MGM Earnings Call

OperatorGood afternoon and welcome to the MGM Resorts International Second Quarter 2026 Earnings Conference Call. Joining the call from the company today are Bill Hornbuckle, Chief Executive Officer and President, Ayesha Molino, Chief Operating Officer, Jonathan Halkyard, Chief Financial Officer, Gary Fritz, Chief Commercial Officer and President of MGM Digital, Kenneth Feng, Chief Executive Officer of MGM China Holdings, and Howard Wang, Vice President, Investor Relations. Participants are in listen-only mode. After the company's remarks, there will be a question-and-answer session. In fairness to all participants, please limit yourself to one question and one follow-up. Please note, this conference is being recorded. Now I would like to turn the call over to Howard Wang. Please go ahead.

Howard WangThanks. Welcome to the MGM Resorts International Second Quarter 2026 Earnings Call. This call is being broadcast live on the internet at investors.mgmresorts.com, and we have also furnished our press release on Form 8-K to the SEC. On this call, we will make forward-looking statements under the safe harbor provisions of the federal securities law. Actual results may differ materially from these contemplated in these statements. Additional information concerning factors that could cause actual results to differ from these forward-looking statements is contained in today's press release and in our periodic filings with the SEC. Except as required by law, we undertake no obligation to update these statements as a result of new information or otherwise. During the call, we will also discuss non-GAAP financial measures when talking about our performance. You can find the reconciliation to GAAP financial measures in our press release and investor presentation which are available on our website.

Howard WangFinally, this presentation is being recorded. I will now turn it over to Bill Hornbuckle.

Bill HornbuckleThank you, Howard, and thanks to everyone for joining today's call. Before we review the second quarter results, I want to provide a brief update on the status of the offer we received from People Inc. Since reviewing the offer, our board of directors has formed a special committee composed of independent directors with no affiliation or association with Barry Diller, People Incorporated or the proposed transaction. This committee continues to evaluate the proposed transaction in consultation with independent outside advisors. I'm confident our board will pursue the course of action that's in the best interest of the company and our shareholders. I don't have anything more to share at this time, and Jonathan and I are not able to answer any questions during Q&A on this topic. Now turning to our results, we are pleased to report that solid fundamentals and business momentum we saw at the start of the year carried forward into the second quarter.

Bill HornbuckleThe company delivered record second quarter consolidated net revenue, driven by a second consecutive quarter of year-over-year revenue growth from our Las Vegas Strip resorts, all-time best regional operations same-store quarterly revenue, and a 20% year-over-year revenue growth at MGM Digital. Revenue for Las Vegas was bolstered by a solid underlying base of group and convention business at MGM Resorts and aided by strong attendance at events around town, ranging from BTS to UFC to a deep playoff run into the Stanley Cup by our very own Vegas Golden Knights. Our group and convention business picked up where it left off in Q1, delivering a 20% room mix in Q2 and keeping us on pace for this market segment to represent 20% of the room mix for the full year. We drove demand from a diverse customer mix that included technology and hospitality corporate groups, as well as top B2B trade shows and professional association meetings, leading to the highest second quarter convention ADR and catering and banquet revenue in our history.

Bill HornbuckleOur all-inclusive experience in Las Vegas has also sustained solid momentum since launch 4 months ago. At the end of the quarter, nearly half of the guests booked this offer were first-time visitors to MGM. The initiative has supported occupancies and forward bookings at Luxor and Excalibur and importantly turned the value narrative into a positive story. We are constantly creating new experiences for our customers that leverage and highlight the MGM Resorts Las Vegas Strip portfolio. One example is the Players Era Basketball Tournament taking place across 2 weeks this November at Michelob Ultra Arena in Mandalay Bay and the T-Mobile Arena. 24 Top collegiate basketball programs from multiple conferences, including 4 of the last 5 national championship-winning programs, will play in a bracket-style tournament with all games televised on ESPN family of networks. To deliver a world-class experience for teams and for fans, Las Vegas stands unmatched, and MGM is proud to offer the ultimate stage.

