The Short Take:
- Both WYNN and LVS saw their Las Vegas revenue decline in the third quarter of 2018
- Total Vegas revenue at WYNN fell 14.1% while LVS saw a decline of 2.1%
- Total casino revenue in Vegas fell an astounding 28.4% for WYNN and 4.3% for LVS
By digging through the third quarter financial documents that Wynn Resorts (WYNN) and Las Vegas Sands (LVS) provided within the last few weeks, we see that neither companies’ Las Vegas resorts performed well in the quarter. While both of these companies now get a vast majority of their revenue and earnings from their Macau casinos, Vegas is still important to them, so we’ll dig into some of the metrics to see what drove the overall declines in Las Vegas revenue for both of these companies.
Here’s an overview of the WYNN and LVS data we’ll be looking at:
|WYNN vs LVS in Las Vegas||Revenue||YoY % Growth|
|Net Revenue: WYNN||399,000,000.00||-14.10|
|Net Revenue: LVS||379,000,000.00||-2.10|
|Casino Revenue: WYNN||93,000,000.00||-28.40|
|Casino Revenue: LVS||88,000,000.00||-4.30|
|Room Revenue: WYNN||111,000,000.00||-5.90|
|Room Revenue: LVS||138,000,000.00||0.00|
WYNN and LVS were very close in terms of total net revenue from their Las Vegas operations. WYNN, which operates the Wynn and Encore on the Strip, brought in $399 million in revenue during the quarter. LVS’ two Las Vegas properties, Venetian and Palazzo, saw revenue of $379 million.
While these total revenue numbers look encouraging, they are actually disappointing. Both companies saw their year-over-year (YoY) Las Vegas revenue shrink during the third quarter. Vegas revenue at LVS fell 2.1% compared to the same quarter last year. WYNN was even worse, falling 14.1% versus Q3 2017.
What drove this decline in revenue? For both companies, two of the main revenue drivers are casino revenue and rooms revenue, or revenue from their hotels.
On the casino side of the equation, WYNN brought in about $93 million from gamblers during the quarter. This was a huge decrease compared to the same quarter in 2017. In fact, casino revenue was down 28.4% YoY.
Las Vegas Sands also saw a decline in casino revenue, but it was nowhere near the magnitude of Wynn’s. LVS Vegas casino revenue for the third quarter came in at $88 million. This represents a YoY decline of 4.3%.
The other huge Vegas revenue driver for both of these companies is rooms revenue. While not as scary as casino revenue, rooms revenue was not exactly stellar in the third quarter. WYNN saw rooms revenue for the quarter come in at $111 million, a 5.9% drop from last year. LVS’s rooms revenue was flat compared to the same quarter last year, settling at $138 million for the quarter.
We’ll be keeping an eye on the both WYNN and LVS so check back to see if this downtrend in Las Vegas business continues for these casino behemoths, or if what we saw in Q3 was just a blip.