Vegas's Economy just Died.

Halloween was a huge hit. So, quick

reminder, use coupon code pennywise, the

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>> at meetke.com for trade alerts, alpha

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more.

>> Shocking Vegas casino CEO admits why the

strip is empty. Let's find out what's

really going on here.

>> Las Vegas dead. Here's a few that I

found looking online. Nobody comes here.

There is no shortage of people

commenting on Vegas being dead. I I

always feel like people are like posting

Vegas at like 2:00 a.m. or sorry, at at

at like um uh 10:00 a.m. on a Tuesday or

something and of course it looks empty.

Like that's how Vegas works, though.

When when you go out to Vegas, it's

packed at night and then during the day

it's dead. But let's see. It sounds like

they've got potentially a conversation

here with a CEO or something. Let's

listen in to see what they get.

>> No longer needs the people who made it

lucky. And

>> it's great that we have a team of

experts tracking the tourism numbers

here locally, courtesy, our economics

department over at UNLV. And one

professor in particular doesn't like

what he's seeing

>> because we have a lot of questions for

him right now. For months, we've been

really shining a light on tourism here

in Las Vegas with how few people I say

few cuz it's still in the millions, but

it is down. We're wondering, is it

slowing? Is it?

>> During a not so recent earnings call,

Caesar's Entertainment's CEO Tom Reed

made one simple statement that wasn't so

simple after all.

>> Seen numbers what, you know, billion and

a half plus. Um, I know last year was a

little shy of that. I'd expect it to be

another record. We'd

>> He said they were kicking out the lowest

end at first.

>> Wait, what did that have to do with the

clip he just showed? The clip said

record numbers. [laughter]

Oh, but then that's also not an earnings

call what he just showed.

Okay. At first, people thought he might

have misspoken, right? Yeah, I'm

confused.

>> People thought he might have misspoken,

but the truth is he didn't. They had no

idea this would soon become the new

business model. The following year,

MGM's Bill Hornbuckle said the same

thing in calmer words. They weren't

chasing budget travelers anymore. They

were targeting quality customers. To

them, that meant wealthier ones. If you

don't have gamblers, right, you don't

need as many dealers, let's say. You

don't need need as many tables open. Las

Vegas is known for its bright lights,

big bets, and non-stop action. But right

now, things are quieter than usual.

>> A recent dip in tourism is sending shock

waves through the strip, and casino

workers are feeling the hit firsthand. A

font of Blue announced some layoffs.

>> But Vegas didn't become an empire by

catering to the elite. It was built on

cheap buffets. $5.

>> You got to go you got to go to

Bignyions. You know, you want you want

cheap and a good experience, you go to

Binyions in downtown Vegas. Uh anyway,

let's go look at a recent earnings call

because I mean, so far I'm getting a

stitched together argument here. I don't

know. I mean, I did my flight training

in Vegas. Shout out to Henderson uh and

Allin. Like I loved my time there. I

love doing flight training there. I got

my instrument rating and my uh you know

pilot license out there. So uh you know

big fan but uh let's go um let's go

look. I mean let's see uh uh let's start

with traffic. This is the Caesar's

earnings call. Okay. No search for

traffic. How about consumer? If I could

get

anything on the consumer. All right. Big

question is leisure demand. Are we going

to see it improve?

Uh that's the difficult answer. That's

the macro question. I know that mix will

be better for us. Recall we have state

farm a state farm conference. So

business travelers, right? But but we're

now what? 4 months into this step down

in leisure demand for Vegas. Oh, it is

showing up in the earnings calls.

And while we're better than we were in

July, we're still not back to where we

were on a year-over-year basis. So the

question in 2026 will be how quick does

this recover? Oh wow.

Okay. So there might actually be some

issues here. So let me uh let's see what

date this was this earnings call. But

that is interesting and it it aligns

with what we think with the K-shaped

recovery of the consumer. This is an

earnings call. Mind you, the video we're

watching was posted uh you know before

this. But this earnings call is fresh.

This earnings call is literally from 3

days ago. So, uh we are seeing

that demand decline. Look at this. This

aligns with the K-shaped economy thesis.

So, once we look at the full context, it

looks like you are getting compression

in the lower-end consumer, not the

higherend consumer, which explains why

they're talking about the State Farm

Conference. The State Farm Conference is

going to be your business cohort which

often is considered a a you know more

premium category. All right. Fine for

regional. Let's see what else we have

here. But we're seeing flow is

improving. Contingency for demand for

Okay. What is this? Let's see. Uh let's

see what else we have here. Specifically

around leisure demand. I heard positive

leisure recovery but I also heard that

the group fillin is mostly of sequential

improvement. So quarter over quarter. We

talked about last quarter and based on

the bookings we can see it looked

particularly soft

which is why we told you we were

expecting a soft summer. There's not a

lot of group business in Vegas when the

weather is particularly hot. Yeah.

