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Las Vegas Sands Shares Fall as Weak Macau Performance Hits Q2 Profit
Las Vegas Sands (NYSE: LVS) reported a drop in its second-quarter profit and revenue, primarily driven by weaker-than-expected results from its extensive casino operations in Macau. The company's shares fell approximately 6% in extended trading following the Wednesday announcement.
Quarterly Results Miss Estimates
The casino and resort operator disclosed a quarterly profit of $373 million, or 53 cents per share. This marks a significant decrease from the $519 million, or 66 cents per share, reported in the same period a year ago.
Total quarterly revenue also saw a slight decline, falling 0.7% year-over-year to $3.15 billion. Revenue from the company's Macau operations, which include six properties such as the Venetian Macau, fell marginally to $1.79 billion.
Macau Hold Rate Pressures Earnings
AdAccording to the company, the downturn was largely attributable to an "unusually low hold in rolling play" within its Macau business. This term refers to a lower-than-average win percentage for the casino on bets made by high-roller gamblers, which countered otherwise solid growth in overall gaming volumes.
Broader market headwinds in the region may have also contributed. The Reuters report noted that overall gambling revenue in Macau was impacted in June by factors including bettors shifting spending to the FIFA World Cup, weakness in cryptocurrencies, and tighter controls on capital flows.
Market Impact
The earnings miss prompted an immediate negative reaction from investors, reflecting the critical importance of the Macau market to Las Vegas Sands' overall financial health. The 6% drop in the company's stock price in after-hours trading signals investor concern over the profitability and near-term outlook for the region.
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