Title

Presentation

Wynn Resorts, Limited beats earnings expectations. Reported EPS is $1.25, expectations were $1.18.

Operator: Welcome to the Wynn Resorts First Quarter 2026 Earnings Call. [Operator Instructions] This call is being recorded, if you have any objections you may disconnect at this time. I will now turn the line over to Craig Fullalove, Chief Financial Officer. Please go ahead, sir.

Craig Fullalove: Thank you, operator, and good afternoon, everyone. On the call with me today are Craig Billings and Brian Gullbrants in Las Vegas. Also on the line are Jenny Holaday, Linda Chen and Frederic Luvisutto. Please note that we published a presentation to provide more color on the company and recent performance ahead of this call. You can find the presentation on our Investor Relations website. I want to remind you that we may make forward-looking statements under safe harbor federal securities laws, and those statements may or may not come true. I will now turn the call over to Craig Billings.

Craig Billings: Good afternoon. And as always, thank you for joining us. Before we get into the quarter, I’d like to take a moment to talk about Wynn Al Marjan in the UAE more broadly. First, I’d like to commend the Emiratis on their response during the initial weeks of the conflict. The country has shown an admirable ability to protect its people and its assets. At Wynn Al Marjan, construction has continued to progress with over 22,000 workers on site. The project team has been incredibly resilient. While we have faced logistical and shipping challenges in the region, deliveries have largely continued, and we are rerouting shipments and sourcing alternative materials where needed. Based on conditions today, these challenges are manageable, though we are realistic that the picture could shift as the situation evolves.

We do expect a modest delay in our opening time line, and I expect that we will quantify that in the coming months. That said, the project continues to move forward every day. Looking ahead, the UAE has world-class tourism infrastructure, unrivaled airport capacity and a strong policy framework. As the region stabilizes, we expect the country will find smart ways to accelerate tourism, and over the longer term, will continue to be one of the most attractive destinations in the world for high-net-worth residents and visitors. With that, I’ll turn to the quarter starting in Las Vegas. We had an eventful first quarter here in Las Vegas with the debut of Zero Bond and Sartiano’s Italian Steakhouse. Both venues opened positive guest and member feedback, and I anticipate that they will further strengthen Wynn Las Vegas position as the place to see and be seen here in Las Vegas.

I want to thank all of those who were involved in making those opening such a huge success, and in particular, the team at Wynn Design & Development. The combination of those openings and the ongoing efforts of our team led to another period of strong results. Hold adjusted EBITDAR grew 5% to $235 million (sic) [ $232.5 million ], inclusive of our best March in the history of the property. Casino revenues were up over 9%, driven by increases in both drop and handle. In the hotel, RevPAR was up nearly 10% year-on-year on a 12% increase in rate. That momentum has carried into the second quarter with drop and handle both up versus the prior year. We’ve also seen positive trends in the hotel with ADR up year-on-year in the month of April. We will begin the Encore Tower remodel in just a few weeks, a project that will ensure our rooms continue to set the standard in Las Vegas.

Our group business remains on pace to grow both room nights and rate above 2025, and we continue to feel good about the business in Las Vegas for the remainder of 2026. Turning to Boston. Encore Boston Harbor generated $51 million of EBITDAR in the first quarter. Slot revenues grew 2% year-on-year despite some very challenging weather in the Northeast and continued gaming expansion in New Hampshire. The team once again tightly managed operating expenses, though wage pressures remain a real challenge at the property and something we are actively working to address. The second quarter is off to a steady start with drop and handle both running ahead of last year. Turning to Macau. The team delivered a strong quarter with VIP hold adjusted EBITDAR of $296 million (sic) [ $279.4 million ].

Lower-than-expected VIP hold impacted the quarter by $17 million. Mass drop was extremely strong, up 19% and handle was up 32% year-on-year. That momentum persisted into the second quarter with mass drop running ahead of last year. Premium demand continues to drive the Macau market, and we were pleased to open our newly expanded Chairman’s Club during the quarter to strong customer reception. While it’s early days for the facility, the space is truly spectacular and a meaningful addition to what we believe is the best gaming floor in the market. With Cotai continuing to be the primary driver of high-quality visitation in Macau, and with Wynn Palace regularly nearing 100% occupancy, I’m pleased to announce a significant new investment at the property.

The Enclave at Wynn Palace, a 432 all-suite hotel, will sit directly adjacent to and connect into the east entrance of Wynn Palace. This is a $900 million to $950 million addition that will increase the existing Wynn Palace room count by 25% and our suite count by 50%, driving more foot traffic into gaming and our existing food and beverage outlets. The design is distinctly Wynn, an evolution of the design language that has defined our resorts from the beginning. You can find additional details on Enclave in our investor deck on Page 19. With that, I will now turn the call over to Craig for some additional details on the quarter.

