MGM Resorts International Stock

Good afternoon, and welcome to the MGM Resorts International Second Quarter 202 Earnings Conference Call. Joining the call from the company today are Bill Hornbuckle, Chief Executive Officer and President; Ayesha Molino, Chief Operating Officer; Jonathan Halkyard, Chief Financial Officer; Gary Fritz, Chief Commercial Officer and President of MGM Digital; Kenneth Feng, Chief Executive Officer of MGM China Holdings; and Howard Wang, Vice President, Investor Relations. [Operator Instructions] In fairness to all participants, please limit yourself to one question and one follow up. Please note, this conference is being recorded.

Now I would like to turn the call over to Howard Wang. Please go ahead.

Thanks. Welcome to the MGM Resorts International Second Quarter 2026 Earnings Call. This call is being broadcast live on the Internet at investors.mgmresorts.com, and we have also furnished our press release on Form 8-K to the SEC. On this call, we will make forward-looking statements under the safe harbor provisions of the federal securities law. Actual results may differ materially from these contemplated in these statements. Additional information concerning factors that could cause actual results to differ from these forward-looking statements is contained in today's press release and in our periodic filings with the SEC. Except as required by law, we undertake no obligation to update these statements as a result of new information or otherwise. During the call, we will also discuss non-GAAP financial measures when talking about our performance. You can find the reconciliation to GAAP financial measures in our press release and investor presentation, which are available on our website. Finally, this presentation is being recorded.

I will now turn it over to Bill Hornbuckle.

Thank you, Howard, and thanks to everyone for joining today's call. Before we review the second quarter results, I want to provide a brief update on the status of the offer we received from People Incorporated. Since reviewing the offer, our Board of Directors has formed a special committee composed of independent directors with no affiliation or association with Barry Diller, People Inc. or the proposed transaction. This committee continues to evaluate the proposed transaction in consultation with independent outside advisers. I'm confident our Board will pursue the course of action that's in the best interest of the company and our shareholders. I don't have anything more to share at this time, and Jonathan and I are not able to answer any questions during the Q&A on this topic.

Now turning to our results. We are pleased to report that solid fundamentals and business momentum we saw at the start of the year carried forward into the second quarter. The company delivered record second quarter consolidated net revenue, driven by a second consecutive quarter of year-over-year revenue growth from our Las Vegas Strip Resorts, all-time best regional operations same-store quarterly revenue and a 20% year-over-year revenue growth at MGM Digital. Revenue for Las Vegas was bolstered by a solid underlying base of group and convention business at MGM Resorts and aided by strong attendance at events around town, ranging from BTS to UFC to a deep playoff running in the Stanley Cup by our very own Vegas Golden Knights.

Our group and convention business picked up where it left off in Q1, delivering a 20% room mix in Q2 and keeping us on pace for this market segment to represent a 20% of the room mix for the full year. We drove demand from a diverse customer mix that included technology and hospitality corporate groups as well as top B2B trade shows and professional association meetings, leading to the highest second quarter convention ADR and catering and banquet revenue in our history. Our all-inclusive experience in Las Vegas has also sustained solid momentum since launch four months ago.

At the end of the quarter, nearly half of the guests booked this offer were first-time visitors to MGM. The initiative has supported occupancies and forward bookings at Luxor and Excalibur and importantly, turned the value narrative into a positive story. We are constantly creating new experiences for our customers that leverage and highlight the MGM Resorts Las Vegas Strip portfolio. One example is the Players Era basketball tournament taking place across two weeks this November at Michelob ULTRA Arena in Mandalay Bay and the T-Mobile Arena. 24 top collegiate basketball programs from multiple conferences, including four of the last five national championship winning programs will play in a bracket style tournament with all games televised on the ESPN family of networks. To deliver a world-class experience for teams and for fans, Las Vegas stands unmatched and MGM is proud to offer the ultimate stage.

From the all-inclusive experiences to the players a tournament, the spectrum of experiences we have created aligns with prevailing consumer trends, bridging the more deliberate spending patterns of value-conscious guests with a broadening demand for our premium live experiences. Las Vegas has become the world stage for premier hospitality and entertainment and MGM is helping to lead the way. We are elevating our commitment to luxury by retouching and reimagining every element of the customer experience, including the convention and public areas within the Bellagio. Room remodels for ARIA and The Cosmopolitan are also on the horizon, building upon our already upgraded suites, villas and high-end gaming areas. We will strategically invest our growth capital into designing creative and inspiring concepts that expand the very definition of luxury, and we're excited to share more details on this vision in the near future.

Our regional operations continued their solid performance in the second quarter, resulting in an all-time best revenue quarter on a same-store basis. We continue to invest targeted capital throughout our regional portfolio, which between now and the end of the year will include enhancing our premium lounge offerings at both Beau Rivage and Borgata as well as a room remodel beginning at Borgata. We continue to see benefits from the recent upgrades and improvements in high-limit gaming areas, which drove record 2-quarter revenues at Borgata and an all-time record quarterly revenue at the Beau. Both were major contributors to all-time same-store record quarterly casino revenues and slot win in the regionals this quarter.

At MGM China, we continued to outperform the market in the second quarter while maintaining solid market share of 16.4%, a sequential increase of a full percentage point. While the World Cup temporarily impacted June volumes in Macau, this was a transitory event rather than a secular shift. Our confidence is reinforced by the immediate and encouraging rebound in volumes observed post tournament throughout the month of July.

At our BetMGM North America Ventures, Adam and Gary Deutsch reported second quarter results yesterday. Our second quarter performance keeps us well positioned to meet our full year guidance and our business continues to grow. Remember, over 2/3 of net revenue comes from iGaming, which continues to drive overall growth.

In our sports business, despite the unrestrained spending and legally burdened predictive market participants, we are still growing. We are also excited about our recent launch in Alberta, where early performance indicates reflect tangible benefits of our omnichannel presence. I'd note that of the first 8,500 deposits we recorded in Alberta, almost 1,000 had prior relationships with the MGM.

MGM Digital reported double-digit revenue growth again this quarter and continues to make progress towards profitability in our underlying businesses. We successfully launched our in-house sports book in Sweden ahead of the World Cup, which drove record high player activity. We have seen great traction with our products, which have led to phenomenal growth in both BetMGM branded services internationally. In Brazil, the environment continues to be dynamic and fluid, but we remain bullish on the long-term opportunity.

Turning to Osaka. Our construction continues to reach milestones on a timely basis as we advance towards the 2030 opening. The underground work is progressing nicely with over 60% of foundation piles completed. Above ground, the property's main structure is taking shape with ongoing concrete placement and structural steel fabrication. We remain on time and on budget as the only licensee in Japan for what we consider the greatest greenfield opportunity in the world.

In closing, MGM Resorts delivered a strong first half of the year, which should come as no surprise considering the enterprise achieved record-breaking 2Q results on our NPS scores. Again, I want to thank every one of our team members for their tremendous daily efforts that drove the record Net Promoter Scores. We are excited as we look forward to the second half of the year as our business is positioned for continued positive momentum, driven by a solid base of group and convention business at MGM Resorts, particularly led by the tech sector. This is further complemented by an expanded sports and entertainment events calendar taking place citywide that represents an increased number of events compared to that of the third quarter last year.

I'll now pass it over to Jonathan to provide some additional details on our performance before we open it up for questions.

Thanks, Bill. And I also want to express my appreciation to the entire MGM team for their continued focus, hard work and daily commitment to operational excellence.

In Las Vegas, we grew both net revenue and segment adjusted EBITDAR in the second quarter on a year-over-year basis. This year, EBITDAR is up $25 million at our Strip Resorts, and the main driver was a recovery at the MGM Grand, which was the beneficiary of the newly remodeled room inventory and a hold benefit. As we look to the third quarter, while the booking window remains short, we continue to see solid group and convention calendars alongside growth in the city's event calendar.

The regional operations second quarter results reflected all-time record quarterly revenues on a same-store basis. In fact, several of our properties delivered record revenue results during the quarter, including Empire City, which grew GGR in June despite new competition in the state. Results for the quarter reflect less than one month of operations from Northfield Park due to the transaction closing in late April. So, on a same-store basis, slot handle and slot win increased 4% and 3%, respectively.

At MGM China, volumes and earnings were solid in April and May. And while we saw a dip in volumes coinciding with the World Cup activity in June, trends have since rebounded. Our capital investment program, highlighted by the recent suite conversions and renovated premium gaming areas continues to yield strong results. Over the past year, we successfully debuted the ultra-luxury Alpha Villas at MGM Macau, expanded our premium mass offerings with 50,000 square feet of high-end gaming space and recently unveiled newly renovated suites at MGM Cotai this past April. Looking ahead, we have commenced design work on approximately 100 suites at MGM Macau as part of our ongoing commitment to staying ahead of the evolving consumer tastes and preferences.

Our BetMGM North America venture continues generating steady growth as we continue leaning into our areas of strength and focus on efficient operations. We have embedded call options around new state iGaming regulation and currently are more optimistic than we've been in a while as we see increased legislative activity in states like Virginia, Maryland and Indiana. Our best-in-class iGaming segment grew 8% in the second quarter. And over the course of the first half of 2026, handle per active grew 7%, while NGR per active grew 9%. Our online sports strategy continued its focus on player management and disciplined acquisition, resulting in growth per handle -- growth of handle per active and NGR per active of 18% and 17%, respectively, during the first half of 2026.

MGM Digital drove healthy growth in net revenues of 20% in the second quarter and reported segment adjusted EBITDAR losses of $31 million. We continue to build brand awareness while focusing on disciplined growth. 2027 is setting up for favorable operating leverage in the LeoVegas and BetMGM branded businesses that will finance growth in Brazil, where we're seeing encouraging data points in first-time deposits, active players and NGR. And as we continue calibrating in Brazil, we're expecting full year EBITDA losses at MGM Digital to be less than last year.

In Japan, we're expecting our funding commitment for the second half of the year to be approximately $125 million to $175 million. To date, we have spent approximately $600 million, and we remain on track to deploy approximately $1 billion in each of '27 and '28, which we will then have fully completed our capital commitments. The project remains on time and on budget for a fall 2030 opening. During the quarter, we bought back about 4.3 million shares for $164 million. And over the last five years, we've decreased our share count by nearly 50%.

I'll turn it back to Bill.

Thanks, Jonathan. Before taking questions, it's worth emphasizing that Las Vegas is stabilizing and growing as evidenced by this quarter's improvements in both revenue and EBITDAR and the continued of premier sports and entertainment events has only reinforced our focus on deploying capital towards our luxury offerings to drive medium- to long-term growth. Our regional operations continue to deliver robust results, marked by record-breaking performances and an exceptional guest response to our targeted capital investments. Macau has bounced back nicely in July while maintaining mid-teen share throughout the temporary disruption caused by the World Cup and digital continues to grow and MGM Osaka forges ahead with its 2030 opening, which has me, despite my many years in this company and this industry, pleased to say our future has never looked brighter.

With that, operator, we'll open it up for some questions.

We'll now begin the question-and-answer session. [Operator Instructions] Our first question today comes from Dan Politzer with JPMorgan.

I wanted to first start with Las Vegas and the health in the underlying market there. It does seem like, Bill, based on your comments that it's getting better. But maybe if you could walk us through the second quarter and the cadence and how it progressed and maybe give us a glimpse into July as we really start to face some of those easier comparisons. And then obviously, tie in with any of the recent initiatives, how those are maybe helping out?

Yes. Thanks, Dan, for the question, and we'll do. And then Ayesha, you can help me pile on top here. Look, I think the second quarter, as we reflect back, April and May were strong. May was exceptionally strong, driven by events and other activity. In April, we had our $10 million baccarat tournament, which was extremely successful. June was more challenged. I think it's the summer heat picked up and we got into the real throes of summer. July, on the other hand, has been good. And so I think we've seen ups and downs in summer. And frankly, I think we'll continue to see so as we think about the third quarter and beyond. But again, healthy group business helped the quarter, great events, which we continue to see throughout the course of the year. And overall, I think the packages helped Excalibur, Luxor stabilize occupancies and somewhat ADRs, and so as we think about three and four, we like what we see in the third quarter. We got some work to do in the fourth quarter.

I thought it was a good response. So I'm happy. I think just turning kind of more broadly to kind of the value of the stock, right? I think, Jonathan, you mentioned MGM has bought back about 50% of its shares in the past five years. I think the average price is probably around $40 or so. The stock is sitting here today at $46. So how do you think about the current value of your stock here and the attractiveness given some of the longer-term value drivers that you've talked about such as Osaka?

Yes, I think your math is about right in terms of what the price has been over the past several years and our share repurchases. We have -- we bought back fewer shares in this past quarter, only about $164 million worth at about, I would say, about $37 a share or thereabouts. So, of course, we think that, that's been a good use of capital.

As it relates to the current value of the stock, we've gone through this on a number of prior quarters in terms of the sum of the parts valuation. And our view, given the current trends really hasn't changed from that.

The next question is from Barry Jonas with Truist Securities.

Just wanted to dig in a little more on strip trends, record group and convention bookings in the quarter, but RevPAR is still down a little. So anything you can call out, whether that's specific properties? Or is it still sort of the kind of lower-end leisure driving that softness? And I guess related to that, do you see a path to return to growth in RevPAR sometime this year?

This is Ayesha. I just want to highlight again what Bill noted in his script in his previous comment. We have seen growth in overall Las Vegas revenue as well as EBITDAR. And so we're pleased with what we're seeing there.

In terms of RevPAR, I just note that, that's -- it is a noncash metric. Overall, I think we continue to see really strong strength in the luxury segment. As we've noted, the lower end of the segment, particularly Luxor and Excalibur, those do remain challenged, but we've been deploying offers such as the all-inclusive, we've seen positive reaction to that.

So, overall, I think we're seeing real health in the group segment. We're seeing real health in the luxury segment. And then we're seeing sort of a continued but relatively stabilized trend at the lower end.

Got it. That's helpful. And then I guess just maybe one on regionals. You've seen what the Sphere has done in Vegas. Just curious how much of an impact do you think a Sphere can do for National Harbor when it opens?

Barry, Bill. So they're projecting 2.5 million visitors, which seems about right. I think it's about a 6,500-seat facility when it's all said and done. I know they're finalizing plans, so I don't want to get ahead of them. But that's the visitation that's being contemplated which is significant. And so whether those are new customers, I think many of them will be for us, and they'll come from farther away just to see it. And we've seen that, obviously, in Las Vegas.

So we expect to capture our fair share of that and then some, given that it is literally on our doorstep. And I think they'll use much of our parking facility, which places them in the midst of our casino environment. So we're pretty excited by all of it.

The next question is from Shaun Kelley with Bank of America.

I want to start with a CapEx-related question. I think a couple of times both in the prepared remarks and throughout mentioned about investing further in the luxury side of the portfolio. So, just curious, I mean, for Jonathan or Bill, whoever wants to take it, does this stay within your sort of normal growth capital bounds? Are there any sort of larger projects or larger ideas that you might have that may push kind of around those kind of those levels that you've been sticking to in the last couple of years? Or just how should we think about sort of that -- those comments and sort of what you're thinking about really 2027 and beyond?

I think, Shaun, a great way to think about it is generally, yes, although particularly here at Bellagio, we're thinking about more villas potentially because we only have eight to draw from eight to nine whatever it is, I think it's eight. And so we're thinking about more villas. Our convention and meeting space, as I mentioned in my prepared comments, needs some work. We have seen tremendous success with activation of Lakeside with Carbone Riviera. And so we're going to look to continue on that theme.

But I think you could think about it at least for today in the context of where we are. And if we add to that, we understand what the consequence to that, but we think we'd only add to that if we thought it was going to pay a real dividend.

Shaun, it's Jonathan. One of the ways I also think about it, and I think this is probably pretty useful in terms of modeling is that we can do quite a lot of work and improvement within our existing footprint in that level of CapEx that we've been spending in the last three or four years. To the extent that we expand the footprint, we add capacity, we add square footage to our portfolio here in Las Vegas, then it would likely be additive to that base level of CapEx.

As an example, we did, as you know, a very large room renovation to the MGM Grand. We're contemplating one later this year, beginning at Aria. Both of those projects have been and will be done within that basic level of CapEx that we've spent the last few years. But if we did something beyond that to add capacity, it would likely be above.

And Shaun, maybe just as a more global thesis, Las Vegas is our home. Las Vegas is the epicenter of gaming in many respects. It's not going anywhere, and there's no -- I don't think anything immediately is going to come even close to competing with it. So we believe in it's not only midterm but long-term future. And so we want to continue to invest aggressively where it makes sense and luxury experiences -- sorry, items are down that lane.

Perfect. And then just maybe a quick one on just the MGM Digital on sort of the international piece, non-BetMGM. But just help us think through the inflection in that business. There was a little bit there saying, obviously, losses equal to or a little less than last year for this year. But is there a bigger sort of J-curve or inflection in 2027? It sounded like we were maybe headed in that direction, but you said something about funding, helping to start self-fund maybe some of those investments in Brazil. So if you could just elaborate on that a little bit.

Yes, sure. It's Gary. Well spotted. Yes, I think that's right. The way you should think about MGM Digital, we basically have the European LeoVegas operated portfolio, LeoVegas branded business and the BetMGM branded business in Europe. That business is setting up, as Jonathan remarked, in '27 for significant operating leverage and likely substantial levels of profitability. And then we can use that to -- at our discretion to finance the remaining growth investments in the portfolio, which are largely dominated by Brazil in terms of what we have line of sight on.

So we do think there will be the ability to self-fund in part the ongoing investments in Brazil and a few other geographies around the world. The exact nature of how much will be self-funded completely, we're working out through the budgeting process that we're in for '27, but we do anticipate some degree of self-financing from the core LeoVegas business.

The next question is from David Katz with Jefferies.

I wanted to just go back to the all-inclusive offerings. I think the term you may have used is supported in reference to Luxor and Excalibur. I'd love just a little more color on whether that's -- we would classify that as upward momentum. And all of this in the context of some of the prior questions around some of the sort of lower half or lower quartile properties within the portfolio and how they're doing.

Yes. I'll kick it off and turn it over to Ayesha. I mean we've booked well over 30,000 room nights on it. It absolutely has helped us stabilize occupancy. And again, I think I commented earlier, the narrative around Las Vegas not providing value and everyone getting beat up on that. We think -- we don't think we know it's helped. We followed it closely through social media and otherwise. And it's a great value at the end of the day is the bottom line.

Ayesha, I don't know if you want any more color.

Just a couple of other notes. I mean a couple of things that have been interesting to us. What we've seen is a lot of interest and demand from the customers, particularly around the weekends. And so they've actually been purchasing the package at slightly higher rates, which has been accretive. And from that perspective, we've also been really happy with the margin profile that we've been realizing from that package. So all in all, in terms of the gross room nights booked plus the change in narrative plus the margin, we think it's been healthy.

Excellent. And as my follow-up, with respect to Park MGM, I think you also indicated a strategy there toward locals. I'd love a little more color about that, which is just interesting.

Yes, sure. We think that property, in particular, has appeal to locals for a couple of reasons. First, there's the obvious proximity to T-Mobile as well as Dolby within its footprint and the non-smoking aspect of it is unique in our portfolio. We also do know that for that property, in particular, much of our high-end play is locals play. And so from that perspective, we've just been taking a look at how to expand its appeal to our local demographic, particularly over the summer.

So we've been doing a host of different things, including looking at sort of F&B, F&B offers for locals as well as parking offers for locals even up to and including locals free-play offers. And so it's really just a focused attempt of demand generation within that demographic.

The next question is from John DeCree with [ CBRE ].

Bill, Jonathan, I wanted to ask about your view on kind of the thesis that customers are staying closer to home, and that might be one of the reasons we're seeing some strength in the regionals relative to leisure in Las Vegas and record revenue quarter on a same-store basis and seeing a little bit of stability in the leisure business in Vegas. How much do you kind of subscribe to that consumer theory and do you look at this as like a zero-sum equation? Or as Vegas starts to recover, do you think the kind of trajectory in the regional is sustainable? So can consumers kind of do both Vegas and regionals as you look across the database?

Ayesha can speak maybe to the database transfer. I would say this, Las Vegas is still down on international travel. And while we're picking up some additional seats, particularly as you look at a place like Canada, we're off considerably. And so it needs to continue to focus on that. And then obviously, particularly in the summer, Southern California is a major drive market. Our driving traffic hits over 50% generally of how people get here, principally driven again by that market. And so since we don't have a regional casino in California as much as we'd love one, I think it's somewhat limited.

I don't know, Ayesha, if you have a specific view.

Look, if I take a look at visitor volume year-over-year to Las Vegas, I mean, there are puts and takes month by month. But overall, the trends -- there isn't a significant departure in overall trend line. I do note that -- and we're happy about this, our regionals are healthy, and we're seeing consistent visitation among our highest frequency regional visitors, and we're seeing consistent play among the top demographics there.

I don't know that I'd say there's a one-to-one trade-off. I don't really think of it that way. I think that as sort of the overall macroeconomic environment continues to stabilize, particularly in Southern California. And as Bill noted, with international travel, I think we have every reason to be optimistic about Vegas.

That's helpful. I appreciate that color. Maybe a quick follow-up on convention group outlook for 2027. I apologize if I missed it. Can you provide any thoughts on bookings or kind of ADR pace for 2027? Obviously, it's been a great year so far, but how does kind of forward years look?

Yes. I think for 2027, we like our on the books position right now. We've still got plenty of runway left for this year and into next year, even for in the year for the year. But we think we're headed into 2027 in a strong position from a group perspective.

The next question is from Steve Wieczynski with Stifel.

I want to first ask about Macau. And it seems like the promotional environment over there continues to be pretty intense. And just wondering maybe from your perspective, what you guys are seeing over there right now? And then how aggressive or nonaggressive you guys have been in terms of having to or trying to protect your market share?

Kenny, over to you.

Okay. Thank you. This is Kenny from Macau. Macau has always been a competitive market and will continue to be. MGM, like past five, six years, has demonstrated a consistent and deep understanding of our customers. We deliver the appropriate offerings cater to premium demand.

I want to see like here, we are not -- it's not purely like a promotion reinvestment. What we are competing is a package is our products, our services, our innovation and then our promotion. It's really a package. Like, for example, during the quarter, like we have completed some meaningful CapEx projects, including our suite conversions and as well as like our premium gaming space at Cotai.

These projects have been well received by our premium customers. And moving on, we will continue to renovate nearly like 100 suites at MD Macau. And our strategy is really to focus on optimizing the yield of every table, every slot, every square foot of the casino floor. And that's our strategy. It's not purely like a reinvestment. It's a package. Like you can look at for the past since pandemic, every quarter, we have like always like in the guided range of our operating margins at MGM China level, like mid-20s to high 20s. We are confident. We feel comfortable that we can sustain such margin going forward. This level is sustainable.

Okay. And then second question, Bill, going back to Vegas, I want to ask the bundling question maybe a little bit differently. And I guess what I'm wondering here is, as you guys have kind of rolled out that bundling promotion, so to speak, have you seen that translate into your -- into growth in your database? Just trying to figure out if you're starting to see new folks come into the market or these are more existing players?

No, it's a great question. Half of the participants in this package are brand new, which if you think about Las Vegas in general right now, I think we're under 15% of first-time visitors in total in terms of visitation. And so it is drawing a new customer base, presumably younger, but I don't think I know that yet, but we're going to try to do some data on that. But yes, it's 50%, which is frankly startling and importantly promising.

The next question is from Brandt Montour with Barclays.

So, first in Vegas, Jonathan, you mentioned hold as being a benefit in the second quarter. Looking back over the last three quarters, it just seems like you guys have had a really nice run of hold. And so the question is, is there anything structural or sort of any changes that you've made to mix or anything as we try and figure out where we should be modeling that business on a sort of neutral basis?

Look, this is Bill. I don't know if I'd changed the model or the percentages of the games. I will tell you, we skew -- there are half a dozen customers, maybe a dozen customers that we have consistently catered to and they have enjoyed their services and their time here. And they swing hard and they swing heavy and they can go either way. And obviously, this past quarter has been to our advantage, but I wouldn't change the formula yet, I would say that.

Okay. That's helpful. And then one more on Macau. When you made that comment, Bill, about volumes recovering sharply in July, I was hoping if you could clarify if that was a MGM comment or an industry comment or both so that we can kind of get a sense for -- the question -- the second follow-up question would be, did kind of did promo kind of drive that recovery in July? And so how we can think about EBITDA flow-through from that sort of?

Yes. I would say I think we've returned to our normal pace, Kenny. I think it's both, meaning both the market and we have recovered in the context of where we were in June. Kenny?

Yes. I think I want to see like we are seeing pent-up demand from World Cup period. Actually, both visitations and even the business volumes have strongly picked up since even the second week of July when there were still a few matches remaining before the end of the World Cup. And the weekly performance has improved week-over-week. We believe Macau like Dining revenue last week at the entire market had recovered nearly to Q1 levels. And at MGM, both property visitations and normalized GGR have already exceeded Q1 levels. With the events and concerts in town in this month and next month, we are confident to see a busy summer in Macau that can draw like a popularity and visitations.

The next question is from Chad Beynon with Macquarie.

Bill, I wanted to ask a strategic question on regionals. I think it's quite clear that you guys are focusing on market-leading properties with hopefully over $100 million of EBITDA. Obviously, one of your companies with some regional assets is going through their HSR process now. And then after the close, Churchill Downs announced that there might be some more regional properties on the market. Can you just update us if there would be markets that kind of help with the hub and spoke and kind of the long-term value for your shareholders?

Yes, Chad, look, I wouldn't say no, never for sure. And while there's always a couple of properties out there that might fit well into the portfolio, and we've kept an eye on that, there's nothing imminent to the contrary.

