Executive Summary

MCRI delivered all-time record quarterly net revenue, net income, and Adjusted EBITDA; diluted EPS of $1.69 beat S&P Global consensus by ~$0.12, while revenue of $142.8M modestly missed consensus by ~$2.7M as mix and margins drove the upside in profitability . EPS consensus $1.574* on 6 est.; revenue consensus $145.54M* on 6 est. (S&P Global)
Margin expansion was the highlight: Adjusted EBITDA rose 8.3% YoY to $54.8M with margin expanding ~170 bps YoY to 38.4%, aided by improved labor management, process streamlining, and technology utilization .
Capital returns remained active: $11.3M in buybacks (111,169 shares) and a $0.30 quarterly dividend declared for Dec 15; cash ended Q3 at $107.6M with no credit facility borrowings, underscoring balance sheet strength .
Key stock narrative: premium positioning/market share gains at Monarch Black Hawk and completed room upgrades at Atlantis (higher ADR) support sustained margin trajectory; investors will weigh ongoing revenue cadence versus consensus alongside durable margin improvements and active capital returns .

What Went Well and What Went Wrong

What Went Well
- Record quarter across revenue, net income, and Adjusted EBITDA; Adjusted EBITDA up 8.3% YoY to $54.8M with margin at 38.4% (“all-time quarterly record”) .
- Broad-based category growth with casino +5.0% YoY, F&B +2.9% YoY, hotel +3.9% YoY; improved expense ratios across casino, F&B, and hotel .
- Management emphasis on technology and process efficiencies: “focus on marketing initiatives, streamlining processes, and utilizing technology” improved expense margins; quote: “Monarch delivered all-time record quarterly financial results… Adjusted EBITDA increased 8.3%… margin increased by approximately 170 basis points to 38.4%” .
What Went Wrong
- Top-line modestly below consensus despite growth: $142.8M vs $145.5M* (approx. $2.7M short), highlighting potential expectations for stronger revenue cadence .
- Continued construction litigation overhang (PCL) remains a risk factor; Q3 included $0.517M of construction litigation expense in non-GAAP reconciliation; broader uncertainty persists around appeal and potential surety requirements .
- F&B and hotel lines, while improved YoY on expenses, remain operationally sensitive to mix, convention timing, and ADR dynamics; management flagged ADR as key driver at Atlantis, implying ongoing need to sustain rate/occupancy balance .

Financial Results

Headline results vs prior periods (oldest → newest)

Metric	Q3 2024	Q2 2025	Q3 2025
Net Revenue ($USD Millions)	$137.873	$136.914	$142.814
Net Income ($USD Millions)	$27.601	$27.008	$31.576
Diluted EPS ($)	$1.47	$1.44	$1.69
Adjusted EBITDA ($USD Millions)	$50.643	$51.289	$54.848
Adjusted EBITDA Margin (%)	36.7	37.5	38.4

Q3 2025 actual vs S&P Global consensus

Metric (Q3 2025)	Actual	Consensus	Surprise
Revenue ($USD Millions)	$142.814	$145.540*	-$2.726M (~-1.9%)
EPS ($)	$1.69	$1.574*	+$0.116 (~+7.4%)
# of Estimates	—	6 (EPS), 6 (Revenue)*	—

Values marked with * are from S&P Global consensus (GetEstimates). Values retrieved from S&P Global.

Segment/category revenue (oldest → newest)

Category ($USD Millions)	Q3 2024	Q2 2025	Q3 2025
Casino	$76.307	$79.589	$80.130
Food & Beverage	$32.888	$32.191	$33.842
Hotel	$21.642	$19.110	$22.494
Other	$7.036	$6.024	$6.348
Net Revenues	$137.873	$136.914	$142.814

Operating ratios (expense as % of revenue; oldest → newest)

Ratio	Q3 2024	Q2 2025	Q3 2025
SG&A as % of Net Revenue	19.7%	19.6%	19.3%
Casino OpEx % of Casino Rev	36.3%	35.7%	35.8%
F&B OpEx % of F&B Rev	72.8%	70.3%	69.9%
Hotel OpEx % of Hotel Rev	33.8%	34.3%	31.4%

Other KPIs and capital returns (focus on Q2 → Q3 2025)

KPI	Q2 2025	Q3 2025
Cash & Cash Equivalents	$71.6M	$107.6M
Credit Facility Borrowings	$0	$0
Capex	$12.4M	$5.4M
Share Repurchases	240,395 shrs; $19.8M	111,169 shrs; $11.3M
Remaining Buyback Authorization	1,709,645 shrs	1,598,476 shrs
Dividend Declared	$0.30/sh payable Sep 15, 2025	$0.30/sh payable Dec 15, 2025

Non-GAAP adjustments (illustrative, per reconciliation)

Q3 2025: Construction litigation expense $0.517M; lobbying to oppose iGaming $0.003M; also stock-based comp $2.078M .
Q2 2025: Construction litigation expense $0.916M; lobbying $0.022M; stock-based comp $1.875M .
Q1 2025: Construction litigation expense $0.447M; lobbying $0.028M; stock-based comp $2.127M .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Quarterly Dividend	Ongoing	$0.30/sh (payable Sep 15, 2025)	$0.30/sh (payable Dec 15, 2025)	Maintained
Share Repurchase Authorization	As of Q2 → Q3 2025	1,709,645 shares remaining (6/30/25)	1,598,476 shares remaining (9/30/25)	Ongoing capital return capacity
Quantitative Revenue/EPS/EBITDA Guidance	2025/near-term	Not provided	Not provided	—

Note: MCRI does not issue formal quantitative guidance; capital return cadence (dividends/buybacks) reaffirmed .