Craig Fullalove: Thank you. At Wynn Las Vegas, we generated $232.5 million in adjusted property EBITDAR on $661.9 million of operating revenue during the quarter, delivering an EBITDAR margin of 35.1%. Unfavorable hold negatively impacted EBITDAR in the quarter by just over $2 million. OpEx per day, excluding gaming tax, was $4.55 million in the quarter, up 6.8% compared to the prior year due to a combination of higher business volumes contractual wage increases and incremental staffing for new outlets, including the newly opened Zero Bond and Sartiano’s as well as PISCES, which opened in May of 2025. Turning to Boston. We generated adjusted property EBITDAR of $50.5 million on revenue of $205.7 million with an EBITDAR margin of 24.6%.

We maintained discipline on the cost side with OpEx per day of $1.22 million, up 3.9% compared to the first quarter of 2025 despite continued labor pressures in that market. The team in Boston continues to do a great job of mitigating union-related payroll increases with identified cost efficiencies that do not impact the guest experience. Our Macau operations delivered adjusted property EBITDAR of $279.4 million in the quarter on $989.2 million of operating revenue, resulting in an EBITDAR margin of 28.2%, lower-than-normal VIP hold negatively impacted EBITDAR by just over $17 million in the quarter. OpEx, excluding gaming tax, was approximately $2.9 million per day in Q1, up 9.9% year-on-year, with the increase driven primarily by higher business volumes, the opening of the Gourmet Pavilion in Q2 of 2025 and the expansion of the new Chairman’s Club this quarter, along with normal course cost of living adjustments.

In terms of CapEx in Macau, Craig mentioned the new Enclave Hotel tower at Wynn Palace. Final government approvals are starting to come together, and we look forward to commencing construction on our larger CapEx projects soon. Spend on the Enclave Tower in 2026 will be limited to some piling and early development works. We continue to expect the initial work on Enclave, together with our other CapEx projects to result in a 2026 expansionary CapEx range of $400 million to $450 million. Moving over to the balance sheet. Our liquidity position remains very strong with global cash and revolver availability of $4.4 billion as of March 31. This was comprised of $2.8 billion and $1.6 billion of total cash and available liquidity in Macau and the U.S., respectively.

The combination of strong performance in each of our markets globally with our properties generating just under $2.3 billion of LTM adjusted EBITDAR, together with our robust cash position creates a very healthy consolidated net leverage ratio of just over 4.4x. Our strong free cash flow and liquidity profile also allow us to continue returning capital to shareholders in both Macau and the U.S. To that end, the Wynn Macau Board recently announced it has recommended to shareholders an increase in the final dividend for 2025 to $150 million, up from $125 million in the previous period, subject to shareholders’ approvals at the upcoming Annual General Meeting on May 28. In addition, the Wynn Resorts Board has approved a cash dividend of $0.25 per share, payable on May 29, 2026, to stockholders of record as of May 18, 2026.

During the quarter, we also repurchased 528,000 shares for approximately $53.8 million and an additional $30.6 million so far in the second quarter. These share buybacks, together with our recurring dividend highlight both our confidence in operations and ongoing commitment of prudently returning capital to shareholders. In terms of CapEx, we spent approximately $179.1 million in the quarter, primarily related to Zero Bond, Sartiano’s and the Cliff House Grill in Las Vegas, the new Chairman’s Club expansion at Wynn Palace and the hotel refurbishments at Wynn Macau as well as normal course maintenance CapEx across the business. In addition to that figure, we contributed $100.1 million of equity to the Wynn Al Marjan Island project during the quarter, bringing our total equity contribution to date to $1.01 billion.

We also continue to draw on the Marjan construction loan with a drawn amount to date of $962.3 million. We estimate our remaining share of the required equity including the new Janu project is approximately $350 million to $450 million. With that, we will now open the call to Q&A.

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Operator: [Operator Instructions] Our first question comes from Dan Politzer with JPMorgan.

Daniel Politzer: Craig F, looking forward to working together. I guess this one is more for Craig B. I recognize you’re in a very tough position as it relates to navigating the path to getting Wynn Al Marjan open. But I guess can you talk about what have you been doing differently over the past few months to ensure the project stays on track to the extent that it’s within your control? And then can you talk about supply chain constraints on getting materials to the region, and how do you think about impacts to the surrounding area supply chain — as supply surrounding area hotel supply coming online in the coming years?

Craig Billings: Sure. I guess, first of all, early on, our focus was really on, of course, on team safety. And honestly, I mean, life kind of carried on relatively normally in the UAE. So really, that was about mental health more than it was physical health, and as you’ve seen, the Emiratis just did an incredible job of defending the country. The team is back in Ras Al Khaimah, both on the design and development side and on the operations side, fully functioning. We’re in the building, snagging the building. Construction actually continued throughout the entire series of events. And so we’re carrying on. I mean, really, the point that you raised on logistics is the only challenge, which is why I called it out in my prepared remarks.

