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SEC filingMGM's Q3 2025 operating results were heavily impacted by a $256M goodwill impairment and $93M in Empire City write-offs.
For the three months ended September 30, 2025, MGM Resorts reported consolidated net revenues of $4.25 billion, a 2% increase compared to $4.18 billion in the prior year quarter. The growth was driven by strong performance at MGM China (+17%) and MGM Digital (+23%), partially offset by a 7% decline at Las Vegas Strip Resorts. Despite the top-line increase, consolidated operating income fell to a loss of $112.9 million from income of $314.9 million in Q3 2024. This dramatic swing was primarily attributable to $256 million in goodwill impairment and $93 million in charges for write-downs and impairments, both related to the company's decision to withdraw its application for a commercial gaming license for Empire City. On a net basis, MGM reported a net loss of $206.7 million compared to net income of $244.2 million in the prior year. The effective tax rate was a benefit of 5.9% on loss before income taxes, impacted by the non-tax-deductible goodwill impairment.
This segment's net revenues declined 7% to $1.98 billion, driven by decreases across all major revenue streams. Casino revenue fell 5% due to disruption from the MGM Grand Las Vegas room remodel and a lower table games win percentage (22.6% vs. 23.7%). Rooms revenue dropped 11% on an 8% decline in RevPAR to $210, with occupancy falling to 89% from 94% and average daily rate down to $236 from $243. Food and beverage revenue declined 5% on fewer restaurant covers. Segment Adjusted EBITDAR fell 18% to $600.9 million, with margin contracting to 30.3% from 34.3%.
Net revenues were flat at $956.9 million. Casino revenue increased 1% for the nine-month period due to higher slot handle and win. Segment Adjusted EBITDAR decreased 1% to $295.5 million, with margin declining to 30.9% from 31.5% due to increased payroll and other expenses.
Net revenues surged 17% to $1.09 billion, powered by an 18% increase in casino revenue on higher main floor table games drop ($4.07B vs. $3.44B). Segment Adjusted EBITDAR grew 20% to $284.0 million, with margin improving to 26.1% from 25.5%, driven by the casino revenue growth.
Revenue jumped 23% to $174.0 million on organic growth and brand expansion. The Segment Adjusted EBITDAR loss remained essentially flat at $23.2 million, consistent with the prior year quarter.
Management highlighted several forward-looking items. The company entered into an agreement to sell the operations of MGM Northfield Park for $546 million in cash, with the master lease with VICI to be amended to reduce annual cash rent by $53 million. BetMGM North America Venture announced it expects to distribute at least $200 million in Q4 2025, with MGM expecting to receive its 50% share. Planned capital expenditures for the remainder of 2025 are estimated at $285-$335 million, including $50-$70 million for MGM China. The company continues to fund MGM Osaka, with estimated remaining commitments of approximately JPY361 billion ($2.4 billion) over the next three years. Future share repurchases remain a priority, with $2.122 billion remaining under the company's stock repurchase plans as of September 30, 2025.
Operating cash flow of $1.874B exceeded net income of $138M by a wide margin, indicating strong cash generation relative to reported earnings. The primary non-cash adjustments were depreciation and amortization ($739M), goodwill impairment ($256M), and foreign currency transaction losses ($285M). Capex intensity remained high at $772M, representing 41% of operating cash flow. Free cash flow (CFO minus capex) was $1.102B, which covered share repurchases of $717M and distributions to noncontrolling interests of $159M. The company also repaid $500M in long-term debt while borrowing $290M under bank credit facilities. Working capital changes were mixed: accounts receivable provided $128M, while accounts payable and accrued liabilities consumed $205M. The net cash position declined by $282M, ending at $2.221B. Overall, cash flow quality is solid, with operating cash flow comfortably funding capital expenditures and shareholder returns, though the large goodwill impairment and foreign exchange losses warrant monitoring.