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Red Rock Resorts reported its second-highest second-quarter gaming revenue and profitability on record on Tuesday, as renovation work at several Las Vegas properties weighed on results but failed to derail the casino operator’s performance.
The company reported Q2 net revenue of $510.3 million, down 3.0% from $526.3 million a year earlier. Net income fell 29.3% to $76.6 million, while adjusted EBITDA declined 9.3% to $208.0 million.
Revenue from Las Vegas operations, the company’s largest business, slipped 2.0% to $503.2 million, while adjusted EBITDA from the segment fell 5.0% to $227.5 million. Revenue and adjusted EBITDA from Native American operations declined 62.0% and 72.0%, respectively.
“Our second-quarter results demonstrate that the company we have built over the past five decades is as strong as it’s ever been, even against the strongest operating quarter in the company’s history a year ago,” President Scott Kreeger said.
Kreeger said the company’s Durango property continued to perform well despite ongoing construction related to its $385 million expansion. The project calls for an expanded casino floor with 400 additional slot machines, a 36-lane bowling facility, luxury movie theaters, new restaurant concepts and new entertainment venues.
“Our Durango property continued to perform exceptionally well despite ongoing construction impacts and has firmly established itself as a meaningful growth driver within the Las Vegas locals market,” he said, adding that the Durango North expansion remains on schedule to open in the second half of 2027.
Red Rock is also continuing redevelopment projects at Sunset Station and Green Valley Ranch. Kreeger noted that renovations at Green Valley Ranch reduced available hotel inventory by more than 21,000 room nights during the quarter, affecting both revenue and profitability.
“We believe these temporary disruptions are more than offset by the long-term benefits of these investments,” Kreeger said.
The next step in Sunset Station’s redevelopment will see enhancements to the movie theaters, relocation of the temporary bingo operation into a permanent location, and redevelopment of the former buffet space into a premium steakhouse and high-limit slot and table game area. Construction remains on schedule for the $87 million project, expected to be completed throughout 2026 and into 2027.
Meanwhile, the renewed Green Valley Ranch hotel will open in late September, but a next phase of redevelopment will extend into 2027. The long-term strategy will encompass a comprehensive casino floor refresh, enhancements to food and beverage offerings, and upgrades to entertainment amenities.
The company ended the quarter with $136.5 million in cash and cash equivalents and total debt of $3.6 billion.
Red Rock’s board declared a quarterly cash dividend of $0.26 per Class A common share, payable on September 30 to shareholders of record as of Sept. 15.
Vice Chairman Lorenzo Fertitta said the company also plans to incur an $8 million marketing expense in the third quarter to mark its 50th anniversary in Las Vegas.
“We’ve done a number of different brand campaigns in the past, and we just felt it made sense to do it around the 50th anniversary,” Fertitta said. “They do cost money, and it is a charge that’s going to hit the third quarter, but overall we think it’s the right thing to do for the long-term benefit of the business.”