What changed in this filing

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Item 2. Management’s Discussion and Analysis

2023-05-09 compared with 2022-11-09 · 161 added, 348 removed, 276 unchanged (65% of the section changed)

8 unchanged sentences

Forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from those we express in these forward-looking statements, including the risks and uncertainties in Item 1A — "Risk Factors" of our Annual Report on Form 10-K for the year ended December 31, 2022 and other factors we describe from time to time in our periodic filings with the Securities and Exchange Commission ("SEC"), such as:

• the impact on the travel and leisure industry from factors such as an outbreak of an infectious disease, including the COVID-19 pandemic, public incidents of violence, mass shootings, riots, demonstrations, extreme weather patterns or natural disasters, military conflicts, civil unrest, and any future security alerts and/or terrorist attacks;

• extensive regulation of our business and the cost of compliance or failure to comply with applicable laws and regulations;

• pending or future claims and legal proceedings, regulatory or enforcement actions or probity investigations;

• our ability to maintain our gaming licenses and concessions, including the renewal or extension of the concession in Macau that expires on December 31, 2022 and the amendments to the Macau gaming law;

• our dependence on key employees;

• general global political and economic conditions, in the U.S.

and China (including the Chinese government's ongoing anti-corruption campaign), which may impact levels of travel, leisure, and consumer spending;

• restrictions or conditions on visitation by citizens of PRC and other regions to Macau;

• the impact on the travel and leisure industry from factors such as an outbreak of an infectious disease, including the COVID-19 pandemic, public incidents of violence, riots, demonstrations, extreme weather patterns or natural disasters, military conflicts, civil unrest, and any future security alerts and/or terrorist attacks;

• doing business in foreign locations such as Macau;

• our ability to maintain our customer relationships and collect and enforce gaming receivables;

• pending or future investigations, litigation and other disputes;

• our dependence on key managers and employees;

• the deterioration of the macroeconomic environment, including an economic downturn or recession or worsening geopolitical tensions that could reduce discretionary consumer spending;

• our ability to maintain our gaming licenses and concessions and comply with applicable gaming law;

• international relations, national security policies, anticorruption campaigns and other geopolitical events, which may impact the number of visitors to our properties and the amount of money they are willing to spend;

• public perception of our resorts and the level of service we provide;

• our dependence on a limited number of resorts and locations for all of our cash flow and our subsidiaries' ability to pay us dividends and distributions;

• competition in the casino/hotel and resort industries and actions taken by our competitors, including new development and construction activities of competitors;

• factors affecting the development and success of new gaming and resort properties (such as limited labor resources, government labor and gaming policies, transportation infrastructure, supply chain disruptions, cost increases, environmental regulation, and our ability to secure necessary permits and approvals);

• construction risks (including disputes with and defaults by contractors and subcontractors;

construction, equipment or staffing problems;

shortages of materials or skilled labor;

environment, health and safety issues;

and unanticipated cost increases);

• legalization and growth of gaming in other jurisdictions;

• our ability to maintain our customer relationships and collect and enforce gaming receivables;

• win rates for our gaming operations;

• construction and regulatory risks associated with our current and future construction projects;

• any violations by us of the anti-money laundering laws or Foreign Corrupt Practices Act;

• our compliance with environmental requirements and potential cleanup responsibility and liability as an owner or operator of property;

• adverse incidents or adverse publicity concerning our resorts or our corporate responsibilities;

• changes in gaming laws or regulations;

• changes in federal, foreign, or state tax laws or the administration of such laws;

• continued compliance with all provisions in our debt agreements;

• conditions precedent to funding under our credit facilities;

• leverage and debt service (including sensitivity to fluctuations in interest rates);

• changes in and compliance with the gaming laws or regulations in the various jurisdictions in which we operate;

• changes in tax laws or regulations related to taxation, including changes in the rates of taxation;

• our collection and use of personal data and our level of compliance with applicable governmental regulations, credit card industry standards and other applicable data security standards;

• cybersecurity risk, including cyber and physical security breaches, system failure, computer viruses, and negligent or intentional misuse by customers, company employees, or employees of third-party vendors;

• our ability to protect our intellectual property rights;

• labor actions and other labor problems;

• our current and future insurance coverage levels;

• risks specifically associated with our Macau Operations;

• the level of our indebtedness and our ability to meet our debt service obligations (including sensitivity to fluctuations in interest rates);

• continued compliance with the covenants in our debt agreements

Further information on potential factors that could affect our financial condition, results of operations and business are included in this report and our other filings with the SEC.

