MGM Resorts CEO Bill Hornbuckle on Las Vegas Market Challenges and U.S. Travel Outlook

Las Vegas Market Resilience

• 💡 Despite summer travel slumps and negative headlines, Las Vegas is not dead, with occupancy rates exceeding 98% in MGM's properties.
• ⚠️ Visitation was down 11-12% in June and July, particularly impacting the lower-value segment of the market.
• 🎯 Lessons are being learned in value creation, as Las Vegas experienced boom years in 2023 and 2024.

Value Proposition and Marketing

• 🚀 A new "Fabulous Las Vegas" campaign is launching to promote the city throughout the fall.
• 💰 MGM is re-evaluating pricing, ensuring value with offerings like $85 rooms at Excalibur and New York-New York, including resort fees, $5 tables, $5 beers, and three-course meals under $33.
• 🗣️ The company acknowledges letting the narrative get away from them and needs to do a better job communicating the existing value.

Diversification and Future Outlook

• 📈 MGM Resorts reported record revenues in the second quarter, driven by diversification across digital, Macau, and regional businesses, in addition to Las Vegas.
• 🎤 Upcoming events like Canelo, Paul McCartney concerts, and increased Raiders home games are expected to boost visitor velocity.
• ✈️ The company aims to be more value-sensitive to attract customers back.

U.S. Travel Industry Challenges

• 📉 International travel to the U.S. has shifted from a $50 billion surplus in 2016 to a $50 billion deficit, with a 40% decline in Canadian visitation impacting Las Vegas.
• 🌍 Despite opportunities like the Olympics and World Cup, policy issues, such as increased visa charges, are hindering international tourism.
• 💰 A significant cut in U.S. government funding for travel marketing, from $100 million to $20 million, is unsustainable and requires advocacy for increased appropriations.
• 🤝 Las Vegas is actively reaching out to Canada, emphasizing its importance and welcoming visitors back.