Bill HornbuckleFrom the all-inclusive experiences to the Players Era Tournament, the spectrum of experiences we have created aligns with prevailing consumer trends, bridging the more deliberate spending patterns of value-conscious guests with the broadening demand for our premium live experiences. Las Vegas has become the world stage for premier hospitality and entertainment, and MGM is helping to lead the way. We are elevating our commitment to luxury by retouching and reimagining every element of the customer experience, including the convention and public areas within the Bellagio. Room remodels for Aria and the Cosmopolitan are also on the horizon, building upon our already upgraded suites, villas, and high-end gaming areas. We will strategically invest our growth capital into designing creative and inspiring concepts that expand the very definition of luxury and we're excited to share more details on this vision in the near future.

Bill HornbuckleOur regional operations continued their solid performance in the second quarter, resulting in an all-time best revenue quarter on a same-store basis. We continue to invest targeted capital throughout our regional portfolio, which between now and the end of the year will include enhancing our premium lounge offerings at both Beau Rivage and Borgata, as well as a room remodel beginning at Borgata. We continue to see benefits from the recent upgrades and improvements in high-limit gaming areas, which drove record 2-quarter revenues at Borgata and an all-time record quarterly revenue at the Beau. Both were major contributors to all-time same-store record quarterly casino revenues and slot win in the regionals this quarter. At MGM China, we continued to outperform the market in the second quarter while maintaining solid market share of 16.4% a sequential increase of a full percentage point. While the World Cup temporarily impacted June volumes in Macau, this was a transitory event rather than a secular shift.

Bill HornbuckleOur confidence is reinforced by the immediate and encouraging rebound in volumes observed post-tournament throughout the month of July. At our BetMGM North America ventures, Adam and Gary Deutsch reported second quarter results yesterday. Our second quarter performance keeps us well positioned to meet our full year guidance and our business continues to grow.— remember, over two-thirds of net revenue comes from iGaming, which continues to drive overall growth. In our sports business, despite the unrestrained spending and legally burdened predictive market participants, we are still growing. We are also excited about our recent launch in Alberta, where early performance indicates— reflects tangible benefits of our omnichannel presence. I'd note that of the first 8,500 deposits we recorded in Alberta, almost 1,000 had prior relationships with the MGM. MGM Digital reported double-digit revenue growth again this quarter and continues to make progress towards profitability in our underlying businesses.

Bill HornbuckleWe successfully launched our in-house sportsbook in Sweden ahead of the World Cup, which drove record-high player activity. We have seen great traction with our products, which have led to phenomenal growth in both BetMGM branded services internationally. In Brazil, the environment continues to be dynamic and fluid, but we remain bullish on the long-term opportunity. Turning to Osaka, our construction continues to reach milestones on a timely basis as we advance towards the 2030 opening. The underground work is progressing nicely with over 60% of foundation piles completed. Above ground, the property's main structure is taking shape with ongoing concrete placement and structural steel fabrication. We remain on time and on budget as the only licensee in Japan for what we consider the greatest greenfield opportunity in the world. In closing, MGM Resorts delivered a strong first half of the year, which should come as no surprise considering the enterprise achieved record-breaking 2Q results on our NPS scores.

Bill HornbuckleAgain, I want to thank every one of our team members for their tremendous daily efforts that drove the record net promoter scores. We are excited as we look forward to the second half of the year as our business is positioned for continued positive momentum driven by a solid base of group and convention business at MGM Resorts, particularly led by the tech sector. This is further complemented by an expanded sports and entertainment events calendar taking place citywide that represents an increased number of events compared to that of third quarter last year. I'll now pass it over to Jonathan to provide some additional details on our performance before we open it up for questions.

Jonathan HalkyardThanks, Bill. And I also want to express my appreciation to the entire MGM team for their continued focus, hard work, and daily commitment to operational excellence. In Las Vegas, we grew both net revenue and segment-adjusted EBITDA in the second quarter on a year-over-year basis. This year, EBITDA is up $25 million at our Strip Resorts, and the main driver was a recovery at the MGM Grand, which was the beneficiary of the newly remodeled room inventory and a hold benefit. As we look to the third quarter, while the booking window remains short, we continue to see solid group and convention calendars alongside growth in the city's event calendar. The regional operations second quarter results reflected all-time record quarterly revenues on a same-store basis. In fact, several of our properties delivered record revenue results during the quarter, including Empire City, which grew GGR in June despite new competition in the state.

