Casino Giant MGM Resorts Expects $100M Blow From Recent Cybersecurity Breach

MGM Resorts International MGM disclosed in a regulatory filing on Thursday that the recent cybersecurity breach affecting its operations could have a negative impact on its third quarter 2023 results, predominantly in its Las Vegas operations, and a minimal impact during the fourth quarter. 

MGM estimates a negative impact of approximately $100 million to Adjusted Property EBITDAR for the Las Vegas Strip Resorts and Regional Operations, collectively.

In September, MGM Resorts said it had identified a cybersecurity issue affecting certain of its U.S. systems.

On September 29, 2023, MGM Resorts determined that an unauthorized third party obtained personal information of some of its customers on September 11, 2023.

The affected information included name, contact information, gender, date of birth, and driver's license number. However, at this time, the company does not believe that customer passwords, bank account numbers or payment card information were obtained by the criminal actors.

After detecting the issue, the company responded by shutting down its systems to mitigate risk to customer information, which resulted in disruptions at some of its properties. The company's operations at domestic properties have returned to normal and virtually all of its guest-facing systems have been restored.

The company has also incurred less than $10 million in one-time expenses in Q3 related to the cybersecurity issue, which consisted of technology consulting services, legal fees and expenses of other third party advisors.

The company believes it is well-positioned to have a strong fourth quarter, with record results expected in November primarily driven by Formula 1.

MGM sees occupancy to be 93% in October and to fully rebound in November for the Las Vegas Strip Resorts.

Price Action: MGM shares closed lower by 1.05% at $34.79 on Thursday.