Published on: October 29, 2025, 12:20h.
Updated on: October 29, 2025, 12:36h.
- Caesars Entertainment’s Las Vegas casino earnings remained stable compared to last year
- Declining leisure demand in Las Vegas has led to unexpectedly significant losses for Caesars
- Management anticipates improved performance in Q4 of 2026
On Wednesday, shares of Caesars Entertainment (NASDAQ: CZR) are experiencing a significant decline after the gaming titan reported a larger-than-anticipated loss for the third quarter, attributed to weak performance in Las Vegas.
During midday trading, the stock is down nearly 10%, with trading volume already exceeding the daily average following a disappointing earnings report released after US markets closed on Tuesday. If the trend continues, Caesars’ shares may close below $20 for the first time since the early days of the COVID-19 pandemic when its casinos were shuttered.
Investors are scrutinizing Caesars as the second-largest operator on the Strip reported $2.87 billion in revenue for the period from July to September, showing no significant change year over year. It can be argued that investors are overreacting today; the company’s struggles were anticipated following a lackluster second quarter for Strip operators.
Another gloomy forecast for Las Vegas casino performance might be in store when MGM Resorts International (NYSE: MGM) announces its third-quarter results later today. MGM and Caesars remain the two largest operators on the Strip.
Challenging Q3 for Caesars, Optimism for Q4 2026
In a conference call with analysts, Caesars CEO Tom Reeg discussed the disappointing third-quarter figures, noting a 6% drop in average daily room rates and a 5% decrease in average occupancy. While a 2% decline in slot handle was manageable, the overall hold on Las Vegas casinos was off by 600 basis points.
Nonetheless, Reeg expressed optimism regarding group and convention business for the current quarter, a trend anticipated to continue well into next year. He indicated that 2025 could be a record year for Caesars in terms of convention and meeting business in Las Vegas, predicting even greater successes in subsequent years.
“We noticed a decrease in leisure demand for Las Vegas during the summer, particularly at properties viewed as price-sensitive, especially those located further from the strip’s center,” he stated during the call. “Higher-end venues have remained resilient, but it is the resurgence of group business in Q4 and Q1 that will prompt rate recovery and lead to a significantly healthier market outlook.”
Reeg also highlighted strengthening revenue from their regional casinos, noting a 6.2% year-over-year increase and positive contributions expected from their properties in Danville, VA, and New Orleans. Management reassured stakeholders that they do not plan to engage in aggressive promotional tactics to attract customers to these regional locations.
Analysts Remain Optimistic About Caesars’ Stock
Despite a nearly 41% drop in stock value this year, Caesars still has proponents among analysts, with some optimism stemming from the operator’s ongoing debt reduction initiatives, even though it is likely to miss its 2025 targets in this area.
“The company has reduced approximately $370 million in debt year-to-date, which we anticipate will fall short of their goal of roughly $1 billion annually with share repurchases now integrated into the capital return strategy,” said Citizens Equity Research analyst Jordan Bender. “We expect the pace of both buybacks and debt reduction to accelerate in the coming quarters as capital expenditures are set to decline starting in 2026, while online operations continue to generate cash flow.”
Bender rates Caesars’ stock as “market outperform” with a target price of $37, highlighting the potential for the company to significantly enhance free cash flow next year.