Jonathan HalkyardResults for the quarter reflect less than 1 month of operations from Northfield Park due to the transaction closing in late April. So on a same-store basis, slot handle and slot win increased 4% and 3% respectively. At MGM China, volumes and earnings were solid in April and May. And while we saw a dip in volumes coinciding with the World Cup activity in June, trends have since rebounded. Our capital investment program, highlighted by the recent suite conversions and renovated premium gaming areas, continues to yield strong results. Over the past year, we successfully debuted the ultra-luxury Alpha Villas at MGM Macau, expanded our premium mass offerings with 50,000 square feet of high-end gaming space, and recently unveiled newly renovated suites at MGM Cotai this past April. Looking ahead, we have commenced design work on approximately 100 suites at MGM Macau as part of our ongoing commitment to staying ahead of the evolving consumer tastes and preferences.

Jonathan HalkyardOur BetMGM North America venture continues generating steady growth as we continue leaning into our areas of strength and focus on efficient operations. We have embedded call options around new state iGaming regulation and currently are more optimistic than we've been in a while as we see increased legislative activity in states like Virginia, Maryland, and Indiana. Our best-in-class iGaming segment grew 8% in the second quarter, and over the course of the first half of 2026, handle per active grew 7% while NGR per active grew 9%. Our online sports strategy continued its focus on player management and disciplined acquisition, resulting in growth per handle— growth of handle per active and NGR per active of 18% and 17% respectively during the first half of 2026. MGM Digital drove healthy growth in net revenues of 20% in the second quarter and reported segment-adjusted EBITDA losses of $31 million.

Jonathan HalkyardWe continue to build brand awareness while focus— focusing on disciplined growth. 2027 Is setting up for favorable operating leverage in the LeoVegas and BetMGM-branded businesses that will finance growth in Brazil, where we're seeing encouraging data points in first-time deposits, active players, and NGR. And as we continue calibrating in Brazil, we're expecting full-year EBITDA losses at MGM Digital to be less than last year. In Japan, we're expecting our funding commitment for the second half of the year to be approximately $125 to $175 million. To date, we have spent approximately $600 million, and we remain on track to deploy approximately $1 billion in each of '27 and '28, which will then have fully completed our capital commitments. The project remains on time and on budget for a fall 2030 opening. During the quarter, we bought back about 4.3 million shares for $164 million. And over the last 5 years, we've decreased our share count by nearly 50%.

Jonathan HalkyardI'll turn it back to Bill.

Bill HornbuckleThanks, Jonathan. Um, before taking questions, it's worth emphasizing that Las Vegas is stabilizing and growing, as evidenced by this quarter's improvements in both revenue and EBITDA, And the continued swell of premier sports and entertainment events has only reinforced our focus on deploying capital towards our luxury offerings to drive medium to long-term growth. Our regional operations continue to deliver robust results marked by record-breaking performances and an exceptional guest response to our targeted capital investments. Macau has bounced back nicely in July while maintaining mid-teen share throughout the temporary disruption caused by the World Cup And digital continues to grow. And MGM Osaka forges ahead with its 2030 opening, which has me, despite my many years in this company and this industry, pleased to say our future has never looked brighter. With that, operator, we'll open it up for some questions.

OperatorWe will now begin the question and answer session. To ask a question, you may press star then 1 on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. To withdraw your question, please press star then 2. As a reminder, in all fairness, please limit yourself to one question and one follow-up.

OperatorOur first question today comes from Dan Politzer with JPMorgan. Please go ahead.

Dan PolitzerHey, good afternoon everyone and thanks for the questions. I wanted to first start with Las Vegas and the health in the underlying market there. It does seem like, Bill, based on your comments, that it's getting better, but maybe if you could walk us through the second quarter and the cadence and how it progressed and maybe give us a glimpse into July as we really start to face some of those easier comparisons. And then, you know, obviously tie in with any of the recent initiatives, how those are maybe helping out. Thanks.

Bill HornbuckleYeah, thanks, Dan, for the question, and will do. And then, Ayesha, you can help me pile on top here. Look, I think the second quarter, as we reflect back, April and May were strong. May was exceptionally strong, driven by events and other activity. In April, we had our $10 million baccarat tournament, which was extremely successful. June was more challenged. I think it's the summer heat picked up and we got into the real throes of summer. July, on the other hand, has been good. And so, you know, I think we've seen ups and downs in summer, and frankly, I think we'll continue to see so. As we think about the third quarter and beyond. But again, healthy group business helped the quarter, great events, which we continue to see throughout the course of the year. And overall, I think the packages helped at Excalibur Luxor stabilize occupancies and somewhat ADRs. And so, you know, as we think about Q3 and Q4, we like what we see in the third quarter.