2 unchanged sentences

We are a designer, developer, and operator of integrated resorts featuring luxury hotel rooms, high-end retail space, an array of dining and entertainment options, meeting and convention facilities, and gaming, all supported by an unparalleled focus on our guests, our people, and our community.

Through our approximately 72% ownership of Wynn Macau, Limited ("WML"), we operate two integrated resorts in the Macau Special Administrative Region ("Macau") of the People's Republic of China ("PRC"), Wynn Palace and Wynn Macau (collectively, our "Macau Operations").

Through our approximately 72% ownership of Wynn Macau, Limited ("WML"), our concessionaire Wynn Resorts (Macau) S.A.

("Wynn Macau SA") operates two integrated resorts in the Macau Special Administrative Region ("Macau") of the People's Republic of China ("PRC"), Wynn Palace and Wynn Macau (collectively, our "Macau Operations").

In Las Vegas, Nevada, we operate and, with the exception of certain retail space, own 100% of Wynn Las Vegas.

1 unchanged sentence

We refer to Wynn Las Vegas, Encore, an expansion at Wynn Las Vegas, and the Retail Joint Venture as our Las Vegas Operations.

In Everett, Massachusetts, we own 100% of and operate Encore Boston Harbor, an integrated resort.

In Everett, Massachusetts, we operate Encore Boston Harbor, an integrated resort.

We also hold an approximately 97% interest in, and consolidate, Wynn Interactive Ltd.

("Wynn Interactive"), through which we operate online sports betting, gaming, and social casino businesses.

Recent Developments Related to COVID-19

Macau Operations

Visitation to Macau has fallen significantly since the outbreak of COVID-19, driven by the strong deterrent effect of the COVID-19 pandemic on travel and social activities, quarantine measures put in place in Macau and elsewhere, travel and entry restrictions and conditions in Macau, the PRC, Hong Kong and Taiwan involving COVID-19 testing, and mandatory quarantine, among other things, and the suspension or reduced accessibility of transportation to and from Macau.

Although there have been periods during which certain restrictions and conditions were eased by the Macau government to allow for greater visitation and quarantine-free travel to Macau, adverse and evolving conditions created by and in response to the COVID-19 pandemic may cause these restrictions and conditions to be reintroduced.

For example, in response to an outbreak in Macau which initially commenced in mid-June 2022, the Macau government extended its COVID-19 containment measures, which included the closures of gaming operations in full as of July 11, 2022, and the closure and the limiting of the opening hours and/or operational capacity of various areas and facilities in Macau.

On July 23, 2022, gaming operations at Wynn Palace and Wynn Macau resumed on a limited basis.

Certain travel-related restrictions and conditions, which continue to reduce visitation and impact our financial results, remain in effect at the present time.

Given the uncertainty around the extent and timing of the potential future spread or mitigation of COVID-19 and around the imposition or relaxation of containment measures, management cannot predict whether future closures, in full or in part, will occur in our properties, and cannot reasonably estimate the impact to our future results of operations, cash flows, or financial condition.

Macau Gaming Concession

On June 23, 2022, Wynn Resorts (Macau) S.A.

("WRM") and the Macau government entered into a concession extension agreement (the "Concession Extension Agreement"), pursuant to which the expiration date of WRM's gaming concession was extended from June 26, 2022 to Decem ber 31, 2022.

Under the Concession Extension Agreement, WRM paid the Macau government MOP47.0 million (approximately $6.0 million) as a contract premium for the extension, and in September 2022 provided a first demand bank guarantee of MOP1,210.0 million (approximately $149.7 million) in favor of the Macau government for securing the fulfillment of its labor liabilities upon the expiration of the Concession Extension Agreement.

In order to enable WRM to fulfill the relevant requirements to become eligible to obtain a concession extension, each of WRM and Palo Real Estate Company Limited ("Palo") (the land concessionaires of Wynn Macau and Wynn Palace, respectively) entered into a letter of undertaking, pursuant to which each of WRM and Palo has undertaken, pursuant to Article

40 of the Macau gaming law and Clause 43 of the concession agreement, to revert to the Macau government relevant gaming equipment and gaming areas at Wynn Macau and Wynn Palace, without compensation and free of encumbrance upon the expiration of the concession agreement term, as amended by the Concession Extension Agreement.

