Studio City has unveiled its unaudited financial results for the second quarter of 2024, revealing a remarkable 40.1% increase in total operating revenue, which reached $161.5 million. This growth is driven by a resurgence in inbound tourism to Macau and the recent expansion with Studio City Phase 2, which opened in April 2023.
Impact of Macau’s Tourism Recovery
The surge in Studio City’s revenue is closely linked to the broader recovery of Macau’s tourism industry. The region has experienced a 43% increase in total visitor arrivals during the first half of 2024. This uptick in visitors has played a crucial role in boosting revenue for resorts like Studio City. Additionally, Macau’s gross gaming revenue saw a 11.6% year-on-year increase in July, further supporting the positive trend in the hospitality and gaming sectors.
Casino Revenue Surge
Studio City’s casino revenue saw a staggering 98.9% increase compared to the same quarter last year. This nearly doubling of revenue highlights the significant role of gaming operations in the resort’s financial success. The robust growth in casino revenue can be attributed to both the increasing number of visitors and the enhanced gaming facilities following the Phase 2 expansion.
Non-Gaming Revenue Growth
Non-gaming revenue also showed substantial growth, rising to $99.4 million from $84 million in the second quarter of 2023. This increase reflects higher earnings from various non-gaming services such as food, beverage, and retail, contributing significantly to the overall revenue growth.
Challenges in Entertainment Revenue
Despite overall revenue growth, the entertainment segment faced a stagnation, with no significant increase reported. This could be due to shifting consumer preferences or market conditions affecting entertainment offerings.
Operating Income Turnaround
Studio City reported an operating income of $3 million for the quarter, a significant improvement from the $18.7 million operating loss in Q2 2023. This turnaround demonstrates effective operational strategies and adjustments that have positively impacted the resort’s financial health.
Surge in Adjusted EBITDA
Adjusted EBITDA for the quarter rose by an impressive 86.3%, reaching $54.2 million. This growth is largely driven by the increase in casino revenue and the overall rise in non-gaming revenue. The substantial improvement in adjusted EBITDA underscores the effectiveness of Studio City’s operational and revenue-enhancement strategies.
Broader Market Trends
The positive financial performance of Studio City is indicative of broader trends within the Macau tourism and gaming sectors. The increase in visitor numbers and gaming revenue highlights a recovering and growing market, benefiting major players in the region.
Paysafe’s Positive Results
In related news, Paysafe has also reported favorable results for Q2 2024. While details of Paysafe’s performance are not included in this report, the positive financial climate for companies in the tourism and gaming sectors is evident.
Studio City’s financial results for the second quarter of 2024 illustrate a strong rebound in revenue, driven by increased tourism and new developments. The significant growth in operating revenue, combined with improvements in operating income and adjusted EBITDA, highlights the resort’s successful adaptation to market conditions and its potential for continued success in the recovering Macau tourism landscape.