And it’s not tragic. I mean supply chains have this amazing ability to become flexible and to find additional routes to market, and we’ve seen that be the case. There are certainly things that are not as easy to get as they would have been before the conflict, but we’re more than making do. We’re actually advancing the project and moving ahead. So I mentioned that we expect a modest delay, and I use the word modest very, very intentionally because that’s what we believe it will be. We don’t want to size that until we have kind of a real view on stability. So if I had to turn it into sound-bite, construction continues. We’re making do just fine, and we will carry on.

Daniel Politzer: Got it. And then just turning to Macau, the new project on Enclave at Wynn Palace — why now? Will this have a gaming element? How do you think about disruption or potential returns on that $900 million to $950 million investment?

Craig Billings: Sure. Look, Wynn Palace runs at essentially full occupancy every night. And so when you’re at 99% occupancy, you’re not making a speculative bet by adding rooms. You’re clearly capturing demand that already exists, and that you’re currently turning away. So adding 25% in total room capacity and increasing the suite product by 50% in a market that’s heavily driven by the premium segment just makes sense for us. I think it’s reasonable to assume — and you can get pretty conservative here, but it’s reasonable to assume USD 2,500 theo per room night, which is incremental $400 million, call it, of GGR. You don’t have a lot of non-EBITDA generating amenities that come with the tower. It does not have a gaming element.

It has very, very modest food and beverage because it’s directly attached to the existing Wynn Palace facility. And so flow-through should be pretty high. I mean that GGR is probably $150 million to $175 million in EBITDA for us. So to us, it felt like a real no-brainer. In terms of disruption, it’s actually — there obviously may be some disruption, but it’s not significant because it’s a relatively constrained portion of the — of our plots where we will be doing the construction, and it’s at the east entrance. So if you’ve been to Wynn Palace, that’s the existing bus entrance. So our North and South porte cocheres will remain completely open and functional as will the promenades that run around and into the Casino.

Operator: Our next caller is Shaun Kelley with Bank of America.

Shaun Kelley: And welcome, Craig, look forward to getting to work with you a little bit more closely. So whoever wants to take it, and Craig Billings, I’m sorry if I missed this, I dialed in a moment late. But obviously, I think the comment was a modest delay around where we’re at with Al Marjan. And just curious on maybe just strategically how you’re thinking about it a little bit more. We’ve had some questions around timing as it might relate to is there an optimal time before the summer? Is it something that given the seasonality in the market, we might want to be a little bit more sensitive to opening during the summer? Or could that give you a little bit more flexibility as you’re re-ramping into the market? I know there’s probably a lot more unknowns, but just any way you’re thinking about it might be useful.

Craig Billings: Yes, sure. Look, there’s pros and cons to both. As you all know, seasonality has an impact on gaming resorts, but not nearly the impact that it has on pure hotels. And so Vegas is a good example. Vegas, it gets incredibly, incredibly hot here in the summer. And there is some modest seasonality that has a lot to do with group and convention more than anything else, but it’s not wild swings. And I think in the long run, I would anticipate the same thing in the UAE. When you can fill your rooms with gaming customers, you obviously don’t have the same level of seasonality that you might see in a pure hotel. So as it relates to the first year in which we opened, I think that’s really dependent on the final resolution on what our opening date is, and what the options are available to us. So I would say — at this point, I would say, stay tuned. But we are forging ahead with the project every day, and we look forward to opening in 2027.

Shaun Kelley: Perfect. And then as a follow-up, let’s maybe pivot to Las Vegas. The Q1 operating performance looks super strong. I mean, RevPAR up 10%, I think, is nicely above the market. Could you help us level set how we should think about Q2 and Q3 both seasonality, and there have been some discussions in the market around things improving, given easier comps ahead. So help us think about that from Wynn’s perspective, just how we should think about the upcoming periods ahead.

Craig Billings: Sure. Happy to, Shaun. I think first of all, it’s important to remember that we had an incredibly strong 2025, unlike the market in general. We produced over $900 million in EBITDA in Vegas in 2025. We had a record second quarter all-time monthly EBITDA record in the month of August, and we set quarterly records for ADR in both 2Q and 3Q of last year. So we really didn’t have a trough. That strong performance obviously has knock-on implications. We will continue to be up against relatively difficult comps. And so the margin expansion that you might normally see coming off a trough quarter isn’t available to us. But hey, I mean, Las Vegas is performing incredibly well by all historical standards. You can see it in the numbers you cited several of them.

There’s a bunch of things to look at and be proud of in Q1 results. And everything that we can see looking out further into the year and based on what we saw in Q1, makes me feel good about 2026. But I do want to carefully distinguish us from the market in general because we didn’t see a slowdown in 2025.

Operator: Our next caller is Lizzie Dove with Goldman Sachs.

Elizabeth Dove: Just on the UAE, obviously, a lot of recent softness understandably that’s completely totally out of your control and hopefully temporary. But I’m curious how you think about longer term, how this kind of influences the ramp profile or if anything has changed in terms of some of the targets or the moving pieces around the targets that you put out in December?