Okay. Great. And then drilling in just a little bit more on the result in Vegas. You had a very low hold comparable in Q2 '25. You mentioned that you were on the right side of that this quarter. Are you willing to provide what the hold adjusted number would be for the quarter and what the positive impact for Vegas was?

No, we don't really like to put kind of a point estimate on that because there are a number of things that drive what the hold percentage ultimately is. But it's in the tens of millions this quarter. It was meaningful, but we don't -- we stopped a couple of years ago presenting any kind of hold adjusted number.

The next question is from Stephen Grambling with Morgan Stanley.

Just on the digital side. So we had the update from BetMGM earlier this week. And as you continue to learn from the digital on the international side, how do you think about whether BetMGM U.S. is being maximized in its current form as a JV? And are there any limitations to evaluating either various ownership structures at this point, whether it's an embedded ROFR or other legal components when we think about the JV as the right setup from here?

Look, I would say this about the JV, which we continue to say we've enjoyed our relationship and our partnership Obviously, we are the brand, they're the technology. There's always things to learn. I think Gary can speak more specifically to that because he oversees these businesses on a daily basis. But the JV is in good shape. And while you never say never to anything, there's nothing contemplated.

So again, there's no limitations to various structures at this point. It's just a question of what you feel is best and price.

Fair.

The next question is from Ben Chaiken with Mizuho.

Recognizing you don't want to comment on hold and some of the other items, I was hoping you could maybe in broad strokes, give an assessment of how you're thinking about the underlying business in Vegas in 2Q from an EBITDA perspective, but more importantly, the trajectory of the business in Vegas as you see it today, understanding that things have improved in July.

Yes. Look, I think you've heard throughout our comments, our luxury business remains strong. The top end of our marketplace, the very top end is very strong and continues to be. We still all have -- and it's not just us, it's the city of Las Vegas. for value customers are continuing to push. We collectively are down 3.5 million visitors from our all-time peak, I think, back in '20 -- help me here, '19 or '18, whatever it was. And so as we think about that, we're going to continue to push ways to do that. We've always been able to get ourselves and keep ourselves in the 90% occupancy range, and we're going to continue to push on that. If you think about what we said about this quarter, it's a good example.

Our convention and catering business, all-time high. And so that speaks to corporate America, the desire of the destination. And the other thing that speaks to here, the marketplace has changed. We are a big event marketplace now. And when something meaningful happens, whether it was just the recent UFC fight with McGregor or again, believe it or not, BTS, the market responds to it and responds with a great deal of interest and velocity. And so we're going to continue to drive it through both the city and independently with events like I mentioned, our Players Era basketball tournament and other things that we all want to create because live is what's happening right now, and it's not lost on us or anybody else for that matter. And so the Sphere has been a big help for the community with other competitors who have helped bring in live entertainment, and we're going to continue to do the same.

Okay. Maybe you may not want to answer this, but just to put a finer point on it, I guess, net of some of the different moving parts in Vegas, are you -- do you think you're growing underlying EBITDA today?

We're growing revenue for sure, up against some challenges on EBITDA. But absolutely, in the long haul, yes, we are.

Ladies and gentlemen, this concludes our question-and-answer session. I would like to turn the conference back over to Bill Hornbuckle for any closing remarks.

Thank you, operator. And again, I thank everyone's participation. Look, Vegas remains stable and consistent. Same with Macau. We love where our regional businesses are coming from and our digital programming, particularly in the digital piece of Gary's business and the digital -- on the international piece of Gary's business is showing some promise return. And so with all that said, we thank you for joining us, and have a great night.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

Good afternoon, and welcome to the MGM Resorts International First Quarter 2026 Earnings Conference Call. Joining the call from the company today are Bill Hornbuckle, Chief Executive Officer and President; Ayesha Molino, Chief Operating Officer; Jonathan Halkyard, Chief Financial Officer; Gary Fritz, Chief Officer and President of MGM Digital; Kenneth Feng, Chief Executive Officer of MGM China Holdings; and Howard Wang, Vice President, Investor Relations. [Operator Instructions] Please note, this conference is being recorded.

Now I'd like to turn the conference over to Howard Wang.

Thanks, Rocco. Welcome to the MGM Resorts International First Quarter 2026 Earnings Call. This call is being broadcast live on the Internet at investors.mgmresorts.com, and we have also furnished our press release on Form 8-K to the SEC.

On this call, we will make forward-looking statements under the safe harbor provisions of the federal securities laws. Actual results may differ materially from those contemplated in these statements. Additional information concerning factors that could cause actual results to differ from these forward-looking statements is contained in today's press release and in our periodic filings with the SEC. Except as required by law, we undertake no obligation to update these statements as a result of new information or otherwise.

During the call, we'll also discuss non-GAAP financial measures when talking about our performance. You can find the reconciliation to GAAP financial measures in our press release and investor presentation, which are available on our website. Finally, this presentation is being recorded.

I'll now turn it over to Bill Hornbuckle.

Thank you, Howard, and thanks again to all of our employees. Their continued dedication and execution drove another gold plus NPS record-breaking quarter, reinforcing the strength and sustainability of our business and our ability to deliver unique and lasting experiences that people find incredibly exciting.

MGM Resorts once again delivered consolidated growth in the first quarter, driven by strength in digital and China. Net revenue for Las Vegas in Q1 grew on a year-over-year basis for the first time in over a year despite an exceptionally strong leisure comparative. We achieved this with solid group and convention business in the first quarter, and we expect this to carry into the second quarter.

The first quarter is simply our seasonally strong group and convention quarter of the year, and we experienced robust business related to both citywide conventions like CES and ConAg as well as in-house programs at Mandalay and MGM Grand. We achieved record 1Q convention ADRs and catering and banquet revenue and drove increased production from our strategic relationship with Marriott. Importantly, we expect this momentum to continue in the second quarter with convention room night mix to up 2 percentage points year-over-year to 20%.

As the city evolves, we are making sure we are leaders in innovation. The MGM Gaming streaming lounge, which opened at Park MGM and received all regulatory approvals during the quarter is another exciting step. We developed a premium creator environment where gaming stores can come to life with plans to integrate celebrities into both the content and the broader guest experience.

Another theme in our Las Vegas business has been our value. MGM has always offered opportunities for our guests seeking value experiences. This quarter, we challenged ourselves to have been more creative and launch an all-inclusive experience at bundles hotel, dining, entertainment and all parking and resort fees. Guests can now choose to stay at Luxor or Excalibur with access to a wide range of dining options across 5 MGM properties. The feedback we're getting from guests is very positive and roughly 1/3 of the bookings are from first-time Las Vegas visitors. The program enhances our ability to convey our value props in innovative ways that resonate with our guests.

Ultimately, Las Vegas' true value lies in delivering iconic one-of-a-kind experiences. We look forward to welcoming the Super Bowl back at Allegiant Stadium in 2029, particularly given our proximity to the venue, which drove outsized benefits during the '24 Super Bowl. In the near term, Allegiant will host a College Football Playoff National Championship in 2027 and the Final 4 in 2028. That same year, the Ace are set to begin their inaugural season in Las Vegas.

During the quarter, Las Vegas has also been named a Target City for the NBA expansion team, and we are actively engaged in discussions with the league and respective team owners. If successful, no U.S. City will have assembled all 4 major professional sports leagues faster than Las Vegas. The ability to attract professional sports franchises and tentpole events exemplifies Las Vegas structural resilience.

The city consistently advances through challenging operating environments by evolving alongside customer demand. Today's consumers are decisively gravitating towards live events and experiential travel in Las Vegas and MGM is capturing that momentum. Las Vegas's ability to adapt its mix, its pricing and entertainment continues to differentiate the market and reinforce its resilience through economic cycles.

Our regional operations have maintained steady market share, strong casino volumes reported solid results for the quarter, reflecting the premium positioning of these properties and their ability to drive consistent, reliable performance. At MGM China, we grew net revenues by 9%, while segment adjusted EBITDA was impacted by our new brand fee. Jonathan will remind you of those details in his section.

Our market share for the quarter was 15.4%. And while February was negatively impacted by hold, we concluded the quarter in the month of March with a share of 17.3%, which has held steady into April. We continue to invest in our competitive advantages in premium mass to support future growth and the suite conversion and renovated premium gaming areas at MGM Cotai were recently completed ahead of the upcoming Golden Week holiday. The next capital projects will involve renovating the suite product in Macau if we want to ensure our offerings stay fresh and ahead of market growth. While we will continue with targeted capital spending, we believe our operating expenses are appropriately sized and scaled to match our growth profile and our margins are sustainable.

At BetMGM North America venture, Adam and Gary reported first quarter results a few weeks ago. We continue to prioritize the iGaming segment where underlying fundamentals are healthy and growing, and we are approaching $2 billion in annual revenue from operators. We are moderating spend in sports to focus on returns, while our online sports business also continues to grow, and we remain focused on driving profitable growth and margin.

Our core strengths remain unchanged: iGaming, multiproduct states, our omnichannel presence in Nevada and our focus on premium mass sports players. We remain disciplined and focused on executing our strategy in areas where we have a competitive advantage.

MGM Digital reported another quarter of double-digit revenue growth as it continues to make progress towards profitability. Sweden and the U.K. continue to drive our LeoVegas B2C business, where the top line grew over 30%. These are also the next 2 stops to our sportsbook integration, further validation of our acquisition of Tipico's U.S. sportsbook technology. We're continuing to invest in Brazil and plan to leverage our global marketing assets and in-house sportsbook capabilities on the significant World Cup opportunity a little later this year.

And in Japan, over 40% of the foundation piles have been installed or completed. The first concrete floor has been poured, and the first structural steel has been erected. I recently visited and approved our markup rooms, which I found exceptional, and we are opportunistic as ever, keeping in mind we expect to be the sole licensing and operator in Japan upon opening. The population and visitation metrics are massive, as we've discussed, Japan has over 120 million residents and hosts over 40 million international visitors annually. MGM Osaka remains on time and on budget for 2030 opening.

For the first quarter of '26 complete, our optimism across all various business segments continues to hold firm, especially in Las Vegas. We remain on track for growth this year.

With that, I'll now hand it over to Jonathan to provide additional details on our performance this quarter.

Thanks, Bill, and I'll certainly join you in thanking all of our employees for their continued hard work and dedication this quarter. We really value our daily contributions and appreciate everything you support our company and our guests.

In Las Vegas, as Bill mentioned, we were able to grow net revenues despite the strong leisure comparison in the prior year. Segment adjusted EBITDA decreased by $62 million which can be explained by just 2 items: an increase in self-insurance expense of $30 million -- of $37 million and a decrease in business interruption proceeds of $31 million versus last year.

Now that we're into the second quarter, comparisons in our leisure offerings should become more normalized, especially towards the latter part of the period. We're encouraged by the incremental momentum driven by our all-inclusive program as well as the convention strength we have on the books.

Our regional operation proved resilient in the first quarter, exhibiting top line growth of 2%. And similar to the Las Vegas story, segment adjusted EBITDA decreased by $20 million, in part due to an increase in self-insurance expense of $9 million and a decrease in business interruption proceeds of $10 million versus last year.

Borgata and National Harbor also faced some weather-related disruptions, but we ended March on a very solid footing, and those trends continued into April. We closed on the sale of the Northfield Park operations earlier this month. So just a reminder for your models, Northfield Park will no longer be in our regional operations going forward. As usual, though, we'll provide same-store results for easy comparison.

Before diving further into our other business segments, I do want to briefly address this external factor that continues to pressure operating costs across our industry and drove a meaningful portion of the increase in our self-insurance expenses this quarter, and that's the growing prevalence of frivolous litigation often backed by large pools of capital, including private equity.

As we noted earlier, we were negatively impacted by $37 million in Las Vegas and $9 million across our regional operations this quarter. While we support a fair and balanced legal system, claims that lack merit, they divert capital management attention and resources away from investments to benefit employees, guests and our communities. We're focused on what we can control, which is enforcing high standards and process and the other operational elements of our business with the utmost care.

Now let's move on to MGM China, which exhibited solid performance in the first quarter. The decrease in segment adjusted EBITDAR of $13 million was primarily driven by the new branding agreement through which we received $23 million more in fees than in the prior year period. As a reminder, the brand fee increased from 1.75% to 3.5% of revenue starting this year. While this impacts segment adjusted EBITDAR, it results in higher cash flow for MGM Resorts.

Moving to digital. Our BetMGM North America ventures at first quarter results reflected continued successful execution of refined player management strategy, delivering 6% growth in net revenue from operations and 11% growth in adjusted EBITDA. This was also the first quarter where we earned branding fees from BetMGM, which amounted to about $1.5 million. Separately, no quarterly distributions were made in the first quarter given the seasonality of cash outlays, which included marketing investments around NFL postseason and March Madness as well as accrued annual compensation payouts.

MGM Digital drove growth in net revenues of 43% in the first quarter and reported segment adjusted EBITDA losses of $26 million. We are continuing to migrate our sports books to our in-house platform such as BetMGM Sweden, and are investing in the opportunities presented by the upcoming World Cup in both Europe and Brazil. Specific to Brazil, we continue to have confidence in the total addressable market. and we may drive investment beyond our original guidance, reflecting regulatory and tax developments as well as competitive intensity as we pursue our long-term share objectives, and we'll keep you posted as the year progresses.

In Japan, we are expecting our funding for the year to be approximately $200 million to $225 million after investing approximately $140 million in the first quarter. Much of it will be addressed with proceeds from the yen-denominated credit facility we closed last October. So in essence, it's prefunded for this year.

For the quarter, we bought back about 2.5 million shares for $90 million. Over the last 5 years, we've decreased our share count by almost 50%. As a reminder, and I can't help myself -- we sold Northfield Park for a 6.6x trailing EBITDA. That's a multiple significantly higher than what is implied by our current share price. With the transaction now closed and the proceeds received, we have increased flexibility to redeploy capital, including reaccelerating share repurchases at our current valuation levels.

I'll turn it back to Bill.

Thanks, Jonathan. Before we go to questions, maybe I'd like to reiterate just a couple of things that were said. Obviously, our diversification strategy is proving successful. Consolidated revenues, again, should grow over 4% and Vegas for the first time in 6 quarters also showed growth at the top line. And as I think about the balance of the year, our group and convention business looks strong. Obviously, we have the benefit now of the MGM rooms for the entire year. We have easier leisure comparatives coming up.

And the high end continues to demonstrate itself not only in gaming, but in non-gaming spend event-driven to be sure and live entertainment to be sure it absolutely shows up and shows up often. And regionally, despite headwinds and the ones that were mentioned in the overall economy, we've seen a solid performance, and we expect to continue to see through the balance of the summer.

MGM Macau continues to hold on to a major market share. We're very proud of what's been created and what they're doing there. And we do believe costs and our margins are sustainable now throughout here. And Japan is off to a great start, albeit early, but we're excited by our progress. We're excited about the design and ultimately, the market that it will provide. And then BetMGM continues to track itself along and you've seen additional and tremendous growth in overall digital business for rest of world.

So with that, Howard, I will turn it open to questions.

[Operator Instructions] Today's first question comes from Dave Katz at Jefferies.

A lot of information here, and I took note of the all-inclusive offerings that you decided to introduce, I think, earlier in the quarter. Can you just talk about what kind of response you're getting to that? Is that a strategy that we could see you deploy in other properties or other areas of the portfolio?

Sure, David. This is Ayesha Molino. We've been really pleased with the response to the all-inclusive package. We've seen really steady momentum since we first deployed that and the customer response has been very good. As Bill noted in his remarks, we're also seeing a significant portion of those customers as net new customers, which we believe is a positive trend line. We're going to continue to evaluate it, understand customer response, understand some whether there are new strategies we could deploy alongside it and whether it needs to be scaled or should be scaled to other properties. So it's going to be -- we're going to continue to watch, continue to refine over time, but we have been pleased with the reaction to date.

Understood. And if I can just as my follow-up, talk briefly about Macau. Having been over there, the operations and the commentary seem relatively stable. But it's always been a market that tends to have surprises around every corner now and again. How are you looking out at the rest of the year in general terms or qualitative terms? And how do you feel about sort of how that market rolls through the rest of this year? And that's it for me.

Thanks, David. I'll kick it off and then Kenny turn it over to you. Look, I think we feel really good about the balance of the year. we brought on many things last year in terms of capital enhancements and just the overall product, and we're excited by that. We've got some more to go. So we're adding some more suites, which will be beneficial. I think everybody understands we're still undersuited, and that will be beneficial. It's always difficult to say Macau is stable, but I feel good about it. I feel very good about our market position and what we're doing and how we're doing it.

And so Kenny, I don't know if you want to add some more color there.

Thank you, Bill. This is Kenny from Macau. As we all know, McCall has always been competitive from day 1. Macau market is a premium one. It's not simply about supply. It's not like a purely like a quantity play. It's more about quality. So it's about understanding to serve the purpose of the target guests. Here at MGM China, first, we are very focusing on the products and services. We want to make sure they are meaningful, effective and targeted to the premium customers.

As Bill just mentioned, we opened like 63 at MGM Cotai side. You never source such products in Greater China area. They are unique. They are different. They are refreshing. They are cozy. And we opened like a yearly for a week, our customers they love it. And also, we just opened like 40,000 square feet of like premium gaming space at Cotai area, we have about like 40 tables or 15 private rooms. This is also new the design, the construction of services there. I can see a lot of customers that are better playing even right now.

Secondly, it's the products, and we will continue to refresh our products. Like, for example, we are in the designing stage, about 100 suites at the Macau, MGM Macau side. and also some kind of gaming spaces, F&B outlets. We want to spend money wisely to really to reflect the purpose to serve the purpose of the customers, why they are in Macau. It's not a typical like hospitality products or resort products. they are serving their targeted premium guests, premium customers.

Secondly, I want to see like the MGM has developed a pretty unique corporate culture here that encourage from the senior management from myself to all other senior management members for team members to react fast effectively to make changes in making changes in developing products and services which evolving with fast-changing customer tastes. So actually, reinvestment CapEx, products, services, they are owning one package. It is a package about how we take care of customers, I think that's the key for us to continue to grow for the rest of this year and next year.

And our next question today comes from Dan Politzer with JPMorgan.

Bill or Jonathan whoever wants to take it. I was hoping to talk a little bit about the strip and health of the customer base there. It seems like you're talking about this evolving health. Can you maybe talk about the first quarter kind of progressed and how you kind of saw that resonate in your customer base? And then expectations for how the second quarter should evolve given your competitor last night had some comments on April?

Yes. I'll start it and Jonathan could kick it off. Look, we had -- interestingly, in the quarter, we had an amazing January last year. So we had a tough kickoff in mostly in gaming. But as the quarter progressed, and obviously, I think you heard yesterday, you heard from us, ConAg was tremendous. And so as the quarter progressed, each month got successively better. March being obviously for us, the best month yet. The market has changed. Consumer has changed -- obviously, we're focused on -- luckily for us, we have a lot of luxury product and brand brands that can cater to that, and it's going to continue.

Despite many headwinds, whether they be air, gas, et cetera, we have yet to see a slowdown. That doesn't mean over summer, that can't happen because booking cycles still remains short. But we feel resilient about it. We feel good about it. We get air care, air traffic coming into the community. Half of the traffic that was lost when -- who is it that went bankrupt? Spirit went bankrupt, has been picked up. We see a couple of additional international flights coming into the market. That's a little early to tell what gas will mean to all of it.

But to date, we feel good about it. Our April is fine. We just had a very successful Baccarat Tournament come through here last weekend. May will be a good month. And so we like the second quarter, but it's early. It's just the end of April. And so time to tell on these short-term bookings and where leisure will ultimately go.

Got it. And then just on that self-insurance, $37 million, I think that you guys had a $13 million charge last year, maybe in the third quarter. this. So is this something just to think about more commonly that this could be impacting results and bearing in mind it does sound onetime in nature? Just any better clarity or a way to think about that going forward?

Sure, Dan. It's Jonathan. I mean we certainly hope not. This is something that we at historically once a year. We, of course, we expense amount every month, but we do a bit of a true-up once a year after that experience, and you remember it correctly, we decided to do it twice this year. And the impact of that examination is this additional accrual that we took across our businesses and the first quarter. So we -- of course, we expect that, that's adequate now.

But on the other hand, it has been an increase in cost in our business. It's the reason I wanted to call it out. Clearly, but for that charge, our results this quarter would have been. I think we'd all agree we've been much better on an operating basis, but we certainly hope that, that's not going to be anything that recurs and in fact, it is an unusual onetime item.

And our next question is from Steve Wieczynski with Stifel.

So Bill, I want to stay with Vegas here for a little bit. Obviously, you noted you feel better about that value customer. It seems like the customer base is now somewhat stable. So I guess the question is based on what you're seeing right now from a forward demand perspective, coupled with that healthy group and convention business, do you think it's going to be possible to grow Vegas EBITDA this year? I mean, you obviously kind of talked about the second quarter and you feel pretty good there. But the first quarter obviously didn't put you guys off to the best start.

Yes. Thanks, Steve, for the question. Look, the one comment you did make, I want to be clear about the leisure customer at the lower end of sets -- for us, obviously, it's Luxor or Excalibur. Midweek is still a challenge. Now the good news is it's like those 2 properties represent about 6% of our overall EBITDA. On the weekends, we are fine, the balance of the portfolio is performing from fine to good. And to answer the core question, we do see growth through the balance of the year. it's going to be tempered modestly, and it's got to be tempered with -- it's a crazy world out there right now. But based on what we see, particularly in advanced bookings, et cetera, we still remain optimistic that we will have growth by year-end.

Okay. Got you. And then second question, we heard last night from Caesars, and obviously, you probably listened to that call that they've been starting to work a little bit more aggressively with the LVCVA to help kind of find and identify bigger events or corporations to bring into the Vegas market. And wondering if you could maybe expand on that a little bit more? And maybe help us understand if you're involved in that process and potentially and then what the potential upside could eventually be there?

Well, it's 40,000 feet. Yes, we're involved. Gary Fritz, who's sitting next to me is on the board. So we have been and we'll continue to be active Look, I think you know this about our business. Remembering we have over 4 million square feet of our own convention group space. We're big into tech. That sector continues to grow and it's looking exciting. We've got some really good groups lined up for the summer. We've got Google coming back and a few other, Cisco is coming in with a massive group this summer.

So the question becomes because ConAg rotates, are there other groups in the world like ConAg, and the answer is yes, there are. And yes, we have been cooperative and will go on with them from time to time field trips to go pursue some of this stuff. I think you heard yesterday, it is true that some of it is "political" in that these groups mean a lot for each one of these communities that they're currently in, whether it's San Francisco or Dallas, you picked the community. And so they're not as easy just to pick up value proposition. There's generally more to it than that. But no, we are active. Now we completely agree with the sentiment that was laid out yesterday, and we'll continue to pursue it.

Our next question today comes from Brandt Montour with Barclays.

So I wanted to key off of that question earlier on about the all-inclusive effort and encouraging commentary around first-time visitors to Las Vegas. You guys obviously have a decade of data in terms of first-time visitors to Las Vegas. Maybe you could kind of open the hood and share some metrics on sort of what a typical first-time Vegas visitor kind of behaves like what the retention is like for a second trip, what you kind of can assume for flow-through and profitability for that guest versus the corporate average?

Brandt, I think the core thing to remember about first-time visitors is I can remember in Las Vegas where visitor profile would indicate that 20% of the visitors were first time. And I think over recent years, that number has been in the mid- to low teens, it drops below -- it dropped to 8% or 9% last year. I think all of the noise around Canada, which were as a place -- many of them came from is real. Our general Canadian business is down 30% to 40%. Obviously, we hope to improve that. We've had a couple of missions up into Canada a convention center and ourselves to help that. I think we have one plan later this summer that I'm actually going on.

In terms of behavior, international has always been a big play there. Mexico opened up a few years ago meaningfully with air traffic. And it's interesting. The majority of first-time visitors actually many of them come through conventions and they come because they have to, they're told to. And then they learn about this place and they go, this looks interesting and fun. I want to come back. so they come back with family, friends, et cetera. And so I think the only real differentiator for now is that internationally is hurting that number to see it grow again through this package has been great because it's important, obviously, for the future growth of Las Vegas as we continue down the road here.

I don't know, Ayesha, if you want to add anything.

I mean in terms of customer behavior, we're certainly seeing the customers they are engaging in all aspects of the business. And so we please see that response. And generally, I think in terms of what we're seeing from a flow-through perspective, we're happy with the results. And so no concerns there either.

Great. Second question would be a follow-up on Macau. Looking at the first quarter, obviously, we're in a new structure with the management fee change and those margins, obviously, on that basis were below what you've talked about on this call in the past. Under the new structure and sort of considering the comment you made about March's exit rate for market share being a little bit better than in the first quarter. How should we kind of think about target margins for that segment under this new structure?

Yes. It's Jonathan. I'd certainly invite Kenny to comment as well. But even with this new structure, I mean the property, first of all, before the branding fee, we expect to be able to continue in the mid- to even high 20s in terms of its property level margin. And then reducing their EBITDA by the amount of the new fee would get you to the new going-forward margin. But I think we feel that safely in the mid-20s.

And our next question today comes from John Decree of CBRE.

I wanted to ask question or 2 about the digital business. Revenue growth in the quarter was really strong, a little bit more than we thought. I mean is that a comparison to the heavy marketing in Brazil last year? Was there something else in terms of revenue uplift? And then just my follow-up in there, how do we think about the kind of time line to profitability in that MGM digital business from here?

It's Gary. Thanks for the question. The real growth engine on the top line, the digital business has actually been the Leo Vegas, the consumer business. So most of that concentrated in Europe with particular emphasis markets in the U.K. and Sweden. We've also had a lot of success launching the business in the Netherlands and expanding it there. Brazil helps, obviously, because it comps against very little revenue. But the core LeoVegas business and consumer business as I believe noted in the prepared remarks, is growing north of 30% year-over-year. So it's not all down to Brazil.

