Executive Summary

Q1 2025 was a solid, record first-quarter for Las Vegas operations: consolidated net revenues $497.9M (+1.8% YoY), net income $86.0M (+9.7% YoY), and Adjusted EBITDA $215.1M (+2.8% YoY) with consolidated adj. EBITDA margin at 43.2% and Las Vegas margin at 47.7% .
Versus S&P Global consensus, revenue modestly beat ($497.9M vs $496.0M*) and Primary EPS beat ($0.511* vs $0.486*); S&P “EBITDA” estimate was $210.0M* vs S&P’s recorded “actual” $202.7M*, noting definition differences with company-reported Adjusted EBITDA of $215.1M . Values retrieved from S&P Global.
Management cut FY25 capex guidance by $25M to $350–$400M (from $375–$425M), citing timing shifts; Q1 capex was $68.2M (investment: $32.2M; maintenance: $36.0M). Utilities were a margin tailwind (-35%) while payroll rose ~2%; sportsbook win was favorable in Super Bowl and March Madness .
Capital returns accelerated: a $1.00 special dividend (May 21) and the regular $0.25 quarterly dividend (June 30) were declared; share repurchase capacity remains ~$309M . A $750M North Fork construction financing closed subsequent to quarter-end, returning $110.5M of capital to RRR and reducing capitalized interest by nearly $100M .

What Went Well and What Went Wrong

What Went Well
- Record first-quarter performance in Las Vegas operations: net revenue $495.0M (+1.9% YoY) and adj. EBITDA $235.9M (+2.7% YoY); consolidated adj. EBITDA margin 43.2% (+42 bps YoY); Las Vegas margin 47.7% (+34 bps YoY) .
- Durango ramp intact and backfill ahead: “on pace to become one of our highest margin properties,” with Red Rock cannibalization modeled at ~10% and backfill “~6 months ahead of schedule” .
- Cost tailwinds and operating discipline: utilities down >35% YoY; favorable sportsbook win in Super Bowl/March Madness; stable COGS; payroll growth moderated (~+2%) .
What Went Wrong
- Continuing renovation disruption expected to intensify in Q2–Q3 at Sunset (podium and table games area), Green Valley Ranch (rooms and convention refresh), and Durango (casino expansion/garage), which may pressure near-term operations .
- Insurance costs creeping up; IT costs shifting from capex to opex (margin headwinds), though being managed .
- Group/catering had tough comps (Super Bowl and COVID rebooks last year), though bookings are improving for the remainder of 2025 and into 2026 .

Financial Results

Consolidated sequential trend (oldest → newest)

Metric	Q3 2024	Q4 2024	Q1 2025
Net Revenues ($USD Millions)	$468.0	$495.7	$497.9
Net Income ($USD Millions)	$55.4	$87.7	$86.0
Diluted EPS ($)	$0.48	$0.76	$0.75
Adjusted EBITDA ($USD Millions)	$182.7	$202.4	$215.1

Margins and Las Vegas segment trend

Metric	Q3 2024	Q4 2024	Q1 2025
Consolidated Adj. EBITDA Margin %	39.0%	—	43.2%
Las Vegas Net Revenues ($USD Millions)	—	—	$495.0
Las Vegas Adj. EBITDA ($USD Millions)	$202.6	$223.9	$235.9
Las Vegas Adj. EBITDA Margin %	43.6%	45.4%	47.7%

Segment breakdown (YoY)

Segment (Q1)	Q1 2024	Q1 2025
Las Vegas Net Revenues ($USD Millions)	$485.6	$495.0
Las Vegas Adj. EBITDA ($USD Millions)	$229.8	$235.9
Corporate & Other Net Revenues ($USD Millions)	$3.3	$2.9
Corporate & Other Adj. EBITDA ($USD Millions)	($20.6)	($20.8)

KPIs and balance sheet

KPI	Q1 2025
Free Cash Flow conversion (Adj. EBITDA → Op FCF)	43% ($93M; $0.88/share)
Cash & Equivalents ($USD Millions)	$150.6
Total Principal Debt ($USD Billions)	$3.4
Net Debt / EBITDA (x)	4.1x
Capex ($USD Millions)	$68.2 (Investment: $32.2; Maintenance: $36.0)
Dividends Declared	$1.00 special (May 21) and $0.25 regular (Jun 30)

Results vs S&P Global consensus (Q1 2025)

Metric	Consensus*	Actual	Beat/(Miss)
Revenue ($USD Millions)	$496.0*	$497.9	+$1.9
Primary EPS ($)	$0.486*	$0.511*	+$0.025
EBITDA ($USD Millions)	$210.0*	$202.7* (S&P actual); Company Adj. EBITDA $215.1	(S&P: -$7.3); definition differs

Values retrieved from S&P Global. Note: S&P’s “EBITDA” and “Primary EPS” definitions may differ from company-reported Adjusted EBITDA and diluted EPS.

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Total Capex	FY 2025	$375–$425M	$350–$400M	Lowered ($25M)
Investment Capex	FY 2025	$285–$325M	$260–$300M	Lowered
Maintenance Capex	FY 2025	$90–$100M	$90–$100M	Maintained
Dividend	Q2 2025	—	$0.25/share payable Jun 30 (record Jun 16)	Declared
Special Dividend	May 2025	—	$1.00/share payable May 21 (record May 14)	Declared

Additional context: Renovation/expansion disruption expected to be heavier through the summer at Sunset, GVR (rooms/convention from June), and Durango (expansion/garage), though quantified impacts were discussed on prior calls (e.g., ~$23M for 2025 across projects) and timing/color updated this quarter .

