Recording a nominal loss in a digital-driven quarter, shares in Caesars Entertainment surged by over four percent on the NASDAQ yesterday when the U.S. casino heavy-hitter released its latest Q2 financial results.
With Adjusted EBITDA stable at US$1 billion (£779m) and Caesars Digital EBITDA booming to US$40 million (£31.16m) from US$11 million (£8.56m), year-on-year, markets reacted kindly to an otherwise hardly inspiring Q2, ending June 30.
By today the value of shares on the Reno-, Nevada-headquartered mostly-retail gambling behemoth–which owns, leases or manages domestic properties in 18 U.S. states–had fallen back to a respectable US$36.90-per-share, a fraction one percent up on pre-Q2 announcement value.
Caesars Entertainment reported net revenues of US$2.8 billion in the quarter (£2.18bn), compared to US$2.9 billion in Q2 last year (£2.25bn).
Under sleight of hand–otherwise known as Generally Accepted Accounting Principles (GAAP)–, Caesars, founded as Eldorado Resorts in 1973, reported a net loss of US$122 million in Q2 (£95.04m) — compared to the net income of US$920 million in the second quarter of 2023 (£716.74m).
Broken down by verticals, Caesars Digital saw a significant 27.8 percent rise in net revenue, year-on-year, to US$276 million in Q2 (£215.02m).
Adjustments
Las Vegas division net revenue was clocked at US$1.1 bn (£856.98m), down 1.9 percent, y-o-y, after “adjustments”. Regional net revenues were US$1.385 billion (£1.08bn), 5.2 percent lower than Q2 2023.
Vegas operations posted a loss of US$272 million for the quarter (£211.9m), Regional operations a loss of US$51 million (£39.73m) and Digital a net income of US$4 million (£3.11m).
Looking at H1 headlines, Las Vegas net revenue was down 1.3 percent, y-o-y, to US$2.129 billion (£1.65bn); Regional net revenue declined US$100 million (£77.9m) to US$2.75 billion (£2.14bn) and Digital grew by near-30 percent to US$558 million (£434.72m).
Correspondingly, Vegas operations recorded a loss of US$470 million (£366.16m) for the half, Regional operations a loss of US$10 million (£7.79m) and Digital a loss of US$30 million (£23.37m).
Optimistic
“Driven by strong operating trends in our Las Vegas and Caesars Digital segments, we remain optimistic for the balance of 2024,” asserted Caesars Entertainment CEO Tom Reeg.
“On a consolidated basis [during Q2], the Company generated US$1 billion of Adjusted EBITDA.
“Our operating results reflect year-over-year growth in Adjusted EBITDA in our Las Vegas segment driven by record same store revenues, hotel occupancy and Average Daily Rate (ADR).
“[And] our Caesars Digital segment posted a new second-quarter Adjusted EBITDA record, driven by strong revenue growth and solid flow through.”
Meantime, following the so-called “Gap Year”, beloved of students looking for a break from their studies, we can also thank Reeg and Caesars for now giving us the unique GAAP Quarter.