Bill HornbuckleWe got some work to do in the fourth quarter.

Ayesha MolinoThank you.

Ayesha MolinoI should think I covered it.

Dan PolitzerOkay. I thought it was a good response, so I'm happy. Thank you. I think just turning kind of more broadly to kind of the value of the stock, right? I think, Jonathan, you mentioned, you know, MGM has bought back about 50% of its shares in the past 5 years. I think the average price is probably around $40 or so. The stock's sitting here today at $46. So How do you think about the current value of your stock here and the attractiveness, you know, given some of the longer-term value drivers that you've talked about, such as Osaka?

Jonathan HalkyardYeah, I think your math is about right in terms of what the price has been over the past several years and our share repurchases. We have, you know, we have— we bought back fewer shares in this past quarter only about $164 million worth at about, I would say, about $37 a share or thereabouts. So of course, we think that that's been a good use of capital. You know, as it relates to the current value of the stock, we've, you know, we've gone through this on a number of prior quarters in terms of the sum of the parts valuation. And, you know, in our view, given the current trends, really hasn't changed from that.

Dan PolitzerUnderstood. Thanks so much.

OperatorThe next question is from Barry Jonas with Truist Securities. Please go ahead.

Barry JonasHey guys, thanks for taking my questions. Just wanted to dig in a little more on strip trends, you know, record group and convention bookings in the quarter, but, you know, RevPAR still down a little. So anything you can call out, whether that's specific properties or, you know, is it still sort of a kind of lower end leisure driving that softness? And I guess related to that, do you see a path to return to growth in RevPAR sometime this year? Thank you.

Ayesha MolinoNo, I just want to— this is Ayesha. I just want to highlight again what Bill noted in his script in his previous comment. We have seen growth in overall Las Vegas revenue as well as EBITDAR. And so we're pleased with what we're seeing there. In terms of RevPAR, I just note that it is a noncash metric. You know, overall, I think we continue to see really strong strength in the luxury segment. As we've noted, the lower ends of the segment, particularly Luxor and Excalibur, those do remain challenged, but we've been deploying offers such as the all-inclusive. We've seen positive reaction to that. So overall, I think, you know, we're seeing real health in the group segment. We're seeing real health in the luxury segment. And then we're seeing sort of a continued but relatively stabilized trend at the lower end.

Barry JonasGot it. That's, that's helpful. And then I guess just maybe one on regionals. You know, we've seen what the Sphere has done in Vegas. Just curious how much of an impact you think a Sphere can do for National Harbor when it opens. Thank you.

Bill HornbuckleYeah. Hi, Barry. Bill. So they're projecting 2.5 million visitors. Which seems about right. I think it's about a 6,500-seat facility when it's all said and done. I know they're finalizing plans, so I don't want to get ahead of them, but that's the visitation that's, you know, being contemplated, which is significant. And so whether those are new customers, I think many of them will be for us, and they'll come from farther away just to see it. And we've seen that obviously in Las Vegas, so, you know, we expect to capture our fair share of that and then some, given that it is literally on our doorstep. And I think they'll use much of our parking facility, which places them in the midst of our casino environment. So we're pretty excited by all of it.

Barry JonasThank you so much.

OperatorThe next question is from Shaun Kelley with Bank of America. Please go ahead.

Shaun KelleyHi, good afternoon, everyone, and thanks for taking my question. Wanted to start with a CapEx-related question. I think a couple times both in the prepared remarks and throughout mentioned about investing further in the luxury side of the portfolio. So just curious, I mean, for Jonathan or Bill, whoever wants to take it, does this stay within your sort of normal gross capital bounds? Are there any sort of larger projects or larger ideas that you might have that may push kind of around those, you know, kind of those levels that you've been sticking to in the last couple of years? Or just how should we think about sort of that those comments and sort of what you're thinking about really 2027 and beyond?

