MGM Resorts International

Company Overview

Business Model: MGM Resorts International operates as a global gaming and entertainment company through its subsidiaries, featuring hotels, casinos, state-of-the-art meeting and conference spaces, live and theatrical entertainment, and an extensive array of restaurant, nightlife, and retail offerings, as well as sports betting and online gaming operations. The Company has implemented an asset-light business model, monetizing owned real estate assets to redeploy capital towards balance sheet improvements, new growth opportunities, and shareholder returns. Revenue is primarily cash-based, generated from customer wagering and non-gaming services.

Market Position: MGM Resorts International operates what it believes are several of the finest casino properties globally, continually reinvesting to maintain a competitive advantage and operate the highest quality resorts in each market. Key competitive methods include desirable leisure and business travel market locations, high-quality resorts and facilities (luxurious guestrooms, convention facilities, premier dining, entertainment, retail), superior customer service, unique entertainment attractions, investment in digital offerings, and distinctive marketing and loyalty programs (MGM Rewards, M life, Golden Lion Club).

Recent Strategic Developments:

• Osaka Integrated Resort: In September 2023, Osaka IR KK, an unconsolidated affiliate with a 50% ownership interest, signed an agreement with Osaka Prefecture and Osaka City to implement its government-certified Area Development Plan for an integrated resort in Osaka, Japan. Preliminary construction began in 2024.
• Online Gaming Expansion:
  • LeoVegas Acquisition: In September 2022, MGM Resorts International acquired LeoVegas, a consolidated subsidiary headquartered in Sweden and Malta, to expand its global online gaming presence. In August 2023, LeoVegas acquired a majority ownership of Push Gaming, a digital gaming developer.
  • BetMGM North America Venture: MGM Resorts International, through its 50% ownership interest in BetMGM, LLC, continues to invest in U.S. online sports betting and iGaming. BetMGM North America Venture launched Single App Single Wallet in Nevada and increased its parlay product capabilities with Angstrom technology.
• Real Estate Monetization & Acquisitions:
  • VICI Transaction: In April 2022, VICI Properties, Inc. acquired MGM Growth Properties LLC, leading to the deconsolidation of MGM Growth Properties LLC and MGM Resorts International retaining an approximate 1% ownership interest in VICI Properties OP LLC. An amended and restated master lease with VICI Properties, Inc. was entered into.
  • The Cosmopolitan of Las Vegas Acquisition: In May 2022, MGM Resorts International acquired the operations of The Cosmopolitan of Las Vegas for approximately $1.7 billion, expanding its customer base and offerings in Las Vegas.
  • The Mirage Disposition: In December 2022, MGM Resorts International sold the operations of The Mirage for $1.075 billion, resulting in a $90 million reduction in annual cash rent under the master lease with VICI Properties, Inc.
  • Gold Strike Tunica Disposition: In February 2023, MGM Resorts International sold the operations of Gold Strike Tunica for $450 million, resulting in a $40 million reduction in annual cash rent under the master lease with VICI Properties, Inc.
• Macau Gaming Concession: In December 2022, MGM Grand Paradise, S.A. was awarded a new ten-year gaming concession, commencing January 1, 2023, following the enactment of new Macau gaming law in June 2022.
• New Market Exploration: Actively working on a response for three downstate commercial gaming licenses in New York to transform Empire City into a full-scale commercial gaming facility. Has a non-gaming management agreement in the United Arab Emirates to bring Bellagio, Aria, and MGM Grand brands to Dubai, with potential for gaming expansion. Continuously exploring new geographies for future development, including Thailand.

Geographic Footprint: MGM Resorts International operates 16 domestic casino properties across the United States, including Las Vegas, Nevada; Detroit, Michigan; Biloxi, Mississippi; Atlantic City, New Jersey; Prince George’s County, Maryland; Springfield, Massachusetts; Yonkers, New York; and Northfield, Ohio. Internationally, it operates two casino properties in Macau through its approximate 56% controlling interest in MGM China Holdings Limited. Global online gaming operations are primarily conducted through LeoVegas (headquartered in Sweden and Malta) and BetMGM, LLC (North America). The Company is also developing an integrated resort in Osaka, Japan, and has a non-gaming management agreement in Dubai, United Arab Emirates.

