In a remarkable turn of events, May witnessed a surge in gaming revenue on the Las Vegas Strip, setting a new record for Nevada. Casino operators are now poised for strong second-quarter earnings, thanks to this robust performance. Let’s delve into the details.
The May Milestone
Nevada’s gaming revenue hit an impressive $1.32 billion in May, with the Las Vegas Strip leading the charge. This iconic stretch accounted for a staggering 84% of the year-over-year increase. Meanwhile, local casinos also contributed significantly, posting a 10% gain in revenue during the second quarter.
Third-Quarter Optimism
The momentum isn’t slowing down. Las Vegas anticipates a bustling start to the third quarter, with over 330,000 visitors expected around the Fourth of July holiday. This represents a 3.1% increase compared to 2023, despite the holiday falling on a five-day weekend this year. Visitors are projected to spend nearly $420 million, a substantial boost from last year’s $372 million.
Analyst Insights
Barry Jonas, an analyst with Truist Securities, highlighted the Strip’s resilience. Despite baccarat win being down about 7% from May 2023 and slot accounting headwinds, overall gaming revenue rose 4% year over year. Excluding baccarat, the growth was even more impressive at 10%. Visitation increased by 5%, and Strip revenue per available room surged by 11%.
Joseph Greff from J.P. Morgan echoed the positive sentiment. Spending per visitor improved during the second quarter, especially for regional operators. The Strip’s year-over-year growth in handle remains encouraging, and resilient spending by high-end consumers continues to bolster the market. Greff predicts that the balance of the year will result in flattish gross gaming revenue growth.
As we look ahead, Las Vegas remains a beacon of optimism. The record-breaking May revenue sets the stage for a promising year, and casino operators can expect robust earnings in the coming quarters. The city’s allure persists, drawing visitors and gamblers alike to its vibrant lights and thrilling entertainment. Stay tuned for more updates as the story unfolds.
