Despite Sky River Casino Success, Boyd Misses Mark In Q3

Written By Dan Holmes on October 27, 2023
Photo of Sky River Casino on a story about its owner, Boyd Gaming, reporting third-quarter financials.

The new Sky River Casino in Elk Grove has been a success, but operator Boyd Gaming reported less-than-expected earnings for the third quarter.

During an earnings call, Boyd, which operates Sky River for the Wilton Rancheria tribe, cited “softness in retail play” as a contributor to unexpected weak numbers for Q3.

Q3 revenue for Boyd, which operates 28 casinos across the country, was $903.2 million, a 2.9% increase over Q3 in 2022 ($877.3 million). But in Q3 2022, net income was $1.46 per share, compared to only $1.34 per share in Q3 2023. Adjusted earnings for Q3 2023 were $137.3 million. It was $159.2 million last year in Q3.

CEO of Boyd says economy had impact on earnings

There are close to 70 casinos in California, all owned by Native American tribes. California online casinos are illegal, as is sports betting and online poker. So Boyd has no online gambling presence in California.

Keith Smith, president and CEO of Boyd Gaming, blamed the economy for the company’s Q3 declines.

“Quarterly results were impacted by declines in play from our retail customers and ongoing cost pressures, both related to the challenging economic environment.

“Continued strength in play from our core customers, strong results from Sky River and online gaming, and growth in our non-gaming business all contributed to a solid performance in the quarter.”

A “softness in retail play” experienced at Boyd casinos and hotels was in contrast to increases in revenue due to “core customer play [which] increased on both a sequential and year-over-year basis, and hotel and food & beverage revenues rose year-over-year,” Smith said.

Revenue from gaming was $641.1 million for Q3 2023. It was $667.9 million for the same period a year ago.

Earlier this month, Boyd paid quarterly cash dividends of 16 cents per share, according to the company. The company maintains $269.2 million in cash on hand and carries total debt of $2.9 billion.

Through the end of Q3 2023, Boyd Gaming reports $1.96 billion in gaming revenue. That’s a 2.7% decrease from $2.02 billion in 2022. However, other key categories (food and beverage, and hotel stays) are up 6% compared to 2022.

The news is disappointing to investors following a promising Q2 2023 report, which saw Boyd report $916.9 million in revenue and $1.58 earnings per share.

Sky River is a massive casino resort near Sacramento

The opening of Sky River Casino near Sacramento in 2022 was a grand success for Wilton Rancheria tribe, thanks in large part to Boyd Gaming overdelivering and opening the venue early. The facility has 100,000 square feet of gaming space for visitors, and presents more than 2,100 slot machines and 80 gaming tables.

For patrons seeking casino dining and entertainment, Sky River is one of the most successful new casinos in Northern California, boasting 17 dining/bar options and a glimmering live entertainment stage.

The Sacramento Bee, in a story outlining the casino’s economic impact on the Sacramento area and the Wilton Rancheria tribe, says Sky River “employs some 1,600 workers, with hundreds of others anticipated to join the rolls once the casino expands.”

Operating successful casino resorts is nothing new for Boyd Gaming, which owns or runs properties in 10 states, including three in downtown Las Vegas.

A replay of the earnings call from Oct. 24 can be heard here.

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Dan Holmes

Dan Holmes is a contributor for PlayCA with plenty of experience under his belt. Dan has written three books about sports and previously worked for the National Baseball Hall of Fame and Major League Baseball. He also has extensive experience covering the launch of sports betting in other states, including Ohio, Massachusetts and Maryland. Currently, Dan is residing in Michigan with his family.

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