MGM revenues up 22% last year with F1 profits at $50 million or more

LAS VEGAS (KLAS) — Revenue of $16.2 billion in 2023 pushed MGM Resorts International to its best year ever — a 22% increase over 2022.

Hotel revenue from the F1 Las Vegas Grand Prix was a major storyline in the company’s performance. The race brought a bump of $50 million to $70 million for MGM, officials said.

But even bigger was the return of MGM China after struggling through COVID-19 recovery rules imposed by the Chinese government. Net revenue of $3.2 billion for MGM China in 2023 eclipsed 2022’s $674 million — a 368% increase, and even 9% above pre-pandemic levels (2019).

In Las Vegas, net revenue hit $8.8 billion for the year, a 5% increase. Profits in Las Vegas were about 2% above 2022 levels.

Beyond the impressive numbers, MGM President and CEO Bill Hornbuckle said recent months have built expectations even higher. He pronounced Las Vegas “the new sports and entertainment capital of the world” in an earnings call with financial analysts on Tuesday.

MGM learned valuable lessons about appropriate room prices for F1, officials said. For the next F1 race, look for lower prices away from the actual racetrack. MGM will make its money from rooms that are right on the racecourse — and they have a lot of those.

In fact, MGM intends to do some work on suites at some of the premium rooms along the course, including Bellagio tower suites, Cosmopolitan’s Chelsea suites and MGM Grand main tower rooms.

Bellagio was one of MGM’s seven properties that had their best fourth quarter and best full year in 2023.

And Super Bowl LVIII might have had a bigger impact, officials said.

“Super Bowl was amazing,” Hornbuckle said. “Will it be the kind of event that will drive, given the additional expense of the tickets, et cetera? The answer was hands-down yes. And particularly rooms. It drove across the board, unlike F1 where it was isolated to our premium properties, Super Bowl drove it across the board,” he said.

“Every cash register, from food and beverage to entertainment, was ringing,” according to Jonathan Halkyard, chief financial officer and treasurer of MGM Resorts.

“We all must admit, 2023 … was an amazing year,” Hornbuckle said.

Analysts were anxious to hear if MGM could maintain that momentum through 2024. Hornbuckle was optimistic, ticking off events that are still ahead this year including big concerts scheduled by Madonna, Bruce Springsteen and the Rolling Stones. March Madness and the new football season will also be good to Las Vegas, along with a better convention schedule.

It’s optimism Hornbuckle wouldn’t have predicted in October, when MGM was still struggling to overcome a September cyber attack. That affected BetMGM and the company’s other digital products…