In terms of the path to profitability, I believe we've indicated in the past that we would see the loss this year for the digital segment having relative to last year. We might see a little bit more investment this year than that, given some of the regulatory changes and tax changes in Brazil. but we're definitely anticipating the loss to materially narrow vis-a-vis last year, which then sets us up into '27 for close to a breakeven year, if not 100% getting there.

Our next question today comes from Shaun Kelley at Bank of America.

For whoever wants to take it, Bill, I think you mentioned a bit earlier that you were still seeing a bit of midweek softness. But just wondering, you had called out a pretty large dynamic between your high and low properties. And I was just wondering if you could kind of update us on the trend line you're seeing there right now. Obviously, inclusive side or offer should help maybe narrow that gap as we get towards the summer. But in terms of what you're seeing right now and just trying to put into context the RevPAR performance for the company sort of relative to some of the market numbers we saw out there, which I think would have bridged a bit higher?

Yes. Shaun, thanks for the question. Ayesha should probably best suited to start this off, so go ahead.

Yes. Sure, John. With regard to the RevPAR question, I think that we look at it as in a couple of different ways. Overall, we think the fundamentals of the business are healthy from a RevPAR perspective. And from an ADR perspective as well as an occupancy perspective, particularly among the luxury portfolio, we're seeing real stability and growth in some segments, and all of that's been positive and all indications forward-looking remain good there as well.

In terms of the lower end of the portfolio, I mean we discussed this in the last quarter as well. We had seen some softness really starting, as you know, in the second quarter -- towards the second quarter of last year, and that's been pretty consistent. We have been deploying strategies against it. As you know, with the all-inclusive as well as with overall cost control there, and I think that's been productive. We're continuing to watch closely as the summer unfolds in terms of what happens with that customer.

But as Bill noted, we feel pretty good about the weekend in terms of the midweek. We're hoping to continue to see more stability as the year progresses. And certainly, I think there are pockets where we have evidence of that, whether that's convention group business continuing to stabilize, including those properties midweek. And then also with some of the programming in the South Strip Allegiant, we're seeing positive reaction that's positively impacting those properties as well.

Shaun, and remembering MGM, we've got about 54,000 more room nights in the bucket this year because obviously, they were offline. So just as clear math, that's going to, yes. .

Yes, fair point on that. And then as a follow-up, but probably a good segue off Allegiant, Bill you mentioned in the prepared remarks a little bit about the NBA, which is a pretty exciting development. It may be too early to speculate, but I think you have a lot of vested interest in making sure that, that ended up at one of your venues, particularly or potentially something like. So can you just talk to us about the strategy there for the city and MGM element to the extent you have a hand in possibly where either a purpose-built stadium ends up or if one of the venues that exist right now could be used for that?

Yes, Shaun, I appreciate the question. Fun question. I will start by saying I'm already under 3 NDAs. So the good news is the NBA has clearly earmarked Las Vegas and Seattle. We have had huge interest and obviously, whether T-Mobile becomes -- and Las Vegas becomes the ultimate side or not time to tell. Obviously, it will be up to the Board of Governors sometime next year. That said, we're excited by it, how could we not be. We've all seen the success in what it means to Las Vegas with the sports teams come. T-Mobile is part of that conversation, whether it's short-term or long-term, all roads lead to it for now because the league has expressed interest to host a team as early as 2028. And so we're intimately involved in many of those conversations.

And I hope, I believe if the answer is -- well, yes, or no. I think we'll know hopefully by this time next year. A process is beginning to start. We've been asked how we would position T-Mobile for any and all bidders, and we're beginning to do that with our partner at AEG and Bill Foley. But we're open to all comers and there has been extensive interest in Las Vegas. And so it's exciting. It's very exciting, actually.

And our next question today comes from Barry Jonas at Truist.

I'm wondering if the current Iran conflict has impacted your UAE nongaming project and its time line? And then I guess do you believe there's still a chance you could get gaming there or in Abu Dhabi?

Barry, let me hand -- it hasn't impacted the ultimate timing, i.e., construction. For now, a China state who is building the project continues, and the project remains on schedule. We have not heard yet nor do I think we will, given the environment for a while whether gaming will be prevented or not, reminding the balance of the group crew who may not be as familiar with that project. They're allowing us to hold 0.25 million square feet of space for a potential casino on one of the podium floors there. And so it could be very exciting.

For us, that is our key focus, not Abu Dhabi, to answer that part of the question. Right now, their business is struggling. The tourism business in that particular neck of the world is down to like or take. I'd say occupancies are down to that level. So it will take some recovery time no matter what happens here over the next couple of months. But long term, we remain very excited. The project is fascinating and fabulous. And so we're going to be all over to continue to push both the agenda, the initiative and the opening.

Great. And then just thinking on international development for Japan, I guess they've reopened the process for additional licenses in the country. Curious how you think that potentially impacts your 2030 project? And then I guess as a follow-up with Iran, any impact to construction costs that you're seeing?

And on the second question, no, not yet, although like everybody in the world with respect to cost of inflation and cost of goods, a lot of it -- a lot of our concrete and steel has been contracted. So that's the good news. But there's obviously a long way to go. We still have 4 years to go there. What was the first part of the question? First part of the question?

Just about additional licenses now, the reopening.

Japan, I'm sorry. Yes. They have started the process. They put some dates on I think it runs through next spring. Time to tell, given the scale and scope and what we all went through, there's only 2 or 3 markets that could actually accommodate something that I think that would make sense and be successful, whether there's the political will at the end of the day to do that or not time to tell. We've all witnessed first time around that there was not.

And then knowing Japan as well as we do, I'll remind everybody, we're in our 17th year of this. So I think it would impact us too quickly no matter what happens. And frankly, if they were able to get better terms and/or conditions that would only work to our betterment. And with 120 million people to share, I'm not overly concerned to the contrary.

And our next question comes from Stephen Grambling at Morgan Stanley.

Can you hear me?

Absolutely, Stephen. .

So Jonathan, you mentioned the multiple for Northfield versus the current trading was higher than where the base line is. I guess does that make you reconsider monetizing other assets as a way to surface value? Are there things that you see out there that could ultimately end up being sold or rethought as a way again of surfacing value?

It really has is a way of hopefully monetizing the price of our shares. We have -- although it's been for a few years now, I would say we've been fairly active in doing just that, starting with the sale of the Mirage at a nice double-digit multiple the sale of our Gold Strike property in Tunica at the same double-digit multiple. And now North Park. I mean, a slot-only facility with no hotel and while performing nicely, I mean, a pretty good multiple and well in excess of what our enterprise trades at.

We're guided in our dispositions more by our strategies and market positions than we are necessarily by the by the level at which these properties could be sold, and that was the case with all 3 of those transactions that I mentioned they're all done really for strategic reasons. I just think they do. These valuations just highlight what we think is a real disconnect with the enterprise valuation. So in short, no, it doesn't really cause us to say, hey, what other properties might we be able to sell because that's usually informed by a strategic approach.

Fair enough. And then an unrelated question just on Macau. It looked like the mass market hold was better than kind of the historical trend. Is there something structurally changing there as we think about either the player type or the bet types or even the technology being implemented that could make that sustainable?

Well, I'll make one comment and let Kenny comment. There's a lot of prop bets now. I mean, I think some back tables have made prop bets. And so that has changed the game, the nature of the game and frankly, the odds of the game. Ken, I don't know if you want to comment a little further?

Yes. Thanks, Bill. We are seeing like increasing adoption of some side bets on gaming floors. As you know, like a side bet in general, carry a house advantage higher than the traditional games. We are rolling out some more side bets literally this week at MGM following some recent approval by the ICG. But the history of side being in Macau is still relatively short. These games only got popular after pandemic. Along with volatility in a premium dream market, we do not think it is the right time to adjust the mass -- the theoretical mass hold we will keep monitoring the adoption of the games, the player and the GGR trends, et cetera.

And our next question today comes from Chad Beynon with Macquarie.

Wondering if you can talk about the international business in the first quarter in Las Vegas, either around Chinese New Year or Super Bowl as those comps have been fairly easy over the past couple of years. We're not anywhere near back to where the peaks were. But wondering if you're starting to see some nice improvement there that could carry forward throughout '26?

Chad, thanks for the question. Look, I would say, yes, to a limited degree. I mean, obviously, the very nature of what's happened with our core Far East business in China and restriction of capital leaving that marketplace has not been eradicated, I guess, or change back to where it was. We do see Mexico more often than ever. I mentioned earlier in my comments, a tremendous backroom at this -- last weekend, this April. And so we -- and it was, as always, full of international land players.

The good news is despite the overall traffic decline international, as I was mentioning earlier, mostly driven by Canada. When it comes to rated play and particularly premium-rated play, it's very healthy, and that hasn't changed. And so -- and I don't think there's anything out there other than an outright or that would change that anytime soon.

Okay. And then on the LeoVegas or the digital business, there's been some contraction in public multiples on affiliate companies and sports data companies and even so on the B2C given regulatory change. What's your appetite in terms of improving or growing the ecosystem from a tech standpoint to just grow that business at a time when multiples might be attractive?

Yes. Listen, I think we feel confident about the assets that we have under the hood right now. We were very deliberate in assembling the portfolio of assets that we did. We didn't buy sort of the most obvious shiny new thing. We were very deliberate turned over a lot of rocks and assembled the portfolio that we did. I think we've mentioned before, we feel we're largely fully deployed in terms of capital commitment to the International and MGM Digital business. can never say never, but I don't see any glaring holes in our portfolio at the moment. So it would take something extraordinary probably to see us deploy additional capital.

And our final question today comes from Ben Chaiken at Mizuho.

I've got one kind of 2-parter. If I recall, maybe clarify, I think there was a small fine in the prior year 1Q. I don't know if that sticks out or if it kind of just gets caught in the wash -- and then maybe you could help us think about 2Q last year in the correct base. In Las Vegas, you reported around $710 million, $711 million, but I think you flagged $60 million of headwinds, $20 million from grand, $20 million from some event spend and $20 million from hold, I believe, I guess if you think about the business today, do those 3 buckets still kind of make sense to you? Or have things changed?

You're correct. There was a small fine in the first quarter of 2025 that we incurred that affected our results there. And so that's one of those things we have those types of not fines, but we have those types of relatively small impacts one way or another in our results pretty much every quarter. Second quarter last year, you're correct that we are underway with the renovation at the MGM Grand during the quarter that affected us for pretty much all of the year. We did have, I think, kind of a negative impact on hold during the second quarter last year. That was roughly $20 million.

And so I guess those are probably the 2 things that I would call out that when I look at this quarter, we certainly have the benefit of the MGM Grand in those rooms back. And then you never know how old is going to go. But last year, in the second quarter, we were impacted negatively by hold.

And then, I guess, the event, the $20 million event, is that just kind of like maybe forget that one? Or how are you thinking about it now?

Well not forget about it, but that was a VIP event that we had. And part of that was also reflected in the hold results that we had during the quarter. But again, we do VIP marketing events in our business, whether it's Chinese New Year, we just had actually the same VIP marketing event this past weekend, which is it's costly, but we think it's really important for our customers and for that segment of the business. So that particular event we've had last year and we had again this year in the quarter.

And did well. And did well with it.

Thank you. And ladies and gentlemen, this concludes our question-and-answer session. I'd like to turn the conference back over to Bill Hornbuckle for any closing remarks.

Thank you, operator, and thank you all for listening in. I hope there's nothing we've shown that we're resilient that this market is resilient, that people -- and this weekend is another good example. I think we have Morgan Wallen here at Allegiant. People are still excited by what we do. And despite all the noise in the world, and we all know there's a lot, we're pleased where we are and we're excited for the future. So thank you all.

Thank you. That concludes today's conference call. We thank you all for attending today's presentation. You may now disconnect your lines, and have a wonderful day.

Thanks, everybody, for joining. Next panel off, we have MGM. We're thrilled to have CEO and CFO today, Bill Hornbuckle, Jonathan Halkyard, we're in Vegas. It feels lively.

As you kind of look out at the business, do you want to give us kind of a high-level update on what you're seeing kind of day-to-day now that we're here kind of been living it?

Yes. And I think this theme has carried itself through some of the other comments I read from yesterday from both Tom and the folks here at Wynn. Our high-end business continues to perform and perform well. I think this quarter has been progressively better. January, February, March. Obviously, we just had CONEXPO go through here and very successfully. And so we're excited by the trends we see in both of those parts of our business. We had nice Super Bowl. We had a great Chinese New Year's here. And so we feel good about that.

I think we have second half of the year with the exception of leisure, which I'll speak to in a second. We have a soft second half of the year. I think the general -- everybody did, us in particular. And so I think the opportunity to show growth ultimately in 2026 is very real and meaningful. And I think you'll see that from us is our expectation. We've got a lot of programming coming in, in April and May, throughout the summer, both short- and long-term programming that we think is going to be exciting for the destination.

Leisure is a little different, although we've seen some green shoots slightly. It's too early to tell if it shifted back to where it was. Obviously, we own Excalibur and Luxor at the value and the chain. And we continue to see softness there. We are aggressively going out trying to do something about it through programming. You'll see us announce something in a couple of weeks, we think will be meaningful in that respect. And so we're excited for that to see where it goes. I think the market enough got caught flat-footed last summer because things were fine. And then in May suddenly they weren't. And so we're going to respond to that and respond to that aggressively. And I think you see a lot of programming only from us, but the community and the convention authority is going to launch something special in April. They will carry its way through the summer. I think you'll see a lot of fireworks around here over the summer. And so we're excited by that.

And so I think generally, tone is affirmative as we particularly go further into the year. First quarter is as expected generally. And I don't know, Jonathan, anything to add to that, but I feel pretty good generally. .

Yes. I would just say the business is pretty much performing the way that we expected it to. And the same could be said for the regions. The other thing I'd add, maybe as there's been some speculation about what the impact of some stimulative tax policy might have on our customer base that certainly, we have seen that in the past when that's happened, we really haven't seen much yet. I would expect if we do, it will probably be in our regional markets first. And so we will see -- it's not really in our plans, but I wouldn't be surprised if that's a tailwind for us as we get into the second quarter. .

As you think about kind of the first quarter, and then we'll get to the kind of second quarter and kind of case for the year. You had this January where industry-wide RevPAR was up, I'm going to say, 4.5%, visitation still down, but I think it was only down a couple of percent. How are you seeing that -- or are you seeing that kind of sequential improvement flow through to your business? And if so, where is it showing up across your portfolio?

High end of note, luxury of note. And the further you go down the spectrum, the softer it gets. And I'll remind everybody, Luxor or Excalibur, by way of example, I think it's like 6% of our overall EBITDA. So while we're focused and we're concerned longer term, that we want to stay pushing that and promoting that business, it's not the end of the world.

I think if you go to the other end of the spectrum, whether it's high-end activity cases around Gymkhana and Carbone Riviera, things that we've just created that are off the charts, by the way, literally that business continues to boom. We came off of a strong first quarter last year in gaming. I think Super Bowl performed well. I think Chinese New Year has performed better this year here locally, domestically. And so the expectations we've had for the year going into particularly the second half have not changed. Group business continues to do well. Our catering and banquet business continues to actually a little better than we anticipated. So we haven't seen spend pullback there to the contrary. And so the expectation we've had, we still hold.

And then the programming that it sounds like it's going to be picking up. Can you maybe expand on that. Is that focused towards a type of customer? Or is it kind of broad-based? Is it -- what is going to be like the messaging or objective there?

Well, I think there's a couple of things to say. And the visitor profile just came out for Las Vegas. And one of the -- we've all heard this messaging over the last course of the year through social media of note where value Las Vegas isn't the Las Vegas it used to be in all of that. No, it's not the Las Vegas it used to be. It is the new Las Vegas that I would say is providing better value for experiences than it's ever provided before in its history. And so to the extent you can do things here that are experiential whether it's through sports and all the sports activity, whether it's ultimately another Super Bowl in '29 or Formula 1, all of that has changed the marketplace forever, and I think that's a good thing. .

Is there still value to be had here? Absolutely. I mean the idea that someone can come in here on a package and for a couple of hundred dollars get room, food, theater and attraction is very real and very much a live still in Las Vegas. And so that narrative, I think, has been way over plate. I don't aspire to it or believe in it or want to support it at all to the contrary.

But Las Vegas has changed. We are a center of activity around special events and so they matter. So whether it's Worldwide Wrestling as funny as that may sound, bring 60,000 people to Allegion, whether it's -- what's the country guy's name, [ Wallar ]?

Morgan Wallar.

Morgan Wallar. Thank you, Ayesha. By the way, those of you who haven't met, that is Ayesha Molino, our new Chief Operating Officer. So, Ayesha? .

It depends on the activity case. We have -- whether it's Final 4 coming up. We are after another Super Bowl. We have the Grand Prix. There's -- I don't know if there's a change. I think there's more of programming of that ilk that brings in different segments at different times. The Bruno Mars is of the world who will come back here now in the stadium, I'm kicking off his tour. We're fortunate to have him as part of our family, his tour was the largest selling tour on Live Nation is in the last couple of years, including Taylor Swift, by the way, in terms of Day 1 performance. And so, I don't know that's changed. I think there's more activity than there's been historically though.

And then it's obviously a pretty fluid geopolitical landscape. How do you think about any impacts or things that you're monitoring as it relates to your business? .

Look, I think one thing that has dynamically changed, and we have focused on this -- I'm also chair of U.S. Travel, is international travel. International travel for Las Vegas historically, has been in the mid-teens. That's fallen to 9% or 10%. Canada is off appreciably. I think that's our key focus market, particularly in the winter months like right now. And so we need to aggressively go back after that in a welcoming message that America is open for business, et cetera, et cetera. What was a $50 billion surplus has turned into a $70 billion deficit for the country. And Las Vegas is a big piece of that in that context.

And so I think there's some of that -- and by the way, it's not the current administration. This all goes all way back to 2016. This is start -- the depth it started go the other way. And so whether it was Trump administration 1, Biden the administration or Trump administration 2, our ability to pay attention to that segment and treat it properly, we need to do a better job collectively at that. It's not just Las Vegas, but I think the country as a whole. .

The other impacts that we're watching relates to our supply chain, and we don't see -- nor do we foresee any impact on supply chain from what's going on right now. And the other is energy prices. And I think many in this room in the past have tried to draw correlations between the price at the pump and gaming revenue. And we have never seen that correlation -- and also in terms of our energy prices, they're largely fixed. And as people have probably seen almost wholly reliant now on solar power here in Las Vegas. So we really don't have exposure as a company to volatility in energy prices other than affecting as Bill said, maybe aggregate demand or air travel. .

And then just while we're on the kind of broader topic and the different things happening in the Middle East and the region, I mean you guys have a deal there, obviously, non-gaming. How are you thinking about that opportunity? Where you sit today? Are there -- I guess, have there been interruptions in terms of the construction?

I find it fascinating. There was a 1-day interruption. A company called China State is actually building the property on behalf of Wasl,our partner and they're back on the site. And so the answer is no. And we think about it long term, and obviously, we believe as I think everyone believes they'll be resolved in the region and safety in the region. So we're excited by it longer to go longer term now, it's a complex, it's probably over a couple of million bucks. It's not our project. So it's on beholding of Wasl, the construction of it and the capital of it.

But in it is a platform for a Casino Sunday, time to tell. The ruler there will have the jurisdiction of if and when. But the ruler also -- their company is owned by Wasl. And so the owner of the property is ultimately the rulers company.

And so longer term, we're excited by it, particularly where the airport is and where it's going, we think Dubai is the marketplace there. And so we're comfortable just having a management agreement to manage something we think is a real brand extended for now, and we'll see.

Can we talk about the kind of longer-term supply demand dynamic in Las Vegas? You've seen a couple of new properties come into the market over the last 5 or so years. You have another giant guitar that's coming off very quickly. How do you think about the next few years in terms of the supply and demand dynamic in this market?

Well, I would remind everybody, at least as it relates to our business, the Fountain Blue and resorts have not hurt us in anyway, actually, we grew through that, through those -- both those openings, if you will. The Hard Rock now, Mirage, the vast majority of those rooms were already in the market and now we're moving it. So you could arguably say 3,000, 3,750-odd keys or whatever it is are coming back.

Look, Hard Rock are serious competitors. We deal with them in New Jersey. We know what they do in Florida. They have a meaningful database. I think Jim and his crew and Joe Lupo over there are good competitors, and we're going to get ready for it. We're not taking it lightly. I can assure you. They're going to have a 5,000-seat theater, which I'm sure will directly go after the kinds of things we do with Park MGM. And so we're thinking about it already every day what to do, how to think about it. Recognizing the kinds of things they've been historically. And again, we got caught, frankly, 4, 5 years ago, flat-footed in New Jersey. We've learned by it, we've now gained back our share and then some. So I think we understand how they play.

I guess, between now and then, you have some big CapEx investments across the strip that you're making and it sounds like more of your high-end properties. Can you guys -- can you just give us an update on kind of where we stand and what maybe you're most excited about there? .

Yes. The recent CapEx projects we've done have been largely around high-end gaming high-limit slot areas, high limit table areas and properties like the Bellagio, the MGM Grand, Aria. We're now doing it at Cosmopolitan. I think we've been very diligent in updating our room product. We did MGM brand last year. We'll start the Aria at the end of this year. And then Bill mentioned some of our very successful recent investments in the M&A -- or sorry, in the F&B category. .

I think, though, the most promising and larger scale growth capital opportunity for us is to improved circulation between our -- the key parts of our luxury campus, Bellagio, Aria and Cosmopolitan. These are 3 massive properties that together, do call it, $1.8 billion to $2 billion in EBITDAR and they were built to compete in a way with each other. Now they're under our umbrella. Our customers love that choice. They have different offerings. And so capital investments that increase the connectivity of those businesses in a way that really customers old value, I think, is going to be something we were looking at in the next couple of years. .

And product offering around entertainment, nightlife, at scale, making sure we're competitive. Obviously, we watch what happens particularly in this building, and they do a very good job with that, and we want some of that back to be really specific. .

If you think about kind of that medium-term outlook, right, you guys have seen the headlines. We've all seen, I mean, to the extent that there is an evolving ownership landscape on the strip, does that impact you, to the extent that it's Tilman or icon whoever? .

No. No, look, I mean, Mr. Fertitta was going to come anyways arguably, and he's already trying to hear in some respects. No, not really. I would say one thing, though, it's kind of fascinating to us. If you do the math that's been applied to that transaction. And say it transacts for, call it, whatever the number is today or call it $35 and you put that same math to our company, we're like $60-plus a share. That math I like a lot. But I'm -- I don't know that it changes the landscape. What you've heard calling for is let's bring back some independent entrepreneurs who run with individualized properties. Think about Phil Ruffin and what he's done with Treasure Island and/or Circus Circus for that matter. But that transaction wouldn't change the landscape in my mind because it doesn't do exactly that. So I don't know if you think of it differently, but I don't.

Competitively, not really. .

Okay. Can we pivot to Macau? I mean we're past Chinese New Year. I don't know we've gotten the GGR numbers we saw for the full month and we can combine and look at them a lot of different ways. But how would you -- in terms of your properties and portfolio there kind of.

Volume grade, last year, the first quarter, the luck gods were with us, not as much this year, would be my overtake of it. And what's important, the volumes are great. and continue to grow. I think the expectations for the market, I think the expectations we've set for the market for the year, particularly are on track and then some. I think at the top line, we're all outperforming that. Market remains competitive. I don't think that's news to anybody here. I don't know if there's anything dramatically going to change this year in a context of competition. I think it's more of the same. It's a dog fight.

For us, we have assets we've put in play mid-season last year, so we'll get the full benefit of a full year, whether it's the Alpha Club in Macau or a lot of the villas and suite products we brought in, we open up, I think it's starting next month, 124 new, I call workhorse suites in Cotai. We've converted 3 floors to just Suites and clearly like the business, but particularly there, premium mass, but premium of note has really made a difference. And so we're pushing hard into that. And we've enjoyed a 15% odd share. And I think over time, we'll continue to do that. I don't think the market changes much in that context.

And then it's long been promotional. It continues to evolve. But where are you seeing that promotionality in terms of your customers? Is it more going after the high end? Is it kind of that premium mask? And I just say that because you've seen in the last 6 months or 4 months -- 4 or 5 months, VIP has been growing a lot faster than the mass segment.

It's both. And so -- and we're a good example is we're converting spaces today that used to be junket because we still have old junket spaces left it into whether VIP and/or mass premium spots for us. And so look, we've -- VIP itself, although I will tell you, of our 10 biggest customers there, 6 or 7 of them are considered in mass premium and the other 3 or 4 are VIP, just like the way they want to deal and play. It's mostly an individual decision in many instances.

And so I don't see that changing greatly. I just don't. I think Macau is on a pretty steady path now for the next year or 2 in the context of the shape of the market, the scale of the market, and how it's being catered to and addressed. We all are under the obligation to put more money into these non-gaming assets. And so it will be interesting to see how that gets manifested over the next couple of years. But I don't think the dynamic of how we're doing the marketing, casino marketing of note is going to change.

Dan, I think it's also more to point out while the competitive landscape for our properties in Macau is really important, and they've been executing well. What's equally important is our relationship, MGM Resorts with that company. We own 56% of MGM China. This is a business that has a absolutely rock-solid balance sheet, pretty low leverage and great free cash flow generation. And in particular, we raised our branding fees payable to MGM Resorts to a market rate. It was a pretty material increase a few months ago. And also the dividend flow that we get from MGM China together, those roughly $250 million a year of, we think, very reliable cash flow for our shareholders and that with minor increases or decreases in performance, those are very solid cash flows for our shareholders. .

And then, Bill, you alluded to the kind of the market share where you're at now, it's roughly doubled pre-COVID. I think part of that was some of the suite product that came online. I mean, do you think about -- how do you think about the incremental non-gaming investments, the competitive market and maybe the opportunity to further increase that share? Do you feel like that's just given how far you come?