Craig Billings: Sure. I mean, look, I’ll start at the strategic level. I think it’s important to step back and look at the UAE’s track record, right? This is a country that has navigated multiple regional conflicts over the past two decades and has consistently come out stronger. They’ve done that by investing in infrastructure, diversifying their economy, positioning themselves as a neutral hub for commerce and for tourism, and that playbook hasn’t changed. What I’d also point out is that the UAE’s response to this conflict has, if anything, reinforced their credibility on the security front. Their defense infrastructure performed exceptionally well. And I think the international community, I hope, took notice of that. Now I’m not going to sit here and tell you there are no risks.

There are logistical challenges today. And depending upon how the situation evolves, there could be more. But when we underwrote this project, we didn’t underwrite a region with zero geopolitical risk. We underwrote a country with a demonstrated ability to manage through it and to emerge in a better competitive position on the other side. So the long-term tourism fundamentals in the UAE haven’t changed, the airport capacity, the Visa framework, the quality of life, those are durable assets. And I’d remind everyone that the UAE’s ambition to grow tourism is a national priority backed by real capital and real policy. And so we think Wynn Al Marjan is positioned to be a meaningful beneficiary of and contributor to that trajectory. And so our conviction in the project hasn’t changed.

How that translates into EBITDA estimates, it’s far too early to tell. I could present you with a bull case, I can present you with a bear case. I could tell you that when the situation stabilizes, as it seems to be, knock on wood, that the Emiratis will — because they’re very thoughtful and very proactive will come out with policy prescriptions and smart ways to drive tourism back to the market, and we could certainly be a beneficiary of that. So I think it’s too early to say. We’re certainly not revisiting any of the numbers that we previously presented. But I got to tell you, we remain as convicted in the project as we were before the conflict began.

Elizabeth Dove: Perfect. That’s super helpful. And then going back to Vegas, there’s been talk in lodging, especially about the C-shaped consumer and lower end getting better. But with what you’ve just printed, it looks like luxury is very much still firing on all cylinders, and you’re outperforming on the hotel side. So maybe could you put a finer point on that, what you’re seeing on that luxury consumer, and how you’re outperforming in Vegas? And maybe just anything you’re seeing in terms of that business consumer versus leisure, anything you’d call out there?

Craig Billings: Yes, I’ll start, and then I’ll ask Brian for his thoughts as well. Look, I think the Q1 numbers tell it all. Some of that, you could say is the luxury consumer. Some of that, you could say, is us and the very specific strategies that we have deployed over the course of the past several years. But there’s kind of three big operating leverage levers in our business, gaming market share, RevPAR and retail sales, and all of them did extremely well in Q1 and continue to do extremely well into Q2. So I think that is the read. Part of that is a read on us, and part of that is a read on the consumer take that for what you will and split the results between those two attributes, how you see fit. But that’s my view on where we are. Brian, what would you add?

Brian Gullbrants: Yes, I think you said it well. But the barometer for us as we look forward, both market share that we’ve taken share in January, February and March, group pace, so we can see what the Corporate America is looking at, and how they’re viewing the economy in the coming 18 to 24 months, and we’re on pace to hit our numbers and exceed our numbers of ’25. And then luxury retail sales, which we have a phenomenal selection of boutiques here, and they’re all year-on-year, quarter-on-quarter growth from very high watermarks from the previous years. So I see those as positive indicators of our customer base and where they’re kind of headed at, and we’re still seeing the bookings. And you can see by our ADR growth that there’s not that much resistance to price at this point. So we feel like we’re in a good place right now, knock on wood.

Operator: Our next caller is Stephen Grambling with Morgan Stanley.

Stephen Grambling: I wanted to turn back to Macau. And just would love to hear any kind of response and impact that you’re starting to see from some of the recent CapEx projects there, particularly the Chairman’s Club.

Craig Billings: Sure. Happy to talk about that. We’ve really had kind of two major initiatives over the course of the past year. The first was the Gourmet Pavilion, which we’ve talked about, and the second was the second level of Chairman’s Club. And one is more mature than the other. Obviously, the Gourmet Pavilion has been open for some time. And what we’ve been able to do with the Gourmet Pavilion is drive a whole bunch of incremental foot traffic into the building and be able to retain the customer that is already in the building longer than they might have otherwise been there because it’s no secret that we, relative to our competitors, have generally historically had very, very good haute cuisine and upscale restaurants, but didn’t have as many more accessible options.

And so it’s played an important role in retention. On the Chairman’s Club, the early signs are actually quite good. There’s really two reasons to put the Chairman’s Club into place. One is obviously, to take incremental share of that customer. I think that will take a little bit based on visitation patterns. I think that will take a little bit longer to play out. The other is, again, to keep people around longer, which has positive implications on hold, and we are beginning to see that now. When we put the Enclave into place, again, with those incremental rooms, the beauty of that project once again is that we’re pushing a whole bunch of new customers that we can accommodate through the pre-existing facilities, and that will play into both of those CapEx — both of the CapEx projects that I mentioned, the Gourmet Pavilion and the Chairman’s Club second floor.