Under the indentures governing our $4.7 billion aggregate principal amount of WML Senior Notes and the facility agreement governing the WM Cayman II Revolver, upon the occurrence of any event after which we do not own or manage casino or gaming areas or operate casino games of fortune and chance in Macau in substantially the same manner and scope as of the issue date of the respective senior notes or the date of the facility agreement, for a period of 10 consecutive days or more in the case of the WML Senior Notes or a period of 30 consecutive days or more in the case of the WM Cayman II Revolver, and such event has a material adverse effect on the financial condition, business, properties or results of operations of WML and its subsidiaries, taken as a whole, holders of the WML Senior Notes can require us to repurchase all or any part of the WML Senior Notes at par, plus any accrued and unpaid interest (the "Special Put Option"), and any amounts owed under the WM Cayman II Revolver may become immediately due and payable (the "Property Mandatory Prepayment Event").

In June 2022, the Macau government published amendments to the Macau gaming law approved by the Macau Legislative Assembly.

These amendments include, for example, the awarding of up to six gaming concessions with a term up to ten years with a maximum three-year extension possible, and an increase in the minimum capital requirement applicable to concession holders to MOP5.0 billion (approximately $625.0 million), an increase in the percentage of the share capital of the concessionaire that must be held by the local managing director to 15% from 10% and a prohibition on revenue sharing arrangements between gaming promoters and concession holders.

On July 27, 2022, the Macau government officially launched the public tender process for the awarding of concessions for the operation of games of chance or other games in casinos.

On September 13, 2022, WRM submitted its tender to the Macau government.

At this time we believe that our concession agreement will be further extended, renewed or replaced by a new gaming concession agreement beyond December 31, 2022.

However, it is possible the Macau government could further change or interpret the associated gaming laws in a manner that could negatively impact the Company.

If we are unable to further extend or renew our concession agreement or obtain a new gaming concession agreement, an election by the WML Senior Notes holders to exercise the Special Put Option and the triggering of the Property Mandatory Prepayment Event would have a material adverse effect on our business, financial condition, results of operations, and cash flows.

("Wynn Interactive"), through which we operate WynnBet, our digital sports betting and casino gaming business.

Key Operating Measures

23 unchanged sentences

We typically expect our win as a percentage of turnover from these operations to be within the range of 3.1% to 3.4%.

however, reduced gaming volumes as a result of COVID-19 containment measures implemented in Macau may cause volatility in our Macau Operations’ VIP win percentages.

In our mass market operations in Macau, customers may purchase cash chips at either the gaming tables or at the casino cage.

15 unchanged sentences

Results of Operations

Summary of third quarter 2022 results

Summary of first quarter 2023 results

The following table summarizes our financial results for the periods presented (dollars in thousands, except per share data):

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 Increase/ (Decrease) Percent Change 2022 2021 Increase/ (Decrease) Percent Change

Operating revenues $ 889,722 $ 994,644 $ (104,922) (10.5) $ 2,751,888 $ 2,721,439 $ 30,449 1.1

Net loss attributable to Wynn Resorts, Limited (142,892) (166,249) 23,357 14.0 (456,267) (578,596) 122,329 21.1

Diluted net loss per share (1.27) (1.45) 0.18 12.4 (4.00) (5.10) 1.10 21.6

Adjusted Property EBITDA (1)

173,534 154,561 18,973 12.3 530,274 420,341 109,933 26.2

(1) See Item 1—"Financial Statements," Note 18, "Segment Information," for a reconciliation of Adjusted Property EBITDA to net loss attributable to Wynn Resorts, Limited.

The decrease in operating revenues for the three months ended September 30, 2022 was primarily driven by decreases of $106.1 million and $90.3 million from Wynn Palace and Wynn Macau, respectively, resulting from a decrease in gaming volumes due to the 12-day closure of our casino operations in Macau in July, as well as other travel-related restrictions and conditions, including COVID-19 testing and other procedures related to the COVID-19 pandemic.

The decrease in operating revenues was partially offset by increases in operating revenues of $68.4 million and $19.6 million at our Las Vegas Operations and Encore Boston Harbor, respectively, resulting from increased gaming volumes as well as increases in hotel occupancy and covers at restaurants.

