2027.
Sports betting assets lose value after terminations
During the conference call, the company briefly mentioned its strategic change relative to Wynn Interactive. In August, Wynn announced that it was terminating online sports betting operations in any state where it did not have a physical location. So, that leaves Massachusetts and Nevada as the only places where it will maintain an online presence.
As a result, the company reduced its Wynn Interactive EBITDA burn rate to just $4.9 million in the third quarter. But that is only after the company recognized a $94 million impairment of goodwill on its online assets.
Meanwhile, during the conference call, Wynn was busy hammering out a new contract with the Culinary Union. The union had already come to terms with MGM Resorts and Caesars. Wynn’s tentative agreement, announced Friday, successfully averts the threat of a strike.
