Wynn Continues Macau Investment Despite Third-Quarter Decline

Wynn Resorts saw revenue fall year on year at all of its properties in Macau, Las Vegas and Massachusetts in the third quarter. Total operating revenue dropped 7.7% to $1.69 billion. Adjusted EBITDAR fell 18.6% to $464.2 million, and net profit declined 80.4% to $17.3 million.

Macau remains an important revenue source for the company. Wynn Macau generated $255.3 million in property EBITDAR on $919.2 million in operating revenue. The period was mixed. While September was weaker, VIP gaming results contributed $12.3 million to EBITDAR.

The company started construction on three projects during the quarter. These are the Enclave tower, a new theater and an event center. The theater and event center are expected to begin hosting guests in 2028, and the Enclave in early 2029. Enclave will add 432 suites to Wynn Palace.

CEO Craig Billings viewed the hotel room shortage in Macau as an opportunity for growth during the earnings call. Billings said the market generates five times the gaming revenue of the Las Vegas Strip, but has only 30% of its hotel rooms. In his view, there is enough demand; the real question is how the rooms are used.

Billings acknowledged that China's economy is going through a period of transition. He noted that regional and sectoral differences make it difficult to draw simple conclusions about the health of the country's economy. He emphasized that Wynn focuses on long-term fundamentals rather than short-term sentiment, and that China has been able to adapt despite uncertainties. Billings said, "China is a large and complex economy, it has been questioned many times before and it keeps adapting. We are not betting on a straight line, we are betting on adaptation."

During the Golden Week holiday, gaming drop and handle and retail sales were broadly in line with the previous year, which encouraged Wynn. However, volumes declined toward the end of October. Regionally, revenue was seen to be weakening across all operations.