MGM Resorts International, which is being pressed to put its casinos into a real-estate investment trust, reported first-quarter sales that missed analysts’ estimates because of a betting slump in Macau.
The company, the largest casino operator on the Las Vegas Strip, saw revenue fall 11 percent to $2.33 billion, according to a statement Monday. That compared with the $2.38 billion average of estimates compiled by Bloomberg. MGM China’s revenue, facing a hit from Macau’s steep drop in gambling, slumped 33 percent to $630 million.
MGM Resorts gets the bulk of its revenue from Las Vegas, from properties such as the Bellagio and the MGM Grand, and is under pressure from Land & Buildings Investment Management LLC to put its properties into a REIT. MGM China Holdings Ltd., its 51-percent owned subsidiary, had been a source of growth when the Macau market expanded.
MGM Resorts shares dropped 2.7 percent to $20.82 at 9:08 a.m. New York time, before the markets opened. The stock is little changed this year, while competitors Las Vegas Sands Corp. and Wynn Resorts Ltd. declined 9.1 percent and 24 percent, respectively.
Las Vegas Sands and Wynn Resorts both reported first-quarter earnings that missed estimates last month.
Gambling in Macau has been hurt by President Xi Jinping’s campaign against graft. The anti-corruption drive has snared thousands of officials and led wealthy Chinese to cut back on conspicuous consumption, such as gambling in the world’s biggest casino market. Total betting in Macau casinos fell 37 percent in the first quarter to 64.8 billion patacas ($8.1 billion).