Bill HornbuckleI think, Shaun, a great way to think about it is generally yes. Although particularly here at Bellagio, we're thinking about more villas potentially because we only have 8 to draw from, 8 or 9, whatever it is. I think it's 8. And so we're thinking about more villas. Our convention and meeting space, as I mentioned in my prepared comments, needs some work. We have seen tremendous success with activation of Lakeside with Carbone Riviera. And so we're going to look to continue on that theme. But I think you could think about it at least for today in the context of where we are. And if we, you know, if we add to that, we understand what the consequence to that. But we think it would only— we'd only add to that if we thought it was going to pay a real dividend.

Jonathan HalkyardAnd Shaun, this is John, it's Jonathan. One of the ways, you know, I also think about it, and I think this is probably pretty useful in terms of modeling, is that, you know, we can do quite a lot of work and improvement within our existing footprint in that level of CapEx that we've been spending the last 3 or 4 years. To the extent that we expand the footprint, we add capacity, we add square footage to our portfolio here in Las Vegas, then it would likely be additive to that, that base level of CapEx. As an example, we did, as you know, a very large room renovation to the MGM Grand. We're contemplating, you know, one later this year beginning at Aria. Both of those projects have been and will be done within that, you know, that basic level of CapEx that we've spent the last few years. But if we did something beyond that to add capacity, it would likely be above.

Bill HornbuckleAnd Shaun, maybe just as a more global thesis, Las Vegas is our home. Las Vegas is the epicenter of gaming in many respects. It's not going anywhere. And there's no— I don't think anything immediately is going to come even close to competing with it. So we believe in its not only midterm but long-term future. And so we want to continue to invest aggressively where it makes sense. And luxury and luxury experiences, not necessarily items, are down that lane.

Shaun KelleyPerfect. Thank you both. And then just maybe a quick one on just the MGM Digital on sort of the international piece, non-bet MGM. But just help us think through the inflection in that business. There was a little bit there saying obviously losses equal to or a little less than last year for this year. But is there a bigger sort of J-curve or inflection in 2027? It sounded like we were maybe headed in that direction, but you said something about funding, helping to start self-fund maybe some of those investments in Brazil. So if you could just elaborate on that a little bit.

Gary FritzYeah, sure. It's Gary. Well spotted. Yeah, I think that's right. The way you should think about MGM Digital We basically have the European LeoVegas-operated portfolio, LeoVegas-branded business, and the BetMGM-branded business in Europe. That business is setting up, as Jonathan remarked, in '27 for significant operating leverage and likely substantial levels of profitability. And then we can use that to, you know, at our discretion, to finance the remaining growth investments in the portfolio, which are largely dominated by Brazil in terms of what we have line of sight on. So we do think there will be the ability to self-fund in part the ongoing investments in Brazil and a few other geographies around the world. You know, the exact nature of how much will be self-funded completely we're working out through the budgeting process that we're in for '27, but we do anticipate some degree of self-financing from the core LeoVegas business.

Shaun KelleyThank you so much.

OperatorThe next question is from David Katz with Jefferies. Please go ahead.

David KatzGood afternoon. Thanks for taking my question. I wanted to just go back to the all-inclusive offerings, I think the term you may have used is supported in reference to Luxor and Excalibur. I'd love just a little more color on whether that's— we would classify that as upward momentum. And all of this in the context, some of the prior questions around some of the sort of lower half or lower quartile properties within the portfolio. And and how they're doing. Thank you.

Bill HornbuckleYeah, I'll kick it off and turn over to Ayesha. I mean, we've booked well over 30,000 room nights on it. It absolutely has helped us stabilize occupancy. And again, I think I commented earlier, the narrative around Las Vegas not providing value and, you know, everyone getting beat up on that, we think— we don't think, we know it's helped. We've followed it closely through social media and otherwise. And it's a great value at the end of the day is the bottom line. Ayesha, I don't know if you want any more color, but—.

Ayesha MolinoJust a couple of other notes. I mean, you know, a couple of things that have been interesting to us. What we've seen is a lot of interest and demand from the customers, particularly around the weekends. And so they've actually been purchasing the package at slightly higher rates, which has been accretive. And from that perspective, we've also been really happy with the margin profile that we've been realizing from that package. So in all in all, in terms of the gross room nights booked plus the change in narrative plus the margin, we think it's been healthy.

David KatzExcellent. And as my follow-up, with respect to Park MGM, I think you also indicated a strategy there toward locals. I'd love a little more color about that, which is just interesting.