The decrease in net loss attributable to Wynn Resorts, Limited for the three months ended September 30, 2022 was primarily related to increased operating revenues at our Las Vegas Operations and Encore Boston Harbor, respectively, partially offset by increased operating expenses associated with higher business volumes at our Las Vegas Operations and Encore Boston Harbor.

The increase in Adjusted Property EBITDA for the three months ended September 30, 2022 was primarily driven by increased operating revenues at our Las Vegas Operations and Wynn Interactive, respectively, offset by a decrease in gaming volumes at Wynn Palace and Wynn Macau, respectively, primarily due to certain travel-related restrictions and conditions, including COVID-19 testing and other procedures related to the COVID-19 pandemic.

Adjusted Property EBITDA increased $12.3 million and $85.8 million at our Las Vegas Operations and Wynn Interactive, respectively and decreased $33.9 million, $41.9 million, and $3.4 million at Wynn Palace, Wynn Macau, and Encore Boston Harbor, respectively.

Financial results for the three months ended September 30, 2022 compared to the three months ended September 30, 2021.

Operating revenues

The following table presents our operating revenues (dollars in thousands):

Three Months Ended September 30,

2022 2021 Increase/ (Decrease) Percent Change

Operating revenues

Macau Operations:

Wynn Palace $ 75,248 $ 181,323 $ (106,075) (58.5)

Wynn Macau 40,368 130,662 (90,294) (69.1)

Total Macau Operations 115,616 311,985 (196,369) (62.9)

Las Vegas Operations 544,389 476,003 68,386 14.4

Encore Boston Harbor 211,783 192,214 19,569 10.2

Wynn Interactive 17,934 14,442 3,492 24.2

$ 889,722 $ 994,644 $ (104,922) (10.5)

The following table presents our casino and non-casino operating revenues (dollars in thousands):

Three Months Ended September 30,

Three Months Ended March 31,

2023 2022 Increase/ (Decrease) Percent Change

Operating revenues $ 1,423,679 $ 953,334 $ 470,345 49.3

Casino revenues $ 359,876 $ 496,264 $ (136,388) (27.5)

Non-casino revenues:

Rooms 197,212 173,817 23,395 13.5

Food and beverage 224,730 217,501 7,229 3.3

Entertainment, retail and other 107,904 107,062 842 0.8

Total non-casino revenues 529,846 498,380 31,466 6.3

$ 889,722 $ 994,644 $ (104,922) (10.5)

Casino revenues for the three months ended September 30, 2022 were 40.4% of operating revenues, compared to 49.9% for the same period of 2021.

Non-casino revenues for the three months ended September 30, 2022 were 59.6% of operating revenues, compared to 50.1% for the same period of 2021.

Casino revenues

Casino revenues decreased primarily due to decreased VIP turnover and table games win and mass market table drop and table games win at our Macau Operations, partially offset by increased table drop, table games win and slot machine win at our Las Vegas Operations and Encore Boston Harbor.

The table below sets forth our casino revenues and associated key operating measures (dollars in thousands, except for win per unit per day):

Three Months Ended September 30,

2022 2021 Increase/ (Decrease) Percent Change

Macau Operations:

Total casino revenues $ 45,361 $ 134,064 $ (88,703) (66.2)

Average number of table games 49 89 (40) (44.9)

VIP turnover $ 283,744 $ 1,234,733 $ (950,989) (77.0)

VIP table games win $ 9,271 $ 54,943 $ (45,672) (83.1)

VIP win as a % of turnover 3.27 % 4.45 % (1.18)

Table games win per unit per day $ 2,381 $ 6,691 $ (4,310) (64.4)

Average number of table games 212 231 (19) (8.2)

Table drop $ 197,066 $ 508,779 $ (311,713) (61.3)

Table games win $ 42,449 $ 110,820 $ (68,371) (61.7)

Table games win % 21.5 % 21.8 % (0.3)

Table games win per unit per day $ 2,501 $ 5,223 $ (2,722) (52.1)

Average number of slot machines 607 712 (105) (14.7)

Slot machine handle $ 121,522 $ 327,017 $ (205,495) (62.8)

Slot machine win $ 5,418 $ 11,538 $ (6,120) (53.0)

Slot machine win per unit per day $ 112 $ 176 $ (64) (36.4)

Total casino revenues $ 22,832 $ 98,264 $ (75,432) (76.8)

