MGM Resorts International (MGM) Earnings & Analysis

Latest quarter

MGM reported Q2 FY2026 revenue of $4.5 billion, compared with the consensus of $4.4 billion, or 0.37% above the consensus measure. The company reported adjusted EPS, as the consensus counts it, of $0.59 versus the $0.63 consensus, a −6.35% result against that measure.

The filing shows revenue rose 1.05% from $4.4 billion in Q2 FY2025. MGM attributed the increase primarily to Las Vegas Strip Resorts revenue and MGM Digital revenue, partly offset by declines at Regional Operations and MGM China. The company said Las Vegas casino revenue benefited from a higher table-games win percentage, while catering and banquet activity supported food and beverage revenue; lower hotel ADR and venue entertainment revenue partly offset those gains.

MGM reported diluted EPS of $1.11, compared with $0.18 a year earlier. The filing attributed a 24% increase in operating income primarily to property-transaction gains, partly offset by a goodwill impairment charge. Operating margin was 11.3%, compared with 9.18%, while gross margin was unchanged at 44.5%. Free cash flow was $824.4 million, compared with $377.5 million a year earlier.

Adjusted EPS is the figure the consensus estimates, not the GAAP EPS above.

What management said on the call

Bill Hornbuckle said second-quarter Las Vegas revenue was supported by group and convention activity and attendance at citywide events. He said group and convention customers accounted for 20% of room mix in Q2 and that MGM remained on pace for that segment to represent 20% of full-year room mix. Hornbuckle said MGM’s all-inclusive offer supported forward occupancy at Luxor and Excalibur, and that nearly half of guests booking the offer by quarter-end were first-time visitors to MGM.

Jonathan Halkyard said Las Vegas net revenue and segment-adjusted EBITDA both increased from a year earlier in Q2, with the recovery at MGM Grand and gaming win percentage contributing to EBITDA growth. He said the third-quarter booking window remained short, while group and convention calendars and the city’s event calendar were expanding. When asked about the second half, Hornbuckle said MGM liked what it saw in the third quarter but had work to do in the fourth quarter.

Hornbuckle said Regional Operations posted its highest same-store quarterly revenue, while Halkyard said same-store slot handle and slot win increased during the quarter. On Macau, Hornbuckle said June volumes were temporarily affected by World Cup activity and then rebounded in July. Kenneth Feng said MGM China’s strategy was to optimize the yield of its casino floor through products, service, innovation and promotion, rather than promotion alone.

Halkyard said MGM Digital grew revenue in Q2 while reporting a segment-adjusted EBITDA loss of −$31.0 million. He said the company expected MGM Digital’s full-year EBITDA loss to be lower than the prior year as it calibrated its Brazil business, and that the company expected favorable operating leverage in its LeoVegas and European BetMGM-branded businesses in 2027.

On investment, Halkyard said MGM had spent approximately $600.0 million on its Japan project and remained on track to deploy approximately $1.0 billion in each of FY2027 and FY2028. He said the Osaka project remained on time and on budget for a fall 2030 opening. When asked to quantify the gaming win percentage contribution, Halkyard said MGM would not provide a point estimate.

Guidance

MGM’s current guidance identifies Japan capital spending of $1.0 billion for FY2027 and $1.0 billion for FY2028. Jonathan Halkyard said the company expected to complete its capital commitments after those planned deployments.