Addressing a slow summer
Hornbuckle confessed that MGM and its properties did not act in the best interest of its customers during the trying summer months, which had resounding impacts on the local community.
"We should have been more sensitive to the overall experience at a place like Excalibur,” he said in the call, according to KLAS. “You can't have a $29 room and a $12 coffee. We lost control of the narrative over the summer,” Hornbuckle continued. “I think we would all agree to that in hindsight.”
While the prices may have upset customers, Hornbuckle said there were other factors that contributed to the lack of traffic in the area.
He referenced a 400,000-person decline in travel via Spirit Airlines, Southern California drive-in visitation declining, and a slump in international travel due to tariffs and policies enforced by President Trump, per KLAS.
“July for everyone in the community was a rough month. The summer was rough,” Hornbuckle said.
MGM optimistic regarding Q4
With the disappointing summer behind them, MGM still has reason to be optimistic. Hornbuckle said that the casino and leisure company has a chance to beat its “all-time fourth quarter” numbers from a year ago.
MGM’s chief financial officer and treasurer, Jonathan Halkyard, also said on Wednesday that the company took on feedback from its customers regarding acceptable prices for various amenities and services. He said about 90 percent of the company’s prices have been adjusted to fit that feedback.
The summer prices had gotten so extreme that “Pawn Stars” star Rick Harrison called out casino companies.
“I also blame the casinos on the Strip a little bit,” he said. “I mean, they've gotten a little insane with their prices.
“I've heard so many people complain,” he continued. “They go to a hotel, they go to check out. And there's $500 in stupid fees on their bills — resort fees and parking fees and this fee and that fee.”
MGM only claimed about $2 billion in third-quarter revenue, though that was heavily influenced by renovations at MGM Grand Las Vegas, the company said.
The fourth quarter got off to a slow start, as year-over-year revenue dropped from $731 million in September to $601 million this time around.