Average number of table games 39 75 (36) (48.0)

VIP turnover $ 152,872 $ 1,335,694 $ (1,182,822) (88.6)

VIP table games win $ 2,389 $ 32,602 $ (30,213) (92.7)

VIP win as a % of turnover 1.56 % 2.44 % (0.88)

Table games win per unit per day $ 771 $ 4,704 $ (3,933) (83.6)

Average number of table games 230 238 (8) (3.4)

Table drop $ 167,539 $ 441,899 $ (274,360) (62.1)

Table games win $ 22,232 $ 87,132 $ (64,900) (74.5)

Table games win % 13.3 % 19.7 % (6.4)

Table games win per unit per day $ 1,211 $ 3,972 $ (2,761) (69.5)

Average number of slot machines 641 574 67 11.7

Slot machine handle $ 193,680 $ 200,543 $ (6,863) (3.4)

Slot machine win $ 6,961 $ 9,142 $ (2,181) (23.9)

Slot machine win per unit per day $ 136 $ 173 $ (37) (21.4)

Three Months Ended September 30,

2022 2021 Increase/ (Decrease) Percent Change

Las Vegas Operations:

Total casino revenues $ 134,314 $ 112,575 $ 21,739 19.3

Average number of table games 237 224 13 5.8

Table drop $ 570,419 $ 507,188 $ 63,231 12.5

Table games win $ 118,263 $ 110,265 $ 7,998 7.3

Table games win % 20.7 % 21.7 % (1.0)

Table games win per unit per day $ 5,420 $ 5,354 $ 66 1.2

Average number of slot machines 1,693 1,746 (53) (3.0)

Slot machine handle $ 1,522,512 $ 1,156,858 $ 365,654 31.6

Slot machine win $ 107,575 $ 80,303 $ 27,272 34.0

Slot machine win per unit per day $ 691 $ 500 $ 191 38.2

Poker rake $ 3,848 $ 2,910 $ 938 32.2

Encore Boston Harbor (1) :

Total casino revenues $ 157,369 $ 151,361 $ 6,008 4.0

Average number of table games 188 181 7 3.9

Table drop $ 364,844 $ 350,145 $ 14,699 4.2

Table games win $ 76,970 $ 74,818 $ 2,152 2.9

Table games win % 21.1 % 21.4 % (0.3)

Table games win per unit per day $ 4,448 $ 4,498 $ (50) (1.1)

Average number of slot machines 2,706 2,734 (28) (1.0)

Slot machine handle $ 1,288,250 $ 1,196,299 $ 91,951 7.7

Slot machine win $ 104,122 $ 98,816 $ 5,306 5.4

Slot machine win per unit per day $ 418 $ 393 $ 25 6.4

Poker rake $ 2,554 $ — $ 2,554 NM

Net income (loss) attributable to Wynn Resorts, Limited 12,332 (183,324) 195,656 NM

Diluted net loss per share (0.02) (1.59) 1.57 NM

NM - Not meaningful.

(1) On January 25, 2021, Encore Boston Harbor restored 24-hour casino operations and reopened its hotel tower on a Thursday through Sunday weekly schedule.

The property reopened its hotel tower to seven days per week as of September 1, 2021.

Non-casino revenues

The table below sets forth our room revenues and associated key operating measures:

Three Months Ended September 30,

2022 2021 Increase/ (Decrease) Percent Change

Macau Operations:

Wynn Palace :

Total room revenues (dollars in thousands) $ 6,974 $ 15,639 $ (8,665) (55.4)

Occupancy 28.1 % 51.9 % (23.8)

ADR $ 145 $ 187 $ (42) (22.5)

REVPAR $ 41 $ 97 $ (56) (57.7)

Total room revenues (dollars in thousands) $ 4,395 $ 10,896 $ (6,501) (59.7)

Occupancy 31.4 % 51.3 % (19.9)

ADR $ 137 $ 211 $ (74) (35.1)

REVPAR $ 43 $ 108 $ (65) (60.2)

Las Vegas Operations:

Total room revenues (dollars in thousands) $ 162,125 $ 132,705 $ 29,420 22.2

Occupancy 88.8 % 83.0 % 5.8

ADR $ 426 $ 392 $ 34 8.7

REVPAR $ 378 $ 326 $ 52 16.0

Encore Boston Harbor (1) :

Total room revenues (dollars in thousands) $ 23,718 $ 14,578 $ 9,140 62.7

Occupancy 97.0 % 87.8 % 9.2

ADR $ 398 $ 351 $ 47 13.4

REVPAR $ 386 $ 308 $ 78 25.3

(1) Encore Boston Harbor room statistics have been computed based on 69 days of operation in the three months ended September 30, 2021, representing the number of nights hotel rooms were offered for sale to the public.