Financial Performance

Revenue Analysis

Note on Gross Profit Calculation: Gross Profit is calculated as Total Revenue minus the sum of Casino, Rooms, Food and Beverage, and Entertainment, retail and other expenses.

Profitability Metrics:

• Gross Margin: 44.94%
• Operating Margin: 8.65%
• Net Margin: 6.18%

Investment in Growth:

• R&D Expenditure: Not explicitly stated as a separate line item. The Company invests in proprietary technology and product innovation, and information technology capital expenditures.
• Capital Expenditures: $1,150,589 thousand
• Strategic Investments:
  • Contributions to unconsolidated affiliates (primarily Osaka IR KK and BetMGM North America Venture): $182,078 thousand
  • Acquisitions, net of cash acquired (primarily Push Gaming): $113,882 thousand

Business Segment Analysis

Las Vegas Strip Resorts

Financial Performance:

• Revenue: $8,816,113 thousand (flat YoY)
• Operating Margin: 35.2% (down from 36.3% in 2023)
• Key Growth Drivers: Increase in rooms revenue (+4% YoY) and food and beverage revenue (+3% YoY), primarily due to increased RevPAR and catering/banquet revenue. This was offset by a decrease in casino revenue (-8% YoY) due to lower table games drop and win percentage.

Product Portfolio: Aria (including Vdara), Bellagio, The Cosmopolitan of Las Vegas, MGM Grand Las Vegas (including The Signature), Mandalay Bay (including W Las Vegas and Four Seasons), Luxor, New York-New York (including The Park), Excalibur, and Park MGM (including NoMad Las Vegas). These properties offer casino gaming, hotel accommodations, food and beverage, entertainment, retail, and convention facilities.

Market Dynamics: Over half of the net revenue is typically derived from non-gaming operations. The segment caters to premium gaming customers, leisure and wholesale travel, business travelers, and group customers (conventions, trade associations, small meetings). It operates in a highly competitive environment with numerous other hotel casinos in the Las Vegas area.

Key Operating Metrics (2024):

• Occupancy: 94%
• Average Daily Rate (ADR): $260
• Revenue per Available Room (RevPAR): $245
• Table Games Drop: $6,028 million
• Table Games Win %: 24.4%
• Slot Handle: $23,840 million
• Slot Win %: 9.4%

Regional Operations

Financial Performance:

• Revenue: $3,720,322 thousand (+1% YoY)
• Operating Margin: 30.7% (down from 30.9% in 2023)
• Key Growth Drivers: Primarily an increase in casino revenues (+1% YoY) driven by an increase in slot win percentage and recovery from a strike at MGM Grand Detroit in the prior year. This was partially offset by the disposition of Gold Strike Tunica in February 2023.

Product Portfolio: MGM Grand Detroit, Beau Rivage, Borgata, MGM National Harbor, MGM Springfield, Empire City, and MGM Northfield Park. The majority of net revenue from this segment is typically derived from gaming operations.

Market Dynamics: These properties primarily compete with other hotel casinos in their local markets and for customers in surrounding regional gaming markets, where location is a critical success factor.

Key Operating Metrics (2024):

• Table Games Drop: $3,909 million
• Table Games Win %: 20.6%
• Slot Handle: $26,894 million
• Slot Win %: 9.9%

MGM China

Financial Performance:

• Revenue: $4,022,384 thousand (+28% YoY)
• Operating Margin: 27.0% (down from 27.5% in 2023)
• Key Growth Drivers: The current year was positively affected by a full year of recovery of operations after the removal of COVID-19 related travel and entry restrictions in the first quarter of 2023, as well as an increase in main floor table games win percentage. Macau visitor arrivals increased 24% in 2024 compared to 2023.

Product Portfolio: MGM Macau and MGM Cotai, which are integrated casino, hotel, and entertainment resorts. Offerings include main floor gaming operations, slot machine operations, premium gaming lounges, stadium-style electronic table games terminals, and non-gaming amenities such as The Mansion and MGM Cotai Emerald Villa for ultra-high-end customers.

Market Dynamics: The Macau gaming market has two primary customer bases: main floor gaming and slot machine operations, with main floor gaming being the primary source of growth. The segment faces intense competition from five other gaming concessionaires in Macau and major gaming centers across Asia and globally.

