8-K: MGM Resorts International Reports Record Full Year 2024 Results, Fueled by MGM China's Strong Performance

MGM Resorts International announces record full-year consolidated net revenues of $17.2 billion, driven by strong performance from MGM China and growth in digital businesses.

Summary

• MGM Resorts International reported its fourth quarter and full-year 2024 financial results.
• The company achieved record full-year consolidated net revenues of $17.2 billion, a 7% increase compared to the prior year.
• MGM China's full-year Segment Adjusted EBITDAR reached a record $1.1 billion, a 25% increase year-over-year.
• The company repurchased over 33 million shares in 2024, reducing shares outstanding by more than 40% since 2021.
• BetMGM is expected to be profitable in 2025.
• Consolidated net revenues for the fourth quarter were $4.3 billion, a 1% decrease compared to the prior year quarter.
• Net income attributable to MGM Resorts was $157 million for the quarter, compared to $313 million in the prior year quarter.
• Consolidated Adjusted EBITDA was $528 million for the quarter, compared to $632 million in the prior year quarter.
• Diluted earnings per share were $0.52 for the quarter, compared to $0.92 in the prior year quarter.
• Adjusted diluted earnings per share were $0.45 for the quarter, compared to $1.06 in the prior year quarter.

Sentiment

Score: 6

Explanation: The sentiment is moderately positive. While the company achieved record full-year revenue and MGM China performed exceptionally well, there were declines in net income and EBITDA in the fourth quarter, and the Las Vegas Strip Resorts experienced a revenue decrease. The outlook for BetMGM is a positive factor.

Positives

• MGM Resorts achieved record full-year consolidated net revenues.
• MGM China had a record year for Segment Adjusted EBITDAR.
• The company significantly reduced its share count through repurchases.
• BetMGM is expected to be profitable in 2025.
• Regional Operations experienced revenue growth in the fourth quarter.
• MGM Digital's revenue continues to grow.

Negatives

• Consolidated net revenues decreased slightly in the fourth quarter compared to the prior year.
• Net income attributable to MGM Resorts decreased in both the fourth quarter and full year.
• Consolidated Adjusted EBITDA decreased in the fourth quarter.
• Las Vegas Strip Resorts experienced a decrease in net revenues and Segment Adjusted EBITDAR for the quarter.
• MGM Digital continues to operate at a loss, although the loss is decreasing.

Risks

• Economic conditions and market conditions in the markets in which the Company operates could impact results.
• Competition with online gaming and sports betting operators and destination travel locations could impact results.
• Disruptions in the availability of the Company's information and other systems or those of third parties on which the Company rely, through cyber-attacks, such as the Company's September 2023 cybersecurity issue, or otherwise, could adversely impact the Company's ability to service its customers and affect its sales and the results of operations.
• Impact to the Company's business, operations and reputation from, and expenses and uncertainties associated with a cybersecurity incident, including the Company's September 2023 cybersecurity issue and any related legal proceedings, other claims or investigations and costs of remediation, restoration, or enhancement of information technology systems.
• The timing and outcome of the claims and class actions against the Company and of the investigations by state and federal regulators, related to the Company's September 2023 cybersecurity issue could impact results.
• The continued availability of cybersecurity insurance proceeds could impact results.

Future Outlook

MGM Resorts is encouraged by strong demand in early 2025 and expects BetMGM to be profitable this year. The company is also focused on scaling its global MGM Digital business.

Management Comments

• Bill Hornbuckle, Chief Executive Officer & President of MGM Resorts International, stated that the company is proud to report the best full-year consolidated net revenues in the history of the Company, driven by record performance from MGM China.
• Jonathan Halkyard, Chief Financial Officer & Treasurer of MGM Resorts International, stated that the company continues to see significant value in its stock and repurchased 3 million shares in the quarter.

Industry Context

MGM Resorts' results reflect the ongoing recovery in the gaming and hospitality industry, particularly in Macau. The growth in MGM Digital mirrors the broader trend of increasing online gaming and sports betting activity.

Comparison to Industry Standards

• Las Vegas Sands, a major competitor in the Macau market, has also seen a significant rebound in its Macau operations following the easing of COVID-19 restrictions.
• Caesars Entertainment, another major player in the US gaming market, is also investing heavily in its digital offerings to capitalize on the growth of online gaming and sports betting.
• MGM's share repurchase program is in line with other companies in the industry that are returning capital to shareholders through dividends and buybacks.

Legal Proceedings

• The company is facing claims and class actions related to the September 2023 cybersecurity issue, as well as investigations by state and federal regulators.

Stakeholder Impact

• Shareholders will benefit from the share repurchase program and potential future growth.
• Employees may see opportunities for advancement as the company expands its digital businesses.
• Customers will have access to new and improved gaming and entertainment experiences.
• The company's commitment to sustainability will benefit the environment and communities where it operates.

Next Steps

• The company will continue to focus on growing its core operations and realizing returns from digital and development investments.
• MGM Resorts will host a conference call to discuss the results.

Key Dates