Right. So, so in other words, you want

the business customers because they're

going to spend more, but it's hot in the

summer so the business people don't

come. So, you're overly reliant on the

leisure travelers. However, those people

aren't showing up as much as they used

to. July was the worst. August built on

that. And then in September and October,

it continued the softness. Leisure

customer has been softer on a

year-over-year basis. Our occupancy

looks better and our rates look better

than it did in the third quarter. So,

things are looking better now is what

they're saying in the fourth quarter so

far, but the third quarter was basically

hell for them in terms of occupancy. So,

a lot of empty room. and you had told

the market that you were promoting more

last quarter and perhaps rolling out

more promotions.

Okay, that's a great question. We're

trying to become more efficient in

marketing. You're dialing back what's

not working and expanding what does. Oh,

look at this. And I want to be clear.

There was a sense that we were getting

into a promo war.

Wow. So, it's getting so promotional.

you're getting into a promotion war

against the other hotel operators just

to try to fill your your hotels. That's

not great. So, if you think about the

way marketing works, you may lean on the

advantages a little bit and say, I'm not

going to be as generous in my give back

as others and you're still going to

perform quite well. Okay, this is just

sort of them marketing it. So I would

think that what we're doing is kind of

taking up that slack, not entering a

promotional war and we're not seeing a

significant response to competitors that

suggest that this is going to keep going

higher. We expect looking forward as

flow through looks. So I sense like

optimism,

but you have to try to read between the

lines a little bit here. And it just

doesn't sound good. It sounds like

they're like, "Yeah, we're hoping this

will work, but we're not sure. We don't

really want to be in a price war because

then our investors are going to dump the

stock." I don't discount that there are

areas in our business and in Vegas that

may have gotten over their skis

price-wise. So, in other words, they

raised prices too much post pandemic.

So, this could be a post-pandemic

tanking where people are just finally

saying, "F you for raising prices this

much." There's a degation of demand.

Occupancy percentage was over 90% of the

quarter. Yeah, but you want to be at,

you know, 100%. Right. Like you look at

cruise bookings, you're actually you

over book cruises at over 100% because

you know some people aren't going to

show up.

Wow. Most of the days you could have

gotten a room in Vegas for $29 plus a

resort fee on the strip. So, there's a

value trade in Vegas. Uh or people just

aren't showing up because it's all the

other bull crap that goes in that's too

expensive. Everybody knows it's not the

hotel room that makes the money. It's

all the other crap you got to spend

money on. The entertainment, the drinks,

the food, whatever.

Wow.

So, there's almost a little bit of a

sense in p of panic here in in this

demand falling. I wonder what's going on

with the actual numbers here. The only

market I could think of that saw a

significant shift in demand was Atlantic

City. The rest of the countries

performed kind of as you'd expect. Okay,

so this is more of a reference to

Atlantic City. That's fine. So, here's

the CEO again. The biggest question is

the consumer. Are we going to see that

recover? Yeah, they don't know. Are we

going to see it continue to improve or

recover or do we stall? That's difficult

to answer. So, in other words, here we

are, you know, halfway through the

fourth quarter or a third of the way

through the fourth quarter and they

still don't know if they're going to get

a recovery in Vegas. That's actually not

good. This is This is pretty bad. The

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channel. Look at this. I've actually got

casino revenues up, but total revenues

are actually down. Not much, but in this

economy where everything is going up on

a 3-month basis, you actually saw

negative

uh uh growth

in their year-over-year revenues on this

third quarter. So, this third quarter

sucked. Hotel went negative.

Uh other revenue went negative. Food and

beverages went negative. The only thing

that was up was casino. So casino was

up. Their operating income collapsed.

Holy smokes. Look at this. $513 million

divided by 644. That's a 20% collapse in

operating income for Caesars. Wow. Maybe

it's true. Dude, look at the interest.

Holy smokes, man. They spent all of

their operating income on interest.

$576

million on interest and they only took

513 million into operating income.

Caesars is full of debt. Long-term debt,

11.6 billion. Long-term financing, $13

billion. That's $24 billion of long-term

debt.

Look at the bills they have to pay. The

current bills they have to pay over the

next 12 months. They have 2.2 2 billion

in bills to pay, bro. All like they have

cash of

42 including their receivables and their

restricteds. They have about 1.35

billion in cash

and two and receivables, right? And 2.2

billion in bills to pay. They don't even

have money to pay their bills because

their interest expenses are so high. So,

they need to start selling stock or

borrowing more. So, let's go to their

cash flow statement and see it happen.