Key Operating Metrics (2024):

• Main Floor Table Games Drop: $14,681 million
• Main Floor Table Games Win %: 25.0%

MGM Digital

Financial Performance:

• Revenue: $552,012 thousand (+28% YoY)
• Operating Margin: Not applicable (Segment Adjusted EBITDAR loss of $77,227 thousand in 2024, compared to a loss of $32,424 thousand in 2023).
• Key Growth Drivers: Primarily due to entry into new markets in 2024. The significant increase in 2023 (224% vs. 2022) was due to a full year of LeoVegas operations compared to a partial year in 2022.

Product Portfolio: Primarily comprised of LeoVegas and other consolidated subsidiaries offering interactive gaming, including iGaming, digital slots and table games, live dealer, and online sports betting. Also includes the 50% ownership interest in BetMGM, LLC.

Market Dynamics: Operates in licensed markets, primarily in Europe, benefiting from higher barriers to entry. Primary competitors are other international online gaming companies, as well as integrated resorts and other entertainment providers.

Capital Allocation Strategy

Shareholder Returns:

• Share Repurchases: $1,357,890 thousand in 2024 (approximately 33 million shares). The February 2023 $2.0 billion stock repurchase plan was completed in 2024. As of December 31, 2024, $826 million remained available under the November 2023 $2.0 billion stock repurchase plan. Subsequent to December 31, 2024, an additional $307 million (approximately 9 million shares) was repurchased.
• Dividend Payments: $0 thousand in 2024. MGM Resorts International suspended its ongoing regular dividends in February 2023 to focus on share repurchases.
• Future Capital Return Commitments: $826 million remaining under the November 2023 stock repurchase plan as of December 31, 2024.

Balance Sheet Position:

• Cash and Equivalents: $2,415,532 thousand
• Total Debt: $6,362,098 thousand
• Net Cash Position: -$3,946,566 thousand (Net Debt)
• Debt Maturity Profile (Principal Amount as of December 31, 2024):
  • 2025: $500,000 thousand
  • 2026: $1,627,567 thousand
  • 2027: $1,425,000 thousand
  • 2028: $750,000 thousand
  • 2029: $850,000 thousand
  • Thereafter: $1,250,552 thousand

Cash Flow Generation:

• Operating Cash Flow: $2,362,495 thousand
• Free Cash Flow (Operating Cash Flow - Capital Expenditures): $1,211,906 thousand

Operational Excellence

Production & Service Model: MGM Resorts International's casino properties typically operate 24 hours a day, every day of the year, with the exception of Empire City (20 hours a day). The Company continually reinvests in its properties to maintain a competitive advantage and ensure they are premier resorts. Operations are largely cash-based, with a focus on generating operating cash flow to fund capital expenditures, future development, acquisitions, and debt repayment.

Supply Chain Architecture: Key Suppliers & Partners:

• Technology Partners: Entain plc (provides exclusive access to its technology for BetMGM, LLC in the United States).
• Manufacturing Partners: Not explicitly detailed in the filing.
• Supplier Engagement: The Company has a long-range 2025 goal to advance positive impacts within purchases of goods and services by building capacity among local suppliers and expanding its Supplier Mentorship Program to achieve 150 graduates.

Facility Network:

• Manufacturing: Not applicable to the Company's primary business model.
• Research & Development: The Company focuses on the development of proprietary technology and product innovation, which positions its digital operations for expansion and growth.
• Distribution: The Company's properties include significant convention and meeting facilities utilized to drive business during midweek and off-peak periods.

Operational Metrics:

• Las Vegas Strip Resorts: 94% occupancy, $260 average daily rate (ADR), $245 revenue per available room (RevPAR) in 2024.
• Regional Operations: Majority of net revenue typically derived from gaming operations.
• MGM China: Majority of casino revenue from main floor gaming operations.

Market Access & Customer Relationships

Go-to-Market Strategy: MGM Resorts International employs a marketing strategy rooted in personalized engagement powered by advanced analytics to deepen customer loyalty and increase engagement. This is centralized around MGM Rewards, a tiered loyalty program that allows customers to earn benefits across gaming and non-gaming experiences. The Company also utilizes the M life loyalty program and Golden Lion Club at MGM China. Marketing channels include brand ambassadors, online platforms, radio, television, print, billboards, regional marketing offices, and direct outreach via mail, email, and social media. Targeted segmentation is used to deliver personalized content and offers.