Yes, I don't know that we'd go much harder than what we are given the scale of the company. Look, we're going to continue to try. I can assure you, but I think it to be realistic in some respects. The market dynamic of what we all -- and for example, our company committed to -- I remember a number far off $2.3 billion of incremental OpEx and CapEx into these non-gaming initiatives over the course of 10 years. We're about 35% into that spend. And so we brought on a show and a theater, we brought on a black box. We brought a museum, which has been highly successful in terms of foot traffic and well regarded in the context of the government and the kinds of things we've done there. We are all getting to a point, and we have underwritten and sponsored many activities, sports and otherwise, throughout the community and some community initiatives as have others. We happen to be leading the pack in some respects in that.

That said, how we then spend the next money particularly given our scale and scope and footprint is a bit more challenged. And so we're going to have a lot of conversations around that, the government of how to make it effective and efficient or more effective and efficient. But I don't know -- I think go back to your core question, I think the market share we see in the mid-teens is fair and I see that to continue to grow. I'll go back to that. I mean, remember, this is a market that was at $45 billion, had aspirations to be in the 60s at one point, and we currently sit in the low 30s. And so I think there's more controlled rational market growth because the government, I think, will be very focused on that. That said, I still see growth in that market.

Maybe pivoting to BetMGM and on the digital side, I mean, that certainly has been a bright spot for the company. First, I guess, on the direct side, right, I think you've talked about up to $1 billion of investment. How do you think about that return over time? And I guess where are we along that trajectory? .

I mean the return has been phenomenal. Our company has invested about $625 million since inception in this venture and maintained the same amount. And last year, we received dividends of $130 million. We expect more dividends this year. And we built a business that has, depending upon the state, high single digit up to 15% or so market share in OSB and then over 20% in iGaming. I think everybody knows those numbers and growing very nicely. So I mean we are now recapturing our investment and built a business that is worth billions of dollars in our view. So I can't think of a better investment. And I've looked at a few of them in this space where that amount of value creation and return of capital has been as quick to mention the amount of investment that we made to build this business is probably a fraction of what others have made. .

And then, I mean, it feels like this is -- there's billions of dollars there. We look at the market cap, we look at your company. I mean, right now, I think you've turned on the dividend, so that's falling. I guess, longer term, is there a path to kind of extracting more value?

Well, we, of course, believe, I think it's pretty clear that the value in BetMGM is not reflected in our stock price, whether one looks at -- well, one can no farther say than Rush Street Gaming or some of the other public companies and those multiples. And when we apply that to the performance that we reported at MGM, it's clearly not there in our valuation. So we will do our level best through disclosure and the rest to make the value in that venture evident to our shareholders. And hopefully, our shareholders over time get rewarded for that.

I do think there could come a point where if they're not being rewarded for it through our share price, I mean, we'd be compelled to look for other ways to monetize or make clear the value of that business because, again, we think that it's a venture that's worth billions of dollars right now, both for us and for Entain.

And I think -- and we've said this historically, on its current path, it's a business that's going to do 500-something main cash flow a year -- cash rate by the end of next year, we believe. Time to tell. There's a lot going on in place in the markets. All that being said, we firmly believe that. And so -- and that's with the existing we've got Alberta to go and a couple of other things to open up. If iGaming continues to open up over time, and we believe it will, that then puts another whole ratchet into all of that for everybody, including -- and particularly including us, we get iGaming a few more states. .

Yes. How do you feel about the regulatory landscape there in terms of the opportunity for iGaming and legalization? Obviously, you had Virginia feels....

I mean look, there are 2 or 3 or 4 states that I think it's rational. I think in the next 2 to 3 years will be on board. And look, remember, what's happening in this industry, we're generating over 65% of our bottom line in our BetMGM business on 3 states really. Although there are 6 states and we're in 5, it's really Michigan, Pennsylvania and New Jersey. So add of Virginia, add Illinois, I'm not giving lead in the word state, add a couple of meaningful states, 3 of them are literally 60% of our business today. The kind of numbers we're talking about with a $3 billion top line. And so the opportunity, while they may be small in the context of 3 or 4 states is massive when you think about it in retrospect. .

And do you feel like on the flip side, the uncertainty on the regulatory landscape, where we sit with prediction markets, yourselves and some of your brick-and-mortar peers kind of are on the sidelines. I mean how do you think about evolving over time? If we do have regulatory certainty, is this an area where you could potentially enter? And then, I guess, aside from that, if we're in this kind of murkiness period and there's additional competing products that come to market....

To be clear on the company's position, I think we've been clear about this. We see it as legal sports betting today catering to miners in many jurisdictions, by the way. We think in several states, led by Nevada and Massachusetts, have spoken out on that and told us you can't participate or you put your license in jeopardy. And I think we can see that message continue to go into other states as we talk about regulatory environments and political environments.

Legally, there are 11 attorney generals pushing up against us right now, hard. The rulings have been favorable recently. I think this ends up or -- 2 or 3 things outcomes ends up in the Supreme Court. There's administration change at some point and the overall focus of it changes and/or if, in fact, it is continued to allow to go forward, this has been in the U.K. for 25 years. The idea of prediction markets is not new. It's got about 7% or 8% market share. It's a marginalized business at its very core. And so the actual business model itself is not a great model. All that said, if down the road, we had to get in, yes, would we be disadvantaged, i.e., the context of database growth? Yes. But we could get in and we would step in and we'd have a product like we want and need to participate. I don't think it gets there.

Okay. And then if there is some form of iGaming type prediction. Like is that just a bridge too far? .

Yes. And if they were foolish enough to attempt that, I think where there's been some consternation with regulators, I think you would see a very strong outcome. I could be wrong, but I don't think I am. .

Let's turn to the capital allocation. You guys have been a prolific buyer of your stock. It sounds like, obviously, the value is still there. Can you maybe talk about where you see the value? Is it Japan? Is it BetMGM? Is it kind of all of the above?

It's all of the above, but you don't really have to go too deep to really understand where the value is. And the market value of our holdings in MGM China is about $3.5 billion right now, roughly $13 to $15 a share. And depending upon your assumptions around BetMGM, a business that has guided to over $300 million of EBITDA this year, our 50% stake of that is probably worth another $13 to $15 a share in our view. So that leaves our domestic opco, a business that's generating over $2 billion in EBITDA. That's 2.5, 3x EBITDA, and Bill wasn't kidding when you just apply the simple math that was reported in the press yesterday around multiples being in the market for Caesars, that gets to a pretty healthy valuation for our company as compared to where we're trading today. That's the reason we've been so ambitious in our share repurchase activity, and we'll continue to do that so long as we see that value. .

That being said, we do have some big projects. We're allocating this year, probably $450 million in equity investment to our Japan project, and that will grow next year and the year after. But we think that, that's going to be the largest and most successful integrated resort globally since Marina Bay Sands. So it's -- we're very happy to put capital there.

And then we have opportunities in the domestic portfolio to invest, and we'll pick our spots for growth capital as well. As we've talked about earlier this morning, our digital businesses are no longer consumers of capital. They're providers of capital for our business. And the same, of course, is true for MGM China, which is generating free cash flow. So those are really our priorities. We have our Japan investment. We have some targeted capital -- growth capital investments domestically and then repurchasing our stock at I mean he multiple half that which we are selling our Northfield Park slot-only facility business, a good business, but it's a slog-only facility in Ohio, we're selling for nearly 7x later in the -- or early in the second quarter.

If there is a transaction in the market, and assets fall out, is there a scenario where you could look to be acquisitive?

It'd be remote. We have enough of Las Vegas in terms of concentration. We have been about diversity, and we like our positions in the markets and the idea that we are a diverse company. I think it proved itself out last quarter, and I think it will continue to prove itself out. So look, never say never. And I'm sure it might be 1 or 2 regional assets that would be attractive, but I'm sure they're attractive to the buyer, too. I mean so I doubt it. .

And I do want to put a little color on Japan for a second because I think it's really important longer term. I'm betting my career on it literally, pull me on that, because I've been told that. Look, there's a market, if it just manifests itself what's going on today in Singapore, if we start with a $2 billion cash flow business, we're going to net about $800 million given our stake and given our share. It's a meaningful business. I think it potentially could be bigger than that, but time to tell, but if you put it in perspective, 120 million people, 6 million people. We are an 1.5 hours closer from Shanghai and Beijing, the Macau.

And so the proximity, the scale, what's happening in the Pachinko business to this day in Japan is over $30 billion, that we're pretty sure about. And so the notion that this won't be just -- we've seen -- one of the additional concerns was well your machines is this isolated thing down in Osaka Bay. 1/4 million people a week went through the last week of the Expo. The infrastructure is there. It works. I think the product we're going to build is going to be exceptional world-class over the use term, but it will be, given the things we do and what we're known for.

I'm very excited by what that potentially brings us. Yes, it's 2030. And we're going to put our money up front. That's the way Japan works with the banks. But by the end of '28, which should be a flash, we'll be through that. And then I think the reward will be substantive. I truly believe that.

So going back to kind of the capital allocation is the thought you shrink the share count today, you're going to have this influx in a few years and then the free cash flow percentage......

We've looked at it as steady growth, Las Vegas, steady growth regional. Let's just keep our steady growth growing. Midterm is all about digital and long term is Japan.

And yes. And the way I think about it is there -- we've bought back over half our shares in the last 3.5 years. There is tremendous potential energy in what we've created with the inflection in the digital business, the cash flow out of MGM China and our investments in Japan, and that potential energy is against a much reduced share count and one that will continue to be reduced. And that's that turns into a very strong free cash flow per share for our shareholders. It's kind of the way I think of it, too. .

Got it. Makes sense. We want to leave a couple of minutes here for questions from the field. Okay. All right. Thank you so much.

Thank you.

Thanks.

Good afternoon, and welcome to the MGM Resorts International Fourth Quarter and Full Year 2025 Earnings Conference Call.

Joining the call from the company today are Bill Hornbuckle, Chief Executive Officer and President; Ayesha Molino, Chief Operating Officer; Jonathan Halkyard, Chief Financial Officer; Gary Fritz, Chief Commercial Officer and President of MGM Digital; Kenneth Feng, Chief Executive Officer of MGM China Holdings; and Howard Wang, Vice President, Investor Relations.

[Operator Instructions] Please note, this conference is being recorded.

Now I would like to turn the call over to Howard Wang. Please go ahead.

Thanks, Marco. Welcome to the MGM Resorts International Fourth Quarter and Full Year 2025 Earnings Call. This call is being broadcast live on the Internet at investors.mgmresorts.com, and we have also furnished our press release on Form 8-K to the SEC.

On this call, we will make forward-looking statements under the safe harbor provisions of the federal securities laws. Actual results may differ materially from those contemplated in these statements. Additional information concerning factors that could cause actual results to differ from these forward-looking statements is contained in today's press release and in our periodic filings with the SEC. Except as required by law, we undertake no obligation to update these statements as a result of new information or otherwise.

During the call, we will also discuss non-GAAP financial measures when talking about our performance. You can find the reconciliation to GAAP financial measures in our press release and investor presentation, which are available on our website. Finally, this presentation is being recorded.

I will now turn it over to Bill Hornbuckle.

Thank you, Howard. To everyone dialing in, we truly appreciate your flexibility in joining us this earlier-than-expected call and look forward to providing you with some important color in detail about our fourth quarter and full year performance.

Before I get started, I'd like to introduce everyone on today's earnings call to Ayesha Molino, our new Chief Operating Officer. Ayesha was previously our Chief Public Affairs Officer and President and Chief Operating Officer of ARIA and Vdara, which flourished under her leadership, and we are thrilled to have her in the COO role. I also want to congratulate Kenny Feng, who has been leading the MGM China as President and Executive Director since 2020, and it is no stranger to these earnings calls on his recent promotion to Chief Executive Officer of MGM China. And finally, I'd like to congratulate Tian Han on his promotion to Chief Operating Officer. Tian has also been integral to the success of MGM China in recent years, and I'm extremely excited to see the great things the entire Macau team does going forward.

MGM Resorts is the leading global integrated reserve operator across physical and digital channels, converging gaming and hospitality with entertainment and sports and this diversity helped us once again to achieve consolidated growth for the fourth quarter and the full year 2025. It's worth noting some of our key accomplishments last year. achieving record 4Q and full year EBITDAR in Macau while maintaining margins and outsized market share throughout the year, accomplishing a nearly $470 million EBITDA turnaround at our BetMGM North America venture, which commenced distribution to its parents in 4Q.

Breaking ground in MGM Osaka, which we believe will be the world's largest integrated resort upon opening and investing in upgrading experiences across our portfolio from dining to enhance VIP gaming environments in Las Vegas to our regional operations and most notably in Macau. These, along with other successes throughout the year drove growth in consolidated net revenues of 6% and positioned us well for further progress into 2026.

Last year marked the return to a more balanced environment after several years of exceptional growth in Las Vegas. And even with the Las Vegas specific headwinds, we were able to achieve record full year slot win in 2025 driven by our luxury offerings. From this reset baseline, we see a path to grow in Las Vegas for the full year of 2026.

First off, we will benefit from a full year contribution from the various capital projects completed last year, including and notably MGM Grand's room renovation. We had anywhere from 700 to 1,000 rooms offline per day for most of last year, but that will not be in the case in 2026. We've received tremendous positive feedback on the refreshed product and are excited to have the full complement of rooms available this year. Other projects completed mid to late '25, including the High Limit slot rooms at Bellagio, in additions to our already deep roster of elite dining experiences with Carbone Riviera here at Bellagio and Gymkhana at ARIA.

Within the group and convention channel, we are experiencing mid-single-digit revenue growth in 2026. This year's mix will be closer to 20% and the quality of the groups I feel has improved because of meticulous action carried out last year focused on improving profitability. To date, we've had solid performances during citywide events, including CES in January, and we're excited for the return of CON/AGG with expectations of getting back to 2023 attendance and achieving more than our fair share among the 140,000 attendees arriving into Las Vegas. Even more exciting is the fact that we have group and convention room [ not on the ] books for future years that we've had more group and convention [ met on the books ] for future years than we've ever had in our history.

While 2026 event calendar continue to fill out, we are seeing comparable arena capacity citywide events relative to last year, which will help provide stabilization levels of business given the proximity of our properties to the golden triangle of venues, Allegiant, T-Mobile and MGM Grand Garden Arena. [ Ten pulling ] events such as Formula 1 also continue to drive visitation this year, and our Strip properties saw higher room rates and increased cash ticket sales at the Bellagio Fountain Club, which remain the premier ultra luxury hospitality venue to watch the race.

We are continuing to invest where we see the greatest growth potential in our luxury offerings. This includes casino operations. We are out to improve on the success of last year's first one-of-a-kind invitation-only gaming experiences, bringing previously unheard of purchase into a $5 million slot tournament and a $10 million baccarat tournament. We'll be hosting both of those tournaments again this year. We're also busy continuing to innovate especially around the opportunities provided by the geographic proximity of major sports events including this weekend, Super Bowl in Northern California and the international visitation accompanying the upcoming World Cup given several matches taking place in the Los Angeles and Southern California.

We know these programs are working as our 2 top luxury offerings, Bellagio and ARIA together saw a 7% increase in EBITDAR in 2025. We also continue to build on efficiencies driven by our technology innovation, which drove an 18% increase in digital check-ins that have resulted in a significant improvement to check in speed, which now averages 1.5 minutes versus the 6.5 minutes while checking into additional front desk, not including your wait time in line. We also saw 1 million chats through our digital concierge last year as we utilized AI to both transform guest engagement and accelerate productivity. And finally, we are busy at work creating programming that will target and highlight the great value MGM has to offer. We'll share more of that and have exciting news and announcements soon.

At the end of the day, there's nothing comparable to Las Vegas. People are visiting to have unforgettable experiences and their exceptional value is the optionality of what our guests can enjoy and discover on any particular visit. There's also value in the unmatched energy and excitement that surrounds everything you do in this town. That's why Las Vegas was selected to host the College Football Playoff National Championships in 2027 and the Final Four in 2028. Las Vegas is where the NBA's exploring expansion and Major League Baseball is now establishing operations. We've also extended our relationship with F1 for 5 years. And there has always been and always will be extraordinary value here in Las Vegas.

Our regional operations continue to deliver solid results regardless of the macroeconomic, thanks to their outstanding asset quality there's strong demographic placement and experienced operating teams. During the quarter, they reported not only record fourth quarter slot win, but also the best full year slot win ever. MGM China remains a strong outperformer, ending the year with a record high quarterly and full year segment adjustment in EBITDAR. We achieved a 16.5% market share during the fourth quarter and impressively maintained share of over 16% for the full year. A record market share level for an annual period as our operating team continues to command a strong understanding of relationship with the premium mass customer driving the market.

Considering our execution, reflecting in our ability to maintain an over-index market share and solid EBITDA margins, MGM China's trading value is at sub 7x forward EBITDA multiple versus an industry average of over 8.5x seems significantly discounted to us. Yesterday, we heard impressive results from Adam and Gary on our BetMGM North America venture. BetMGM beat 2025 guidance during the year where they started by inflecting positive and ending by turning annual EBITDA around by nearly $470 million. The strong performance resulted in a $135 million distribution of MGM during the fourth quarter. And during 2025, monthly player volumes increased 24%, while active player days increased 14. This momentum remains positive, highlighted by the plan outlined on the earnings call to reach $500 million of adjusted EBITDA in 2027.

MGM Digital also continues to see encouraging momentum. We are excited by the scaling of the BetMGM brands in key international markets, where Sweden continues to be our top market. We exited 2025, making significant headway in Brazil, particularly after the December launch of our in-house sports book. The Brazilian market is new, robust and evolving, and we are confident that our product and our JV with Global and the value global marketing assets have created a funded opportunities that they're worthy of sustained investment in the coming year.

Progress also continues with our development projects, setting long-term growth pipeline for our business. Construction remains on schedule in Dubai with Bellagio, ARIA and MGM Grand Hotel towers scheduled to open in 3Q of '28. And in Japan, construction remains on time and on budget for MGM Osaka. Currently, about 20% of the foundation piles have been installed or completed and the project remains on track to open in 2030.

The outlook for the coming year is encouraging. With a more constructive backdrop and a stabilizing environment, our message last quarter holds true. We are optimistic that growth in Las Vegas can be achieved this year. There are also potential macro catalysts that could benefit both Las Vegas and MGM more broadly, including lower trending interest rates, certain tax regulations, including no tax on overtime and tips and other stimulus benefiting consumers and further progress at the Las Vegas Airport as about 50% of the lost capacity left by value airlines and select international carriers have been backfilled by other airlines.

Beyond the macro drivers, MGM is driving convention and group nights with more future room nights on the books than we've ever had. We also continue identifying opportunities to operate more efficiently and make further progress on our AI and technology initiatives, all while our improved liquidity and cash flow generation allows us to pursue innovative ideas and strategic investments that can and will deliver meaningful value.

With that, I'll now turn this back to Jonathan to provide additional details on our performance for the quarter.

Thanks very much, Bill, and thanks to all of our employees who stepped up throughout a challenging year, strengthening the foundation we have today and allowing us to take advantage of the growth opportunities in 2026.

Consistent with our third quarter commentary surrounding Las Vegas, we saw stabilization in the fourth quarter. Las Vegas EBITDAR declined 4% year-over-year an improvement versus the declines experienced earlier this year, driven by the completion of the MGM Grand room remodel in October, a year-over-year improvement in convention mix and holds settling in above our normal range. Luxor and Excalibur continued to have a disproportionate impact to this quarter's decline in Las Vegas, though keep in mind, these 2 properties only represent about 6% of Las Vegas segment adjusted EBITDAR in 2025.

While we do not see immediate changes to value customer habits, we are seeing strength in the south end of the strip when we have robust programming at Allegiant and as Bill referenced, we're working towards some creative concepts on marketing our value proposition to these customers. Additionally, the comparisons just become more favorable toward the end of the first half of 2026.

The return of the MGM Grand room inventory has been a benefit. And it's worth noting upon completion, the average age of our Las Vegas rooms since renovation is about 6 years. We have a strong maintenance capital program to reinvest in our properties regularly, and I would argue that we have the best maintained portfolio of assets on the strip, which is recognized in the positive feedback from customers and of course, the outsized room occupancy share that we command in the market.

Our regional operations had another strong quarter to close out a record-breaking year. Not only did they achieve best ever fourth quarter slot win, but they accomplished the best-ever annual slot win performance for 2025, resulting in a 2% rise in net revenues in the fourth quarter and stable EBITDA. I'd also highlight that the sale of the Northfield Park operations remain on track for the first half 2026 close.

MGM China just crushed it this quarter. During the fourth quarter, net revenues grew 21% and segment adjusted EBITDAR grew by 31%, a new fourth quarter record. A relentless competitive environment is the norm there, but our team has consistently maintained mid-, high-20s margins with their focus on maintaining high service levels while anticipating evolving customer tastes and preferences. MGM China recently announced new terms for its branding fee, which will increase this year from 1.75% to 3.5% and secured the MGM branding through the life of the concession and auto renews for up to 20 years upon a concession renewal.

The rate is comparable to the only other U.S.-based Macau operator and is sensible, given the strength of MGM's brand, its market size and global reach. The brand has proven its value over time, helping drive MGM China's market share and EBITDAR, both of which have almost doubled since 2019. The renewal terms also result in greater cash flow generated for MGM Resorts, which if we use 2025 results, would represent over $50 million in incremental cash flow to our company. We remain highly confident in the long-term growth prospects in Macau and remained aligned with the MGM China shareholders and our desire to increase profitability and ultimately, the enterprise value of MGM China.

Our BetMGM North America venture had a tremendous year with growth in fourth quarter net revenue from operations up 39% and EBITDA improving by $176 million to [ $71 ] million in the quarter. As reported on their recent earnings call, MGM BetMGM provided 2026 adjusted EBITDA guidance of $300 million to $350 million and $50 million of expected CapEx, along with the expectation of regularly distributing excess cash to its parents.

MGM Digital saw impressive 35% growth in net revenues due to continued momentum across the various international geographies, including our legacy LeoVegas markets and Brazil. We plan to continue investing in growth initiatives throughout 2026. And including integration of our sportsbook platform that we expect to launch in several of our key markets, including Sweden, as well as continued investment in Brazil. We anticipate another year of solid top line growth an improvement in 2026 EBITDAR that we expect to be approximately half the losses that we had in 2025.

In Japan, we're expecting our 2026 funding commitment to be approximately USD 350 million to USD 400 million. Much of it will be addressed with proceeds from the yen-denominated credit facility we closed last October, which we upsized to approximately $350 million during the quarter at a low single-digit cost of capital.

We bought back over 15 million shares during the fourth quarter for $516 million, bringing our total 2025 share repurchase activity to 37.5 million shares for $1.2 billion, and that represents an average price of $32.43. And over the last 5 years, we've decreased our share count by almost 50%.

Finally, I want to remind everyone of our various sources of cash flow spanning the business, including cash generated from our Las Vegas and regional operations our MGM China branding fees and distributions and now our BetMGM distributions. The cash sources from MGM China and BetMGM in particular, are high-margin, recurring sources of income and should be assessed accordingly when valuing our company. We've augmented these recurring sources of cash with other actions, including raising a low cost of borrow yen-denominated facility to fund most of our Japan commitments this year, selling our Northfield Park operations, which will close in May, and reallocating capital previously earmarked for our pursuit of a table games license in New York.

In aggregate, these growing sources of cash flow enable us to fund growth opportunities, including the entirety of our MGM Osaka commitment and any future CapEx projects we choose to pursue. It also covers share buybacks, maintenance CapEx, interest expense and rent expense. And keep in mind, not all leases are created equally, none of our triple net real estate leases allow for rent to escalate above 2% in the first 10 years and the most aggressive lease terms cap our rent escalators at 3% for the next 10 years after that. As a result of our aggregate cash flow sources, we can convert our diverse operating strength in a meaningful, durable free cash flow to drive shareholder value.

I'll turn it back to Bill.

Thanks, Jonathan. A couple of thoughts before we go to questions. We exited 2025 with Las Vegas showing signs of stabilization and an improving trajectory. We continue to see those positive trends as we begin 2026 and expect to make even greater progress from a reset baseline in Las Vegas when we lap earlier leisure comparisons in the second half of the year. Our diversity supported consolidated growth in 2025 and has proven to support our growth in almost any environment.

Everywhere we operate, we have the best portfolio of brands, physical assets, leadership and employees who once again set a new annual record for gold plus NPS scores. We have a growth pipeline that includes digital in the near to medium term and arguably the greatest global integrated resort opportunity with MGM Osaka opening in 2030. We have a solid balance sheet, low relative leverage and favorable lease structures with reasonable rent escalators. We generate substantial and growing cash flow that provides us with the ability to pursue any opportunities that may drive value creation. We have a massively shrinking share count, and we are reverting to growth in Las Vegas.

Operator, if we could open it up for questions now, we'd be happy to take it.

[Operator Instructions] Our first question today comes from Dan Politzer with JPMorgan.

Bill, I wanted to just pick back up on your last comment there on the path to reverting back to growth in Las Vegas. I think you laid out certainly a big -- a number of factors with group and convention pacing up mid-single digits, CON/AGG and obviously, strong OpEx control with some of those technology benefits. So I mean, other than the second half comparison is getting easier, I guess, how do you think about the path forward in terms of the first quarter and second quarter in terms of getting back to normalized EBITDA growth in Las Vegas here?

Look, I'll kick this off and maybe Ayesha can pipe in here as well. This current quarter we're in, as compared to the first year, you know there's some differentiators that I think we will intend and should go through.