Earnings Call Themes & Trends

Topic	Q3 2024 (Q-2)	Q4 2024 (Q-1)	Q1 2025 (Current)	Trend
Durango ramp & Red Rock backfill	Durango net return ~15% Y1; cannibalization in-line; backfill expected over “next few years”	Expansion phase underway; $116M; garage/high-limit; expected Jan-2026 completion; record Las Vegas results	Property “on pace” to be among highest margin; cannibalization ~10% at Red Rock with backfill “~6 months ahead”	Improving ramp; backfill ahead
Margins/costs	EBITDA margin near record; noted seasonality; min wage headwind	Las Vegas margin 45.4%	Consolidated margin 43.2%; utilities -35%, payroll +2%; sportsbook favorable	Margins firming with cost tailwinds
Capex & projects	Sunset ($53M) and GVR rooms ($150M) for 2025; disruption ~$23M est.	FY25 capex $375–$425M; GVR scope added to include convention	FY25 capex cut to $350–$400M; Q1 capex $68.2M; detail by project	Slightly reduced spend; execution ongoing
Macro/consumer	Stable core locals; group/catering tough comps	Strong Q4; continued stability despite seasonal patterns	Stable April trends; local core strong; California drive-in steady	Stable
Tariffs/supply chain	—	—	Tariffs could add ~4–6% to project cost; mitigated via sourcing/substitutions; not material to current projects	Manageable risk
Sports & mobile	—	—	Better sportsbook hold (SB + March Madness); expanding third-party book operations (TI, Fontainebleau, El Cortez)	Positive contribution
Financing/tribal	North Fork project update; cost ~$785M; 18–20 months to open	Expected to close financing; total project ~$750M	Closed $750M financing; $110.5M capital returned; cap interest -~$100M	Positive milestone

Management Commentary

“Our Las Vegas operations achieved its highest first quarter net revenue and adjusted EBITDA in our history while maintaining near record adjusted EBITDA margin” .
On Durango: “Property continues to show positive momentum... on pace to become one of our highest margin properties,” adding 95,000+ new customers; Red Rock cannibalization backfill “ahead of pace” .
On cost/margins: “We performed better from a sports win perspective... payroll rose about 2%... utility costs were down over 35%” .
On capex shift: “For the full year 2025, we now expect to spend between $350 million and $400 million, down $25 million from our previous earnings call” .
On North Fork: “$750 million financing… delayed draw… will significantly reduce… capitalized interest expense by nearly $100 million… RRR received $110.5 million in return capital” .
Capital returns: “Board… declared a special cash dividend of $1 per Class A… and regular… $0.25… we have returned approximately $159 million to our shareholders in 2025” .

Q&A Highlights

Flow-through and costs: Margin aided by sportsbook win, utilities -35%, stable COGS; payroll +2% tied to prior minimum wage increase; insurance costs creeping up; some IT expense shift to OpEx .
Cannibalization/backfill: Red Rock cannibalization modeled at ~10%; “running… ~6 months ahead of schedule” on backfill .
Capital allocation: Special dividend coincided with $110.5M capital returned from North Fork; buyback capacity ~$309M remains active for flexibility .
Macro/resilience: Locals market viewed as resilient versus typical recessions; Las Vegas locals historically durable due to convenience/proximity/affordability .
Tariffs: Expect 4–6% project cost impact; mitigating via domestic sourcing/substitutions and GMP contracts; not material for announced projects .
Operations outlook: April trends stable; disruption to increase at Sunset/GVR/Durango through summer; group/catering bookings improving for the rest of 2025/into 2026 .
Sportsbook: Expanding third-party bookmaking to TI, Fontainebleau, El Cortez to improve penetration given in-person registration requirement in Nevada .

Estimates Context

Q1 2025 vs S&P Global consensus: revenue $497.9M vs $496.0M* (beat); Primary EPS $0.511* vs $0.486* (beat). S&P “EBITDA” estimate $210.0M* vs S&P “actual” $202.7M* differs from company-reported Adjusted EBITDA $215.1M (definition mismatch) . Values retrieved from S&P Global.
Implications: Small top-line/EPS beat with margin tailwinds suggests modest upward bias to near-term EPS estimates; however, management flagged heavier renovation disruption in Q2–Q3, which could temper EBITDA trajectories near-term .

Key Takeaways for Investors

Las Vegas locals momentum continues: record first-quarter results and rising Las Vegas adj. EBITDA margin (47.7%) underscore healthy core demand and operating discipline .
The beat was quality-driven: better sportsbook win and sharply lower utilities provided incremental margin, while payroll inflation moderated; watch insurance/IT OpEx creep .
Capex pragmatism: FY25 capex trimmed by $25M; disruptions peak in Q2–Q3 as Sunset/GVR/Durango projects progress—near-term noise for a better asset base by year-end .
Balance sheet/returns: $750M North Fork financing de-risks funding, returns $110.5M, and supports a $1 special dividend plus regular dividends; buyback option remains open at ~$309M capacity .
Durango remains a multi-year growth driver with Red Rock backfill ahead of plan—supportive for margin and cash flow compounding into 2026 .
Risk watchlist: construction disruption execution, tariff-driven cost inflation (~4–6%) management, and insurance cost creep .
Trading lens: Near-term: expect “disruption headlines” vs resilient underlying locals trends; Medium-term: completion of projects + Durango ramp + capital returns are constructive for multiple support.

Notes:

“Values retrieved from S&P Global” applies to consensus/estimate figures marked with an asterisk (*).
Company-reported Adjusted EBITDA differs from S&P’s EBITDA definition; comparisons use reported Adj. EBITDA for company results and S&P’s metrics for consensus context.

Citations: Press release and 8‑K (Q1 2025) ; Q1 2025 earnings call ; Prior quarters for trend .

Red Rock Resorts, Inc. (RRR)·Q1 2025 Earnings Summary