Wynn Resorts reported healthy demand in Las Vegas for its luxury segment during the third quarter, saying revenue rose 1% and adjusted earnings were flat over difficult comparisons with the third quarter of 2023.
During an earnings call Monday, CEO Craig Billings said Wynn Las Vegas and Encore grew hotel revenue by 5%, slot handle by 4%. The company also continued to see a healthy table drop, though it was 3% below 2023.
As a high-end resort, Wynn isn’t facing the same headwinds of other Strip properties that cater to a mix of consumers.
“More recently, demand has remained healthy in the fourth quarter, with strong growth in slot handle, stable drop, and solid non-gaming demand,” Billings said.
Billings said Las Vegas year-over-year comparisons are “increasingly challenging” and that “trees don’t grow to the sky.” But he added that demand from high-end consumers remains stable, with $950 million in trailing 12-month adjusted earnings on $5 billion in capital between Wynn and Encore, and “We’re extremely pleased with the performance of our business here. Looking ahead, our luxury positioning and unique programming continue to appeal to the market’s most affluent and resilient customers and position us well to continue our leadership on the Strip as we move into 2025.”
In a response to questions from Wall Street analysts, Billings said Wynn’s high-end consumers in Las Vegas “continue to hold up,” while facing tough comparisons.
“I think 2025 in Las Vegas is all about demand and everything we see now is that we’re in a pretty good place,” Billings said. “Our retail-lease revenue, which is heavily tied to luxury retail, was up 3½% year over year in the third quarter. We continue to see a strong consumer here, which gives us comfort in revenues, but not comps.”
The Super Bowl last February will be a difficult comparison, Billings said, while bookings for the F1 race the weekend before Thanksgiving have shaped up.
As for table drop, Billings said Las Vegas gaming revenue was more subject to volatility from high-end table play six to eight years ago, but Wynn has done a lot to grow and diversify its casino business “by stealing market share and dampening exposure to extreme high-end volatility. We feel good about the gaming business here and that high-end consumer continues to hold in there.”
Wynn said group business remains healthy through the end of 2024, with record room nights and strong average daily rates. Next year will be a lot like this by intent, so as not to crowd out other hotel segments.
At Encore Boston Harbor, Billings said demand was strong with slot handle up 3%, table handle up 1%, and non-gaming up 2%. He added demand has remained healthy through October, led by the strong slot handle and stable non-gaming revenue against a difficult comparison.
In Macau, Billings said adjusted earnings rose 3% year over year, with healthy demand and operating revenue growing 6% led by 10% year-over-year growth in combined mass table and slot win.
“While the competitive environment in Macau is clearly intense, we continue to focus on maximizing EBITDA, revenue, and market share. We have several initiatives in place that focus on our natural product and service leadership that we expect will support and drive market share in 2025 and beyond. We’ve seen the current competitive dynamic before, and we are confident our continued investment in our market-leading assets and five-star service positions us well to compete profitably over time.”
In October, he reported a healthy mass table drop in Macau, strong VIP turnover, and 99% hotel occupancy. “Our long-term outlook in Macau remains decidedly bullish.”
In response to a question, Billings said the third quarter in Macau “was unique from a margin perspective,” with market share stable, but gaming revenue down. “It really comes down to the competitive nature of the market there and market share versus EBITDA as we set up into 2025, but again, it looks pretty good.”
