Truist Securities gaming analyst Barry Jonas told investors in a report that while the summer will have some soft results, it’ll pave the way for a profitable 2026.
Strip resorts are expecting soft summer visitation, but believe there will be a fall rebound and growth through the fourth quarter into good start of 2026.
The predictions are outlined in a report to investors by gaming industry analyst Barry Jonas, managing director of Atlanta-based Truist Securities. Jonas issued the report Friday after meeting with executives of the major casino companies in Las Vegas.
Jonas said he believes the summer lull is more the result of traditional pullbacks during the hot months than consumer sentiment.
“Operators see a softer summer driven by weak convention business and summer seasonality with no real callouts around consumer weakness,” Jonas said in the report. “Commentary suggested rate trends were in line with our most recent room survey noting a soft Q2 followed by a relatively better but still soft year-over-year July/Q3. Q3 also sees a negative impact from a Jewish holiday shift from Q4.”
Jonas said operators are clear that they are not seeing any fundamental consumer issues, as gaming revenues remain solid, hotel bookings and rates are improving in the third quarter and look positive for the fourth quarter and 2026 has a better setup with a strong event and convention calendar. Additionally, the disruption from the Las Vegas Convention Center renovation will be over once the project is completed by the end of the year and in time for the ConEx-ConAgg conference and its 100,000 attendees in March. The LVCVA has noted a record number of events booked and expected attendees for 2026.
Jonas said locals operators Boyd Gaming Corp., Red Rock Resorts and Golden Entertainment noted steady performance in the market largely driven by strong employment and wage growth, as well as high home prices and less exposure to equity markets.
“We think the public operators remain disciplined and don’t intend to chase the low end of business, given that those customers will often rotate from promo to promo,” he wrote.
Tariff worries have slowed gaming manufacturing businesses.
“Manufacturers noted some product sales hesitancy from operators in April around Liberation Day given the uncertainty of tariffs and overall macro,” Jonas said. “Since then, larger players, including Light and Wonder, have seen a return to more normal product sales trends though we’ve heard more hesitancy from some smaller players. Manufacturers were more aligned regarding tariff mitigation strategies, highlighting their ability to adjust supply chains on international shipments. Several companies have moved production offshore to other countries such as Mexico and then deliver the international units directly.”
Macao rebounding
Jonas’ report shared some notes on individual companies:
-For Caesars, Strip trends in the second and third quarters are a bit softer with less group capacity in the market given LVCVA and Venetian renovations. The company is likely to be impacted the most by the opening of Hard Rock Las Vegas at the former Mirage site, but the Seminole Tribe’s property comes online in late 2027, which gives Caesars plenty of runway to prepare before then.
-For MGM, management does not see anything systematically wrong with the convention business as June and July have historically been hit or miss, but 2026 future bookings are pacing up by double-digit percentages. Despite the decline in Canadian tourism, MGM noted that international marketwide visitation is still up year over year, and domestic air capacity for the market would also be up year over year if not for the pullback from Spirit Airlines.
-For Boyd, management estimates that outside of the Orleans, local properties modestly outperformed the market, which was slightly down. The company is expected to capitalize on its Cadence Crossing opening in 2026 and has other regional projects underway across the United States.
-For Red Rock, management noted consistent locals market trends so far but cautioned that the month of June can be a more difficult month. Management is analyzing three Las Vegas growth opportunities for its next big project, including the expansion of Durango, Inspirada, located in the highest net worth area in Nevada though with less developed surroundings and Cactus, where the company owns 128 acres in a strong locals market and optimally located right off the freeway. The project will be at a bigger scale than Inspirada but also more competitive given its proximity to the successful and competitive South Point property and Penn Entertainment Inc.’s M Resort.
-For Golden, management is seeing some volatility at the Strat with weekends a bit stronger and midweek softer. But the company does expect a pickup in September on the Strip as the convention calendar improves, but noted its low visibility as 30 percent of its bookings are within seven days. Atomic Golf generated $20 million in revenue in the first nine months of last year. The company gets a share of revenue and expects to generate “a couple million dollars” of profit this year along with increased traffic at the Strat.