Ayesha MolinoYeah, sure. We think that property in particular has appealed to locals for a couple of reasons. First, there's the obvious proximity to T-Mobile as well as Dolby within its footprint, and the non-smoking aspect of it is unique in the portfolio. We also do know that for that property in particular, much of our high-end play is locals play. And so from that perspective, we've just been taking a look at how to expand its, its appeal to our local demographic, particularly over the summer. So we've been doing a host of different things. Including looking at sort of F&B offers for locals, as well as parking offers for locals, even up to and including locals' free play offers. And so it's really just a focused attempt at demand generation within that demographic.

David KatzI appreciate that. Thank you very much.

OperatorThe next question is from John DeCree with CBRE. Please go ahead.

John DeCreeHi, everyone. Thank you for taking my question. Bill, Jonathan, Ayesha, I wanted to ask about, you know, your view on kind of the thesis that customers are staying closer to home and that might be one of the reasons we're seeing some strength in the regionals relative to leisure in Las Vegas and, you know, record revenue quarter on a same-store basis and seeing a little bit of stability in the leisure business in Vegas. How much do you kind of subscribe to that consumer theory and you know, do you look at this as like a zero-sum equation, or as Vegas starts to recover, do you think the kind of trajectory in the regionals is sustainable? So can consumers kind of do both Vegas and regionals as you look across the database?

Bill HornbuckleAyesha can speak maybe to the database transfer. I would say this, you know, Las Vegas is still down on international travel. And while we're picking up some additional seats, particularly as you look at a place like Canada, we're off considerably. And so it needs to continue to focus on that. And then obviously, particularly in the summer, Southern California is a major drive market. Our drive-in traffic hits over 50% generally of how people get here, principally driven again by that market. And so since we don't have a regional casino in California, as much as we'd love one, You know, I think it's somewhat limited. I don't know, Ayesha, if you have a specific view.

Ayesha MolinoYou know, look, if I take a look at visitor volume year over year to Las Vegas, I mean, you know, there are puts and takes month by month, but overall the trends— there isn't a significant departure in overall trend line. You know, I do note that, and we're happy about this, our regionals are healthy and we're seeing, you know, consistent visitation among our highest frequency regional visitors, and we're seeing, you know, consistent play among the top demographics there. I don't know that I'd say there's a one-to-one trade-off. I don't really think of it that way. You know, I think that as, as sort of the overall macroeconomic environment continues to stabilize, particularly in Southern California, and as Bill noted with international travel, I think we have every reason to be optimistic about Vegas.

John DeCreeThat's helpful. I appreciate that color. Thank you. Maybe a quick follow-up on convention group outlook for 2027. I apologize if I missed it. Did you provide any thoughts on bookings or kind of ADR pace for 2027? Obviously, it's been a great year so far, but how does kind of forward years look?

Ayesha MolinoYeah, I think for 2027, we like our on-the-books position right now. You know, we've still got plenty of runway left for this year and into next year, even for in the year for the year. But we think we're headed into 2027 in a strong position from a group perspective.

John DeCreeGreat. Thank you so much.

OperatorThe next question is from Steven Wieczynski with Stifel. Please go ahead.

Steven WieczynskiHey, guys. Good afternoon. I want to first ask about Macau. And it seems like the promotional environment, you know, over there continues to be pretty intense. And just wondering maybe, you know, from your perspective, what you guys are seeing over there right now And then, you know, how aggressive, you know, or non-aggressive you guys have been in terms of, you know, having to or trying to protect your market share.

Bill HornbuckleKenny, over to you.

Kenneth FengOkay, thank you. This is Kenny from Macau.

Kenneth FengMacau has always been a competitive market and will continue to be. MGM, like, past 5, 6 years has demonstrated a consistent and deep understanding of our customers. We deliver the appropriate offerings catered to premium demand. I want to see like here we are not— it's not purely like a promotion reinvestment. What we are competing is a package.. Our products, our services, our innovation, and then our promotion. It's really a package. Like, for example, during the quarter, like, we have completed some meaningful CapEx projects, including our suite conversions, and as well as, like, our premium gaming space at Cotai. These projects have been well received by our premium customers. And moving on, we will continue to renovate nearly like 100 suites at MGM Macau. And our strategy is really to opt— like to focus on optimizing the yield of every table, every slot, every square foot of the casino floor.