Let's find out. Cash flow statement. So,

they actually they paid off some debt

here. That's interesting. Yeah, cuz the

interest is so high. They they paid off

1.5 billion, but then they took out 1.2

billion in debt again. They actually

spent some money repurchasing their

stock. So, on in this last quarter,

they did better. They borrowed less.

They paid off some debt with some of the

cash they have, but now they're they're

running out of cash. So, I don't know

why you're spending $180 million to try

to pump your stock here. I understand

why they're paying down debt. This makes

sense. And if I look further out, oh,

this is 9 months. Oh, I'm sorry. That's

9 months. Oh, wow. So, we don't even

know what they did cash flow wise in the

last quarter. I bet you in the last

quarter they had to take they had to

borrow more. That's fascinating. They're

not even telling us that. probably

because it sucks.

Wow. Okay. So, that's interesting. But,

you know, some of this could have been

driven by last, you know, the first and

second quarter where they had extra cash

flow and they were able to pay off some

of their debt. But, I think their

borrowings, I wouldn't be surprised if a

lot of these borrowings were here, but

it's going to get worse. They need to

borrow more just to stay ahead or they

need to sell stock. So, how's the actual

stock performing? So, let's go to

Caesars.

Uh, if I go to Caesar's Entertainment,

the stock's actually up right now, but

it's bouncing off a low. Look at this.

COVID low on the stock is $6. So, we're

still above the COVID low, but look how

much this has tanked. Since

uh in the last three years, this stock

has eviscerated money. In the last three

years, this stock is down 83%.

83%

crash on Caesar's Entertainment.

Probably because these bastards raised

prices too much during COVID thinking

they were hot stuff. And now people are

revoling. People are like, "F you, man.

I ain't paying this [ __ ] anymore."

Free drinks and free parking. It was the

only city in America where a truck

driver, a teacher, and a tech executive

could sit at the same table and feel

like equals. That was the magic

>> that I found looking online. Nobody

comes here. It's too expensive. Resort

and parking fees are too high. And my

>> Yeah, they the resort fees are bull

crap.

>> Personal favorite. Las Vegas is too

expensive and it smells bad. So I re

>> well honestly a lot of the hotels are

are like let me put it this way.

Bellagio used to be lit. Okay now it's

kind of like musty and old right like

you're see like I went to okay personal

experience. So Bellagio little pissed

about uh they've kind of fallen apart in

my opinion and I had that opinion back

in 2019 because I held a real estate

conference at Bellagio and like man this

kind of sucks. Ironically, the Rio's

remodel, the remodeled rooms are quite

nice.

I went to the win with Lauren uh uh a

little bit earlier this year and the

service sucked. We were like, "Oh, we're

going to have, you know, uh a mommy and

daddy trip. It's going to be great." It

was just a day trip. The service was

bad. And we're like, "This is the win."

I think it's just honestly because they

have they're trying to cut costs while

at the same time uh they're not getting

as many revenues. It's

>> down to some local experts to ask them

is Las Vegas really dying?

>> To make it worse, they didn't just kick

out the lowest end, they kicked out

their foundation.

>> Yeah. Well, keep in mind, too, in 2008,

Vegas was like the first to go, right?

So, like this could be part of the big

economic cycle. And as the strip now

empties out on weekdays and dealers wait

for players who never show the cost of

that decision.

>> Oh great. I also just got a headline

here asked if the US and Canada will

restart negotiations. Trump says no.

Great. That lowers the taco scale.

>> Is finally catching up. If you ever walk

the strip when it still felt alive hit

taxes

>> these which I believe is is simply an

unintended consequence. We are forcing

these individuals to move offshore.

>> Stevens calls those levies phantom taxes

since gamblers can end up paying taxes

on money they never saw.

>> Uh I don't think the executives blaming

taxes are the problem.

>> I think what it is is, you know, you're

charging too much money, man. You guys

you guys got greedy.

>> Averaging over $55 a night. Even

so-called budget hotels like Excalibur

and Luxor charge 45 in fees plus another

20 to 25 just to park.

>> We went to uh the Dorado Hotel. That

one's beautiful. Uh cuz it's new

construction basically. I think it's

like 22 or something.

>> Literally paying to lose money.

Republicans for the change, but says

both parties need to cooperate to fix

it.

>> I don't think anyone Democrat or

Republican had any intent on hurting Las

Vegas or or for that matter hurting the

gaming industry in any sense. This is a

reference to the big beautiful bill and

the gambler's taxes. That's fine. Uh,

okay. So, yeah, this is a $30 cocktail.