Earnings Call Themes & Trends

Note: An earnings call transcript for Q3 2025 was not available in our document set as of this analysis; themes here reflect consistent management messaging across Q1–Q3 press releases.

Topic	Previous Mentions (Q1 2025, Q2 2025)	Current Period (Q3 2025)	Trend
Technology/Operational Efficiency	Implementing new technologies and processes; margin +110 bps YoY in Q1; Q2 emphasized technology-driven margin gain to 37.5%	Further margin gains; EBITDA margin ~38.4%; improved labor management/processes	Improving
Atlantis Renovation/ADR	Q1 near completion of ~$100M room upgrades	Q2 completion; elevated guest experience	Higher ADR drove lower hotel OpEx%
Monarch Black Hawk Market Share	Ongoing share gains in Denver/Boulder mid-to-upper-tier guests	“Another period of market share gains”; premier luxury positioning	Positive
Cost Discipline (F&B/Hotel)	Q1/Q2 F&B OpEx% down; hotel OpEx% mixed (timing/mix)	F&B OpEx% down to 69.9%; hotel OpEx% down to 31.4%	Improving
Regulatory/Legal (PCL litigation)	Risk disclosures across periods	Risk reiterated; non-GAAP add-back present	Ongoing
Capital Returns	$0.30 quarterly dividend maintained	Dividend declared for Dec 15; buybacks continued	Consistent

Management Commentary

“In the third quarter of 2025, Monarch delivered all-time record quarterly financial results. Net revenue increased 3.6% year-over-year to $142.8 million… Adjusted EBITDA increased 8.3%… Adjusted EBITDA margin increased by approximately 170 basis point to 38.4%” — John Farahi, CEO .
“At Atlantis in Reno, we remain committed to the ongoing enhancement of the property… We believe that our elevated product, combined with exceptional guest service, will continue to drive increased guest visitation and sustained revenue growth.” .
“At Monarch Black Hawk, revenue growth… was primarily driven by another period of market share gains… the property’s position as the premier luxury casino resort in Colorado…” .
On cost discipline: SG&A ratio down to 19.3%; F&B OpEx% and hotel OpEx% improved on labor efficiency and ADR .
Capital allocation: dividend maintained; buybacks funded from operating cash flow; strong cash and no borrowings .

Q&A Highlights

The Q3 2025 earnings call transcript was not available in our document set; as a result, Q&A details and any verbal guidance clarifications could not be reviewed at this time. We will update upon transcript availability (no transcript found via document search through Nov 20, 2025).

Estimates Context

Q3 2025 EPS beat: Actual diluted EPS $1.69 vs S&P Global consensus $1.574*; ~+7% surprise. Drivers include margin expansion (EBITDA margin to ~38.4%) and net interest income vs prior-year expense . Values retrieved from S&P Global.
Q3 2025 revenue miss: $142.814M actual vs $145.540M* consensus (~-1.9%); strong casino growth and improved mix offset but did not fully meet top-line expectations . Values retrieved from S&P Global.
Revisions watch: Given revenue modestly below but EPS above, Street models may tilt toward slightly lower near-term revenue but higher margins/EPS, reflecting demonstrated cost discipline and ADR/mix improvements .

Key Takeaways for Investors

Margin story strengthening: EBITDA margin expanded to ~38.4% (from 37.5% in Q2 and 36.7% in Q3’24), underpinned by technology/process efficiencies and labor management; this was the primary lever behind the EPS beat .
Category breadth with operating leverage: Casino +5.0% YoY, F&B +2.9%, hotel +3.9%; F&B/Hotel expense ratios improved materially, supporting sustainable profitability even amid mixed event/convention timing .
Premium positioning drives share: Monarch Black Hawk continues to gain market share among higher-value guests; completion of ~$100M Atlantis room upgrades and higher ADR bolster the Reno asset’s pricing power .
Strong balance sheet + returns: $107.6M cash, no borrowings; $11.3M Q3 buybacks and a maintained $0.30 dividend provide downside buffer and capital deployment flexibility .
Watch litigation overhang: Construction litigation remains an overhang with ongoing appeal; non-GAAP add-backs continue (e.g., $0.517M in Q3) — track legal milestones and any cash/bonding implications .
Near-term setup: With top-line slightly under consensus but profitability outperforming, the stock’s reaction should hinge on confidence in sustaining margin gains, continued market share growth at Black Hawk, and ADR traction at Atlantis .
Medium-term thesis: Limited unit growth near-term but high-quality assets, operational excellence, and shareholder returns create a durable compounding profile; potential strategic/M&A optionality noted by management .