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Revenue diversity is fine but has it gone too far?

  • Non-gaming (room, food & beverage, and entertainment) revenues accounted for 62% of total Strip revenues in Fiscal Year 2011 (ending June 2011), far higher than its 49% proportion seen 15 years ago
  • Vegas operators e.g. MGM, CZR, STN, have been more dependent on hotel revenue growth.  Unfortunately, Vegas REVPAR growth is trending negative in Q3 compared with a 15.4% growth rate in 2011, as it has become difficult to push rates higher.
  • Our big issue continues to be that fewer young people are playing slots and slots are the highest margin revenue stream in Vegas

CHART DU JOUR: GAMING CONTINUES ITS DECLINE - STRIP1