Okay, so this is the other pisser. If

you go to like a UFC fight in Vegas,

they'll charge you literally like

Lauren's like, "Kevin, get me a

cocktail." I'm like, "All right, $40.

$40 freaking dollars. That's insane."

during the Great Recession when somebody

wrote that Las Vegas was the nation's

greatest ghost town in waiting, right?

And then during the pandemic, we all did

it. We all took that walk down the strip

when nobody was there. It was

unbelievably scary in terms of how are

we going to bounce back? And yet still

here we are today. It's not how many

>> and now the city is starting to feel it.

Visitor volume fell 11% this June with 1

and a.5 million fewer tourists in the

first half of the year alone.

>> Right. The strip isn't empty because

people forgot about it. It's empty

because the house changed the rules and

the players walked away.

>> So, a reference to the big beautiful

bill and the gambling issue. That's

possible as well. But you are also

seeing that leisure demand down which is

problematic. So, it's they are actually

getting hit. This is true. So, like in

fairness, I started this segment out by

talking about how uh you know, are

people just on TikTok like trying to

look for some drama? This is actually

real. This is happening.

>> Gaming industry for the Nevada

Independent. He tells me tourists are

getting off the strip.

>> Well, where guess where they're going?

>> Red Rock Resorts, boy gaming properties.

They've all did they all did well in the

last quarter. It's a lot of locals

because locals don't go to the strip.

>> Remember how I just mentioned uh the

Dorado Resort? I'm 98% sure the Dorado

Resort uh resort Vegas is a Red Rock uh

resort. I'm pretty sure Dorado. D what

uh El Dorado?

I can't find No. Where is it? Not El

Dorado. Where is it? What's it called?

Why can't I find this darn thing? Vegas.

What's this place called that I went to?

Dorado

Resort. See if I can find it. It's close

to Henderson. I don't know. Maybe I'm I

got my name wrong on it. Uh but uh let

me go to I'll just go to Henderson here.

I'll go to Henderson Executive Airport

because this is where I did my flight

training. And then where is the casino?

The one that I'm thinking of is

off of County Clark Road by Costco.

Durango, not Dorado. Duh, dumbass.

Sorry, folks. I I don't have the best.

It's right across IKEA. Lord and I were

here and we're like, "Hey, we can walk

to IKEA." And then we're like, "Bro,

it's 100°. We're not going to walk

across the highway uh to go to IKEA."

But so Durango, they're off strip. It's

easier to get to from the Henderson

airport. Uh they are it's it's a it's a

small resort, but it's really really

nice. And I'm pretty sure Durango is a

Red Rock resort.

Uh let's see here. Hotel Durango.

Durango.

Durango. Here we go. Durango Hotel and

Casino

Roads. There it is. Owner Red Rock

Resorts. Boom. And opened in uh 2023.

That's what I thought. That's the same

experience I had. Get off the strip

where the service has gone to crap and

go to some of these newer resorts. Same

thing this guy's saying

>> and aren't going to pay the prices down

there.

>> Say the out of town visitors from from

Southern California. They're discovering

some of the local property.

>> That's me. [laughter]

>> And it's not just brick and mortar

competitors. Online gambling is it.

Dude, honestly, having an IKEA next to

Durango is like uh you know, it's kind

of a plus.

>> Exploding too. In July,

>> we went and had lunch there. And the

lunch was like $8. [laughter]

>> 2025 alone, digital casinos rad in 1

bill780 million, 0, up more than 20%

from the year before. Players are

swapping plane tickets for phone

screens. They can gamble from home, get

better odds, correct, and skip.

>> Right. Exactly. That's the thing with

the betting markets now. You could do

your betting at home. So these are a lot

of issues for Vegas. I think they're

right about that. Bellagio win AR

>> reported cooling demand from their elite

guests. Because here's the thing, the

rich don't need Vegas. They can play in

>> we got the stock market, bro.

>> Monaco, Macau or Singapore, where

exclusivity feels authentic and privacy

is part of the package. Vegas tried to

reinvent itself as a luxury playground,

but forgot it was already something far

more powerful, the People's Casino. The

irony is brutal. In trying to escape the

chaos that made it famous, Vegas cut out

the very soul that kept it alive. The

show girls, the slot players, the bus

tours, the retirees chasing luck. They

were never the problem. They were the

heartbeat. Now the strip is learning

what every casino should know. You can't

outsmart math. When the middle class

disappears, even the rich lose the crowd

that made them feel rich.

