Investment Response
In a recent development, BetMGM, the digital sports betting and gaming venture of MGM Resorts International, is expected to see a significant increase in its annual profitability by 2028. According to analyst projections and company targets, BetMGM could reach approximately $500 million in annual EBITDA, supported by solid revenue growth and improving digital operations.
MGM Resorts' CEO, Bill Hornbuckle, has attributed BetMGM's profitability to disciplined player acquisition and better management of lower-value users. He also highlighted the role of artificial intelligence in optimizing marketing spend and refining player value models.
The newer analytics capabilities at BetMGM have allowed for faster reinvestment decisions and a higher concentration of high-margin betting activity. This focus on the non-VIP customer base and improved operational efficiency are key factors in BetMGM's projected growth.
Analysts from Citizens have modelled that BetMGM could achieve this profitability target by 2028 with recurring EBITDA margins above 26%. They emphasise the importance of BetMGM maintaining double-digit revenue growth specifically over the next two years to hit the $500 million EBITDA benchmark by 2028.
While BetMGM continues to thrive, other segments of MGM Resorts’ portfolio have faced challenges. The Las Vegas Strip, for instance, has seen a downturn in foot traffic due to ongoing renovations, which has dampened earnings. However, the continued recovery in the "premium mass" segment and strong performance from regional casinos and international operations have helped offset these declines.
In a positive note, MGM Resorts International reported net revenue of $4.4 billion for the second quarter of 2025, marking its highest-ever consolidated quarterly revenue. Earnings per share came in at $0.79, surpassing the $0.58 consensus estimate.
Despite these financial strides, shares of MGM Resorts fell approximately 4% during Thursday's session, trading around $36 as of midday. The decline could be attributed to various factors, including the ongoing renovations on the Las Vegas Strip and investor sentiment challenges.
In other news, MGM China posted a 3% year-over-year increase in adjusted EBITDAR, driven by growth in the premium mass segment. COO Hubert Wang reiterated the division's focus on the higher-spending, non-VIP customer base in MGM China.
Notably, BetMGM reported its first-ever profit with first-half EBITDA of $109 million in 2025. However, the company's market share dipped to 6.2% in Q2 across 14 key states, trailing Fanatics, which held 7.6%.
In a move to boost its profitability, Hornbuckle met with the chairman of the House Ways and Means Committee in Las Vegas, alongside Caesars CEO Tom Reeg and Wynn CEO Craig Billings, to have a gambling deduction cap included in former President Trump’s tax legislation repealed.
As BetMGM continues to grow and evolve, it remains a key player in the gaming industry, with a promising future on the horizon.
- BetMGM, a digital sports betting and gaming venture, is projected to see an increase in its annual profitability to around $500 million by 2028, supported by solid revenue growth and improved digital operations.
- MGM Resorts' CEO, Bill Hornbuckle, attributes BetMGM's profitability to disciplined player acquisition and better management of lower-value users, also highlighting the role of artificial intelligence in optimizing marketing spend.
- Analysts have modelled that BetMGM could achieve this profitability target with recurring EBITDA margins above 26%, emphasizing the importance of BetMGM maintaining double-digit revenue growth specifically over the next two years.
- While BetMGM continues to thrive, other segments of MGM Resorts’ portfolio, such as the Las Vegas Strip, have faced challenges due to renovations and decreased foot traffic.
- In an effort to boost its profitability, BetMGM's CEO, Bill Hornbuckle, met with the chairman of the House Ways and Means Committee to discuss the possibility of repealing a gambling deduction cap included in former President Trump’s tax legislation.
