MGM Resorts (NYSE:MGM) Posts Better-Than-Expected Sales In Q4, Stock Soars

MGM Resorts International (NYSE:MGM) reported its fourth-quarter and full-year 2024 financial results on February 12, 2025, surpassing analysts' expectations and driving a significant increase in its stock price. The company's strong performance was driven by record full-year consolidated net revenues, a 25% increase in Segment Adjusted EBITDAR for MGM China, and a 40% reduction in shares outstanding since 2021 through aggressive share repurchases. BetMGM, the company's online sports betting and iGaming venture, is expected to be profitable in 2025, further boosting the company's growth prospects.



MGM Resorts' Q4 performance was marked by a slight decrease in consolidated net revenues of 1% compared to the prior year quarter, with net income attributable to MGM Resorts of $157 million compared to $313 million in the prior year quarter. However, the company's full-year consolidated net revenues reached a record $17.2 billion, up 7% from the previous year. This strong financial performance was driven by MGM China's record full-year Segment Adjusted EBITDAR of $1.1 billion, an increase of 25% from the prior year.



The company's digital transformation, particularly BetMGM, has contributed significantly to its overall performance and growth prospects. BetMGM's revenue grew by 15% in the fourth quarter of 2024 compared to the prior year quarter, reaching $140 million. This growth was primarily driven by entry into new markets. For the full year 2024, MGM Digital revenues grew by 28% to $552 million, demonstrating the digital business's increasing contribution to the company's overall revenue.



MGM Resorts' strong demand in early 2025, with December marking the highest convention booking month on record, positions the company well for continued growth. The company's aggressive share repurchases, totaling over 33 million shares in 2024, have reduced shares outstanding by more than 40% since 2021. This strategic move increases the value of remaining shares and boosts earnings per share (EPS), further enhancing the company's growth prospects.



In conclusion, MGM Resorts' better-than-expected sales in Q4, driven by record full-year consolidated net revenues, MGM China's strong performance, and the company's digital transformation, have contributed to a significant increase in its stock price. The company's strategic initiatives, such as share repurchases and expansion into new markets, position it well for continued growth and success in the future. Investors should consider MGM Resorts as a strong contender in the gaming and hospitality industry, with a promising outlook for the coming years.