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Wynn's revenue drops in Q2 despite strong US performance as Macau headwinds drag results down

wynn's-revenue-drops-in-q2-despite-strong-us-performance-as-macau-headwinds-drag-results-down

Gaming and hospitality giant Wynn Resorts has shared its financial results for the second quarter of the year. The business has delivered $908.8 million in operating revenues, down $81.3 million from the comparable period last year; while a net loss widened from $137.4 million in Q2 2021 to $213.4 million the last quarter.

“Our second quarter financial results reflect continued strength at both Wynn Las Vegas and Encore Boston Harbor,” said Craig Billings, CEO of Wynn Resorts. “Our teams’ ongoing focus on five-star hospitality and new experiences at our market-leading properties combined with very strong customer demand drove a new all-time quarterly record for Adjusted Property EBITDA at Wynn Las Vegas and a second-quarter record at Encore Boston Harbor.”



Craig Billings

But while the company’s operations in its home market remained strong, Wynn’s endeavors in Macau didn’t fare as well, with Covid-related travel restrictions continuing to impact results. Despite this setback, Billing said the company remains confident “that the market will benefit from the return of visitation over time,” with some of the restrictions in place during Q2 having now been lifted.

Adjusted Property EBITDA for Q2 2022 was down, at $179.2 million, a decrease from $206.9 million in 2021. While EBITDA increased $93.5 million and $16.8 million at the company’s Las Vegas operations and Massachusetts’ Encore Boston Harbor, respectively, it decreased $103.5 million and $54.5 million at Wynn Palace (Macau) and Wynn Macau, respectively.



Wynn Palace

A similar picture can be seen when breaking down operating revenues for Q2 at each property. While Las Vegas increased $206 million and Encore Boston Harbor was up $44.9 million, Wynn Palace and Wynn Macau saw operating revenues decrease by $211.7 million to $58.7 million and $125.4 million to $58.6 million, respectively, from the second quarter of the last year.

Travel-related restrictions affecting Macau operations during the second quarter include Covid-19 testing and other mitigation procedures. These adverse conditions continued being in place after the end of Q2, as the gambling hub faced in July one of its worse outbreaks yet, which forced a two-week shutdown to curb the spread of the virus. Casinos have now been allowed to reopen and some border measures have been lifted, resulting in early signs of recovery.

All in all, Wynn’s results for the quarter could be described as a tale of two cities. While the US gaming market remained strong, in particular the Vegas Strip, where the company’s gaming revenue was up by a whopping 58%, Macau was a drag for the business.



Encore Boston Harbor

Looking ahead, on Wynn’s earnings call, Billings said that Massachusetts was set to be a good opportunity for the company’s digital segment after the state passed sports betting earlier this month. “We are looking forward to the potential for a significant catalyst for Wynn Bet in Massachusetts both in digital and retail sports betting,” the executive said. 

“For us, Massachusetts was always an important bootstrapping event for Wynn Bet and for Wynn Interactive,” he noted. “We’ll be in Massachusetts on day one.” The Massachusetts Gaming Commission has now taken the reins on the law’s implementation, but a launch date still remains to be determined.

As for Wynn’s half-year results, revenue was $1.9 billion, up from the H1 2021 revenue of $1.7 billion. Operating expenses for the six months were higher, at $2 billion, while the company’s overall net loss for H1 was down by $23.5 million from 2021 to $468 million.

See Wynn Resorts’ full Q2 results here.

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