Wynn Resorts second-quarter revenue

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Wynn Resorts CEO Matt Maddox said Tuesday a spike in coronavirus cases in the southwest has softened Las Vegas demand in July, and he holds out hope that a quick-turnaround COVID-19 test in the future will allow conventions and group business to return sooner than expected. 

Maddox said their two Las Vegas resorts in Wynn and Encore have served as more of super regional properties relying on drive-in traffic from California and Arizona for and without convention business, nightclub crowds and large shows. Wynn is focused on promotions and offers and partnerships to get people from California and Arizona to come and stay in its hotels and gamble more in the casino. Non-gaming revenue is down by two thirds, and that was two thirds of the business, he said. 

“We did notice there was some pent-up demand from California as we opened in June,” Maddox said. “We were receiving roughly 4,000 reservations a day that would be spread over the upcoming two weeks. Then as the virus began to spike in our key drive-in markets like California and Arizona, we saw a downtick in reservations — roughly 25% after the Fourth of July. 

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“We operate our business every day based on that reduced demand and sitting here 30-odd days into the third quarter our (earnings) is roughly $5 million. It’s impossible to predict when Las Vegas during these times of restriction and closure will be making $5 million a month and $10 million a month. It’s out of our hands outside of the expenses, and we are focused on that every day and what’s going on in our key drive-in markets. We’re experiencing mid-50% occupancy on the weekends and in the 30s during the week. The visibility is quite murky because it is short-term bookings from our drive-in market.” 

Maddox said groups and conventions are holding off until late spring and the back half of 2021 to see what’s going to happen with COVID-19. Wynn is focusing on point-of-care testing to be approved by the FDA to at least allow smaller groups to book events sooner. State mandates limit meeting sizes to 50 at this time. 

“I believe if we can have on-site point-of-care testing that provides pools where you can do 10 people at a time with a five-minute turnaround, that changes the game for groups,” Maddox said. “Maybe you’re not waiting until mid next year if you can have testing that shows everyone walking into this space is COVID-free. That is a bridge we need to get to in a place that requires a lot of people to be together before we’re into the vaccine.” 

Wynn executives said 2022 and 2023 convention bookings are strong.

About the Author

Buck Wargo

Buck Wargo is a former journalist with the Los Angeles Times and has been based in Las Vegas as a business, real estate and gaming reporter since 2005.

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