Stephen Grambling: That’s helpful. And going back to Vegas, I think that you have in there that you’re still on plan and planning through the refresh. Can you just remind us of the cadence there and if anything has changed in terms of the timing?

Craig Billings: Nothing has changed in terms of the timing. It will commence shortly, and then we do it in pockets over the remainder of 2026 and into very early 2027, working around kind of peak occupancy points.

Operator: Our next caller is John DeCree with CBRE.

John DeCree: Craig, I know you’ve probably already provided everything you can about UAE. But maybe to pile on one more question. I know we spent a little bit of time talking about construction, but I wonder if you could comment on any changes in some of the ancillary items, building property awareness, hiring, the pace of hiring marketing programs and things like that. It might be a little bit early for some of that. But has anything changed in terms of strategy or pacing on those fronts?

Craig Billings: No. I think your mass — in terms of awareness in all of the preopening branding that we would do nothing really changes. Everything kind of carries on as normal. In terms of the mass hiring to be — when we are able to quantify our modest delay, we will obviously slightly delay mass hiring, but that’s really just because you don’t want to burn cash that you don’t need to burn. And so you bring people on just ahead of opening and then you aggressively train them. In terms of the ability to hire, I got to be honest, we haven’t seen any slowdown whatsoever in interest in working in the building. Remember, substantially all of our operations leadership team is already in place. So the senior talent question is kind of largely behind us, but we haven’t seen it let up.

I mean, again, it’s interesting to watch the news coverage. And I don’t want to minimize what’s happening in the region, and I’m not minimizing what’s happening in the region. I’ve been watching it hour-to-hour, day-to-day for weeks now. But life day-to-day has kind of — in the UAE has kind of carried on and things are getting done. And again, the Emiratis are doing a great job of making sure that the population is secure. So other than things moving back some small amount of time, I don’t see a significant change in anything we would do preopening.

John DeCree: Craig, I appreciate the additional color there. And maybe a quick follow-up on Las Vegas. You’ve already commented quite a bit about the 1Q results being quite strong. But I wanted to ask, I know Las Vegas had some pretty significant citywide events and not typically your customer. But do those big citywide kind of sellout that we see like CONEXPO, does that help at all in terms of pushing rate, or would you say your business is still just kind of different focus from that?

Craig Billings: No, it’s definitely beneficial to our business for sure. I mean, usually, we draw a lot of business off citywides. And the usual playbook is that we tend to in many cases, house the executives, the VP level folks, et cetera, et cetera. So that’s super important to our business. And then, of course, Beyond that, anything that creates compression in the city more broadly is also inherently beneficial for us. Brian, would you add anything to that?

Brian Gullbrants: No, compression is key. When the city fills and the cream of the crop want to stay here, we’re able to accelerate the ADR and the yielding and our team does an exceptional job of that. So I think we’ve got every bit of it in Q1, it was quite remarkable. The team did a great job.

Craig Billings: Your presumption that we do a lot of kind of all in-house business, which I think was implicit in your question, is absolutely correct. But we take advantage of citywides just like everybody else in the market does.

Operator: Our next caller is Robin Farley with Union Bank Switzerland.

Robin Farley: Great. My question, going back to Al Marjan, not so much about your resorts specifically or when it might open, but I wonder if you have any thoughts on just the broader market. We can see what’s happening with the occupancy rates in the region right now. Just what your thoughts are about the timing for recovery in that market, sort of independent of when you ultimately end up opening just what your expectations are for recovery in the market more broadly the time frame.

Craig Billings: Yes. I think it’s a little early to start forecasting the recovery pace. But what I would say is this, you have incredible airlift in Dubai. You have a market through which many folks transit if nothing else, because of that airlift. You have a government that from a policy perspective, has committed itself to tourism, and you have incredible amenities and incredible hospitality. So I think when things do stabilize, I think you have to assume that policy prescription and really Emirates, frankly, are going to hit the gas in terms of trying to drive folks to the market as quickly as they can. I think our read is that there are certainly certain demographics out there that would be delighted to return to the market today.

And then there are other demographics that probably would be a little bit more cautious. But if you look at history, the demand curve on travel is extremely flexible. I mean look at the — I hate to bring up the events that have happened in Las Vegas, but look at events that have happened in Las Vegas and the response to that, I’m referring specifically to 2017, the response to that was real, but obviously short-lived. I can look at 9/11. I can look — I look at a number of events that might have called into question the recovery of travel, and sure enough, it did. And so again, I’m not going to make any forecast as we’re sitting here on this call, particularly as things are just starting to settle down. But I don’t think you can underestimate the flexibility of the traveler and the desire of local constituents in the UAE to stimulate a return to the market.

Operator: Our next caller is Brandt Montour with Barclays.