As it relates to occupancy, it is clearly stabilized. Obviously, we have CON/AGG coming up. We have seen and have demonstrated the ability to continue to drive the high-end luxury pieces of our business. And that will continue, I think, all the way through 2026. We've seen, and particularly in gaming, the high end and I don't mean premium, super high end, I mean, high-end business led by things like our holiday gift shop which was the second highest holiday gift shop, I think we've ever had. And so it's fair to say the [ K ] economy is alive and well. But given the positioning of our assets, the programming, I think as we get through into April, particularly May and beyond, I think you're going to see some really strong performance.

Obviously, the MGM piece is a big piece for us. I've never seen a remodel impact of property the way that one only because we had so many rooms out at the same time. And so all of those things I think are looking favorable. And generally, I think things will stabilize. I think we've begun to see if the convention authorities are expecting 1 million more visitors. And so '24 was an amazing year. And so '25 was difficult. Yes, we need to solve for Canada and leisure travel, but generally speaking, we feel very positive, positive enough to think that we're going to exit '26 [ on a note ]. Ayesha, if you want to add.

Yes. Just a couple of thoughts. Certainly, I think as Bill noted, as we look at CON/AGG, we're certainly looking at that favorably for our business. When we think about CON/AGG and we think about that combined with our own convention base, especially as we head into the latter part of Q2 and into Q3, I think we have reason to have a very favorable outlook. I'd also note in the near term, we have events like the Super Bowl that are continuing to drive a lot of excitement among our meaningful customer base. And so we continue to see that base turn out, as Bill noted, particularly at the high end, but with a lot of excitement for our business.

Got it. That's helpful. And then just for my follow-up. In the fourth quarter, obviously, we saw that the table hold was a bit higher and can kind of triangulate on the math there. But were there any other one-offs in particular in the fourth quarter, either in Las Vegas or any of the other segments you would call out just for modeling purposes?

Yes. The hold was a little bit above average for us and a little bit above prior year. We consider that impact in the fourth quarter to be kind of $20-ish million to the bottom line in Las Vegas. The only other really onetime items would be some in corporate expense. And so for modeling purposes, the corporate expense number is around $110 million, $115 million per quarter. We had some unusual expenses in the fourth quarter and some in the first quarter of last year that should not recur this year.

And our next question comes from John DeCree with CBRE.

Maybe to continue the discussion in Las Vegas, Jonathan, I think in your prepared remarks, you've mentioned the value customer a little bit. I think I heard you say there isn't really any change there. But as we think about value customer or leisure more broadly. Can you elaborate on some of the things that you might be able to do, the city is doing as a whole to kind of help get that customer kind of stabilized throughout 2026.

Yes. And I certainly didn't mean to minimize the contribution of our Luxor and Excalibur properties. We love those properties. But I do think they are the ones that cater most to that value-conscious customer, and they do represent about 6% of the EBITDA for our properties here in Las Vegas. That being said, we're -- we've done a number of initiatives already, both on the revenue driving and the cost side to address those customers, and we have more planned this year. I may invite Ayesha, if you wanted to add anything else.

Yes, sure. Just a couple of things. When we think about the leisure customer, in particular, like a lot of companies in the hospitality industry, I think over the last year or so, we did see that shortening of the booking window. But that being said, we're paying close attention to that customer, and we are starting to see a response, particularly to sort of large-scale events, that feels positive to us. In terms of some of the broader initiatives, the city late last year ran a citywide sale that was very well received. And so I think there is constant effort at coming together to make sure that we are driving visitation to the city.

That's helpful. Maybe one more as a follow-up on Vegas. The gaming revenue volumes, the win, even outside of some favorable table hold, I think volumes were quite good and have been all year. Can you talk a little bit about your casino room night mix or what you might attribute some of the resilient or better gaming volumes, too, in spite of lower occupancy on the strip. Obviously, you've mentioned the high end is doing well. But anything you can add to give us some color on why you think the casino business, the table slots is doing so well in spite of lower occupancy.

John, this is Bill. I'll kick it off, and Ayesha can finish it in terms of the mix. Look, I think we mentioned it throughout our comments, and we've done this and seen it work. If I think about Bellagio, we've reinvested in the high-end slot room by way of example, we've reinvested actually in almost all of our high-end slot rooms across the company. I was just a National Harbor over the weekend and saw that one. It's paid dividends.

That market, which, obviously, those are high-end customers, but not to the extreme, you get into some of our table games customers. It is working. So we've picked, I think, the right things to invest in. I think it's working in Macau of note. I think Kenny and the team there have particularly picked the right things. And then the activity case -- we have this dialogue around value. There are value in high-end activity. When people come to Las Vegas for whatever the event is, we've got a bunch of stuff coming up, as we mentioned, they're not afraid to spend money. And so we need to be value-conscious. We need to understand that mix and how we price certain things to be sure. But when you think about the top end of our business and the experiences people continue to seek and want, we think we're doing a rational and a good job both marketing to them and ultimately providing.

And we've pushed hard on BetMGM, by way of example. I think one of the reasons for the success of holiday gift shop was our ability to provide omnichannel into that program and those people. And so we continue to do that. So that's been an added nice channel. And I think the Marriott channel, underlying a lot of this, those customers, many of them come having -- not have to pay for their room per se, meaning in cash. And so I think the opportunity to enjoy Las Vegas and all that we do, I think, has been paying off. And so I think it's a combination of a lot of things, really.

Yes. The only thing that I'd add is we have a very strong database and we've been fortunate to see the resiliency of that database over time. And I think even as we think about forward-looking casino bookings, those are remaining strong for us and so -- especially from the medium to the high end. And so again, I think that the strength of that database continues to pay dividends.

And our next question today comes from Shaun Kelley at Bank of America.

Bill or Jonathan, just kind of wanted to think about some scenario analysis around Las Vegas, specifically. And if I could, margins have been down the last 3 years. I think business has kind of normalized a little bit post-COVID. And just kind of trying to think about what you're seeing on the expense side of the ledger. So I think we now know some of the drivers and what you're looking forward to drive '26 on the top line. But help us think about, yes, 2 things, like, one would be just operating expense growth and any internal initiatives you have to sort of kind of manage that? And then secondarily, remind us on the room renovation cadence, what was the disruption for MGM Grand in this past year, if you could put it in EBITDA dollars. And you talk about room nights, more importantly, relative to, I think, ARIA was slated for this year. Is that still the case? And any other major projects for this year that could be a little disruptive?

Okay. Thanks a lot, Shaun. I'll take those in turn and certainly invite Ayesha to comment as well. In terms of expense growth, we'll be able to hold our overall expense growth to the very, very low single digits this year. Wage, of course, wages are an important part of our cost structure. And we have been able to largely offset wage growth, unit labor cost growth with the labor complement that we have, even adjusting for modest occupancy declines in 2025. So we had FTEs down slightly in Las Vegas regions and in the corporate office during 2025.

In terms of the renovation impact for the MGM Grand last year, it was about $65 million in EBITDA during the year. And that is, of course, that's already completed. So we'll not only not suffer that this year, but hopefully enjoy some benefit from those remodeled rooms. There's not going to be much renovation impact at all in rooms in Las Vegas. We are starting the ARIA project, but that won't be until midway through the fourth quarter. So that will be more of a 2027 discussion for us in terms of in terms of room renovation disruption from ARIA in Las Vegas.

Anything you want to add on the cost structure?

Just a couple of thoughts on that. I think the teams have done a really excellent job with FTE management throughout the year. and they're constantly looking for ways to improve upon that through technology or otherwise. And so we've certainly seen the dividends of that -- of those actions over the course of the year. And as Jonathan noted, a couple of major differences between ARIA and MGM Grand, [ GM Grand ], of course, we did the bathrooms, which are not slated to be done at ARIA, which will cause significantly less disruption in terms of the number of rooms that have to be taken out at any given time. And as Jonathan noted, we very thoughtfully scheduled this so that the vast majority of the disruption will take place over slower periods. And so we're looking to mitigate revenue impact there as well.

And our next question today comes from Chad Beynon with Macquarie.

I wanted to shift to Macau. Really strong quarter, particularly compared to what we've seen in terms of market growth and some others experiencing some cost creep. So can you maybe touch on that, what the margin environment is like if believe that the Macau margins can remain in this area? And then anything that you're seeing in terms of early bookings for Lunar New Year.

Kenny, all yours.

Yes. Thank you for the question. We do see very rational competition in the current marketplace in the past few quarters. Particularly if you look at our reinvestment rate over the GGR trend, that could be a little bit of volatility due to the mix of business. But in general, it's fairly, fairly stable. MGM China margin has always been in mid- to high 20s as we guided, we always delivered what we said for the past few years.

As to Chinese New Year, we are very optimistic. We see very, very encouraging booking trend for Chinese New Year. We even have a long waiting list for our top-tier, [ the hotel ] products. The player quality is very high. MGM China here, I mean we do have a limited room inventory, but we are good in premium [ mass ]. We are very focused on quality over quantity. And the management is always our strength. We are confident about the demand. We will make sure that we yield our products wisely. And we will [ make sure ] what we are doing to serve customers what we want. There's a new phenomenon. These days, even ahead of holiday, there's no slow period. So we are -- we feel good about it in January. Thank you.

And our next question today comes from Brandt Montour with Barclays.

So a couple on Vegas for me. You guys gave us a lot of helpful details. Bill, you talked about stabilization and you sound pretty confident about the stabilization you're seeing. I was hoping that we could sort of dig into that because if you look at the fourth quarter from a KPI perspective, right, RevPAR was down a decent amount but then casino revenue was up a lot. And so when you think about monthly October, November, December to January, what does the stabilization look like from a KPI perspective? And maybe said another way, can you back to growth with RevPAR, yes, with RevPAR declines like you're seeing or even maybe less so but still material.

Go ahead. Go ahead, Jonathan.

Yes. So I would say the general cadence in the fourth quarter was, October was -- and I'm talking about kind of ADRs, October was down more than December was. November was pretty stable, and it was driven a lot by special events in F1. And then as we started to look into the first quarter, we saw, again, moderating declines versus prior year in ADR. We are confident about the casinos ability to drive revenue growth through events and through omnichannel marketing and just through more effective casino marketing. And it's interesting to note that RevPOR, so overall revenue per occupied room was actually up slightly for MGM Resorts in the fourth quarter. And so we're constantly doing this shifting between the different pockets of demand and different revenue channels in order to optimize revenue. And as we look into the first quarter, we're just seeing some of this continued stabilization that we saw developing in the fourth.

Jonathan, that's really helpful. And also in Vegas, you made a comment, Jonathan, about table hold settling in and the level that you guys are achieving, yes, it's been pretty consistent on an annual basis for the last couple of years in the '24 and change area. That is above pre-COVID average. So the question is what structurally has changed for the hold? And is this the new CEO that we should be forecasting?

I wouldn't agree to the last comment, but I would say more relative. Look, we see a lot of high-end activity. So the premium, premium customers that would be able to come, I mean, you can see it in our baccarat share. If you think about our baccarat share, we're well into the high 40s, I think, this last couple of months. So that more than anything is driving it, but we continue and consistently do that. And while that business is volatile at times, I think our market share of that would be continuing to lift that number more than almost anything else.

And our next question today comes from [ Steve Pezzella ] with Deutsche Bank.

Just pivoting to the regional segment. Any color you can give us on how the year started off for the regional portfolio? And if you have any thoughts on a range of outcomes for the regional business this year?

Our regional business has continued to be really steady over time. And certainly, we're seeing that steadiness continue into the first quarter. And as Bill noted earlier, there have been some real meaningful pockets of excitement for our regional properties. I point here to Borgata and the investment in the High Limit table room there, which is paid really nice dividends for us, and we're continuing to invest, as Bill noted, in that product at various of our regionals. So we're proud of how steady that those assets have remained and continue to see that steadiness.

And I would remind us, I don't think that [ baccarat ] product in [indiscernible] came on until May, when did they come on? It was later in the year is my point. So we'll have the benefit of the first couple of quarters there. And then you probably all saw -- and we're excited by -- we'll see if this comes to fruition or not, but we believe it will based on conversations I've had, but the notion of a steer coming to Maryland is very compelling and very exciting, I think, for the project, the region and ultimately, National Harbor if it's executed as thought about, it could deliver a couple of million more customers a year there. And so we remain very excited by some of our regional properties. They're well placed and they're great assets and that we think will continue to grow over time.

Okay. And just real quick for my follow-up. You mentioned the World Cup in your prepared remarks. Are you expecting incremental visitation to Las Vegas as a result from people visiting. And have you seen any kind of advanced bookings indicated increased demand from that?

We are expecting, yes, it's a unique opportunity to particularly bring high-end customers who will be in the region to Las Vegas, potentially in and out of L.A. or on their way to New York or any place else for that matter. And so we're highly focused on that. I think it's a little early on the overall mix [ at total ]. But I think when it relates to particularly the high end of the market, we're pretty excited by what may come out of South America and some other markets as we would all understand them.

And our next question today comes from Barry Jonas with Truist.

One narrative on the Vegas softness has been that perhaps there's trade down where some folks aren't going to Vegas, but perhaps gaming closer to home. Curious if you've seen that dynamic as you look at your database?

No. This becomes the constant is digital gaming offsetting brick-and-mortar gaming. I think the closest analogy we have is Michigan, where we have a robust sports and iGaming business. yet our property continues to gain share. And so no, we think ultimately, it's additive. When you think about the opportunity for database for omnichannel. People come here, they get to go home, load it up, if you will, with BetMGM app and to continue the experience. And so no, it's nothing that has shown itself as a significant issue to the contrary, we see it still as a benefit.

Great. And then just for a follow-up. Bill, what's the latest on the 90% gaming loss tax deductibility? I guess what are next steps there? And how impactful could this be to your business if it unfortunately would stand?

I'm going to let the expert handle this, Ayesha.

We're continuing to see significant strength in our slot handle into the first quarter, even as that has taken effect. So we are watching it closely, but we are partnering closely also with our industry, our fellow colleagues in the industry to advocate for a fix on that.

And our final question today comes from Stephen Grambling at Morgan Stanley.

And apologies if I missed this, but it looks like you ramped up the buyback in the quarter and talked through some of the sources of liquidity from here. So how should investors think about the right level of potentially parent level buyback versus MGM China, maybe buying back there where I think you mentioned you saw value. And as a related follow-up on that, if MGM China is part of the direction you want to go. Are there any limitations in terms of how high you can take that share?

Okay. I'm a little unclear in the final part of the question. But as it relates to buybacks at MGM Resorts, it really is a -- it's a constant evaluation we do around the value that we see in our shares versus the other uses of cash that we have that we think are high priorities. In the last 6 months, of course, we made the decision not to proceed with the New York license that was $500 million at least that had already had been previously earmarked for that. We see great value in the shares. And so we began share repurchases again in the fourth quarter.

I think share repurchases are always going to be in our capital allocation mix because, fortunately, we can -- with our level of free cash flow now that the distributions we're getting from MGM China and BetMGM, we can afford to invest in our properties, invest in MGM in Osaka and as well as repurchase shares. I didn't go through the multiple math that we all know very well on MGM Resorts right now, but suffice to say it's a really compelling investment, we believe, and that's why we're doing it.

I'm not going to speak for the...

Stephen, on the China question is I think I understand it, there's about 22% float in the company. We have to keep that. And so the idea that we would buy back from the open market is -- we've got to keep that float. And frankly, the exchange is pushing to have more. So that's not what was implied there. The simple implication was the multiple value seems cheap.

No, that's exactly what I was saying. That's helpful. So it sounds like, again, the parent, you get that cheapness through buying back at that level rather than directly anyway.

Correct.

Thank you. Ladies and gentlemen, this concludes our question-and-answer session. I'd like to turn the conference back over to Bill Hornbuckle for any closing remarks.

Thank you, operator. Just a couple of quick comments before you all go, and we appreciate your time given the time of day.

Look, diversification is clearly working. Our consolidated EBITDA growth was up 20% in the fourth quarter, and I think we proved it. You've heard us stress signs of stabilization in Vegas. And obviously, we believe that. We've seen it in various segments, whether it's group, the MGM discussion. We see stimulus coming in helpful, both in leisure and particularly in our regionals. We see Macau continuing to perform at the performance level it is. We've all been challenged with [ you ], but how do you do this and the market conditions -- we've been doing this for a couple of years now. And so hopefully, we've built some faith and credibility in that. And then BetMGM had a remarkable year. And it sets itself up for when we think and say in 2027, we think we can be at $500 million, we believe that. And we didn't say that until recently, and we are now saying it with belief. And so we think we're in great shape as we think about '26 and the things in the immediate future.

And with that, operator, I will end the call, and I thank everybody for their time.

Thank you, sir. This concludes today's conference call. We thank you all for attending today's presentation. You may now disconnect your lines, and have a wonderful evening.

Thanks, everyone, for sticking with us. This is the second day of the conference. And our next presenters sit at the crosshairs of both, I would say, secular tailwinds, but also some questions around the regulatory backdrop, competitive backdrop.

Very excited to have Adam Greenblatt, the CEO of BetMGM as well as Gary Deutsch, the CFO.

To kick things off, you came off of a very strong quarter. You've also talked about a march to over $500 million in EBITDA. Maybe if you can just level set for us where you're coming from and what that path looks like as we think about puts and takes to get to that $500 million plus.

Great. Okay. So firstly, thanks for having us of course.

Thank you.

I'll start with Q3 results, what we put out into the market. We delivered in the third quarter 38% growth in our online sports business, 21% growth in our gaming business, online gaming business. We delivered year-to-date EBITDA of $150 million. We've guided full year guidance to approximately $200 million of EBITDA and $2.75 billion of revenue. So that's context.

The really exciting part and why we're so excited about the business in 2025 and outlook is that this year represents -- that $200 million of EBITDA represents an almost $0.5 billion improvement in year-on-year EBITDA. Yesterday, we wrote big checks to our shareholders, which is another exciting moment for us.

Fewer in this room.

Somewhere in this room, yes. Hello. So yes, so we're feeling really good about where we are now. In terms of the mark to $500 million with -- for me, the real challenge is moderating expectations for 2026 because how do you come off a $0.5 billion EBITDA improvement and the next year not be like, really shouldn't you be doing better than that?

Right.

Well, I guess -- so maybe when we think about that longer term, I mean, is there any thought process right now? Or has it changed in terms of thinking about contributions from iGaming versus sports betting or other puts and takes to think about from a -- whether it's taxes or new regulated markets?

So just again to level set, our iGaming business represents about 2/3 of our revenue. Currently, yes. Similarly, in terms of contribution. Our sports -- online sports business generated positive contribution this year in aggregate meaningfully for the first time, which, again, when you get to a certain scale in our business and the unit economics are really attractive. Flow-through is about 40% to 45% from revenue to EBITDA.

Right. Now this past quarter, you talked about some very strong numbers. Some of your peers attributed some weakness to hold issues. What have you seen in hold? And how do you think about as you continue to grow, what might happen to hold over time? Is there room for that to continue to march higher? And is there anything to think through in terms of the volatility of that?

Great. So I'll deal with the first part and maybe you can deal with the hold progression. So in terms of -- it's important to note that our business is somewhat different from the other leading competitors. Our business skews higher value and our higher-value players in the main skew more singles. So -- and the margin of singles bet is lower than the margin of parlay bets.

And therefore, our aggregate margin reflects the weighted average of that observation. Also as a result of that, where some of our competitors saw significant softness in trading margin in September, the impact on us was less magnified, less accentuated because of our bet mix, because of our player mix. Do you want to talk about how it's evolving?

Yes. And for the year, I just looked at the results, the combined 2 months of the fourth quarter so far, and we're above our year-to-date average on hold. So the NFL season has been good to our aggregate hold for the course of the year.

Look, as we see it going forward, it's -- there's 2 pressures. One is the pressure -- upwards of margin expansion from the fact that we do have more players that are taking SGP bet single game parlay bets or different forms of parlay, which have a higher margin. And then there's the downward pressure that we are attracting more and more big staking players.

So as we plan going forward, we see it moving up slightly, but we don't see a step change. And as Adam said, we don't see it going through a level that you'll see reported by the others. That said, the thing to focus as you look at the industry, of course, is on the NGR margin, which is the -- it's -- I call it the moneymaking zones.

It's between the [indiscernible] on one side and then the bonus to handle on the other. And you will see some of the ones that have higher hold will also have the bonus to handle float up. So it's looking at the progression of the NGR margin.

My last point on this is that there's many ways to get to a big revenue number. Our way is more handle driven with a lower hold, whereas some have a lower handle with a higher hold. And you can't expect that some player who's prepared over the course of time to lose $100 a month is their sort of limit that all of a sudden, just because they start playing single game parlays that have double the margin, they're going to start being willing to lose $200 a month. There's some law of the wallet or sort of limits there.

Definitely the way that we think about, share of wallet over time and on the real revenue NGR basis. I know you're trying to keep expectations down, but we do have the World Cup next year. Anything that you can share there in terms of what you've seen in other markets or how to think about what that might look like?

So it's worth noting that we were still here. We were here last World Cup. So we have something to refer to and understand the impact on. So we have a data foundation. We also have Euro subsequently. So this year, for the first time, we have 102 game format as opposed to 60-odd. So we have more content. We have all of those games in prime time, time zones. And we have a much more extensive footprint and a highly engaged betting active space.

And so we think we'll -- the tens of millions of dollars of revenues that we took last World Cup, we think we're going to do significantly more than that. But really, it's -- the World Cup is also helpful because of its timing. We're in the sports frenzy of the year now, now is the busy season.

Next year, it's going to be where, frankly, it's competing with baseball. So in terms of the ability to drive engagement and drive incremental NGR because really, if you're taking money from another sport, it's not really helpful. But the ability to drive incremental NGR is amplified by its timing. So we're excited about it. It will have a positive impact. And frankly, given our heritage, our sports product is excellent, really, really excellent.

And so when you say incremental, that's incremental in terms of new customers, more so than incremental spend or is it both?

Both. And look, this is a personal belief. I think the World Cup this coming year is going to be the thing that puts soccer more firmly on the map in the U.S. sports betting [landscape].

I mean they said that in '94. I mean the most popular bet will -- just talking...

Here's the [naysay].

The most popular bet is going to be, will somebody ever -- will anybody ever score that's going to be the popular bet for the...

You just find soccer boring. That's...

It will be fun.

So one of the big questions, I think, that we've been getting too for the entire group has been looking at handle, which is decelerating. I know that's not revenue, but you get to look at things a little bit more granular. What are you seeing in terms of looking at the market and trying to evaluate whether we're hitting maturity potentially earlier than people thought or where we are in that maturation in different markets in the U.S.?

Well, we're still growing, we're still growing nicely. Of course, coming off the back of such incredible year-on-year growth that we've been seeing, we would naturally -- our comps get much, much harder. So we would naturally see growth rates moderating, but we are still growing. NFL season to date handle is up 10% in our business this year.

But even with that, you cited some of the numbers around NGR being up over 30%. So even if we look at the older states versus newer states, is that mainly old states are all kind of in that same range?

The performance of the old states is actually very surprising, like New Jersey, the depth of the New Jersey market, both in sports and iGaming is astounding. And what we saw in October is actually handle growth was accelerated again, where it moderated in September. October, we saw it pick up again. So I think these things come in waves and cycles.

And we've got -- Missouri is about to launch. I mean, what other new states do you have on your kind of outlook or what do you think is possible? And how should we think about some of these new states versus the existing states in terms of the ramp?

So well, actually, we launched in Missouri on Monday. So that represents our 30th state, which is a nice round number and an important milestone for our business. We now serve 50% of the U.S. population with sports and iGaming.

In terms of the outlook, by definition, the further we get into state count, the more difficult and more complex unlocking those states become from a sports betting and iGaming perspective. Having said that, budget pressures are very real. I think the prevalence of the very visible prevalence of illegal markets in both sports betting and iGaming will put positive pressure on states to legalize because frankly, with the existence of -- I'll call out 2, with the existence, and I know we'll get there, of Sweeps casino and prediction markets, states are -- have no control, have no responsible gaming objectives and regulatory objectives satisfied and aren't making any money. That's not a great combination.

Since you brought it up, on the prediction markets, I mean, does it put you at a disadvantage to not be involved? Or how do you think about the prediction markets? I know there's been a public comments about, look, Nevada is part of the heritage, but what are some of the other things that you're trying to think about both near term and long term as you look at this market evolving as well?

Look, the real progress being made by prediction markets as we determine is, frankly, in markets where there isn't legal sports betting available. And why is that? As a consumer, I mean, for those that haven't, I'd invite you to try BetMGM's product, put it in your hand and try and do the same thing with a prediction market alternative, build a more exotic bet.

With BetMGM, with our competitors, you get the best you want, at the size you want, when you want it available immediately. End of, right? It's just so much more intuitive, smoother and a better player experience. And I think as long as that can -- is maintained and the rules would indicate that they will be maintained, we feel pretty good about our ability to compete in legalized sports betting markets, which is why our focus, frankly, is ensuring that all states legalize sports betting.

Right.

When you talk to investors, do you call prediction market, sports betting?

I do not. I say prediction markets, but sometimes I'll say aspects of it look, sound. We wrote a note looks like a duck. It sounds like a duck, probably a duck.

Probably a duck. It sounds like a duck. It's probably sports betting because the parlay product doesn't look like a prediction market.

I mean the interesting thing to look at is what the IRS is going to do because we've been looking at that and -- so if it looks like a duck, smells like a duck, should they be paying federal excise tax on sports betting handle and it's still to be...

I think right now is the future...

Well, no, there's -- so we pay as a legal sports betting operator, we pay a federal excise tax to the IRS for all -- it's a fraction of all handle. Should that be paid. And we should see where the big 4 auditors and the tax advisers come out on what the platform says one thing, what the IRS says is another. So it's an interesting place to watch, too.

Two things, just to pick up on that. It's the beauty of substance over form. It looks and quacks like a duck. The auditors, their role in life is to ensure that substance is clearly represented. So it will be interesting to see where they come out on this issue.

