Boyd Gaming executives told Wall Street analysts Thursday that customers are staying closer to home, boosting the second quarter in its Midwest & South segment, while hindering its Las Vegas properties.
CEO Keith Smith said strong performances in the Midwest & South segment, along with online and managed properties, were offset by continued softness in Las Vegas, primarily at The Orleans and ongoing construction disruption at the Suncoast. Excluding those two properties, the balance of their Las Vegas segment delivered revenue and adjusted earnings growth and strong margins during the quarter, reflecting continued strength among local customers.
“Although we’re only three weeks into the third quarter, the overall trends in the second quarter are continuing into July,” Smith said.
As for downtown Las Vegas, Smith said trends are consistent with recent quarters. “While play from both core and Hawaiian guests was stable, our downtown business was impacted by lower pedestrian traffic throughout the downtown area, reflecting continued softness in destination business.”
CFO Josh Hirsberg said there’s no indication the destination business will be flat or positive in the third quarter.
“Our expectation is for it to be less bad,” Hirsberg said. “Don’t expect it to flip, because we don’t see any indication of it changing.”
The Midwest & South segment’s revenue grew 3% during the second quarter, led by growth in gaming. Adjusted earnings grew 4% from property margins expanding to nearly 38%. “This was the segment’s strongest margins in almost two years,” said Smith, who cited growth in play from core customers as guests stay and spend closer to home.
“That’s been going on for the last several quarters. If that’s the result of everything going on in the world or higher airfares, it just appears our Midwest & South portfolio is outperforming our Las Vegas portfolio. There’s a lot going on with the consumer these days. The higher-end consumers, if they’re in the stock market, are doing quite well. The tax credits and larger tax refunds this year are offset by higher gas prices and inflation.”
Smith said Boyd benefited from investments in properties, including food and beverage offerings in that segment.
In the Las Vegas locals segment, Smith said overall gaming revenue was even with the second quarter of 2025, with stable play from core and retail customers. Excluding The Orleans and Suncoast, the remainder of the locals segment achieved solid results, with revenues up 4% driven by an increase in gaming revenue. Adjusted earnings grew 3%, while margins exceeded 50%.
Smith said the Suncoast renovations, including the gaming floor, should be completed by the end of the third quarter. Performance should pick up during the fourth quarter. There are plans to refresh the casino floor at The Orleans that will begin in the first half of 2027. Since Cadence Crossing in Henderson opened in late March, Smith said visitation and revenue has been strong.
“By early next year, we will have renovated over 70% of our Las Vegas hotel room inventory, introduced 17 new food and beverage concepts, and significantly enhanced our southern Nevada presence with Cadence Crossing and investments we’re making at the Suncoast.”
The management business saw adjusted earnings by 18%, driven by the recent completion of the first phase of the expansion project of the casino floor at Sky River Casino in northern California. The second phase will add a 300-room hotel, three new food and beverage outlets, a full-service spa, and a new entertainment-event center.
“Once completed in early 2028, we’re confident this expansion will further strengthen Sky River’s position as one of northern California’s most successful and popular gaming destinations,” Smith said.