>> Ah, that's interest. That's an

interesting line. Um, take that for what

it is. But yeah, it makes sense. It

makes sense. So, I'm I I have to say I'm

I'm surprised. Uh, I thought that a lot

of the Tik Tok stuff was honestly just

clickbait. uh that Vegas was dying. But

I think Vegas is getting the big middle

finger, which is y'all raised prices too

much. You got too greedy and and now

it's going to show up in the corporate

earnings. Uh and you know, sucks to suck

basically. So, uh that is my assumption

here of what's going on. I'm going to

look at one more. I'm going to look at

Win. So, uh we'll go look at the Win

Resorts 10Q. Uh they again I didn't have

a great experience at the win. That

doesn't necessarily mean their earnings

are down but they are an onstrip

property. So why don't we go take a look

at it. We looked at Caesars and uh so

let's look at the win and then we've got

here we go. This is Win Resorts Limited.

Let's see if they're winning.

Wow. Almost no growth in operating

revenues as well. 1.7 billion

versus 1.737

divided by 1.732.

Wow. That's 29 basis points of growth,

which uh looks like 0.29%

growth. Nothing. Basically negative with

inflation.

Wow. How's their profit? So their

operating income is also down. 264 minus

269

is oh sorry 264 divided by 269 I've got

about 1.9% operating income. Yeah. So

even the win which is tailored to more

of potentially a luxury style customer.

Wow. Look at their earnings per share.

They're what is it because of interest

or what happened here? Oh, they have an

other loss of $36 million here. What the

hell is the other loss? Because their

net income fell like 40% over here. Holy

smokes. So, what's other? How do you

just write off $34 million and not tell

me what it is? You have to tell me what

it is. It's going to be in the footnotes

here somewhere. Other. Other. Other. I'm

very curious now to see what your other

is. It's going to be like some

restructuring like severance for firing

people or whatever.

Other long-term debts. They also have a

lot of debt. Sucks for them. Uh I debt

is like debt's so great when things are

going up. But I'll tell you, you know,

me personally, like I I'm so grateful

for this. I keep talking about it. I'm

debtree, no mortgages, no personal debt,

nothing, right? My real estate startup,

no bank debt. We got a little like a

fraction of the assets we have uh for

convertible bonds uh to to you folks who

who have invested and and trusted us. Uh

thank you for that. by the way, we

couldn't do it without you. Uh, but

thank you uh for the SEC. Make sure you

read the offering circular if you're

considering investing at reinvest.co or

house hack.com. It's the same company.

Uh, okay. So, other Why can I not I want

to find out what happened with the write

off. So, I'm just going to command F it

because I can't find it. Other property

charges. It's like $30 million write

off. This is a corporate and other.

Okay. Other other non-operating income

and expenses. We incurred a foreign

currency rmeasurement loss of $36

million because of exchange rate

fluctuations of the dollar.

Basically, the dollar lost value. Okay.

So, the dollar went down. All right.

Well, I mean, it's not necessarily Vegas

related, but here are the Vegas

operations. You could actually see the

breakdown. Wow. Macau actually got hit

hard, though. It's not like Macau is

down 10%. So, it's not just Vegas.

Wind's just getting hit across the board

here, but Vegas definitely got hit as

well. Uh.1%

on just Vegas.

Operating revenues, rooms down 10.5%.

Food and beverage down 6.8%.

Entertainment down 5.5%. That's the last

6 months. Wow. Casino revenue decreased

primarily due to lower VIP win as a

percentage of turnover and mass market

table games at Macau, partially offset

by an increase in casino revenues from

Vegas due to higher gaming volumes

during the six months ending June. Yeah,

but they talked about also the pain uh

really starting in July at Caesars.

That's interesting. And these are just

some miscellaneous win rates over here.

That's fascinating.

Table gain wins. Oh, look at this. You

could see the percentage of people

actually winning at different locations.

Table gain wins 18%. VIP win as a

percentage of turnover 2%.

This is how the casinos make money. Your

odds of winning ma as a mass market

table 23%

sort of the net the net wins. This is

how they make all the money is you know

they they're taking the 80% side.

[laughter] That's fascinating. That's

very interesting. Wow. Occupancy rates

here. You can see occupancy rates in

Vegas. Wow. The occupancy rates actually

kind of suck and they've fallen quite a

bit. That's a big drop in occupancy down

to 88.3%. And that's before what we saw

about July.

Yeah, might be true. Vegas is getting

whacked.

>> Why not advertise these things that you

told us here? I feel like nobody else

knows about this. We'll we'll try a

little advertising and see how it goes.

>> Congratulations, man. You have done so

much. People love you. People look up to

you.

>> Kevin Pra there, financial analyst and

YouTuber. Meet Kevin. Always great to

get [music] your take.