Brandt Montour: So a two-parter for Las Vegas. You guys came in at OpEx per day, just a little bit higher than the $4.3 million to $4.5 million target range you laid out last quarter. And I don’t want to connect anything to that, but one of your peers this earnings season did call out an elevated level of sort of related claims and liabilities related to labor that did sound sort of Las Vegas wide in nature. And so maybe you could take two of — those two questions separately and let us know if you’re seeing any of that creep in your labor pool.

Craig Billings: No. Not at all. What you saw, really, there were really two things happening in OpEx. One is the wage increases that we have signaled for numerous quarters now, many of which are contractual. And the other is we started feeling just a little bit of pressure in COGS in food and beverage. And I think you’ve seen some of the food price volatility that has been in the market. What we try not to do is go adjusting portion sizes and things like that based on potential transitory moves in underlying input costs because that can have brand impacts and perceived value impacts and what we’ll continue to do is watch it. And if we have to make a move on price, we will.

Brandt Montour: Okay. That’s super helpful. And in Macau on the new tower, you gave us some thoughts on that. I’m just curious, when you underwrite that, are you underwriting to a promotional environment or competitive environment similar to today in the premium mass, or do you sort of think about it as maybe something that could lighten up by the time you open or if it even needs to? And then the other question would be, is that product going to be suite that’s tiered above your current suite product, or would that be sort of kind of the same?

Craig Billings: Sure. On the first portion of your question, I think the investment thesis for a project like this is really simple. Same product, more customers. So you’re tacking on additional room supply in a very efficient manner and driving that customer to your pre-existing amenities and your pre-existing facilities. We’ve been actually reasonably disciplined with respect to reinvestment. I don’t think we excessively considered reinvestment trends in underwriting this project. We underwrote it based on what we know our reinvestment rate to be. And the room product itself, so the base room will actually be slightly larger than our base room within Wynn Palace. They are all suites, so they all have separate living chambers and bed chambers. And the way I would describe it in terms of aesthetic finish is that it is complementary to our existing product. It’s not the same nor is it a radical departure that would feel as though it was off brand.

Operator: Our next caller is David Katz with Jefferies.

David Katz: Craig F, welcome to the hemisphere. I wanted to just go back to Al Marjan, you talked about alternative supplies and things like that. How comfortable are you today with the budget and the cost? And might we sort of build a little bit more cushion in there as we go forward?

Craig Billings: Yes, it’s a good question. The only thing I would say, there’s really two prongs that I would use to respond. The first is shipping rates have definitely gone up. It’s nothing significant. It’s — in the end, that will be likely a rounding error on the total budget, but shipping rates have certainly gone up. And then the second is we have a team that’s on the ground there now, and we will be carrying the cost of that team for slightly longer. So that too will be incremental preopening budget that we will have to wear. I don’t think either of those — neither of those change the investment thesis of the project or I think, should be a concern to investors, but it certainly will be the case. And as we bring together our perspective on any delay, we will clarify that point.

David Katz: Understood. And if I may, what would be the circumstances, or is there any thought given to expansion in Las Vegas at some point. The land bank is available. I asked about it periodically, maybe too often.

Craig Billings: Oh, it’s never too often, David. So yes, we’re always thinking about expansion opportunities. And the reality is there’s a time and place to consider expansion here and that time and place is based both on the market and the other things that we have going on. So if you look at the last two significant openings in this market, I could argue that they did not grow visitation to Las Vegas and thus, they had to be share takers in order to drive their business. And so that’s a particular dynamic that I think you have to pay attention to. And then as it relates to Wynn, specifically, we — remember, we still do all of our own design and development and construction management. And so there’s only so much pig you can put through the python, if you will, and you can only do so many things at once.

And so we have to take account of that as well because we have to build, we have to design and build at a given quality level. So we certainly will expand in Las Vegas eventually. But when that is, we’ll see. We’ll get there when we get there.

Operator: Our next caller is Chad Beynon with Macquarie.

Chad Beynon: Craig, I just wanted to go into your comment around design and development, the 432 rooms at Enclave, I know years ago, there was a proposal or kind of drawings around slightly more rooms. Maybe it’s kind of the same size, just bigger rooms now. So I just wanted to ask why 25% is the right number given the Wynn share? And then my second question around that is, I just wanted to make sure that, that land parcel, I believe you have two land parcels, one was 7 acres and one was 5. Do you still have that remaining parcel? And if you wanted to build in addition to this, that would be available.

Craig Billings: Sure. I’ll take the last one first. This is a very small parcel actually that sits on the east side of the property. So when most people think of our land bank at Wynn Palace, they think of the two parcels that are actually on the other side of the building. Those two parcels remain available, and this development is not consuming either of those two parcels. So it’s really kind of a tuck-in on a relatively small parcel on the east side. That then leads in — that’s a portion of the answer to your first question, which is why that room count, And it’s because we’re dealing with a constrained amount of land on that side. You opened the question by talking about the idea that there had been something floating around out there years earlier, it makes me wonder if you’re bugging the Wynn Design & Development offices.

But that is true. And in fact, this is a — we’re bringing those plans back to life. We did have to do some updating around some aesthetic elements, around some technology elements. But that plan has been out there for some time, and now we feel like it’s the time to do it.

