Red Rock Resorts Posts First Revenue Decline in Five Quarters
Red Rock Resorts (RRR) reported net revenues fell 3.0% to $510.3 million as its Las Vegas segment turned negative for the first time in five quarters.
Red Rock Resorts (RRR) reported second-quarter net revenues of $510.3 million, down 3.0% from $526.3 million a year earlier, marking the first year-over-year revenue decline in the trailing five quarters. The Las Vegas casino operator's net income fell 29.3% to $76.6 million from $108.3 million, a sharper drop than the 3.8% decline posted in the first quarter and a reversal from the 55.1% increase reported a year ago.
The deterioration traces to the company's core Las Vegas segment, which had absorbed a decline before but never posted one outright. Las Vegas net revenues slipped 2.0% to $503.2 million, compared with gains of 0.9% in the first quarter, 2.5% in the fourth quarter of 2024 and 0.8% in the third quarter of 2024. Segment Adjusted EBITDA fell 5.0% to $227.5 million, extending a second consecutive quarterly decline after a 1.5% drop in the first quarter, following growth of 3.2% and 3.4% in the two quarters before that. Companywide Adjusted EBITDA declined 9.3% to $208.0 million from $229.4 million, a steeper drop than the 1.2% dip in the first quarter.
The Native American segment, which manages third-party tribal casino properties, reported net revenues down 62.0% to $3.8 million and Adjusted EBITDA down 72.0% to $2.8 million. The comparison period a year earlier included a one-time cumulative revenue catch-up tied to development fees, and the current quarter's level sits closer to the roughly $3.7 million to $4.7 million run-rate the segment posted in the three quarters before it.
Cost growth outpaced the revenue slide. Operating income fell to $136.0 million from $168.0 million, even as depreciation and amortization rose to $59.0 million from $48.0 million and SG&A climbed to $117.9 million from $112.0 million. Diluted EPS fell to $0.67 from $0.95, though the comparison is complicated by a drop in diluted weighted-average shares outstanding to 58.8 million from 102.7 million, reflecting a change in dilutive share treatment likely tied to Up-C unit exchanges alongside the buyback program authorized in the third quarter of 2024.
Red Rock held its quarterly dividend flat at $0.26 a share, the fifth straight quarter at that level following an increase from $0.25 a share declared in the third quarter of 2024. A $1.00-a-share special dividend paid in the first quarter, declared alongside fourth-quarter 2024 results, did not recur this quarter.
Total debt rose to $3.6 billion from $3.4 billion at both the fourth quarter of 2024 and third quarter of 2024, an increase of roughly $200 million over two quarters, while cash held roughly flat at $136.5 million against $134.0 million and $142.5 million in the two preceding quarters. The $300 million expansion of the company's share repurchase program, which extended authorization to December 31, 2027, and left roughly $573 million remaining as of October 2025, went unmentioned in the second-quarter release.