MGM Resorts Defies Global Economic Uncertainty with Strong Q1 Earnings, Thanks to the Growth of its Operations in China

On Wednesday, MGM Resorts International reported first-quarter earnings that exceeded Wall Street expectations. The company’s strong performance was primarily due to the growth of its operations in China.

MGM has been benefiting from the relaxation of post-pandemic entry restrictions and has seen an increase in traffic at its gaming hubs in Macau thanks to the resurgence of travel and tourism spending in China, which is the world’s second-largest economy. MGM China reported a 78% increase in adjusted property EBITDAR in the first quarter compared to the previous year.

CEO Bill Hornbuckle attributed the record results to the strong performance of MGM China and luxury resort properties in Las Vegas. While regional operations in the U.S. were impacted by poor winter weather in January, they quickly recovered in February and accelerated in March. CFO Jonathan Halkyard mentioned that MGM’s exciting pipeline of limited license development projects in New York, Japan, and potentially the United Arab Emirates will drive free cash flow growth over the next decade.

MGM’s total revenue for the quarter rose by 13% to $4.38 billion, surpassing analysts’ expectations of $4.24 billion. The company’s adjusted profit per share of 74 cents also exceeded Wall Street estimates of 56 cents. Shares of MGM rose approximately 3.14% in after-hours trading following the earnings announcement.

Overall, MGM Resorts International continues to thrive despite challenges faced by other industries due to global economic uncertainty and changing consumer behaviors caused by the COVID-19 pandemic.