MGM Resorts Soars as BetMGM Reports First Profit: A New Era for Sports Betting?

MGM Resorts (MGM) shares surged following its Q1 2025 earnings report, as its joint venture BetMGM LLC reported its first-ever quarterly EBITDA profit, marking a critical turning point for the company’s high-stakes wagering operations. The results highlight a dramatic shift from years of losses to profitability, fueled by surging revenue, operational discipline, and strategic bets on iGaming and enhanced sports betting products.

The Profit Milestone: From Losses to a $22M EBITDA Boost

BetMGM’s Q1 EBITDA jumped to $22 million, a stark reversal from a $132 million loss in the same period last year. The improvement was driven by a 34% year-over-year (YoY) revenue surge to $657 million, with iGaming and online sports betting both delivering record performances.

• iGaming: Revenue hit $443 million (+27% YoY), boosted by exclusive content and a 39% increase in active player days.
• Online Sports: Revenue skyrocketed 68% to $194 million, while total handle rose 29% to $4.088 billion, reflecting stronger engagement and higher-value bets.

The results were further supported by operational efficiencies, including refined player segmentation and a strategic focus on premium customers. While one-time accounting benefits played a role, management emphasized that operational improvements—not just accounting shifts—were key to the turnaround.

The Numbers Behind the Turnaround

The Q1 performance underscores a retooled strategy:
- Player Engagement: Average monthly active users (AMA) rose 6% to 1.067 million, with sports bettors placing 28% more bets per user and generating 37% higher handle per user.
- Cross-Selling Success: 13 percentage points of improvement in cross-sell rates (users active in both iGaming and sports betting) reflect a stronger multi-product ecosystem.
- Product Innovation: Parlay bets (including sports guarantees) now make up 4.8 percentage points more of revenue than a year ago, driving higher margins.

CEO Adam Greenblatt: Betting on Sustainable Growth

CEO Adam Greenblatt highlighted the company’s focus on “strategic execution” in iGaming and “brand elevation” in sports betting, despite “unfavorable sports outcomes” that typically pressure margins. He reiterated confidence in BetMGM’s full-year EBITDA-positive target for 2025, with revenue guidance of $2.4–2.5 billion.

Long-term, management aims to hit $500 million in EBITDA, a milestone that could be achievable as online sports betting transitions to “contribution profitability”—a shift from relying on subsidies to standalone profitability.

Market Positioning and Risks

BetMGM’s market share in iGaming stands at 22%, solidifying its leadership, while sports betting holds an 8% share in a highly competitive space. The company plans to capitalize on its parent’s resources: Entain’s proprietary tech platforms and MGM Resorts’ hospitality footprint could further integrate gaming and hotel experiences.

However, challenges remain. The Q1 profit included a partial offset from “customer-friendly sports results”, meaning future quarters could face volatility if outcomes swing against bettors. Additionally, regulatory hurdles and market saturation in key states like Michigan and Colorado require sustained innovation.

Conclusion: A Watershed Moment for BetMGM

The Q1 results are a watershed for BetMGM, proving that its pivot to data-driven player management and premium product offerings can deliver profitability. With $2.5 billion in annual revenue now within reach and a path to $500 million EBITDA in sight, the company is positioning itself as a dominant player in North America’s nascent but rapidly growing legal betting market.

Investors should note that while the one-time accounting benefits provided a tailwind, the operational improvements—such as higher handle per user and cross-sell rates—are sustainable advantages. If BetMGM can maintain this momentum while navigating regulatory and sports outcome risks, MGM Resorts’ stake in the venture could become a major driver of shareholder value in the years ahead.

The numbers don’t lie: after years of losses, BetMGM has finally flipped the script. The question now is whether this is just a flash in the pan—or the start of a profitable new era.