Wynn Interactive operating losses shrink 79% in Q3 as drive to profitability continues

Wynn Interactive has enjoyed its second consecutive period of loss reductions in adjusted EBITDA and operational losses during Q3, according to the latest data released by parent company Wynn Resorts.

Releasing its financial update for Q3 as part of the wider Wynn Resorts update, Wynn Interactive confirmed a reduction in its adjusted EBITDA losses of 82% year on year (YOY) to $17.7m, down from a prior 2021 high of $103.5m.

Operational losses at the US casino giant’s interactive arm also fell sharply during Q3, dropping 79% YOY to $27.1m from a prior 2021 high of $131.6m.

At a wider group level, Wynn Resorts reported total operating revenue of $889.7m in Q3, down 10% YoY from the same period in 2021 when the firm generated operating revenue of $994.6m.

Total operational expenses fell from just over $1bn in Q3 2021 to $942.7m in Q3 2022, while operational losses dropped by 36% YOY to $52.9m over the same period. Wynn Resorts’ adjusted EBITDA rose by 12% YOY during Q3 to $173.5m.

The firm’s CEO Craig Billings welcomed the results, highlighting the new third-quarter record in adjusted EBITDA on Wynn’s combined North American properties Wynn Las Vegas and Encore Boston Harbor.

“Their relentless focus on five-star hospitality, combined with our market-leading facilities, continue to elevate our properties above our peers as the destinations of choice for luxury guests in both Las Vegas and Massachusetts,” Billings said.

“In Macau, while Covid-related travel restrictions continued to negatively impact our results, we were pleased to experience encouraging pockets of demand during the recent October holiday period. We remain confident that the market will benefit from the return of visitation over time,” he added.

During the quarter, Fertitta Entertainment chairman Tilman Fertitta purchased a 6.1% stake in Wynn Resorts, becoming the second largest shareholder in the firm, with the stock rising by double-digits as news of his acquisition broke.

Addressing this move in Wynn Resorts’ Q3 earnings call, Billings hailed Fertitta’s investment as an endorsement for the business as a whole but refused to be drawn on his involvement with the business following this acquisition.

“I guess what I can say is kudos to him because he’s done quite well. Since he appears to have started acquiring in the second quarter when the stock was excessively cheap,” Billings said.

“It’s actually right around when we were buying back some stock as well that we reported in our second quarter.

“Based on what we’ve seen watching our share register, as we do constantly, sometime in Q2 we began seeing accumulations really by certain banks that have traditionally been associated with derivative transactions like total return swaps, etc, and we watch those banks’ established positions in our stock, and we were well aware of them.

“All in all, I think it’s just a great recognition of the value in our equity, but there’s not much more to say beyond that,” Billings concluded.