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  • Q4 2023: Wynn Resorts thrives in Macau despite China uncertainty
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Wynn Resorts witnessed an 84% year-on-year revenue rise in Q4 2023, to $1.84bn.

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Net income for the same period was $729.2m, a 2,151% rise from Q4 2022, which Wynn attributed primarily to higher revenue from both its Macau and Las Vegas operations.

Across its two Macau venues, Wynn Palace revenue soared 364% year-on-year to $524.4m. Wynn Macau generated $386.2m, up 400% on Q4 2022. 

Revenue from Wynn’s Las Vegas operations reached $696.8m, marking a 19% increase over the previous year, whereas revenue from Encore Boston Harbor decreased by 0.6% to $217.1m.

Wynn Interactive loss

In Q4 2023, both the Encore and Wynn Interactive, the company’s online sports betting and casino division, recorded operating losses of $15.8m and $8.6m respectively. 

Last year, Wynn withdrew its digital platform WynnBet from eight US states to focus primarily on Massachusetts and Nevada, where it also has a physical presence. 

However, in January, it was revealed that WynnBet also plans to exit Massachusetts, marking its ninth US market exit.

CEO Craig Billings (pictured) indicated that the firm’s operations in New York and Michigan remain “under review,” with further updates expected soon.

Diluted net income per share was $6.19 for the quarter, compared to diluted net income per share of $0.29 for Q4 2022. 

Meanwhile, adjusted Property EBITDAR came in at $630.4m for Q4 2023, compared to adjusted property EBITDAR of $195.1m for Q4 2022.

“The strong momentum we built throughout 2023 continued during the fourth quarter with adjusted property EBITDAR reaching a new all-time record,” said Billings. 

“On the development front, construction of Wynn Al Marjan Island continues, with much of the hotel tower and podium foundation complete, and preparations underway to start vertical construction of the hotel tower.”

Macau’s resilience

On the firm’s Q4 earnings call, CBRE equity analyst John DeCree sought insight from Billings regarding Macau’s performance amid concerns about China’s macroeconomic landscape.

“We still hear from investors skittish about some of the uncertainty around the macroeconomic picture in China, yet we continue to see monthly numbers out of Macau continue to recover and grow.”

While Billings stressed that he would leave the “detailed China macro analysis to people who do that for a living”, he added that there are a lot of “crosscurrents” to consider.

“I think it’s well observed, maybe not well understood, that Macau’s trajectory does seem to be decoupled from the broader China macro.”
Wynn Resorts CEO Craig Billings

He noted pent-up demand from previous closures, Macau’s geographical advantage, and modest stimulus measures.

“But you also, as you rightly pointed out, clearly, have a litany of difficult economic indicators. Yet Macau continues to tread along. So to us, it’s really about the long-term viability of Macau,” Billings said. 

“We’re clearly already at levels that allow us the financial and operating flexibility to plan for that longer-term time horizon.

“I think it’s well observed, maybe not well understood, that Macau’s trajectory does seem to be decoupled from the broader China macro,” he added, suggesting optimism for its future trajectory despite short-term uncertainties.

Analyst reaction

The gaming team at Morgan Stanley said: “While macro fears remain top-of-mind the company has been able to maintain mass market share despite more base mass visitation returning to Macau (which should continue to recover) along with Vegas firing on all cylinders coupled with development optionality in New York and the UAE.

“While it remains unclear what micro/macro indicator gets the Macau stocks to rally, the underlying fundamentals of WYNN’s business appear to be performing well.”

Q1 2024 outlook

Looking ahead, Billings highlighted February as an important month, which “will really set the tone for the quarter.”

He pointed to the Super Bowl being played on 11 February and to the Chinese New Year, which is celebrated on 10 February in 2024. 

March has a couple of headwinds, according to Billings, with easter timing being one of them. 

“But our forward booking indicators continue to look strong, and we feel good about it.”

“How the quarter plays out will be very dependent on February, and again all forward indicators look strong for February, but subsequent to that, we’ll take it from there,” he concluded. 

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