Distribution Channels:

• Direct Sales: The Company engages in direct customer relationships, particularly for its premium gaming customers, leisure and wholesale travel, business travelers, and group customers (conventions, trade associations, small meetings).
• Channel Partners: The Company leases space to third-party retail and food and beverage operators for branding opportunities.
• Digital Platforms: The Company leverages its app and other digital platforms for tailored content, e-commerce, seamless integration of physical resorts with digital casino and sports betting experiences, cross-property and omni-channel promotions, digital commerce and pricing technologies, and enhanced mobile and self-service check-in options.

Customer Portfolio:

• Enterprise Customers: Includes premium gaming customers, leisure and wholesale travel customers, business travelers, and group customers such as conventions, trade associations, and small meetings. The Company's diverse portfolio appeals to the upper end of each market segment, as well as leisure and value-oriented tour and travel customers.
• Strategic Partnerships: The Company has a 50% ownership interest in BetMGM, LLC and Osaka IR KK.
• Customer Concentration: A significant portion of the Company's operating income is generated from high-end gaming customers, which can cause variability in results.

Geographic Revenue Distribution (2024):

• United States: $12,664,897 thousand (73.46% of total revenue)
• China: $4,020,420 thousand (23.32% of total revenue)
• Other: $555,228 thousand (3.22% of total revenue)
• Growth Markets: The Company is actively pursuing development in Japan (Osaka IR KK), exploring a full-scale commercial gaming opportunity in New York (Empire City), and has a non-gaming management agreement in the United Arab Emirates with potential for gaming expansion in Dubai. It is also exploring new geographies for future development, including Thailand.

Competitive Intelligence

Market Structure & Dynamics

Industry Characteristics: The hotel, resort, entertainment, and gaming industries are highly competitive, with competition extending beyond specific geographic areas to other states, countries, and online platforms. The growth of gaming in areas outside Las Vegas and the increased availability of online sports betting and iGaming have intensified competition. The Macau gaming market is administered by the Macau Government through concessions awarded to six different concessionaires.

Competitive Positioning Matrix:

Direct Competitors

Primary Competitors:

• Land-based Gaming & Hospitality: A large number of other hotel casinos in the Las Vegas area (including major hotel casinos on or near the Las Vegas Strip, downtown, and elsewhere), other hotel casinos in regional markets, and other leisure destinations. In Macau, five other gaming concessionaires.
• Online Gaming: Other international online gaming companies.
• Broader Entertainment: Integrated resorts and other providers of entertainment.

Emerging Competitive Threats: New entrants, expansion of hotel room capacity and convention space by competitors, growth of gaming in new jurisdictions (e.g., Virginia, Nebraska, Texas, North Carolina, Japan, Taiwan, Thailand), increased availability of online sports betting and iGaming, and alternative accommodation providers (e.g., peer-to-peer inventory sources).

Competitive Response Strategy: MGM Resorts International's strategy includes locating properties in desirable leisure and business travel markets, constructing and maintaining high-quality resorts and facilities, recruiting and retaining well-qualified employees, providing unique entertainment attractions, investing in digital offerings, and developing distinctive marketing and customer loyalty programs. The Company also focuses on driving profitability in integrated resorts, expanding its international brick-and-mortar footprint, growing global digital brands, and disciplined capital allocation.

Risk Assessment Framework

Strategic & Market Risks

Market Dynamics: The business is highly sensitive to reductions in discretionary consumer and corporate spending, which can be influenced by inflation, economic contraction, economic uncertainty, geopolitical uncertainty, increased travel costs, unstable job markets, and outbreaks of infectious diseases. Evolving consumer preferences, such as increased demand for non-gaming offerings, also pose a risk if not anticipated and addressed. Technology Disruption: Significant expansion in legalized iGaming and online sports betting, coupled with intense competition in these markets, poses a risk if the Company's digital businesses fail to gain necessary scale or respond quickly to new regulations, products, or technologies. This could also lead to increased competition for land-based operations. Customer Concentration: A significant portion of operating income is generated from high-end gaming customers, leading to potential volatility in results. The concentration of major gaming resorts on the Las Vegas Strip makes the Company susceptible to risks common to the Las Vegas tourism industry, such as the cost and availability of air services and highway capacity constraints. Geographic Concentration: The Company's Macau operations are significantly impacted by economic, regulatory, and geopolitical conditions in China, including restrictions on currency conversion, cross-border travel, and anti-corruption campaigns.