And the last thing, it's been a fascinating learning journey for me, the nuances and machinations of the relationship between the federal government and state governments. And one of the things that really, really sits in my mind is that Congress did not intend to hide elephants in mouseholes.

Right. And that's what's happening. I mean more directly put sports betting legislation to the states. Right. So I mean it's just interesting that the wheels seem to go so much in one direction when every sort of legal argument or even common sense argument says otherwise. No. We'll see how that plays out.

And we've seen different changes every single year. It feels like every 2 years, there's some big new competitor who's coming into the space. Nothing has really made a huge impact. Even now, it sounds like it's not having a material impact on anything that you're seeing in the business.

But I think one of the worries out there is that this money is being raised and maybe it gets put into the market in terms of a heavy promotion. How do you think about having to respond to that? And then maybe this is a good time to -- what are you doing maybe on the product side that will continue to evolve a product that maybe already is superior to make sure that it is staying superior?

Since past the fill in 2018, we've had lots of contenders. The next bright light, the next heavyweight, today, we've got 5 competitors who are really challenging for a place in this thing that's -- in the biggest sports betting market in the world, right?

And there's a reason for that because number one, it's hard. Number two, there are benefits of scale and efficiency. And number three, our offering and our value proposition is really good. And so in that context, just this season, we've improved our product dramatically. It is faster. It is more stable. We have enhanced discovery.

We've added meta information, so information about teams and players, which allow our players to get as informed as possible about the bet that they are considering. We have other things. We added NFL player props. We can -- you can now cash out your live NFL SGP during the game. There's a whole raft of things.

And also, one of the advantages of being part of the ecosystem that is Entain, MGM and BetMGM is that we benefit from the investments that both -- all 3 parties make. And so behind the scenes, back to the point you made or the question you asked about margin, behind the scenes, there is a big investment in trading and trading platform being made at Entain. We will be the beneficiaries of that. And we understand exactly where the impact points are and have scaled that, and that represents an opportunity depending on, obviously, when that lands.

The other thing that is going to be a meaningful -- it's invisible now, but the thing that is going to have a meaningful and positive impact is the combination of the investment and effectively rearchitecture of our data platform, BetMGM's data platform, combined with some work that we're doing on AI-driven personalization.

The idea is like why has our EBITDA this year improved so much? One of the reasons is the gains and improvements we've made in marketing efficiency. The combination of marketing personalization powered by our version 3 BI infrastructure and platform, we think that there's more to go for there.

And you talked about your total generosity, marketing variable plus promotions, do you want to help size that?

I'm not sure what we you said in the -- what we said publicly. I mean we've been fairly stable in the last 2 years. And we've made sort of a step down in our optimization of promotional work when we got into last year. But as I alluded to earlier, sometimes we'll float up. It depends. We have certain customers who like very high-margin bets. They get a different type of promotion often than our bigger stakers who play on a 4.6% margin. It's a different level.

So you talked about going after effectively larger betters, bigger players effectively. Is that changing any other aspects of their demographic either by age? Or do you see differences in geography? And maybe split that between sports betting and iGaming? Or is that even a relevant way to think about it?

It is a relevant way to think about it. Look, our strategies for gaming and for sports are somewhat different. In gaming, with the MGM brand that we proudly represent, we are an every person product. We are a leader in the market. We have 20-plus percent market share in the 5 states that we participate in.

We are the #1 gaming operator in Canada, right? So in relation to gaming, that is our strategy. And of course, that skews more balanced men and women because of the gaming product, fastest growing of that gaming product ecosystem is slots biases for more female participation.

Our sports business, as you'd expect, skews massively male. We're about 82%, 85% male depending on the period. And what surprises, I think what would surprise is that actually more than 60% of our players are under 39 -- under 40 years old. So while there is the -- Gary talked about the difference between volume and value. We have a big group of players who skew younger. But we have a meaningful -- I think relative to our competitive set, we certainly over-indexed at the top end and over-indexed at 40-plus.

Right. You brought up Canada and being a leader in that market. Alberta has been opened up. How do you think about that market versus Ontario and how to think about the size and the cadence of that ramping up?

Well, firstly, with the good news. The good news is we spoke to the authorities in Alberta yesterday, and they are indicating to us that they're on track for a late Q1 launch. I think that's ambitious. It will probably be late Q2. These things are hard when you get close to the finish line. But certainly, we're hoping for a first half launch.

Now Alberta as a province, as a jurisdiction, by population is about 30% the size of Ontario. Our internal models anticipate from a value perspective, Alberta to represent about 40% of Ontario. We also think the ramp versus Ontario will be somewhat faster just because of the profile that the success of Ontario has generated as well as the fact that our marketing and frankly, all of the marketing in Canada is nationwide, the way the media market works. So Albertans have been exposed to the work we've done to build the BetMGM brand in Ontario. So we think we should ramp and the province should ramp more quickly.

So there's a similar question for Missouri. I know it's only a couple of days in here, but any reason to believe that, that market will be similar or different to other new markets? I mean North Carolina was the last one. That was a super fast ramp. Missouri has a little bit of overlap with some other markets. So what are you seeing? Or what are you anticipating?

So Eilers & Krejcik, one of the industry analysts has estimated that in 2028, the market will be worth about $600 million of GGR, gross gaming revenue. We think the ramp -- based on what we've already seen, we think the ramp is going to be quite fast, largely because a lot of the value we've seen since days. So this is really a snapshot.

A lot of the value and the activity has come from players that actually signed up before the market launch. So based in Missouri, but signed up in Kansas or signed up in Illinois and now are playing again now, they can play at home.

So we think as a result of that dynamic, number one, thank goodness, we have a single account, single wallet. You carry on playing and it's seamless. But number two, I think we -- we think the net incremental new player will be less, but we will see more activity from existing players.

From -- and maybe changing back to some of the older states. In the beginning, it was all about customer acquisition costs, customer acquisition costs. As we get to a more, I want to say, steady state because obviously still growing fast, but what are you seeing in terms of retention? How has that changed versus your expectations? And are you changing the way that you try to dial into retaining customers or reengaging customers?

Yes. Last season, we saw a dramatic improvement in retention, and that was a combination of the approach to player reinvestment and the work that we've done on product. This year, we had -- what we saw was the first few weeks of the season were extremely competitive.

All of the bank players were throwing a lot of value at the market. And we saw, as a result of that, some softness in retention in those early week cohorts. That's gone. So from about week 7, we are now comping positively, meaningfully positively against the already improved retention rates from last year.

And the new players that we're getting are bursting out of the gates faster. So we're getting more precise in getting players, identifying the real money betters who are going to be with us for the long time, nurturing them and getting them going without overinvesting in players that may never get to that category.

And people always talk about these like LTVs, which is always tricky for a new market, right? So now you have a little bit longer time, you're seeing some of this retention. How would you characterize how LTVs in different states are compared to maybe your original underwriting or how you've been thinking about the size of the market?

I mean some of the states have -- there's differences in LTV across the states. Some of that's due to tax rates in different places, some of its proximity to Nevada and where we had a good MGM base to begin with.

But when we look at our LTVs, we -- I often say the metric is the model because within -- it's not like you're getting a SaaS customer, they all pay this license fee and they have this resubscription rate and blah, blah, blah. We have a pocket of really great players, middle players, and we have to blend that together. So we do an analysis of the cohort.

We look at them on our models that predict to the 36-month point or around that area to say where we're going to be. We're always above that level, I mean, better than that level. And then we look at what we see as our prevailing either growth or potential degradation rate over time. And we look at those to form the LTV and like we're comfortable that where we are is a good IRR.

And even if the acquisition period, the payback is 36 months, those are positive NPV cohorts. And so we look at that in aggregate. And certainly, each week's new hall, we run our models and we come to a view on that. But we always check it against the sort of long-term progression of the full set of cohorts.

Just to double down, that's a really important point. This is not a static fix it once and let it run. We look at every cohort in every state, every week. And we are constantly dialing up, dialing down where we fish for players, what channels are performing, which cohorts are performing. And we go where the players are and where the value is.

I want to ask a similar question that I asked on sports betting for iGaming, which is what are some of the big kind of product enhancements or things that you're changing in iGaming as you look at not only ending the year, but as we look at the year ahead?

So in iGaming, we think we've got -- we know we have real competitive advantage. We have competitive advantage through our omnichannel strategy. So our games portfolio focusing on the combination of successful retail games and porting them into digital and vice versa.

We've had some fabulous game launches, omnichannel game launches this year where we've taken BetMGM players onto the floor of MGM Resorts that they can have a real-life experience on a new game that we've launched online. It really works well. Our players love it. Alongside that, we have exclusive branded content, Wizard of Oz, The Price is Right, Family Feud, whole constellation of content around things which are only available at BetMGM. We've had a very, very successful launch recently.

Can you give that mix, the mix proprietary, sorry? What percentage of your mix of iGaming games are kind of proprietary to you all?

I don't know the answer to that right now.

It's under 10% now.

I think you're asking a different question. The way we think about proprietary is born and built and owned by ourselves or MGM or Entain.

Right.

There is another category which lives in the middle, which is where BetMGM owns the IP. We have built the game either with one of our -- one of Entain or MGM Studios or a third-party studio, and that becomes our own content. But the -- I think where your question was going is we still pay rev share on that middle portion, but they are particularly attractive.

And that was to the -- when I said that under 10% is where we don't pay any royalty to anyone.

Right. That's just, yes, purely yours. And then there's the -- what you pay maybe is some percentage above that.

There's games that no one can get anywhere but us, but that we'll still pay a rev share because of the content we've incorporated into our game.

Got it. And if you think about -- and I cut you off there. So there are other products or things that you're doing on the iGaming side that we should be thinking through next year as we think about integrating the business between iGaming and sports betting, iGaming and omnichannel or otherwise?

So really, really important points. One of the things that has proven extremely successful for us is our engagement tool strategy. We have built proprietary games where -- which has led to the average, and this is -- I think I've shared this before, but the average number of days in a week of our iGaming population is over 4.

So on average, our players enjoy BetMGM 4 out of 7 games in a week -- 4 out of 7 days in a week. That's a lot. And part of that recipe is the stickiness and success and attractiveness of our engagement games.

Then the other success that we've seen this year, which you signed posted, so thank you. The other success we've seen is in the world of cross-sell. So our cross-sell, the percentage of players that start in sports and then move to -- and enjoy gaming something in our world of gaming has gone up by a full 10 percentage points year-on-year.

So now we are cross-selling at a rate of north of -- in an average week, north of 60% cross-sell from sports to gaming in an average week. And that's partly because of our -- again, the gaming -- sports branded gaming content. So our Steelers games, our Lions games. This is how we use our relationships with our sports teams to create incentives and hooks for our gaming players to cross-sell back into sports. And so -- and that's been very successful as well.

So as we work down the P&L, I mean, it sounds like there's also opportunity within margins. I mean, you're talking about this big inflection that's happening. As part of that, I think the technology could be a benefit. Maybe talk to how you think about opportunities to leverage AI? Is that more of a top line driver? Is it more of a margin driver? What are the biggest pockets that you're trying to implement?

It has to be the AI question.

We got pretty far before -- I think it can wait...

I think the AI is going to be helpful in a number of areas and very practical areas. I'm not anticipating not needing anyone in BetMGM and my agent runs the business. That's not what -- we're not there yet. Where we see there is value is, of course, in the areas of responsible gambling, so understanding player behaviors and patterning, which would then highlight where there might be an emerging issue, an emerging responsible gambling thing to look at.

The other areas, of course, are in the areas of customer contact. So things like chatbot automation, AI-driven chatbot automation, intent recognition. There are also -- we think there are opportunities, and we're exploring opportunities in the world of trading.

Creative design, we have zillion pieces of art that come together across ads and cannot be automated. We have zillion regulations by different states and document management tools and things like that. So there's lots of just G&A type administrative things that it provides opportunity for savings on it and expedited responses to different requests.

And this is the last one I'll specifically refer to. The world of -- our business gets more efficient when the big numbers become even more precise, okay? Our big numbers are what we spend in marketing and how much we reinvest in players. And the world of AI in terms of personalization is really interesting.

So I referred to the re-architecture of our business -- of our data platform. The combination of that with the CRM tool that we are connecting it with will allow us to drive a degree of hyper-personalization that we've not seen before and at the heart of that is our AI tool.

And is that an LLM that you've built? Or are you leveraging kind of third parties?

Third parties.

Okay. And how do they structure those? And maybe I don't know if you can disclose that, but is that usually based on some sort of a fixed fee or use cases? Or is that a percentage of revenue? Or is that something we should be considering in your margins at some point?

The deal doesn't scale up with revenues. So adds another element of why the operational gearing and the value of getting bigger.

One of the other things that I've often thought about within this whole space is that you have all these people who are on your app, and you talked about 4 out of 7 days a week engagement. I'm sure there's a pretty lengthy period of time that they're on the app as well. Are there ways that you can use that to monetize eyeballs effectively in other ways? Or are we still a ways from actually monetizing and through advertising on your...

I'm a bit of a purist on this one, Steve. I feel like our players want a gaming experience, want a sports betting and gaming experience. I don't -- other than...

I tend to eat pizza when I'm watching football and betting on football.

We could sell [995 prime rates].

While I understand the attraction, I feel like the elegance of a premium and dedicated experience is very BetMGM. And I'd rather make my money by being amazing at what we do than try to monetize in adjacent verticals and disrupt what really is our core transactional experience.

Fair enough. Another question that we get from folks often is the age-old question about your parents who are in the room, parent companies. We've heard both of them describe their pitch for why MGM and Entain are kind of the -- I don't want to say rightful owners, but how has the relationship with each of them evolved? How do you think about what you get from each party?

So the relationship has strengthened individually and together. And one of the -- success begets success actually. I remember in the early days, Jim Murren, the previous Chief Executive of MGM Resorts said, the sports betting and iGaming thing, it's kind of an amenity.

It's not an amenity anymore for either company. And that's a great thing. It's a great thing for me. It's a great thing for BetMGM. Why? Because the attention that the biggest regulated market in the world deserves is being committed. We get the attention that the opportunity needs, the opportunity to compete at the very, very highest level requires.

And so that is important for both Entain, I think, and for MGM Resorts. The Board dynamic is fantastic. The Board dynamic is about, well, how do we make this better? How can we support the business? And that's from everybody. And the dialogue between Entain and MGM Resorts, your should speak to them. What I observe is that it's regular, it's clear and it's positive. And so I couldn't ask for more.

Look, operationally, we've been doing this for a long time. It's the only thing we've ever known. So we are one big company. It's not like we're some Frankenstein that was put -- look we BetMGM 7 years of doing this. We know each other. We know -- the lines between things are -- it's just one big circle around BetMGM.

How soon are you writing checks back ?

For sure. Yes. They pay our allowance. Now we're paying their allowance.

So I guess on that point, how do you think through capital allocation as we do see EBITDA ramp, I mean, what are you going to do with some of that cash? What would you want to do? Is there things that you'd rather reinvest in a more material way?

Gary, in terms of capital allocation, Gary says, well, the first 20% goes to Gary.

Yes. I mean the plan is we're going to push money back to the parents every quarter. And certainly, if some investment opportunity that exceeds our in-quarter ability to generate cash is needed, we have access to $150 million revolver. And then obviously, we can go back to the parents and flow the cash back if we had to, if we wanted to.

But now we are consistently cash flow positive. So really, it's cash back to shareholders and then we see what the market requires.

No, we're about out of time, but I want to ask one more question. Somebody outside right before this had said this to me, you know what, I'm going to throw this question out there, which I kind of have my own view, but it's a question of what is the competitive moat of your business? And they were talking about sports betting broadly. They just were having a tough time. I think it was in the context of prediction markets as we talked about. But maybe just thinking about sports betting and iGaming, how do you think about your competitive moat?

So we just launched with Jon Hamm at the center, Jon Hamm, our new brand ambassador, we launched our "Make it Legendary" campaign. And now for me, that is the essence of what BetMGM is about.

At our core, we bear the name of MGM where, frankly, the heritage is amazing experiences and premium, entertainment-centric. And so what we want and what we aim to do is create those legendary moments but execute with precision, execute with personalized experiences all the way through the journey.

So what you get as a player in terms of reward, what you get in terms of communication and how your product looks and feels in your hand. We've done this, as he said, for 7 years, and I think we are pretty good at it now. So I think as new entrants have tried to come and eat our lunch, we're happy to defend.

And we also are advocates of enforcement of the law.

Well, that's a good place to stop. Thank you so much. Please join me in thanking both Adam and Gary for all the time today, BetMGM, thank you.

Thank you.

Good afternoon, and welcome to the MGM Resorts International Third Quarter 2025 Earnings Conference Call. Joining the call from the company today are Mr. Bill Hornbuckle, Chief Executive Officer and President; Corey Sanders, Chief Operating Officer; Jonathan Halkyard, Chief Financial Officer and Treasurer; Gary Fritz, President of MGM Interactive; Kenneth Feng, Executive Director and President of MGM China Holdings Hubert Wang, COO and President of MGM China Holdings; and Howard Wang, Vice President, Investor Relations.

[Operator Instructions]. Please note, this call is being recorded. Now I would like to turn the call over to Mr. Howard Wang. Please go ahead.

Thanks. Welcome to the MGM Resorts International Third Quarter 2025 Earnings Call. This call is being broadcast live on the Internet at investors.mgmresorts.com, and we've also furnished our press release on Form 8-K to the SEC.

On this call, we will make forward-looking statements under the safe harbor provisions of the federal securities laws. Actual results may differ materially from those contemplated in these statements. Additional information concerning factors that could cause actual results to differ from these forward-looking statements is contained in today's press release and in our periodic filings with the SEC. Except as required by law, we undertake no obligation to update these statements as a result of new information or otherwise. During the call, we will also discuss non-GAAP financial measures when talking about our performance. You can find the reconciliation to GAAP financial measures in our press release and investor presentation, which are available on our website. Finally, this presentation is being recorded.

I will now turn it over to Bill Hornbuckle.

Thank you, Howard, and good afternoon, everyone. Our industry is constantly changing, and MGM is always moving forward, proactively navigating with agility and allocating capital with discipline to best position our company for future success. One example of our capital discipline was a challenging decision to withdraw our application for commercial license in Yonkers, New York. We dedicated significant time and resource over the last several years to this project adjusted along the way with our best efforts to make the project work for all parties involved. We have been and continue to be a proud partner of the city of Yonkers and the State of New York. We remain committed to operating the property in its current format and believe it will continue to enjoy success serving customers in the Hawkers and surrounding communities.

Also, we have been consistent in our focus on premium best-in-class market-leading integrated resort operations and have held true to our message that we will optimize our portfolio when the right value opportunities are presented. This was the case for Northfield Park, which we are selling for $546 million in cash. You may recall, we acquired the operations in 2019 for $275 million. We have grown the business and create significant value over the last 6 years. And importantly, the sale multiple of 6.6x represents a significant premium to MGM's current share price which values the opco business at less than 3x.

This company's diversity is also a true benefit, and then all the headlines or concerns about Las Vegas and the general consumer MGM's consolidated net revenues grew this quarter, thanks to the geographic and channel diversity of our business.

I've spoken in the past about the evolution of Las Vegas and that over the last 30 years, the market has grown at a CAGR of over 4%. Of course, that growth ebbs and flows over shorter measurements of time. And this summer, we heard from some of our guests around value in Las Vegas, and we responded by making adjustments to ensure a rationalized premium value experience across all of our properties.

We also partnered with the destination on a fabulous 5-day sale during which we sold over 300,000 room nights nearly double our typical pace, reflecting the strong demand that exists for our experiences. There are additional factors presuming the current visitation dynamic, including international visitation, particularly from Canada, Southern California drive traffic and the recent Spirit Airlines bankruptcy, resulting in several canceled routes. We are still expecting to receive over 40 million visitors to Las Vegas in 2025.

While we don't expect the dynamic to be changed overnight, we are proactively working to create initiatives and draw incremental visitation. Despite these headwinds, several of our luxury properties generated record 3Q slot win. As we look to the fourth quarter, we see signs of stabilization as the luxury market segment continues exhibiting strength, Groups and conventions are returning and all MGM guest rooms will be upgraded and back online and F1 ticketing presales, particularly for the Bellagio Fountain Club are pacing higher versus the prior year. All of which puts us on a solid footing as we approach 2026.

Over 90% of our target groups and conventions are contracted for next year, and the first quarter starts off strong with ConAg continuing into the year with other citywides. We also built off the 900,000 room nights we are facing the book through our Marriott partnership this year. And I'd note, October is shaping up to be the strongest room night month ever for forward bookings originating from the Marriott channel. We'll have a full year in 2026 to benefit from the group and convention initiatives launched in the second quarter this year that will allow us -- that will allow meeting planners and attendees to earn Marriott Bonvoy loyalty Perks.

In the meantime, we continue maintaining an oversized share -- room nights and rate relative to our Las Vegas competition. As visitation ramps up in Las Vegas, we fully expect our advantage will be maximized by the outside efforts of our employees who achieved our highest-ever 3Q gold plus NPS scores despite continued disruption from the MGM throughout the quarter, which, again, now has ended.

Our teams in the regional markets drove another quarter of solid results. Several regional properties achieved record 3Q total revenue and EBITDAR and the regional operations as a whole generated all-time record slot win this quarter. The targeted capital to create and elevate VIP experiences at Borgata but a notable role again as a casino GGR growth outpaced the market during the quarter, and the Borgata posted all-time high table game shop and slot win.

In Macau, even a brief closure caused by typhoon wasn't enough to stop the positive momentum as MGM China achieved record 3Q EBITDAR. Our contributions are leading McCaul's evolution in the entertainment destination including the Macau 2049 residency Show at MGM Cotai and the Poly MGM museum at MGM Macau, all while staying focused on understanding our customers, particularly our focus on premium mass. The high end continues to drive market growth and quarter-to-date, we've seen a great response to the Alpha Gaming Club at MGM Macau, which officially opened in late September.

Similar to the elevated experience provided by MGM Cotai's Matching 1, MG< Macau's 3,500 square meter Alpha Gaming Club includes nearly 30 tables, dedicated restaurant cigar lounge and located just below the newly designed alpha bills. With more nongaming and entertainment events taking place in Macau, customers now have more reasons to visit and continue to drive growth into the market.

The later 2 drove accelerated revenue growth for this segment which in aggregate -- grew top line by 23% this quarter and saw a priority market collectivity growing in line with TAM or higher. Our European Bet MGM reached a new all-time revenue high in 3Q, we've improved profitability driven by customers' growth and market share gains.

Even though the success has been offset by increased investment in Brazil, we are seeing quarter-over-quarter growth with healthy player fundamentals. Notably, growth has been driven around key metrics of retention, which is exceeding even some of our healthy mature markets. We have a great relationship with our local media partner, Grupo Globo, and are taking a disciplined investment approach for long-term brand positioning and profitability. We expect that to gain market share and reduce our gross spend in the future and MGM Digital has an opportunity for $1 billion in revenue with a significant margin, driving double-digit returns on those investments.

Progress in Japan continues for 2030 opening, and we remain confident in our ability to generate a high-teens return at the time of opening, particularly as the only integrated resort in Japan, a country of over 120 million people. As of early this month, all elements of this project were under construction and at 1 time, there are 60 to 80 cranes and other pieces of heavy equipment on site. We also recently entered a USD 300 million equivalent yen-denominated credit facility at very attractive rates to support our funding commitment to MGM Osaka.

And then Dubai also continues to make progress with an expected opening date in the second half of 2028.

With that, I will now hand it over to Jonathan to provide additional detail on our performance this quarter.

Thanks, Bill. And I'd like to echo my appreciation to all of our employees throughout our operations globally for their hard work and dedication. The effort does not go unnoticed and truly is the driver behind everything MGM achieves.

This quarter, the Las Vegas segment reported $601 million in EBITDAR and down $130 million year-over-year. The bridge to that shortfall includes 3 main parts: there was $27 million in decreased business interruption proceeds together with an increase in insurance expense due to increased reserves, $25 million in disruption from the MGM Grand Room renovation and $78 million from the impact on operations, primarily related to occupancy and ADRs.

Roughly half of that operations impact can be attributed to Luxor and Excalibur and $6 million more can be attributed to lower hold year-over-year. The balance is attributed to softer ADRs and a decrease in occupancy, which affected volumes in food and beverage in some of our properties. This operating environment has provided an opportunity for us to focus on our cost containment efforts, and we've been able to reduce certain costs alongside top line fluctuations.

Net revenue in Las Vegas declined 7% but we managed expenses down accordingly where possible, including FTEs that also decreased by 7%. As we look into the fourth quarter, we're seeing improving room rates. We also have the benefit of all MGM Grand rooms online and newly upgraded in time for the group and convention season. and we're seeing strong group demand in November and December, driving stabilization in our business.

As we look to next year, the 2026 group and convention channel has the ability to drive growth. Currently, future bookings are pacing up in all outer years, while attrition and cancellations are in line with historical averages. Regional operations had another steady quarter as we grew net revenues modestly. EBITDAR was down $4 million related to a decrease in business interruption proceeds of $6 million year-over-year. Beyond that impact, the results were very solid.

MGM China continued its impressive run with record third quarter EBITDAR despite an estimated $12 million typhoon-related impact in September. We also ended the quarter with record market share of 15.5%. We continue to benefit from MGM China's strong cash flows with an $85 million dividend paid to MGM Resorts in September.

As we look to fourth quarter in Macau, we experienced year-over-year growth across segments during the Golden Week holiday period with visitation up 11% and total win up 20%. For the month of October, we're pacing to a 16.5% market share and well over $100 million in EBITDA.

Our Bet MGM North American venture reported outstanding results and also announced that prior to the end of the calendar year, it will begin distributing cash back to MGM Resorts with the expectation of doing so on a quarterly basis going forward. We expect to receive at least $100 million in the fourth quarter from our $630 million total investment with more to come. The business model is proving out within just the last 12 months, we've witnessed the evolution from positive EBITDA inflection, then to solid growth trajectory, and now to a business generating ample cash capable of funding growth and cash distributions.