Chad Beynon: Okay. Yes, it’s just — it’s always nice to find all presentations on your website. So thanks for still leaving that up from years past. My second question, just around the really strong table drop number in Vegas. I believe that may have been a multiyear quarterly high. If you can just talk about if that was kind of broad-based or driven by Chinese New Year or Super Bowl or just kind of good breadth over the 3-month period.

Craig Billings: Sure. It was broad-based. We — Bac did grow more than non-Bac, that is true, but it was broad-based. And really, it’s the culmination, quite frankly, of everything we’ve been doing over the course of the past several years. We don’t control the total market. We only control our share of it. So everything that we can do to garner incremental share, we will do. That comes down to hosting capabilities and hosting infrastructure. It comes down to machine learning on the offer development side, it comes down to the service levels in the building. It comes down to all the amazing work that Wynn Design & Development does in terms of designing and building and fitting out these new amenities that we’ve continued to add because, again, at the end of the day, gaming market share, RevPAR, retail sales, those are the prime operating leverage levers in our business. And so everything we do is in support of driving those metrics.

Operator: Steve Wieczynski with Stifel.

Steven Wieczynski: So Craig, if we stay on Enclave for a second. I guess the simple question is, what does Enclave do or not do to Wynn Macau? And I guess what I’m trying to get here is, look, I understand they’re two totally separate type of assets. But when Enclave opens, obviously, Palace might need a little bit more additional gaming capacity. So do you guys think about taking tables away from Wynn Macau? I guess the simple question is, is there a cannibalization risk there?

Craig Billings: No, there’s no cannibalization risk. The reality is that we’re thinking about table allocation weekly. And so I wouldn’t think about it as cannibalization. It is true that on peak days — we talked about this on prior calls, on — at peak events, we do fill our table count. But beyond those peak events, we have plenty of table capacity at Wynn Palace, and we just expanded the Chairman’s Club so that we can satisfy our best customers, so I would not think about it as cannibalization of Wynn Macau.

Steven Wieczynski: Okay. Got you. And then second question, Craig, I’m not sure you’ll really answer this or how much detail you’ll get into. But obviously, a pretty big holiday period just wrapped up or essentially wrapping up now in Macau. It seems like visitation, I mean, from what we can tell into the market was really, really healthy over the past couple of days, but any color you can provide on maybe how that visitation translated into GGR from your perspective?

Craig Billings: Yes, it was good. Well, first of all, remember, we’re not levered to visitation like some others in the market because we play at the very top end of the market. And so it’s not about how many, it’s about who for our business. It’s important to remember that. But it was good. Drop was up year-over-year, and we felt good about the holiday.

Operator: James Hardiman with Citi.

James Hardiman: So going back to Al Marjan, I just remember, at the Analyst Day back in December. So much of the discussion was around the fact that even though you had a high degree of confidence in monetizing your own rooms, there was somewhat of a gating factor based on the pace of other hotel development in Ras Al Khaimah. How are you thinking about that latter piece, given what’s going on in the Middle East? Maybe another way to ask that question. It seems like your construction is moving forward. Other projects, are they keeping pace with you? Are there other projects being greenlighted in an environment like this? Or are you likely to have to sort of rely on your own capacity in the near term while that catches up even more so than we may have initially expected?

Craig Billings: Yes, sure. I’ll answer that for — from two perspectives. The first is, we’re starting pilings on the Janu here in a couple of weeks, ourselves. So construction has continued. I can’t say it’s continued at the exact same pace. And quite honestly, I don’t monitor every single construction project weekly over there, like I do ours. So that’s kind of point one. I don’t think you should underestimate the ability of folks in that market to build and build quickly. But on the other hand, what I would say is, if that incremental room capacity if it was due to come on over the course of ’27, ’28, ’29, and now it’s due to come on over the course of ’28, ’29, ’30, it doesn’t matter. I mean we’re talking about — we’re thinking over a 10-year period, 20-year period, and we’re thinking about the long arc of that property and the opportunity that, that property can deliver to our shareholders. So we’re really not overthinking it, to be honest.

James Hardiman: Got it. And then along the lines of maybe overthinking it. If I think about I don’t know, potential positives that could come out of this. Certainly, one of the positives of the last couple of years is that there’s been nobody else to get approval, right, in the UAE for an additional gaming site, do you think this does anything to help or hurt incremental licenses, or could this maybe allow you to be the only show in town for even longer?

Craig Billings: I don’t know yet. I mean, look, I could — as I said in answer to an earlier question, I could build an entire bull case around this, but now is not the time to do that. The reality is that we don’t know. And it’s a great question. And it’s a question, frankly, that we ask internally. So I don’t think you’re overthinking it. I think you’re thinking like management. But I don’t have a good answer to it at this point.

Operator: [Operator Instructions] Our next caller is Trey Bowers with Wells Fargo.