Kenneth FengAnd that's our strategy. It's not purely like a reinvestment. It's a package. Like, you can look at for the past 6, 3, since pandemic, every quarter we have like always like in the guided range of our operating margins, like at MGM China level, like mid-20s to high 20s. We are confident, we feel comfortable that we can sustain such margin. Going forward. This level is sustainable.

Steven WieczynskiOkay. Thanks for that, Kenny. And then second question, Bill, going back to Vegas. I want to ask, you know, the bundling question maybe a little bit differently. And, you know, I guess what I'm wondering here is, you know, as you guys have kind of rolled out that bundling, you know, promotion so to speak, have you seen that translate into your— into growth in your database? You know, just trying to figure out, if you're starting to see new folks coming to the market, or these are more existing players?

Bill HornbuckleNo, no, it's a great question. Um, half of the participants in this package are brand new, which, if you think about Las Vegas in general right now, I think we're under 15% of first-time visitors in, in total in terms of visitation. And so it is drawing a new customer base, um, presumably younger, but I don't think I know that yet. But we're going to try to do some data on that. But, yeah, it's 50%, which is frankly startling and, you know, importantly promising.

Steven WieczynskiOkay, great. Thanks, guys. Appreciate it.

OperatorThe next question is from Brandt Montour with Barclays. Please go ahead.

Brandt MontourHi, everyone. Thanks for the questions. So first, in Vegas, you know, Jonathan, you mentioned hold as being a benefit in the second quarter. Looking back at the last 3 quarters, it just seems like you guys have had a really nice run of hold. And so the question is, is there anything structural or sort of any changes that you've made to mix or anything as we try and figure out where we should be modeling that business on a sort of neutral basis?

Bill HornbuckleLook, I— this is Bill. I don't know if I'd change the model or the percentages of the games. I will tell you, you know, we skew— there are half a dozen customers, maybe a dozen customers that we have consistently catered to and they have enjoyed their services and their time here. And, you know, they swing hard and they swing heavy and that can go either way. And obviously this past quarter has been to our advantage, but I wouldn't change the formula yet. I would say that.

Brandt MontourOkay. That's helpful. And then one more on Macau. You know, when you made that comment, Bill, about volumes recovering sharply in July, I was hoping if you could clarify if that was an MGM comment or an industry comment or both so that we can kind of get a sense for— you know, the question, the second follow-up question would be, you know, did it kind of— the promo kind of drive that recovery in July. And so how we can think about EBITDA flow-through from that sort of—.

Bill HornbuckleYeah, I would say I think we've returned to our normal pace, Kenny. I think it's both, meaning both the market and we have recovered in the context of where we were in June. Kenny?

Kenneth FengYeah, I think I want to see, like, Bill, like we are seeing pent-up demand. From World Cup period. Actually, both the visitations and even the business volumes have strongly picked up since even the second week of July when there are still a few matches remaining before the end of the World Cup. And the weekly performance has improved week over week. We believe Macau gaming revenue last week, and the entire market had recovered nearly to Q1 levels. And at MGM, both property visitations and the normalized GGR have already exceeded Q1 levels. With the events and the concerts in town in this month and next month, we are confident to see us busy summer in Macau that can draw like a popularity and visitations.

Brandt MontourPerfect.

Bill HornbuckleThanks, everyone.

OperatorThe next question is from Chad Beynon with Macquarie. Please go ahead.

Chad BeynonAfternoon. Thanks for taking my question. Bill, wanted to ask a strategic question on regionals. I think it's quite clear that, you know, you guys are focusing on market-leading properties with hopefully over $100 million of EBITDA. Obviously, one of your companies with some regional assets is going through their HSR process now. And then after the close, Churchill Downs announced that there might be some more regional properties on the market. Can you just update us if there would be markets that kind of help with the hub-and-spoke and kind of the long-term value for your shareholders? Thanks.

Bill HornbuckleYeah, Chad, look, I wouldn't say no, never for sure. And while there's always a couple of properties out there that might fit well into the portfolio and we've kept an eye on that, there's nothing imminent. To the contrary.