MGM Digital reported revenue growth of 23% during the quarter, while segment EBITDA was a loss of $23 million. For the full year, we now expect MGM Digital to have EBITDA losses that could approach $100 million given our increased investment in Brazil. Though keep in mind, the actual contribution is consistent with our stake in the Brazil venture, which is roughly 50%. The venture has seen encouraging growth quarter-over-quarter throughout the year in active players, deposits and GGR. In our fourth quarter initiatives, including launching our in-house Sportsbook and continuing to increase the scale of the business, focusing on efficient returns.

In Japan, construction continues making practice. We've recently raised a yen denominated Term Loan A at the MGM Resorts level equivalent to USD 300 million at a borrowing cost of approximately 2.5% as of this month. This facility also has the ability to upsize to $450 million and we're already receiving incremental interest. We'll use the proceeds from this issuance to cover our equity contributions for MGM Osaka at least through next summer.

Finally, we continue to see significant value in our share price. In this quarter, we were able to provide yet another transaction precedent to further evidence the attractive valuation, when you strip out the value of MGM China at market value and assign a consensus value to the BetMGM North America venture, which we still view as very conservative given the current trajectory, you end up with an implied multiple of under 3x trailing 12-month asset EBITDA to say nothing of the value of MGM Digital, a business that's capable of $1 billion in run rate top line with double-digit EBITDA margins and this compares to the 6.6x announced sale multiple for Northfield Park operations in Ohio, which, if applied across the board to our brick-and-mortar business, inclusive of Vegas, which arguably deserves a higher multiple in the regionals that would imply a share price of approximately $60.

I'll open it back to Bill.

Thanks, Jonathan. Fairly, I followed over a page, which I would like to spend a second on commenting about our digital business. before we take your questions.

I know a few weeks ago, you all heard BetMGM's venture reported strong 3 quarter results and raised our full year guidance for the second time this year. increased 2025 EBITDA guidance to approximately $200 million represents an EBITDA increase of roughly $450 million in just 1 year without any new jurisdictions. Importantly, BetMGM will start returning capital MGM Resorts with an expected initial cash distribution of at least $100 million in the fourth quarter.

I also want to follow up on BetMGM's recent comments about prediction markets. For decades, the gaming industry has been a highly regulated at the state level. This intense scrutiny has been essential to ensuring the integrity of the gaming industry and in the case of sports betting, helped to identify potentially irregular activity. This is not the time to back away from these high standards. Gaming historically has been and should continue to be a highly regulated industry with safeguards in place to protect consumers and promote integrity.

I also want to take a moment and thank our Chief Operating Officer, Corey Sanders, who will be retiring at the end of the year, making this his last earnings call. I'm sure many of you on this call spoke to Corey frequently throughout his tenure. It's impossible to overstate what Corey has meant to this company over the last 30-plus years. As a person, as a leader, Corey understands the importance of caring for employees and treating people with respect. We all want to thank you, Cory, for your dedication, your service and your leadership and let you know that you will be deeply missed.

In closing, I want to stress that MGM is the only global operator across physical and digital channels, converging gaming and hospitality with entertainment and sports delivering diversified growth at scale. We have proven to be disciplined allocators of capital, and we'll look at any opportunities with attractive returns, including share buybacks.

And in Las Vegas, it's worth repeating, we are focused on what we can control and are well positioned to adapt given the range and diversity of our luxury offerings. We stabilized -- we see stabilization in the fourth quarter and growth in 2026 and beyond. And over the long run, we see a measured supply outlook, a growing local population, expanding entertainment infrastructure rising demand for live entertainment and for luxury, and we remain very bullish on Las Vegas.

And now operator, if we could open it up for questions. Thank you.

[Operator Instructions]. And our first question will come from John DeCree with CBRE.

I'm sure we'll talk quite a bit about Las Vegas, but maybe to start with your decision to exit New York. Obviously, it was a set focus of your orders for a while. Bill, I know you get some prepared remarks, but curious if you could elaborate. Was it just investment sizing, you put out a press release, but anything else you could kind of tell us there? And then my follow-up with the swing in liquidity. How should we think about MGM's kind of return hurdles for investment going forward with New York didn't quite pencil out?

Sure. look, there was originally a concern with -- and I think most of you know this, between ourselves and resorts, we basically had a guarantee to Whether we did the tax or not, we had to make whole, on the education fund, we had to make whole for the horseman. And ultimately, we struck a deal with the city of Yonkers, which meant we would have had a minimum tax of about $400 million. So that was our first hurdle. We knew that, but that remained a large hurdle.

As we then began to understand the landscape and particularly as it's looked more and more where the competitive set would land, it put further pressure on the deal further pressure on the numbers. And I think the thing that concerned us probably the most was at the end when we thought we were buying for a 30-year license and were told it was [ 15 ] and it was done after we've made an original submission that was concerning because if not for that, then what else. And so while we initially like the return, it got tighter and tighter so much so that given overall market conditions, we think it's capital best spent some other location and some other opportunity.

And John, it's Jonathan. On your second question in terms of our return thresholds. I mean, given present circumstances with our share price, our return thresholds are pretty darn high. I mean we can capture free cash yield, just in repurchasing our own shares. I don't have the math in front of me, but it's probably 25% or 30%.

One investment we're very excited about is our project in Japan. And despite Sarah's great efforts in securing this yen-denominated facility, which will get us through next summer, and we'll be investing in that project in late '26, '27 and '28. But this is a project that we think probably has the most favorable supply-demand dynamics of any integrated resort. So we're very excited about that project.

Otherwise, we're being -- we scrutinize our capital investments very closely, the growth capital investments that we have opening shortly in Las Vegas, like Carbon Riviera, Jim Cana, and the rest, we think are going to drive very nice returns for us. But we have a high return threshold right now as compared to simply buying our own shares.

And Corey, congratulations on your retirement. It's been great working with you over the years. Congratulations.

Your next question will come from Shaun Kelley with Bank of America.

Also I'd like to offer my congrats to Corey, and we enjoyed working with you for that. So if I could just build on the last question a little bit around -- sort of the high ROI threshold, Jonathan, that you mentioned. I think the question we get over and over again is, obviously, I think we know the trajectory of land-based gaming in the U.S. we think a lot more about the growth in digital that you're experiencing. Does the turnaround -- and so there's going to need to be a balance at some point between value today and a lower cost of capital but -- or a higher cost of capital, the growth that you could achieve looking to a digital future. So just trying to kind of get your current sense on how you -- how you kind of prioritize or balance that? And just sort of your thoughts on doubling down on digital given, I think, the stability we've seen from the BetMGM team, obviously, lending itself to being able to return some capital to you.

Yes. Thanks, Shaun. The interesting thing is right now, our digital investments are cash generative as opposed to cash consuming. We're in a very much a growth mode in MGM digital as it relates to our BetMGM brand expansions over in Europe and in Brazil. But the kind of the Corio Vegas business together with, of course, BetMGM and North America are both generating now pretty substantial cash flow for us. So it's not requiring a digital investment. And as it relates to other additional investments in digital, we're really just focused on growing the existing businesses we have right now as opposed to doing any kind of inorganic growth.

And then just as my follow-up, obviously, throughout the prepared remarks, you guys weathered pretty challenging Q3 environment. A lot of talk about Q4 stabilization as the group calendar comes back. F1 sounds encouraging. So just can you help us kind of put it on a spectrum of what -- like we hear stabilization? Is that getting better sequentially? Is that potentially flat in the 4Q? How much better could it be? Or do you really need like a bigger group calendar like we expect to see in Q1 potentially see some growth in the Vegas segments just given some of the calendar issues that you're up against in Q4?

Shaun, I'll kick it off, and obviously, my colleagues will pile on here. It has been sequential. Obviously, July for everyone in the community was a rough month. The summer was rough, but it sequentially got better. I will say the same about October. Knock on wood, we may even be October of last year. And recognizing the fourth quarter last year was like an all-time fourth quarter.

So all that being said, F1 does feel good. leisure activity is there, we obviously can generate through value. We saw it with a fabulous sale. We literally doubled the bookings in that particular week. So we feel better about it. There's a lot out in front of us. The FAA in its considerations with the government shutdown may or may not have an impact. It has not, to date, thankfully. But there's no precursor to what that will mean for the next 6 weeks or so.

But I think overall, we feel positive. There's a couple of weeks in December with leisure that is a hole that we need to -- we want to continue to push on to see how we fill. But sequentially, we feel better. And we use the word stabilization not lightly. We think we can get there.

Next question will come from Brandt Montour with Barclays.

Just starting off in Macau, the stats you gave for October were really impressive, obviously, implies share gains, and you gave the share number. But some of your peers have been more aggressive recently and they've been sort of public about that. And I know the EBITDA is there for you, you gave that for the month of October as well. But have you had to change your strategy at all? And is that sort of imputed in the share numbers that you have here?

Kenny, why don't you take that?

Yes. Okay. This is Kenny. Thank you for your question. Actually, competition is not new to us at all. We see rational competition in the market that operates like a folks operators are focusing on like offering quality products and bringing in accident services for Macau visitors.

For MGM China, we -- as we always said, we are focusing on understanding our customers like conducting CapEx project and improving our services to refresh and fine-tune the prices for our premier customers. For example, we have fully launched our 4 -- and the 5 clubs and the fantasy product at MGM side. There is no such competitive products in the Macau peninsula market. These products, the key that these products truly reflect our understanding of our customers, they are well received. Like Ma market in January looks pretty optimistic for October.

But for MGM China, we believe we anticipate we will deliver one of the strongest months in terms of GGR and the EBITDA performance at our company's history. So currently, what we are focusing on is we are focusing on the effective projects. Like on Cotai side, we are trying -- we are doing like we are converting 160 rooms to 63. Majority of them are 2-bedroom saves. So construction has started. We targeted to complete in the first half of next year. We believe these 60 spaces will -- to the evolving taste of our customers. And we are also developing some other high-end gaming place. places at MGM Cotai side as well. We hope we can utilize this our advantage, which is our deep concerning our customers. We are acting quickly and to maintain our market share. in the mid-teens in Macau.

Okay. That's great color. And then back domestically, you guys had a saving program of about $150 million. Some of that was taking price in certain areas. And I was hoping you could give a refresh on that program and sort of if you had to sort of change things around, given some of the consumer awareness of prices in Las Vegas and if that was something that had to be adjusted and how you're faring there?

Yes. We are kind of deep into that program now. In fact, most of the actions, the vast majority, let's say, over 90% of the actions that we set out really about this time last year are complete. And I would say -- and I don't want to speak for core or Bill, but in my opinion, there's really nothing we would have done differently on the -- kind of on the customer value side than what we did. In fact, many of the things that we did were in response to what we were hearing from our customers and the kinds of things that they were and were not willing to pay for A lot of our activities also were in just the daily blocking and tackling of labor management and procurement and those types of things as well. I certainly wouldn't undo any of that because I don't think they in the end really had a customer impact.

And just maybe a more global view on the whole value. Look, we lost control of the narrative over the summer. I think we would all agree to that in hindsight. When we look at the $150 million, we think about resort fees and parking and some of the other things that were fee-based inside that number, those have remained as and in place. When we think about pricing and things that got everyone's attention, whether it's the infamous bottle of water, where Starbucks Coffee Excalibur cost shame on us. We should have been more sensitive to the overall experience at a place like Excalibur to those customers. You can't have a $29 room and a $12 coffee. And so we've gone through the organization. We think we hope we believe and we price corrected. I think the sale that the community did and we participated in a meaningful way, demonstrated we -- test value we're going in Las Vegas and will always be that. We'll always need to be that. And so I think we've positioned ourselves for that, and we'll continue to do so going forward.

Next question will come from Dan Politzer with JPMorgan.

I was wondering if we could talk a little bit about Las Vegas through the lens of the high end and low end. Bill, you mentioned luxury properties, record slot handle there. and then kind of juxtapose that with Excalibur and Luxor. Have you seen maybe a widening in the performance between the segments of your portfolio? And if so, kind of what are the adjustments or levers you can make going forward to kind of keep everything on the growth path?

I think the core answer is yes. I don't think that's unique to us or our industry for that matter. But yes, look at Bellagio, ARIA, Cosmopolitan have continued to maintain rates, continue to maintain ADRs, generally speaking, in a tough environment. you lose 400,000 seats in a marketplace over the summer, principally around Spirit and spirits of value or airline that speaks to a marketplace that we potentially lost. When you think about what's going on in the country and you think about Southern California market, heavily Hispanic, I think our drive -- I don't think I know our drive traffic was down in the summer. And so that had presented and continues to present somewhat of a challenge. You think about international visitation in Canada. And while we're all trying to do things to make that better, I don't think that's going to go away anytime soon.

And obviously, that's really across all of our marketplaces, the international piece, but it also impacts, I think, to a degree, for sure, Luxor Excalibur, which is the 2 properties that we struggled here in Las Vegas the most. I don't know, Corey, if you have some more color.

Look, I think you look at the Bellagio, it seems to be -- you wouldn't know anything was wrong with it. We're able to fill the hotel rooms. The gaming volumes are high-end players is where it has been in the past. Weekends for everywhere, we were able to get occupancy. Rates sometimes a little more challenged than it was last year, but still we're able to fill the hotels. And this midweek when the convention base is not here, it's really Luxor and Excalibur, that probably have the biggest challenges of occupying rooms.

Got it. And then this is a higher level 1 for Bill or Jonathan, whoever wants to take it. Obviously, there's been a few deals on the M&A front lately that you guys have been involved in, but I guess can you just talk about the appetite for a more diversified cash flow stream as you think about the things that you're seeing in your portfolio now? And obviously, the balance sheet is in good shape right now, but if something did come across your plate, what are kind of the thresholds we should think about that you guys would kind of go to kind of take advantage of that?

Well, I'll talk about 40,000 feet, and Jon I can think about the actual threshold. Diversification, we've been saying it all along is key. We think we have the opportunity, given our scale, scope, breadth and knowledge to participate in many pieces of this marketplace. We think we do best when we're creating things that are at the highest end. And I think a lot of the recent things we've done in Macau proved that to be the case. I think ultimately, what you'll see in Japan will prove that out to be the case. We are obviously in the digital business in a big way, the combined businesses next year will probably do $3.5 billion top line. And as we've said, time to tell bottom. All that said, diversification is key.

We have a large Las Vegas concentration which we understand and we manage to and -- but we will continue to look. I mean, obviously, right now, the value of our stock, you just -- I mean, when we're trading under 3x for our core business, not to continue to buy back our own stock. It doesn't make -- it makes all the sense in the world to us for today, but I'm sure the market because it always has, will readjust itself and other opportunities may come up.

I think, our -- one of the pretty things about the performance of MGM China, for example, and BetMGM, and we expect MGM Digital as our company is becoming more diversified rather than less as those relatively smaller business businesses grow at very high rates. With respect to M&A activity in the regional markets, between Goldstrike and Tunica, over $100 million EBITDA business, Northfield Park over $130 million EBITDA business. These are big businesses, but yet they are ones that we don't think have the growth to represent the scale of the regional portfolio that we aspire to have. So it's a pretty high bar for us to look at any additional regional properties. They have to be, of course, of the quality consistent with our brand but also of a scale, and they're just in any market that we're not in. So it's a pretty high bar for regional M&A, I would say.

Next question will come from Steve Wieczynski with Stifel.

So what as the strip leisure recovery question maybe a little bit differently. So if we think about the next couple of months and fully aware, the booking window is a little bit tighter right now. But are you seeing a major difference in the booking patterns for that FIT visitor between your different properties. You talked -- you touched on this a little bit, Bill. But meaning is demand at Bellagio, Cosmo, ARIA, whatever you want to think about it, all really strong and you aren't seeing the same thing at the other properties like New York, New York, Luxer, et cetera? Or moving forward, are the booking patterns starting to become a little bit more similar across all your assets there?

I think the luxury booking patterns are similar to what they've been in the past. The core is -- and the legacy properties are booking a little bit differently. So where we used to book a ton of that in 30 days, we're seeing some of that book out a little further.

Okay. Got you. And then, Jonathan, to your last kind of remark there. If we think about the rest of your regional portfolio now after the Northfield sale. Just wondering how you view the rest of your regional assets at this point, meaning would any of the remainders be for sale? Are they all for sale at the right price? Just any high-level thoughts there about kind of rightsizing the rest of that regional portfolio would be helpful.

That's a top question with my CEO in right but I'll...

I mean, sure, I guess, at some price, all properties are for sale. But I would say that our regional portfolio right now, they represent pretty much in every case, market-leading properties with very nice importation into Las Vegas. Most of them very important BetMGM omnichannel locations as well. So we like that regional portfolio a lot.

Yes. And of the 7 -- 5 of them, our market leaders that they dominate anywhere from 25% to 47% of market mix in those particular -- the markets that they serve. And so we think of them, whether it's Borgata or the Bow in Mississippi as highly representing our brand well, market leaders independent of anything else we do, they stand on their own and they do quite well.

Obviously, to Jonathan's comment on digital, it's important in most all of those states. A couple of them are not. Obviously, we've talked about New York. And so how to think about that long, long term, time to tell. But one day at a time, we've just come off of the -- we're not going to push forward for today in New York.

Your next question will come from Stephen Grambling with Morgan Stanley.

Just want to follow up on Dan's question, but perhaps from the opposite angle. You talked about the undervalued nature of the stock. So what do you view as the primary levers or path that you could pursue to unlock value from here? And I know you referenced diversification, but is there also a path of simplification to consider? And if there are, what do you think is the kind of the lowest hanging fruit as we look across China, BetMGM, digital or otherwise?

Let me kick it off and then Jonathan be up. Obviously, digital and the unlock over time of BetMGM is something that we'd contemplate and that's not a surprise to anybody on the call. And so we're constantly talking to our partner about how we can all get the best value of what has been created there. which is a tremendous business. I think that's very real. Look, we enjoy our position in Macau. We particularly as of late. I think the team has done an amazing job there. You all know we own 56.7% of it. And so we've had a 20-year relationship with Pansy Ho, and so I don't see that changing anytime in the near future. If we can diversify and continue to grow our digital business and obviously, when Japan steps in, it's going to outweigh this -- but if we could continue to grow our digital business, it will become more and more of a performer and more and more of what's important to us -- but that's probably the place that we most think about diversification.

Yes. And I think it's generating cash flow through our dividend stream from MGM China, now dividends from BetMGM. And then the other thing I'd say is we've, of course, talked a lot about the last quarter in Las Vegas, but we still think Las Vegas is a fantastic market, and we love our position here. We have a better cost structure than we've ever had in Las Vegas. And so with the dynamism in this market, I think that that's an unlock also for the stock.

That's helpful. Maybe 1 quick follow-up since you flagged digital unlock with BetMGM first. Are there any organizational changes or bylaws to consider that need to be thought through as we think about the timing or path?

No, not really. Look, we have a great relationship and partnership with our folks and friends and Entain. We constantly think about ways to improve that business. But no, there's nothing in that context that we need to unlock it.

Your next question will come from Barry Jonas with Truist Securities.

First off, congrats, Corey. It's been a real pleasure working with you over the years. I wanted to start on a strip question on the 2026 group outlook. I know the homebuilders conference is not in town for just next year. But that definitely doesn't seem to dampen the enthusiasm we're hearing for growth. So ConAg obviously, returns. But are there other specific large conference call outs you could share so we better understand what's driving the growth outlook?

Yes. Barry, we'd have to look and get back to you on the large conference call outs that I could tell you, our mix is going to be better next year. We're going to have more room nights. First half of the year is going to be extremely strong. First quarter and second quarter will be north of 20% convention mix, which allows us really not only to fill all of our rooms but even potentially yield up our rates.

Understood. Okay. And then just as a follow-up. There have been some talk about increasing promotions in the regional markets. Curious to get your take on what you're seeing there. just in the regions and at the strip, you're seeing anything there as well?

Look in the regional markets -- well, I guess I go back to Kenny's enter, there's always competition. Maryland continues to be more and more competitive as does New Jersey. Look in New Jersey, we've recreated a real differentiator with our product. We've gone in there. We've done all the rooms now what's called the MGM Tower, with the old Water club. We've gone through and redone and have an amazing baccarat area of VIP, domestic VIP. We have a new noodle shop. We have a new BBar, which is a center bar. And so you go in there, it's refreshed. It feels like a new property, and it's really focused on the high end. We've repositioned an aircraft there. So we are doing personalization when it comes to our highest level customers in that market.

And so while we're aggressive, we're aggressive, not necessarily in what shows up in your mailbox, but what shows up with your host. And so we're pushing that high-end VIP extensively there. The other markets continue to be aggressive, and we continue to do what we do. I think the margin in this quarter was 30.1% for regional. So I think it's indicative of our activity case is measured and appropriate. And I think we'll continue to do that.

And we monitor all of our competitors in all of our markets also. And our reinvestment is where we thought it would be and it's fairly close to what it was last year.

Last question for today will come from Chad Beynon with Macquarie.

Corey, congrats from us as well on your retirement. I wanted to ask about, I guess, capital in Vegas. So maybe a 2-parter on this. First on MGM Grand. I think the disruption that you outlined today on last quarter's call, ended up being exactly what you had thought. So first question on that, given that, that project is done, should we start to see the ADR increases and some of the returns come in? Or do you maybe have to ease into this a little bit just because of the market softness?

And then the second question that I have on capital projects in Vegas. Bill, I think you teased us before on ARIA potentially being a project in '26. I believe that wouldn't start until maybe after some of the big conventions, but if you could update us on that as well.

Sure, Chad. I'll kick it off. Well, I think we were down for the quarter, 8% in room nights and 5% in OC. So I think the first real challenge for all of us given market conditions is to refill those rooms, and we've begun to do that, frankly, occupancy fairly easily and not easily, but I mean, we're in good shape there.

Yes, over time, it will build because the actual product itself is spectacular. I think it exceeded not only our expectations, but the customers who have stayed there. And so I think as that gets out and use of what that product actually is, I think we'll see both AC and ADR lift over the long haul. We are going to take pretty much the balance of '26 off in terms of room remodel.

And what may be MGM so impactful was we were redoing the bathrooms and plumbing. So we were taking 2 more floors out than normal. So there was always 5 to 8 floors out in any given moment. normal remodel centers around 3. But we're not going to start the ARIA until November of next year and then really push it into '27 and have the principal work being done over the summer so we can come out of that seasonality rate to roll and go to the next one, which is -- like Golden Gate Bridge in 2028.

Chad, it's Jonathan. we will be, as Bill said, starting that in November, we will incur CapEx right at the end of '26 in the room renovation, but even so, we expect CapEx to be in '26 to be below in 2025. And during our fourth quarter call, we'll give specifics on CapEx guidance for the year.

Excellent. Thank you very much.

Ladies and gentlemen, this concludes our question-and-answer session. I would like to turn the conference back over to Mr. Bill Hornbuckle for any closing remarks. Please go ahead.

Thank you, operator. And again, I appreciate everyone's recognition of Corey's, with Corey congrats and you're making me just. And look, Vegas is fine fundamentally. We feel good about the fourth quarter and particularly going into '26. Macau continues to outperform, and we're excited by that. And we're even more excited by what the digital business has been able to do year-over-year and ultimately where we think this goes. So hopefully, you share some of that excitement, and I appreciate everyone's time today. I know it's late back East. So thank you all.

This concludes our conference call for today. Thank you for your participation. You may now disconnect.

Let's keep right after it. Our next fireside chat here is with the management team from MGM Resorts, I think a group that needs very little introduction. But to my left, somebody who does need a modest introduction because he's new and he's moved from your side of the room to this side, it's Howard Wang. So Howard, welcome. Howard is in charge of Investor Relations now for MGM and been with the company for, how long?

7 months.

7 months, and a big transfer from L.A. to Vegas. To my right, obviously, no introduction needed Chief Executive Officer, Bill Hornbuckle. Bill, welcome. Thank you for joining us, traveling all the way from Vegas. And to Bill's right, Senior Vice President, Corporate Finance, Sarah Rogers. Sarah, always a pleasure. Thanks.

And then on the far side.

James Kayler.

Making sure the balance sheet balances.

So Bill, a lot of places we could start, but where I'd love to lead off is, especially with having you and being our first gaming company as well as just MGM has gone through a lot of changes, a lot of transformation over the last kind of 5 to 10 years. But when we think about your hands in lots of different businesses now globally. So a very large and interesting development pipeline, New York, Japan, obviously, great success in Macau, possibilities around the Middle East and Dubai. Then we pivot here, huge flagships. I mean the definitive brand on the Las Vegas Strip. Sorry, Caesars. We'll say the same to you in a few hours. But obviously, defining the Las Vegas Strip on that side and then this huge regional presence, and what you're doing on online. What's the connecting tissue? Or help us through the strategic vision at the C-suite of MGM. What's connecting all these businesses as we think about all the different things you have going on at the moment?

Well, I think the vision and the -- if you think about how we think about business for the next 3, 4 or 5 years and how we thought about it over the last couple of years is diversification of the business. We have been told, and we hear the story, you're centric -- and by the way, we still are centric to Las Vegas. But as we continue to diversify, as we think about our digital business in the short and the midterm, as we think about Japan in the long term and our Asia platform, no matter what happens in Las Vegas, it will, to a certain degree, deleverage that meaningful point of the portfolio. And so for us, it's about continued growth, it's about diversification.

Vegas is principal to who and what we are. And so even if you think about that portfolio, I think it served us well through a very difficult summer for most. I mean we started Bellagio and we end up at Excalibur, and the diversification we've seen there has been great in the context of luxury continues to pay off. Obviously, Las Vegas and the community and us when it comes to Excalibur, Luxor have a little different story to tell this summer, and we'll talk about that I'm sure going forward here. But for us, it's really about diversification of the business.