Operational & Execution Risks

Supply Chain Vulnerabilities: Adverse market conditions, including labor market disruptions and global supply chain issues, could impact the Company's ability to hire and retain sufficient employees or procure necessary supplies. Geographic Concentration: Operations outside the United States are subject to inherent risks of conducting business under non-U.S. laws, regulations, and customs, including changes in government programs, labor regulations, and political instability. Capacity Constraints: Future construction, development, or expansion projects (e.g., Japan integrated resort, New York commercial gaming facility) are subject to significant development and construction risks, including financing delays, changes to plans, cost increases, labor disputes, and regulatory approval delays.

Financial & Regulatory Risks

Market & Financial Risks: The Company has substantial indebtedness ($6.4 billion principal amount as of December 31, 2024) and significant financial commitments, including annual rent payments of $1.8 billion under triple net lease agreements (subject to annual escalators) and guarantees of $3.01 billion and $3.0 billion principal amount of indebtedness for the landlords of Bellagio, Mandalay Bay, and MGM Grand Las Vegas. Restrictions in debt agreements limit financial flexibility. The suspension of regular dividends may adversely affect common stock market price. Insurance coverage may not be adequate for all losses, and costs may increase. The business is sensitive to energy prices. Regulatory & Compliance Risks: The gaming industry is highly regulated, requiring maintenance of licenses and payment of gaming taxes. Violations in one jurisdiction could lead to disciplinary action in others. The regulatory environment for iGaming and online sports betting is evolving and uncertain, with risks of legal action, fines, and operational restrictions. The Macau government has the right to terminate or redeem MGM Grand Paradise, S.A.'s concession under certain circumstances, and the concession includes significant investment commitments. Compliance with anti-money laundering, environmental, and other general business regulations is also required. Legal Proceedings: The Company is subject to consumer class actions, investigations by state and federal regulators, and potential regulatory penalties related to the September 2023 cybersecurity issue. Other routine legal proceedings are also ongoing.

Geopolitical & External Risks

Geopolitical Exposure: Leisure and business travel, particularly by air, are susceptible to global geopolitical events such as terrorist attacks, acts of violence, acts of war, or outbreaks of infectious diseases. Operations outside the U.S. are exposed to foreign currency exchange rate fluctuations (Japanese yen, Hong Kong dollar, Euro). Trade Relations: Increased trade tension between the U.S. and other countries could lead to decreased cross-border travel, higher prices for imported goods, and protectionist legislation impacting international operations. Sanctions & Export Controls: Violations of the Foreign Corrupt Practices Act or similar anti-corruption laws could result in severe criminal and civil sanctions.

Innovation & Technology Leadership

Research & Development Focus: Core Technology Areas: MGM Resorts International leverages technology, powered by advanced data and analytics, to deliver personalized digital experiences and targeted marketing. Key areas include enhancing e-commerce, seamlessly integrating physical resorts with digital casino and sports betting experiences, cross-property and omni-channel promotions, digital commerce and pricing technologies, and the MGM Rewards loyalty technology platform. The Company also focuses on enhanced mobile and self-service check-in options and a digital concierge. Innovation Pipeline: The Company is expanding its digital portfolio by building on core markets and identifying new opportunities for expansion and brand distribution, supported by the evolution of its technology platform.

Intellectual Property Portfolio:

• Patent Strategy: The Company seeks to establish and maintain proprietary rights in its business operations and technology through patents, trademarks, copyrights, and trade secret laws.
• Licensing Programs: Not explicitly detailed as a revenue-generating licensing program, but the Company uses software modules licensed under "open-source" licenses, which carry risks.
• IP Litigation: The Company faces risks of third parties alleging infringement, misappropriation, or violation of their intellectual property rights, which could lead to litigation, substantial costs, and diversion of resources.

Technology Partnerships: Entain plc provides BetMGM, LLC with exclusive access to its technology in the United States.

Leadership & Governance

Executive Leadership Team

Leadership Continuity: The Company's long-term people strategy is designed to enhance talent attraction and development, supporting business objectives, guest experience, community engagement, and financial goals. This includes workforce development strategies, leadership development programs, and a focus on reinforcing leadership expectations.