Chad BeynonOkay, great. And then drilling in just a little bit more on the result in Vegas, you had a very low hold comparable in Q2 '25. You mentioned that, you know, you were on the right side of that this quarter. Are you willing to provide what the hold-adjusted number would be for the quarter and what the positive impact for Vegas was?

Jonathan HalkyardNo, we don't really like to put kind of a point estimate on that because there are a number of things that drive what the hold percentage ultimately is. But, you know, but it's in the tens of millions this quarter. It was meaningful, but we don't— we stopped a couple of years ago, you know, presenting any kind of hold-adjusted number.

Chad BeynonOkay. Thanks, Jonathan. Appreciate it.

OperatorThe next question is from Stephen Grambling with Morgan Stanley. Please go ahead.

Stephen GramblingHey, thanks. Just on the digital side. So we had the update from BetMGM earlier this week. And as you continue to learn from the digital on the international side, how do you think about whether BetMGM U.S. is being maximized in its current form as a JV? And are there any limitations to evaluating either various ownership structures at this point, whether it's an embedded ROFO or other legal components when we think about the JV as the right setup from here?

Bill HornbuckleLook, I would say this about the JV, which we continue to say, we've enjoyed our relationship and our partnership. Obviously, we are the brand, they're the technology. There's always things to learn. I think Gary can speak more specifically to that because he oversees these businesses on a daily basis. But the JV is in good shape. And while you never say never to anything, there's nothing contemplated.

Stephen GramblingSo again, there's no limitations to various structures at this point. It's just a question of, you know, what you feel is best and priced.

Bill HornbuckleFair.

Stephen GramblingFair enough. I'll jump back in the queue. Thank you.

Bill HornbuckleThanks.

OperatorThe next question is from Ben Chaiken with Mizuho. Please go ahead.

Ben ChaikenHey, thanks for taking my question. Recognizing you don't want to comment on Hold and some of the other items, I was hoping you could maybe in broad strokes give an assessment of how you're thinking about the underlying business in Vegas in 2Q from an EBITDA perspective, but more importantly, the trajectory of the business in Vegas as you see it today, understanding that things have improved in July? Thanks.

Bill HornbuckleYeah, look, I think you've heard throughout our comments, our luxury business remains strong. The top end of our marketplace, the very top end, is very strong and continues to be. We still all have— and it's not just us, it's the city of Las Vegas— for value customers are continuing to push. You know, we collectively are down 3.5 million visitors from our all-time peak, I think back in 20— help me here— '19 or '18, whatever it was. And so, you know, as we think about that, we're going to continue to push ways to do that. We've always been able to get ourselves and keep ourselves in the 90% occupancy range, and we're going to continue to push on that. You know, if you think about what we said about this quarter, it's a good example. Our convention and catering business, all-time high. And so that speaks to corporate America, the desire of the destination. And the other thing that speaks to here, the marketplace has changed.

Bill HornbuckleWe are a big event marketplace now. And when something meaningful happens, whether it was just the recent UFC fight with McGregor, or again, believe it or not, BTS, the market responds to it and responds with a great deal of interest and velocity. And so we're going to continue to drive it through both the city and independently with events like I mentioned, our Players Era, basketball tournament and other things that we all want to create because live is what's happening right now and it's not lost on us or anybody else for that matter. And so, you know, the Sphere has been a big help for the community. We have other competitors who have helped bring in live entertainment and we're going to continue to do the same.

Ben ChaikenOkay. Maybe you may not want to answer this, but just to put a finer point on it, I guess, net of some of the different moving parts in Vegas, are you— do you think you're growing underlying EBITDA today?

Ben ChaikenThanks.

Bill HornbuckleWe're growing revenue for sure, up against some challenges on EBITDA, but absolutely in the long haul, yes, we are.

Ben ChaikenThank you. Appreciate it.

OperatorThis— ladies and gentlemen, this concludes our question and answer session. I would like to turn the conference back over to Bill Hornbuckle for any closing remarks.

Bill HornbuckleThank you, operator. Again, I thank everyone's participation. You know, look, Vegas remains stable and consistent, same with Macau. We love where our regional businesses are coming from and our digital programming, particularly in the digital piece of Gary's business and the digital— on the international piece of Gary's business is showing some promising return. And so with all that said, we thank you for joining us and have a great night.

OperatorThe conference is now concluded. Thank you for attending today's presentation. You may now disconnect.