We have seen, and I think you've all seen what's now happened, we've had the catalyst, and we've had that changing point. I know you'll hear more from the BetMGM folks later today with that business. There's been a $400 million turnaround basically in a year. And so that's hit its catalyst.

Our regional business has continued to do well. We're leading market in 5 of the 8 markets that we're -- 7 markets that we're in. So we continue to perform well there. And they have, interestingly, I reflect back to '08, '09 and '10 and even this year, they perform well in more difficult times, and they're continuing to perform well, particularly in the place like Atlantic City, which through some enhancements, both in the MGM brand showing up for the old Water Club, we redid that tower, and what we did on the casino floor there in the context of VIP business and expansion of that, both in Asia play. We have a noodle shop, we have an expanded VIP area. That business has remained strong and then some.

And so the bigger play there is diversification and making sure at our scale, we have the opportunity. We are now getting into this as we've hit $50 million in our rewards platform to be able to begin omnichannel in a meaningful way. And that is all part and parcel. We've seen that pay dividends already in Michigan, in places like Michigan. We see it playing dividends in New Jersey and ultimately, obviously, in Las Vegas.

So let's just hit on the elephant in the room. We're going to get it out of the way. Let's talk a little bit about Las Vegas. You kind of mentioned -- and this is a theme that, by the way, goes beyond Las Vegas, right? We talk about this bifurcated consumer environment. We've seen high and low end, what you're seeing at the luxury price points, what you're seeing at some of the more value-oriented properties. But let's just start at the very highest level. Summer, and this was all updated through kind of second quarter earnings calls, was weak, right? I mean we saw that kind of big step down in June. It sounds like it continued in July, but didn't get that much worse. But what are you seeing right now? How would you characterize the broad environment? And then let's break it down.

Sure. Look, I think that our third quarter is going to represent what the second quarter did when it's all said and done in many forms. Specific to Las Vegas, I just mentioned it, but our luxury, the Bellagios, the Arias, the Cosmopolitans continue to perform at a very high level. Now if you compare them to '23 and '24, which was just stratospheric, it's off. But the idea, the notion that we'll -- I read a headline the other day, Las Vegas is dead. No, Las Vegas isn't dead. We ran 98% this weekend full stop. I mean -- so I mean, we are not dead. We are far from dead.

The idea of that, though, where it has hurt, and not only the community but us is at the lower end. And so value-oriented folks who go to Excalibur, Luxor, remembering a couple of things have happened to us, one specific to the company. We've had a massive remodel at MGM. We've had 800 rooms out of order. We've sped that up so that we'll be done with it by the middle of October. And so for the fourth quarter, we'll have all of our inventory back. We think that's a meaningful thing to do. We've seen in the market of Spirit go bankrupt. We've seen them pull back almost 400,000 seats, that's had an impact on the summer. And I think overall dynamic and policy, if you think about visitation, people who are traveling and people who aren't, and you think about Southern California drive traffic in from Southern California has been meaningfully off. And I think it's the low-value market, I don't think I know in terms of Excalibur and Luxor of note that's been impacted.

But the idea that Las Vegas is dead, I would say this. We are putting a push on because we let the narrative get away from us in the context of value. And so we are out putting a push on Las Vegas is a huge and remains a huge value for consumers at all levels. We have a group in Canada today through the convention authority that's literally promoting that storyline. We launched, Las Vegas, a campaign starting next week. It's a national campaign around Las Vegas, Fabulous Las Vegas, that harkens back to all of the things that it once was in terms of value creation. We are all participating in the citywide program to promote Las Vegas in terms of value and production. We have taken a very hard look at pricing. And it's not about room rates, it's not even about resort fees or parking fees. And by the way, that's not historically going to change. We value that business. We think we are a good value there. But we have done things like you buy $12 Starbucks coffee. So if we go through a $26 bottle of water at Aria is the one that keeps resonating with me.

So if we're going to go back through our pricing on those things that people touch every day and matters. So tonight, you can check into New York, New York or Excalibur for $85, including resort fee. You can get a $5 beer, you can bet on a $5 table. So we've looked at the marketplace and we're going to make a difference where we think the narrative is most important and where it helps.

But I think the fundamentals of Las Vegas are strong. We're coming in the convention season. We're coming into event season, I think, which really drives visitation. We've got Crawford against Canelo in the middle of September in Allegiant Stadium, that's 65,000-odd people. We have Paul McCartney in the second weekend in October. I think he'll do fine. I think he'll sell out. And so we have 9 Raiders games this year versus 8, and it goes on and on and on. Continuing the fall program with the convention foundation back in play I think will change the whole story line.

Okay. You mentioned Southern California, which is obviously the biggest feeder market. The visitation number, right, in July, I think definitely caught people's eye, down 12% if I remember correctly. What are you seeing like international is getting a lot of like play in the press, right, just international visitation into the U.S. generally. Canada, high on that on that list. So like from international travel and then from an airlift perspective, what are you seeing maybe?

International airlift is actually on par interestingly. Canada is off 40% for Las Vegas. And obviously, commentary about the 51st state isn't helping. I just got to say that. Having said that, their peak season is February and October in terms of when they come, particularly around the notion of hockey. And so we've got time, I think, to rebound and hopefully repair. That ad campaign, I mentioned it will be in Canada. Again, we have a delegation up there today talking to Canada, making sure that they feel loved, that they feel welcome, that we want them and that we need them.

There's only so much we can do and so much we can control. But put it in perspective, international Las Vegas business is about 11% of the mix. Canada is about 3%. Mexico is about -- 3% or 4%. Mexico is about 3%. Mexico was fine and then some, and I think the Canelo fight will actually raise the annual number. Some of the other business is off, but only in a minor percentage. So it's an impact, particularly the Canada discussion. But in the relative scheme, it's not significant. The drive traffic this summer, Southern California has been -- and not having Spirit in play at the scale that they once were is also a big play. It just -- the market hasn't rebounded that quick enough.

And just remind us of some of the high-end properties. International, when we think about gaming tended to be a bit more Asia-specific or Asia-oriented, obviously. Without going totally down the Macau rabbit hole just yet, just what's that -- at the higher end price points, do you see the same patterns or are they exacerbated or are they muted because the demand is to backfill Bellagio no matter what?

They are muted. In terms of high-end gaming, whether it's Asian or otherwise, most of the noise we hear specifically around international travel is just not an event. Everything from we go get to an airplane to -- so that's not a serious event, and we've continued to see that continue to grow as it has from '23, '24 and beyond.

When you think about China in general all the way back to '19 and '18, we're not back to where we were. And frankly, we won't be. One of the broader challenges for international travel is this is not an immediate Canada thing. You can go back and it's just not this administration thing. You go back to 2016, we had a $50 billion international surplus. Today, we have a $50 billion deficit in international travel with U.S. And obviously, Vegas plays a big part in that. And so there is a broader concern, something broader going on that we, as a country, need to get our act together and focus on welcoming people for -- and if you think about the opportunity before us, you got the Olympics twice. You've got Ryder Cup right now. You've got World Cup coming up. There's a massive amount of things that are going to happen to showcase America that are coming up that we, the collective government and the destinations need to do a much better job with them.

Is the group calendar and the return of this, and we all make a science out of September and holiday shift relative to October. But is the group calendar enough to help put a line underneath this bill in terms of like can that drive enough compression, enough movement? And do you start to see that in what you're able to look out and see kind of as we turn the corner into Q4 and into '26, can convention, group event, can that start to heal some of the transient softness we're seeing?

Heal, the word, is absolutely yes. To the extent how far we go, it's -- look, we do know. We know our group business is strong in the fourth quarter. We know it's the strongest it's ever been in 2026 and 2027. We see what we're booking today versus what we booked historically, and it's better and bigger. I know corporate America will show up because the boss makes them show up. What I don't know necessarily is, take CES as an example. What's going to happen? It's too early to tell empirically what that data is going to provide and what ultimately shows up.

I will say one thing. For us, the Marriott relationship. We switched gears on something with our original deal with them. We opened it up to conventions. And so I'll go back to the CES example. What happens there now is if I've got a Marriott Bonvoy, 200 million of them, and I want to be in Las Vegas on a convention like CES, we now accept and take their points and we trade for that. I think that will make a difference for us on citywide and things that are tied to Las Vegas, but not specifically tied to a property. I think for us, it's a distinct advantage.

And Tony was on stage earlier, actually mentioning that you've done some work and the group overlaps were smaller than maybe you had thought through what you're able to, and it sounds like that...

Well, I think his concern was, look, we know everybody in the group business. "We know everybody." No, we don't know everybody. We had 13 offices, they have 1,300 people in the field. And so there's a segment, particularly the benefits of the mid-market like MGM and whatnot that we did not have the access to that they do. And so it's a meaningful differential. And to put that many people to work on behalf of the company, they're doing over 20,000 room nights a week with us. And so -- and that's going to continue to grow as we open up this convention market as well. And so we're very excited by that.

Let's shift gears to Macau for a quick minute. I mean this has been actually underneath it all, a huge success story, very MGM-specific to start with in terms of what you've done on the share gains and improvement side. And now it seems broadening out to the entire market. So I actually want to start on that in reverse. We've seen this kind of improvement over the summer. We kind of sit here and look at a lot of macro variables and we're kind of saying, look, Macau seemed to have led the improvement that we're seeing in other places right now, meaning like, yes, I see some enthusiasm in the stock market in China, but not necessarily all a China macro. If you had some of our hotel companies, they're not blowing the doors off in China, and yet Macau is booming. So square the circle for us, what are your people on the ground telling you about why Macau is having a great -- it's such a phenomenal summer?

I'll talk to macro and the micro to our company. We're talking to Macau, maybe 25 million visitors. And if you really start to think about that, it's 7 million, 8 million people come 3 times a year. So the actual penetration into what you need to come into Macau and comparative to 1.4 billion is like slim and nothing. And so I just got to always keep that in mind, the perspective of what we need to feed that marketplace.

It really hasn't changed. What's happened is the junket tiers have obviously now gone. VIP customers are still coming and in mass. We have seen from Southeast Asia and some of the other places that we have offices in that we market to, a big lift, and we have, I think, a distinct advantage there where others potentially haven't been has relied more on junkets historically and therefore, not been established. So we know the customers. We know where they live. The infamous, we know where you live. And so we're in a great position to do that. We also have 9 hotels in China. So it's not a huge thing, but we do understand the general sentiment and the economy and what's going on in the hospitality business there because we follow that closely.

Macau is an exception. And I think part of it is they have allowed people to come. If you go back a year or 2 years ago, they were telling the individual people, I'm sorry, you've been four times, you can't go a fifth time. Any and all of that has stopped for now. I think they're letting the market run. I mean it's just over $30 billion. I think it's got some more room to grow. It won't be $45 billion anytime soon. So I think that's a reality that we all understand.

And then I think our personal ability at MGM to go after share, we got very aggressive on the casino floor and what that product needed and wanted to be, and we changed a bunch of things. How we fed people literally on the floor. How the floor is designed. What's the padding in the carpet, believe it or not, is a real discussion there. The lighting, the coloration, how you position the games. And we went deeply into that in the context of asking customers what they wanted to see, what they wanted to do, what they want to participate in. And I think we've been rewarded for it.

Now others are following suit, and that's not a surprise. Fortunately, I don't think we've seen -- although it's always aggressive there, we haven't seen marketing dollars continue to creep out of control. So I think the programming is in play. I think the government watches that all now closely anyway. So I think there's a check and balance there on that. And so we're going to hit a 28% margin, give or take, and I'm excited by where that has gone and where it's going.

And then for us, we've been able to add more villas and more suite product, which, again, the market has gone, particularly in our case, to premium. And so we were under suited and generally speaking, we're under room given our scale. And we have outperformed. We're about 130, picking up 100 more tables didn't hurt. And if you look back at the old model, we really added 200 tables, 100 new ones, and we had 100 that were tied in junkets and not as productive as from a margin perspective as I thought they could be. So now we've unleashed all of that. And so it's paying dividends.

You alluded to this, but just to make sure we put a fine point on it. There is some concern in part because of MGM's success story on market share, that means there's a loser when those numbers have to come up to 100%, that promotions could tick up. It doesn't sound like anything you've seen to date that your property people are calling out there. But is that a concern as, again, the fight gets fought to try and win a little bit of that share back?

We had this very conversation a year ago, okay, and so a year later, we still haven't like gone crazy. We, in the market, we, MGM, our margin effect, I was suggesting we'd be in the mid-teens given all the program we had to bring in to satisfy the government requirements. We're beating that. And we haven't -- so I would challenge that. It doesn't mean tomorrow. And some of that does sound silly, but I would challenge that.

Let's switch to digital a little bit. We've talked -- again, this is another one where I think, a year, if that was -- Macau was consistent, this is like 180, right? So I'd love maybe your just high-level decomposition here first. Again, I think I sat here with you, I think, a week after this conference in September. And it was kind of like we've got a leash for what can happen here or we think we've got the right steps. We fast forward, almost every KPI in the business accelerated and it looks like we're looking at a multi-hundred million dollar change in trajectory in less than a year. So looking back on it now, like with kind of with hindsight, what's been the biggest kind of...

I see Adam back there, and I know you're going to hear from him later. A lot of credit to the team for doing really a couple of principal things. We were very aggressive in marketing at a top level. And Adam will get into some of this detail, I suspect. And so doing what mattered from a marketing perspective saved us a great deal of economics and accretive to the bottom line. Improving the product year after year after year, we're now really in our second full year, and we hit football again. And Adam, I suspect, will get into this in greater detail. Actually just simply improving the product and making it more competitive has made a massive difference.

And then the fascinating thing to me, if you think about New Jersey as the example, New Jersey with iGaming started in 2012. We still see double-digit growth. And so the breadth of these markets, same in Michigan, same in New Jersey, the growth rate that we have seen year-over-year because we've only added 1 or 2 states for sports betting even. We're pushing 30% growth rates in most of these markets. And so it's a credit to the team and what the focus has been, a credit to our partner, Entain, and opening their ears and eyes and saying, okay, we need to help this business do more. And just overall, the marketplace has continued to do well, and we've benefited from that. We've stopped losing share. We're taking back some share. And so -- and over time, between a single wallet and single account, the idea of omnichannel, 15% of folks who now touch either our product or BetMGM's product share, meaning they come -- they touch both products. And so those numbers continue to go higher, and we're excited by that.

And so it's been literally almost a $400 million turnaround from when we sat here a year ago to today, and probably more importantly, we've all talked about making $500 million at some point as the next threshold. There's a vision and a view into that, which we all believe is very real at this point.

So you mentioned, obviously, your partner, Entain. I think the JV structure has always been a topic of discussion.

You couldn't help yourself, could you?

Well, I mean I think with -- I mean with the inflection in the business, does that change the thinking around that? Does it create any sort of urgency? Or is it just operate the business, number one?

Operate the business, number one. We want to continue to see that clear path to that $0.5 billion. There's a lot that's in play right now that confuse the business or just sidetrack the business and some other deviation is not smart. And so we're going to continue on the track we've got and take a view once we get to the next year.

Was that a causative shot at prediction markets?

I didn't say that. I mean I'll explain about prediction markets. MGM Resorts' view is it invites the federal government into a space it's never been, and it's not a place we'd like to see this marketplace go, full stop. We're going to watch. We'd be foolish not to. I will reference and again, I think Adam can put more color on this down the road. The prediction markets are in U.K., they've been there for 20 years. They're a piece and apart, they're under 10% market share and they get beat up a lot. I mean if you go play on these prediction markets, you may even have to be that sharp to figure out what to do. So it's out, it's real. We have to contend with it and understand it. We've got to be ready for it if it becomes even realer. But officially, it is not something we endorse.

Let's talk on international digital though. This is another piece. And just you mentioned U.K. You're in that market with the BetMGM brand. Some of these markets -- so I think what are the priorities for the markets, U.K., Netherlands, Brazil, I think, are all on that list?

As a growth priority, it's Brazil. We've seen enough now to realize and still believe it's a $7 billion or $8 billion market. It's crowded, but we think we can share still between 5% and 10% share, which you put a normal margin to that. And remembering our partner is Globo. So we have a distinct advantage in terms of advertising and marketing dollars to the business to put a normal margin on that. And over time, we see that as a $200 million or $300 million piece of that alone.

LeoVegas business, look, there's been a lot of regulatory between U.K., Sweden and some other things. Like in Sweden, you had to get relicensed and start over. But all that foundationally is on solid footing and going in the right direction. We put our own sports betting product in typical in play. So it's in Finland, it's in the Netherlands and it's headed into Brazil. We feel really good about that product and ultimately what it can do. We still have a piece called Push Gaming, which is in the content business, which we're pushing out content, not only to BetMGM but to ourselves and to other vendors. And we like being in that side of the business, having a purview and a view in terms of games and what they can be. And particularly there, we've leveraged into our scale with jackpots that the markets haven't seen before. We have a pretty big balance sheet as compared to most of the competition. And we're leveraging into -- go into a $2 million jackpot. And particularly in places like U.K., it's paying a dividend.

Let's switch over to capital allocation and CapEx. So I think you had a little something you wanted to share on Japan, which I know is a big personal ambition of yours, Bill?

Yes, it is. So we are literally in the ground. We have poured our 52nd pile as of this morning, so yay. 5 years from now, this will come to life. We are projecting opening in the third or fourth quarter of 2030. What you're looking at is about -- between the 2,800 rooms, that will become one of the world's, if not the world's largest casino, with 750 tables, over 6,000 slot machines. There's over 70 food and beverage outlets. There's a theater for 3,500. There's a convention facility, MICE facility for just under 1 million square feet of space. You can't see it, but there's a small theater outdoor. And there's an outdoor pavilion that has bars and restaurants and whatnot along the garden area there. Across the way here, there's a museum that leads to a ferry terminal.

We have seen now the infrastructure in play because of the World's Fair, World Expo. They brought over 1 million people to the site, and so I've seen it work. And so I feel excited by the rail and the network that's put in play for this site. But it's a landfill site. So for us, we're playing in the mud better part of the year and then we're going to begin to build this thing.

If you think about Singapore as a proxy in our future, Singapore, we're going to have half the facility, meaning one, they have 2. We have 5x the population, twice the visitation already in Japan before we open this thing. Singapore is going to do $2.5 billion in cash flow this year, the Sands alone, over $3 billion in the market. You put all that dynamic in play and you take a pachinko market that's almost $20 billion inside Kansai region and you put it to work here, I think this is a -- for us, this is a once-in-a-lifetime opportunity that I'm very excited by. And we've taken our projections up over $2 billion. And nothing is a layup in life and certainly getting this far has not been a layup. We've been after 16 years, to be clear. True. It is crazy. It will be 20 years before we opened from the first day I met my first Diet member. But we couldn't be more excited about what this will do for the company.

All right. Give us like some fun engineering facts, 52 pilings out of how many? Like what are we getting to there?

The building is only 38 stores tall. I had this wonderfully graceful, elegant tall building. And I was told it would sink into the ground in about 5 years, so don't do that. So those pylons go 80 meters deep just to support this thing, the weight because it's a landfill. It's an island, but not really. It's a landfill. And so to get bedrock, we had to go 80 meters. And there's 3,500 of them.

So 3,500 will be the...

Look, it's crazy ambition, but that's been rewarded particularly in this neck of the world, and we think this will be, too.

Great. And then what I found is with projects like this, there's something, there's some variable that it's always hard to pin down but it ends up being that big surprise. Do you think it's depth of the slot market in that mass market? Or do you think it's VIP in terms of -- what do you think we're all going to ultimately underestimate?

I think the depth of the slot market is what we're going to ultimately underestimate. Now there's only so much capacity in this thing. It's 6,500 machines. There's only so many people a day you can let into a place like this. And like Singapore, it will have a fee to get in. The interesting thing for us, though, because this will have all the usual toys, villas, high-end baccarat, all the things that would attract high-end customers. We're 1 hour closer, 1.5 hour closer to Beijing and Shanghai than Macau. And by the way, remember, we know those customers. And so I think that's going to be the secret opportunity here to really take it from where we think it will be to potentially the next step.

And airlift would be direct from there to Osaka with plenty of options?

Right, including a ferry or a helicopter, I think it's a helicopter, maybe not a helicopter, but we've got a helicopter pad as well. And that will be a common thing.

That will be a busy helicopter pad.

Hopefully.

Okay. James, do you have anything else in Japan?

I mean I think we maybe pivot to capital -- like as part of that conversation.

Well, let me touch on a couple. I'll just go do the regional thing quickly. We live in New York. So here we are. You probably have some meeting or another setup around this. So what's going on here? A big important market and something that we -- I think the RFP is already in. So where do we sit in the process?

We, next week, hear from City Council officially, get our vote. We then, by end of month, need to make our submission, including our tax bid. Remember that taxes are "biddable." And despite what Senator Addabbo may say, they're telling us by end of year, this license will be awarded. There's a concern that they can't get the legislature back together to vote on it or whatever they need to do next in time, but we've been assured they're going to get it done because, frankly, the community wants the cash. We have to write a $500 million check.

And so that's the timing of all of it. They've changed a couple of the rules I'm not crazy about. There's a deal out there that says after we've made our submission, by the way, that if you spend under $1.5 billion, you only get a 10-year license. And if you spend over -- I think it's $5 billion, you get a 20-year license. So they've now moderated it, tied to amount of money you spent what their license duration is. I hope I was right. I'll leave it at that. I hope I was right. So anyways, that's the timing in the process. So by end of the year, we're going to know where we stand.

And you mentioned the biddable tax rate, which is unique in the market structure. Is it a size scale, that and the $500 million though in terms of both -- or the $500 million, that's minimum?

They can both. That's the minimum.

That's the minimum. And you can -- so you can balance those but...

And remember, we and Aqueduct are required to come back to the same tax base as a minimum that we currently are paying. So we give the state -- I'm going to make up a number, I'm not far off though, $360 million, give or take. Plus we have the horseman we pay a lot of money to. Plus the city is going to get a little vague now going forward. And so we have to meet that as a minimum going forward as does Aqueduct. The third license does not, but if they don't -- there's so much competition, if they don't bid high enough fee, they're not going to get it anyway, so. But it's one more quirk.

And then one more region around the world and then -- but I'd love to talk about the Middle East for a second. I think, generally, you've got a management non-gaming structure set up in Dubai. But where do we sit and kind of what you're thinking about that part of the region, that part of the world right now?

This project, you're looking at the project here, it's on a 25-acre island. That's a massive beach club. There's an Aria, a Bellagio and an MGM. It's about 1,800 keys, I think, all said and done. And our partner, which is ultimately Wasl, which is owned by the ruler, to be clear, has enabled us to build a 250,000 square foot podium right in the middle at a floor on the intent that hopefully, someday, it becomes a casino. I thought by now, Abu Dhabi would have ruled on what they were doing. There's a lot of dialogue around that. You know there's a gaming commission set up. Obviously, we all understand what Wynn is doing to the north.

We will -- this opens in spring of -- excuse me, in fall of '28. And so it's well on the ground. I think there's 5 or 6 floors out. I don't know if there's another picture here, but I think there is. There's 5 or 6 stories up already, and it's progressing. I don't know when we'll hear here, but I do believe this. The airport currently is to the south, it's moving -- excuse me, to the north, it's moving to the south along the Dubai, Abu Dhabi border. It's going to be the world's largest airport. The budget for us is like $100 billion, it's insane. And if this gets a casino, and I believe it will over time, we think it's a massive opportunity as well given logistics and location.

So just to be clear, what are we specifically are we waiting to look forward? There's a possible...

The ruler, think of the ruler as the governor and legislature all in one. Each ruler has its right to say yes or no. So we're waiting for the ruler to say, go forward. Because the regs are in play and the environments are in play with the gaming commission. We understand how it would work. We don't have permission yet from the ruler of Dubai to go forward.

But there's nothing in those rules that preclude this building from possibly qualifying as a casino asset?

No, we've taken that into consideration.

Okay. James?

Well, we have a couple of minutes left. But I mean, maybe just to circle back on the capital allocation and the balance sheet. I mean obviously, a ton of balls in the air, Japan's a massive investment, New York potential. So the last few years, you've sort of really invested in stock. What does capital allocation look like going forward from here? I think leverage is, if you do a lease adjusted, it's sort of like 4-ish times. Sort of what's the comfort level should we expect? Is that kind of -- are you trying to solve to stay in there? So what does that -- how do we think about all those things?

So we do have a financial policy in place that says 4.5x is sort of our limit. That being said, I think if Bill and the Board had some wonderful idea for growth, there'd be willing to be at least a short-term flexibility on that. We've obviously bought back over 40% of our shares outstanding, and we have messaged that with the excess cash coming down and with the future obligations for Japan that we will ultimately slow. But again, if the share price gets to a point where there's -- so attractive, that's something we will continue to consider.

Sarah, can you just remind us of equity commitments or needs across these different project buckets because I think we're now at that place where Japan, some meaningful commitments are going out the door. I think it's equity first, but where are we at for committed debt financing for the project?

That's right. So we have the financing in place for Japan as of the last Q, it's JPY 380 billion and spot at that time had us at about $2.6 billion in outstanding dollars remaining. This year will be around $300 million and the future years at around $500 million to $600 million. And then the debt will kick in. For New York, it's a $500 million license fee and then $1.7 billion in build spend, and that is something that could be financed by VICI or another firm.

And then any other needs on the cap structure side on the debt side? Or that's pretty much -- those are the 2 big?

I mean, BetMGM business, the digital business is in good shape. We're all in per se. I hope and believe the BetMGM business will be showing off dividends pretty soon here. I mean we're sitting on some real cash there, and so I think that's a real opportunity for all of us. And the other business, we are where we are. There's marketing, but it's not significant in the context of spending.

Fantastic. I think that's what we got time for. So Bill, Sarah, Howard, thank you for joining us. We all appreciate it.

Thank you all.

Thanks.