Raymond Bowers: It looks like promotional intensity in Macau was down nicely year-over-year in the first quarter. Could you just talk about what you guys are seeing in terms of promotional competition and expectations as we progress through the year?

Craig Billings: Craig, do you want to take that?

Craig Fullalove: Yes, sure. I can take that. I mean I think overall for us, in particular, I mean, as Craig mentioned, we stay very disciplined on the promotional environment. I don’t think we’ve seen it necessarily change substantively. It’s day-to-day combat, as we’ve said, in terms of share and how that oscillates around across the market. But overall, we stay really disciplined to it. We understand right down to the decimal point, kind of what our reinvestment needs to look like, and what we need to do in terms of GGR in order to justify incremental reinvestments. But as you can see from our numbers, we’ve continued to stay disciplined over many, many quarters now. And we continue to do that, and we’ll continue to make the right moves when it comes to reinvestment for both the properties over there.

Raymond Bowers: And then this question has been asked a few different ways already, but I’ll put it in a slightly different way. I think if you had asked people where the next $1 billion project for Wynn would be, I don’t know if Macau would have been the first response. So as we think about the Enclave project, is this you guys just what you’re now seeing in the market? It just gives you increased confidence a few years from now of what the TAM is? Or is it we kind of create the Wynn level TAM and we’re capacity constrained. So we need these rooms and 25% extra rooms is just going to kind of bring the TAM with it given our unique product.

Craig Billings: Sure. First of all, we’ve never not believed in the market. We absolutely believe in the market and we believe in the supply/demand dynamics that exist in that market. I’ve talked a lot about that on prior calls. Beyond that, I would pretty much say what you said in the latter portion of your question. I mean think about it. This — we have a land bank there, including — we have a substantial land bank there. And we could have pursued a full-blown resort. We’re not doing that. We’re pursuing essentially an incremental tower. And so an incremental tower is pretty easy to — I think pretty easy to wrap your brain around because we have a pre-existing facility in the form of Wynn Palace. We can tack on to that with incremental rooms, and we’re running at 99% occupancy.

So yes, I don’t think we are TAM dependent. Given we’re running at 99% occupancy, we are not TAM dependent to fill those rooms by any means. So for us, it’s a pretty easy underwrite actually.

Operator: And that comes from Steven Pizzella with Deutsche Bank.

Steven Pizzella: Craig, in Las Vegas, occupancy was down slightly in the quarter. Do you want that to grow? Or are you happy with ADR gains while visitation remains challenged to the broader market? And as you start the LV room remodel, any early reads that if you’ll be able to push rate more on the other rooms and limit the potential disruption?

Craig Billings: Yes, I’ll cover the first portion, and then I’ll ask Brian to cover what he’s seeing in terms of rate, recognizing we don’t give guidance. Look, we manage rate and occupancy. We’re not chasing ADR as a stand-alone metric. We’re managing rate and occupancy to deliver EBITDA. And so if we can maximize EBITDA at a lower occupancy level, which allows us to modulate certain things like restaurant operating hours and other aspects of the business then we’ll do that. So it’s not pursuit of ADR for the sake of ADR. It’s really to drive bottom line results. Brian, any reads on — I mean, geez, we’re obviously getting bookings now in a pretty short window for the period in which we are putting rooms down in Encore, any early read on rate?

Brian Gullbrants: No. Right now, rates are holding. We start actually in another week on this project. It’s going to be a 12-month project. So we have a long way to run through this. It’s 6 floors of inventory out for the next 12 months. And we’ll see very shortly. But right now, we’re maintaining rate. We do feel like we’ll be able to increase rate at some point over weekend specifically and where we have peak periods compressed by large groups. But right now, we run in the mid-80s as you can see. And so we don’t really need that midweek unless we have a lot of compression, but weekends, we’ll definitely be able to grab some rate. To what extent we don’t know yet but we should see very shortly.

Steven Pizzella: Okay. And then just following up on UAE real quick. Has your approach to marketing the property changed at all? Do you feel like you might have to do some more incremental marketing?

Craig Billings: Not at all. No, I think you — well, first of all, the tourism authorities in the UAE are, in particular, Dubai are among the most sophisticated marketers, frankly, I’ve ever met. And so you’re going to see them activated — I suspect, you’re going to see them activated very quickly after the situation stabilizes. And I don’t think the market is lacking for awareness. For us, again, if you really think about our business, we talked a little bit about this at the Analyst Day, you can divide the business into gaming, non-gaming. The gaming proposition remains as really the only facility of that scale on that side of the planet. And so I don’t think that changes one bit. And on the non-gaming side, we always knew we would have to heavily market going into opening and subsequent to openings just to increase brand awareness. So I don’t think anything has changed at all.

Craig Fullalove: All right. Thank you for joining the Wynn Resorts Q1 earnings call. We appreciate your interest in the company and look forward to talking with you all again next quarter.

Craig Billings: Thank you.

Operator: Thank you for participating on today’s conference call. You may now disconnect, and have a great rest of your day. Thank you.

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