Decrease in Caesars' earnings in Las Vegas, however, forecast for a recovery in Q4 2021 and 2026 predicted.
Las Vegas and Caesars Entertainment are bracing for a challenging 2025, but there's a glimmer of hope for recovery in the near future.
In the second quarter of 2025, Las Vegas tourism experienced a significant decline. Visitor numbers dropped about 6.5% year-over-year through May and an 11.3% in June compared to the previous year. Gaming revenue on the Strip also saw a slight decline, and overall business sentiment remained pessimistic due to a soft national economy and reduced international travel[1][2].
Amidst these challenges, Las Vegas is focusing on strategies such as promoting sports tourism and targeting a wide range of price points to drive demand and stimulate recovery. Hotel occupancy remains slightly below pre-pandemic levels, but average daily rates have increased, aiming to maximize revenue despite fewer visitors[3].
One of the Strip's major operators, Caesars Entertainment, reported a 3.7% year-over-year decline in net revenue and a nearly 21% drop in net income from its Las Vegas operations in Q2 2025. The company earned $1.054 billion in net revenue and $212 million in net income during that period, down from $1.095 billion and $268 million respectively in Q2 2024[4].
However, Caesars Entertainment is not without its silver linings. The company's digital segment has been a bright spot, with net revenues increasing 28% and 51% for sports and iCasino respectively in the second quarter. Caesars Digital segment delivered $343 million in net revenues, up 24% versus the prior year, and set an all-time adjusted earnings record of $80 million[4].
Tom Reeg, CEO of Caesars Entertainment, expects a reduction in taxes in 2025 to offset the adjusted earnings shortfall in Las Vegas in the second and third quarter. He also projects a record group year in Las Vegas for 2025, and 2026 should also be strong[4].
Reeg anticipates a less disruptive second phase of construction at Caesars Republic in Lake Tahoe. Despite the initial loss of room nights due to the opening, the company is optimistic about the long-term potential of the resort[4].
In terms of operational adjustments, Caesars is pruning unprofitable programs to increase EBITDA in the third quarter. The company also experienced a one-time impact of $30 million due to various events, according to Reeg[4].
Looking at regional properties, Caesars saw a 3.6% increase in revenues, with the opening of two new properties and same-store gaming revenue growth. Caesars president and COO, Anthony Carano, remains encouraged by forward group bookings in Q4 and the first half of 2026[4].
Despite gaming revenue increases not fully reflecting improvements "under the hood" due to increased marketing expenses to compete, Carano is optimistic about the future. He attributes the decline in Las Vegas tourism to a slowdown in travel, but is hopeful for a rebound later in 2025 and into 2026[4].
In summary, the recovery timeline for Las Vegas tourism and Caesars Entertainment’s earnings points to a sluggish 2025, with a soft summer and ongoing economic challenges, but an expected improvement beginning in late 2025 and continuing through 2026[1][2][4].
In 2025, Caesars Entertainment intends to expand its digital segment, focusing on sports and iCasino, as a potential source of growth amidst the challenges in Las Vegas' tourism and finance sector (digital segment, sports, iCasino). Recovery in Las Vegas tourism and Caesars Entertainment's earnings is projected to start towards the end of 2025 and continue into 2026, with a focus on strategies like promoting sports tourism and diversifying price points (recovery, Las Vegas tourism, sports tourism, pricing strategies).
