Hospitality and casino entertainment company MGM Resorts (NYSE:MGM) reported Q2 CY2025 results beating Wall Street’s revenue expectations, with sales up 1.8% year on year to $4.40 billion. Its non-GAAP profit of $0.79 per share was 42.7% above analysts’ consensus estimates.
Is now the time to buy MGM? Find out in our full research report (it’s free).
MGM Resorts (MGM) Q2 CY2025 Highlights:
- Revenue: $4.40 billion vs analyst estimates of $4.32 billion (1.8% year-on-year growth, 1.9% beat)
- Adjusted EPS: $0.79 vs analyst estimates of $0.55 (42.7% beat)
- Adjusted EBITDA: $647.5 million vs analyst estimates of $1.17 billion (14.7% margin, 44.6% miss)
- Operating Margin: 9.2%, in line with the same quarter last year
- Market Capitalization: $9.64 billion
StockStory’s Take
MGM Resorts’ second quarter delivered revenue growth and an adjusted profit well ahead of Wall Street expectations, but the market responded negatively due to a significant shortfall in adjusted EBITDA. Management highlighted the benefits of MGM’s diversified portfolio, with international and digital segments offsetting softness in Las Vegas. CEO Bill Hornbuckle pointed to ongoing room renovations at MGM Grand and weaker midweek performance at value-oriented Las Vegas properties as the main drags on domestic results, while he noted record performance in China and regional markets as key supports.
Looking ahead, MGM’s forward outlook is underpinned by optimism around digital expansion, upcoming major Las Vegas events, and new international projects. Management expects catalysts like the Las Vegas MLB stadium, conventions, and the return of Formula 1 to boost future demand. At the same time, executives acknowledged continued risks from U.S. leisure softness and competitive pressures, but believe targeted investments in hospitality, digital gaming, and international development will position the company for growth. As CFO Jonathan Halkyard stated, “Our active accelerating growth pipeline, paired with a nearly halved share count, will unlock meaningful value.”
Key Insights from Management’s Remarks
Management attributed the quarter’s performance to strong growth in digital gaming and international operations, but acknowledged ongoing headwinds in Las Vegas and elevated investments in development projects.
- Digital and omnichannel gains: MGM’s BetMGM North America venture posted robust results, with higher player engagement and improved marketing efficiency driving improved profitability. The company’s consolidated international digital business also neared breakeven (excluding Brazil), reflecting improved performance in markets like the U.K. and Sweden.
- Las Vegas disruption impact: Executives identified the MGM Grand room remodel and lower midweek visitation at value-focused properties as the main causes of Las Vegas margin pressure. The company accelerated renovations to complete them before major fall events, aiming to capitalize on refreshed rooms during peak periods.
- Marriott partnership momentum: The strategic alliance with Marriott contributed to a 31% increase in booked room nights and higher spending per guest, with management highlighting this channel as a key source of higher-value customers and future group business.
- Record regional and China results: Regional U.S. properties delivered their best-ever second quarter net revenue, while MGM China achieved record adjusted EBITDAR and market share. Management emphasized the continued focus on premium mass players in Macau and robust new suite conversions to support future growth.
- Development pipeline and capital allocation: MGM prioritized funding high-profile projects in Japan, Dubai, and New York, moderating share repurchases to preserve financial flexibility. The company is leveraging its scale and international experience to manage multiple initiatives simultaneously, including the launch of proprietary sportsbook technology and live studio content.
Drivers of Future Performance
MGM’s guidance is driven by ongoing digital expansion, major event-driven demand in Las Vegas, and continued growth in international markets, though management remains cautious about U.S. consumer trends.
- Digital strategy acceleration: Management is investing in BetMGM’s technology and marketing, targeting sustainable profitability and scale, particularly in North America and Brazil. The international digital segment is expected to maintain breakeven performance, with further upside from new markets and content integration.
- Las Vegas event catalysts: Upcoming events—including the opening of the MLB stadium, major conventions, and the Formula 1 race—are expected to drive higher demand and occupancy, especially at luxury properties. However, risks remain from softer value-segment demand and changing consumer preferences.
- International development progress: Large projects in Japan, Dubai, and a New York casino license represent mid- and long-term revenue opportunities. Management sees these as transformative, but acknowledges significant capital requirements and regulatory milestones ahead. The company is balancing these investments with measured capital returns to shareholders.
Catalysts in Upcoming Quarters
Looking ahead, the StockStory team will closely monitor (1) the pace of Las Vegas recovery as renovations finish and major events return, (2) BetMGM’s ability to sustain digital profit growth and expand in new markets, and (3) progress on international projects like MGM Osaka and Dubai. Successful execution across these milestones will be critical to MGM’s long-term value creation.
MGM Resorts currently trades at $35.35, down from $37.91 just before the earnings. In the wake of this quarter, is it a buy or sell? See for yourself in our full research report (it’s free).
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