Board Composition: The Board of Directors has a dedicated committee focused on Corporate Social Responsibility and Sustainability ("CSR&S"). The Audit Committee is responsible for overseeing cybersecurity risk and receives regular reports from the Chief Information Security Officer.

Human Capital Strategy

Workforce Composition:

• Total Employees: Approximately 45,000 full-time and 18,000 part-time employees domestically. Additionally, approximately 13,000 employees at MGM China and 2,000 employees at LeoVegas.
• Geographic Distribution: Employees are located across domestic operations (U.S.), Macau, and international online gaming hubs (Sweden and Malta).
• Skill Mix: The Company invests in developing talent across gaming, hospitality, and entertainment industries, supporting continuous learning and skills-based development.

Talent Management: Acquisition & Retention: The Company focuses on fostering a people-driven culture and has streamlined recruitment processes to meet business and operational needs. It invests significant resources in talent development to be a premier employer of choice. Retention Metrics: Not explicitly disclosed. Employee Value Proposition: The Company provides competitive benefit offerings focusing on four pillars of well-being: physical, emotional, financial, and community. This includes a new Employee Assistance Program (EAP) for enhanced mental health benefits, tuition reimbursement, and contributions toward student loan debt repayment.

Diversity & Development:

• Diversity Metrics: The Company aims to cultivate a culture of respect and a workplace that reflects its communities, employees, partners, and stakeholders. A long-range 2025 goal is to ensure employees have equal access to leadership opportunities.
• Development Programs: Investments in continuous learning, education, professional/personal development, and skills-based learning through various modalities, including digital. Partnerships with institutions like the Nevada System of Higher Education offer free online degrees for employees.
• Culture & Engagement: Multiple channels facilitate communication, including open forums with executives, employee engagement surveys, and employee and business network groups.

Employees and Labor Relations:

• Approximately 38,000 employees are covered by collective bargaining agreements as of December 31, 2024.
• Key agreements are scheduled to expire in 2025, including with The Cosmopolitan of Las Vegas (approximately 3,000 employees) and the International Brotherhood of Teamsters (valet operations at nine Las Vegas Strip Resorts).
• Employees of MGM China and LeoVegas are not part of a labor union and are not party to any collective bargaining agreements.
• The Company participates in multiemployer pension plans, including the Southern Nevada Culinary and Bartenders Pension Plan (Green Zone status) and The Legacy Plan of the UNITE HERE Retirement Fund (Red Zone status, with a rehabilitation plan implemented).
• Contributions to the UNITE HERE Health fund were $237 million in 2024.

Environmental & Social Impact

Environmental Commitments: Climate Strategy: MGM Resorts International is committed to environmental stewardship, assessing and implementing projects to improve its environmental footprint. The Science Based Target Initiative (SBTi) approved its climate targets as science-based and in line with the Paris Agreement's 1.5 °C pathway. Investments include a power purchase agreement for 115 MW of solar capacity and 100 MW of battery storage for Las Vegas properties, in addition to the 100 MW MGM Resorts Mega Solar Array. Emissions Targets:

• 50% reduction in Scope 1 & 2 GHG emissions intensity (pounds of carbon dioxide equivalent per square foot; 2007 baseline) by 2030.
• 50% reduction in absolute Scope 1 & 2 GHG emissions (metric tons of carbon dioxide equivalent; 2019 baseline) by 2030 (SBTi validated).
• 30% reduction in absolute Scope 3 GHG emissions (metric tons of carbon dioxide equivalent; 2019 baseline) from purchased goods and services, fuel-and energy-related activities, waste generated in operations, and employee commuting by 2030 (SBTi validated). Renewable Energy: 100% renewable electricity purchased in the U.S. and 80% globally by 2030.

Supply Chain Sustainability: The Company's social impact and sustainability approach includes building capacity among local suppliers and expanding its Supplier Mentorship Program.

