Not everything will be better about this year’s upcoming Las Vegas F1 race. While construction issues have been greatly reduced, and the process of preparing for the crowds has gone much more smoothly, the financial return for MGM Resorts and Caesars Entertainment is expected to be much less than the inaugural event.
During quarterly earnings calls, executives from MGM and Caesars each expressed concerns about the financial returns for this years race to investors and analysts. With expectations of returns for the 2024 Las Vegas F1 race so negative, both companies are now projecting multi-million dollar declines.
Despite this, both operators view the event as a valuable addition to the schedule, helping to draw affluent visitors during a typically slower time of year. Chief Financial Officer for MGM, Jonathan Halkyard, stated that while the 2024 race will not be as large, it still brings in “…significant economics to MGM during what has historically been one of the slowest weekends of the year.”
Executives at Caesars had a similar take on this years Las Vegas F1, noting that the event continues to drive more visitors that usual to Las Vegas. MGM’s CEO, Bill Hornbuckle, acknowledged that hotel revenue from this year’s event is expected to be down approximately $30 million from 2023. One reason is that the rates charged for these rooms this year is so much less that last year.
Hornbuckle went on to confirm that room reservations for the race weekend this year were not as strong as before, noting that some rooms were being booked for half of what they demanded for the first event. Should we be sad to hear that MGM and Caesars would not be able to take advantage of the situation again? Only if your a stockholder.