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How Las Vegas Casinos Make Money – In The Casino & Beyond

The economics behind how resorts in Las Vegas make money is evolving. While the casino is still the star of the show, ancillary offerings like rooms, dining, and entertainment are making their presence known on the income statement.

Curious as to the impact of other revenue centers, I dug into MGM Resorts’ 2022 annual financial reporting to get a feel for how casinos make money, and what parts of the business are driving profitability.

For those unfamiliar, MGM operates properties in Las Vegas including MGM Grand, Luxor, Bellagio, Excalibur, Park MGM, New New York York, Cosmopolitan, and Mandalay Bay.

While MGM Resorts’ footprint extends beyond Las Vegas, I figured their high-level numbers would be able to provide a solid window into the business.  

Below, is an overview of MGM’s revenue per category or, simply put, what customers spent per activity before MGM deducted out expenses.

Casino revenue is defined as what the casino “won” over the year after paying out players. All numbers below are expressed in thousands (add 3 zeros to the end of each).

Revenue per Category: 

A table depicting MGM Reosrts revenue by business unit.
A pie chart showing MGM Resort's revenue by business unit.
Blue, money generated by the casino, is still king.


As you look at Revenue generated by MGM, it’s no secret that the casino is king accounting for 44% of the money coming in. Notably, this figure was 48% in 2016 when I last crunched the numbers, so the gaming floor is losing ground.

Hotel rooms and Food/Beverage come in as the second two largest generators accounting for 23% and 20% of the company’s revenue in 2022 respectively.  

When you take the revenue per category and subtract out the expenses incurred, you can get a nice, simplistic, high-level picture of what the casino profits from each category.  

A table showing profit by business unit at MGM resorts.
MGM’s profit per category after the deduction of expenses.
A pie chart showing profit by business activity at MGM Resorts.


Although other categories carry some weight for MGM, the Casino still nets almost as much money as the rest of the categories combined at close to $3 billion vs. $3.5 billion of profit generated by room sales, entertainment, and food & beverage combined.  

There are additional expenses that eat away at MGM’s bottom line that aren’t directly attributable to one of the revenue categories above such as corporate expenses ($131 million in 2022) and general and administrative expenses ($1.2 billion in 2022), etc, however, the info above should give you a good idea of where Las Vegas resort revenue and profits are coming from.

What’s clear is that although money generated from gaming is important, it’s not the only show in town. There are now other key drivers of resort profitability including entertainment options, dining, and the property’s hotel.

These fringe services are becoming a more important piece of the profitability picture as up-and-coming generations shy away from gambling and seek “experiences”.

More properties are getting creative with revenue drivers and rightfully so. For instance, you can now play Twilight Zone Mini Golf, rip on a zipline attraction, dine at some of the best buffets in the world, sip slushy drinks immersed in an opulent pool scene, or even see a big-name headliner.

Gambling will always be the core offering, but there’s an undeniable shift in Vegas toward new and innovative dining and entertainment options.  

See Also: Could Circus Circus be the next Las Vegas implosion?

Feature Image: ©f11/123RF.COM

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Friday 17th of September 2021

Says By Author Jake Posted on Last updated: August 5, 2021

BUT this number are from 2016. Is there anything more updated? Curious about the "On a final and unrelated note, as of the end of 2016, MGM logged an “Outstanding Chip Liability” of over $227 million. "


Friday 5th of January 2018

The end of 2016 or the end of 2017 there was $227 million in chips out?


Friday 5th of January 2018

This data was based on MGM's 2016 annual report - Their 2017 report actually comes out in February and that info will be detailed there!

Al Sahlen

Wednesday 3rd of January 2018

Thanks for this. Interesting to see where we're blowing our dough. Happy to do it!

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