Social Impact Initiatives:

• Community Investment: Guided by "Focused on What Matters: Embracing Humanity and Protecting the Planet," the Company aims to contribute to social and economic progress in its communities by creating jobs, providing strong wages, and implementing workforce development opportunities. The MGM Resorts Foundation facilitates employee contributions to charitable causes, including an Employee Emergency Grant and Community Grant, and a Matching Gifts program.
• Product Impact: The Company has integrated responsible gaming and gambling education into its gaming experiences. The GameSense program, an industry-leading initiative, promotes sustainable and enjoyable experiences. At MGM China, a Responsible Gaming Committee and Operations Team address problem gaming. MGM Digital implements functions and tools, including LeoSafePlay.com and machine learning algorithms, to protect customers and support individuals with unsound gaming behavior.

Business Cyclicality & Seasonality

Demand Patterns:

• Seasonal Trends: MGM Resorts International's results of operations do not tend to be seasonal, as casino properties and digital operations typically run 24/7 (with the exception of Empire City). However, interim period results can be affected by the timing of major conventions, Far East baccarat volumes, entertainment and sports events, marketing and special events for high-end gaming customers, and the level of play during major holidays (e.g., New Year, Lunar New Year).
• Economic Sensitivity: The business is particularly sensitive to reductions in discretionary consumer spending and corporate spending on conventions, trade shows, and business development. Adverse macroeconomic conditions, including inflation, economic contraction, and geopolitical uncertainty, can lead to decreased demand.
• Industry Cycles: Not explicitly detailed as sector-specific cyclical patterns.

Planning & Forecasting: The Company's operating results are highly dependent on customer volume, which influences hotel room pricing and other amenities. Success depends on anticipating consumer preferences and reacting to trends, such as the growth in demand for non-gaming offerings.

Regulatory Environment & Compliance

Regulatory Framework: The gaming industry is highly regulated, requiring MGM Resorts International to maintain licenses and pay gaming taxes in each jurisdiction of operation. Regulations generally concern the responsibility, financial stability, and character of owners, managers, and financial interest holders. Industry-Specific Regulations:

• Gaming Licenses & Taxes: Each casino and online operation is subject to extensive regulation. Violations in one jurisdiction can lead to disciplinary action in others.
• Macau Concession: MGM Grand Paradise, S.A. operates under a ten-year gaming concession (commenced January 1, 2023) which requires annual fixed and variable premiums, as well as payments for the temporary use of reverted gaming assets. It also obligates MGM Grand Paradise, S.A. to invest approximately MOP 19.7 billion ($2.5 billion as of December 31, 2024) in gaming and non-gaming projects and international tourist market development over the concession term.
• Online Gaming: iGaming and online sports betting initiatives are subject to evolving regulatory and enforcement environments, with varying legality and enforcement approaches across jurisdictions. International Compliance: The Company is subject to the United States Foreign Corrupt Practices Act and other similar anti-corruption laws due to its international operations. Legal Proceedings: The Company is subject to consumer class actions and investigations by state and federal regulators related to the September 2023 cybersecurity issue.

Tax Strategy & Considerations

Tax Profile:

• Effective Tax Rate: 4.7% in 2024, favorably impacted by an increase in Macau gaming profits (exempt from complementary tax) and a decrease in the valuation allowance for Macau deferred tax assets.
• Geographic Tax Planning: The Company has significant deferred tax assets from foreign tax credit (FTC) carryforwards ($1.0 billion carryover, with an $855 million valuation allowance as of December 31, 2024). These FTCs are primarily from the Macau Special Gaming Tax.
• Tax Reform Impact: Legislation influenced by the OECD Pillar Two framework (global minimum tax) has been enacted in some jurisdictions, but has not materially impacted current year financial results and is not expected to materially impact future financial results.

Insurance & Risk Transfer

Risk Management Framework: MGM Resorts International maintains "all risk" property insurance coverage for its operating properties, covering casualty losses such as fire, natural disasters, or terrorism. It also carries business interruption insurance and general liability insurance. Insurance Coverage: Property insurance coverage may be significantly less than the replacement cost for a total loss, and certain casualty events (e.g., labor strikes, nuclear events, some forms of terrorism, power loss, pollution) may not be covered. Cybersecurity insurance is maintained to assist with recovery costs from cyber events, but may not be sufficient to cover all losses. Risk Transfer Mechanisms: The Company occasionally hedges its exposures to foreign currency exchange rate fluctuations (Japanese yen, Hong Kong dollar, Euro) with derivative instruments to minimize impact. It also provides shortfall guarantees for the indebtedness of certain landlords and guarantees for Osaka IR KK's obligations.