Las Vegas Sands Q4 2023: Recovery in Asian Gaming Markets

Las Vegas Sands Q4 2023 Earnings: A Tale of Recovery in Asian Gaming Markets

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In the wake of the global pandemic, the gaming industry has faced unprecedented challenges. As economies and businesses strive for a return to pre-Covid levels, Las Vegas Sands has recently reported its earnings for Q4 2023, offering a snapshot of the current state of the industry. The figures reveal a mixed picture, with impressive year-on-year growth but a lingering gap in revenue when compared to pre-pandemic levels.

Las Vegas Sands Q4 2023:

• Revenue: $2.92B (161% YoY increase).
• Still 16.9% below Q4 2019.
• Marina Bay Sands (Singapore): $1.06B revenue, steady development.

Macau Operations:

• Total revenue: $1.86B (319.6% increase from Q4 2022).
• The Venetian Macau: Top contributor with $748M.
• Adjusted property EBITDA down 13.7%, signaling a slower recovery.

Asian Gaming Market:

• Positive trends in MGM China, Macau's 2023 growth, and record-high revenue in the Philippines.
• Anticipation for a bright future with new developments in Japan and the Mohegan Inspire.

Robust Q4 2023 Performance

Las Vegas Sands reported a total revenue of $2.92 billion for Q4 2023, marking an astounding 161% increase compared to the same quarter in the previous year. This surge in revenue is a testament to the gradual recovery of the gaming industry. However, it is crucial to note that despite this substantial growth, the company has not yet reached pre-Covid levels, with revenue still down by 16.9% from Q4 2019.

A standout performer in Las Vegas Sands' portfolio is Marina Bay Sands, the company's Singapore operation. Out of the $2.92 billion generated in Q4 2023, $1.06 billion came from Marina Bay Sands alone. This represents a noteworthy 55.6% growth from the previous year and a remarkable 24.4% increase from Q4 2019. The consistent growth in Singapore indicates the resilience of the business and its ability to maintain positive momentum despite challenges faced by other operations.

Macau's Slow Recovery

In contrast, Las Vegas Sands' Macau operations are still in the process of recovery. The total revenue from the five casino resorts and other ventures in Macau amounted to $1.86 billion for Q4 2023. While this reflects an impressive 319.6% increase from Q4 2022, it remains 16.9% below the figures reported in Q4 2019.

The Venetian Macau emerged as the leading contributor in Macau, generating $748 million in revenue, followed by The Londoner Macau with $589 million and The Parisian Macau with $222 million. The varying contributions highlight the complexities of the recovery process and the differing impacts on individual properties.

Analyzing the gap between 2019 and 2023, the net revenue showed a 16.9% decline. However, adjusted property EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) presents a slightly more optimistic picture. In Q4 2023, the adjusted property EBITDA across all properties amounted to $1.2 billion, compared to $1.39 billion in Q4 2019, reflecting a decrease of 13.7%. This suggests that EBITDA might be the first metric to fully recover to pre-Covid levels, providing a potential indicator of the industry's overall resilience.

Asia's Gaming Market on the Path to Recovery

Las Vegas Sands' performance is not isolated in the gaming industry. Reports from MGM China indicate revenue surpassing pre-Covid levels, with a 10% increase in Q3 2023 compared to Q3 2019. The Gaming Inspection and Coordination Bureau of Macau reported that Macau generated MOP$183.1 billion (US$22.7 billion) in 2023, showcasing a substantial increase of 334% from 2022. Although this is still 37.4% less than 2019, it signifies a robust growth trajectory, hinting at the possibility of revenue exceeding pre-pandemic levels in the coming years.

Beyond Macau, other Asian territories are contributing to the industry's revival. The Philippines, for instance, reported a record-high revenue of Php285.27 billion ($5.09 billion) in 2023, reflecting a year-on-year growth of 33.1%. These positive indicators, coupled with the recent developments such as the first Japanese casino resort in Osaka and the Mohegan Inspire receiving a five-star hotel rating, paint a promising future for Asian gaming.

Conclusion: A Bright Future for Asian Gaming

In conclusion, Las Vegas Sands' Q4 2023 earnings shed light on the ongoing recovery in the Asian gaming market. While challenges persist and the industry has not fully returned to pre-Covid levels, the positive growth trends in Singapore, Macau, and other Asian territories indicate a resilient and dynamic gaming landscape. The upward trajectory, coupled with significant developments on the horizon, suggests that the Asian gaming market is on the cusp of a bright future, even if the industry has not yet reached its optimum form. As economies stabilize and travel resumes, the gaming industry in Asia is poised for further growth and success.