Room revenues increased $23.4 million, primarily due to higher occupancy and ADR at our Las Vegas Operations and Encore Boston Harbor.

Food and beverage revenues increased $7.2 million, primarily due to increased restaurant covers at our Las Vegas Operations.

Entertainment, retail and other revenues increased $0.8 million, primarily due to an increase in visitation to our Las Vegas Operations.

Operating expenses

The table below presents operating expenses (dollars in thousands):

Three Months Ended September 30,

2022 2021 Increase/ (Decrease) Percent Change

Operating expenses:

Casino $ 239,901 $ 315,316 $ (75,415) (23.9)

Rooms 67,689 52,100 15,589 29.9

Food and beverage 185,388 163,655 21,733 13.3

Entertainment, retail and other 72,964 156,490 (83,526) (53.4)

General and administrative 201,275 197,350 3,925 2.0

Provision for credit losses (8,186) (347) (7,839) 2,259.1

Pre-opening 6,447 1,333 5,114 383.6

Depreciation and amortization 172,502 177,110 (4,608) (2.6)

Property charges and other 4,733 15,301 (10,568) (69.1)

Total operating expenses $ 942,713 $ 1,078,308 $ (135,595) (12.6)

Total operating expenses decreased $135.6 million compared to the three months ended September 30, 2021, primarily due to decreased casino, entertainment, retail and other, provision for credit losses, and property charges and other expenses, partially offset by increased room, food and beverage, and pre-opening expenses.

Casino expenses decreased $51.5 million and $39.9 million at Wynn Palace and Wynn Macau, respectively.

These decreases were primarily due to reductions in gaming tax expense driven by the declines in casino revenues at each of Wynn Palace and Wynn Macau, resulting from the effects of the COVID-19 pandemic, partially offset by increased casino expenses of $10.1 million and $5.8 million at our Las Vegas Operations and Encore Boston Harbor, respectively, primarily due to increased operating costs, including gaming tax expense, driven by the increase in casino revenues.

Room expenses increased $9.2 million and $7.4 million at our Las Vegas Operations and Encore Boston Harbor, respectively.

These increases were primarily a result of higher operating costs related to the increase in occupancy.

Food and beverage expenses increased $22.3 million and $3.7 million at our Las Vegas Operations and Encore Boston Harbor, respectively.

These increases were primarily a result of higher operating costs related to the increase in food and beverage revenues as well as higher nightlife entertainment costs associated with increased business volumes at our Las Vegas Operations' nightlife venues.

Entertainment, retail and other expenses decreased $86.4 million at Wynn Interactive, primarily due to decreased marketing costs, partially offset by an increase of $7.1 million at our Las Vegas operations, due to higher operating costs associated with increased levels of business.

Provision for credit losses decreased $5.2 million, $1.4 million, and $0.9 million at Wynn Palace, our Las Vegas Operations, and Wynn Macau, respectively.

These decreases were primarily due to the impact of historical collection patterns and expectations of current and future collection trends, as well as the specific review of customer accounts, on our estimated credit loss for the respective periods.

For the three months ended September 30, 2022, pre-opening expenses totaled $6.4 million, which primarily related to reconfiguring the theater space at Wynn Las Vegas to host an all-new, exclusive theatrical production, Awakening , which premiered in November 2022.

For the three months ended September 30, 2021, pre-opening expenses totaled $1.3 million, which primarily related to restaurant remodels at our Las Vegas Operations.

Depreciation and amortization decreased $7.7 million at Wynn Palace, primarily due to certain furniture, fixture and equipment assets reaching the end of their useful lives in the first quarter of 2022.

Property charges and other expenses for the quarter ended September 30, 2022 consisted primarily of asset abandonments of $2.0 million and $1.0 million at Wynn Palace and our Las Vegas Operations, respectively, and other contingency expenses

of $1.9 million at Wynn Macau.

Property charges and other expenses for the quarter ended September 30, 2021 consisted primarily of advocacy-related expenses of $12.5 million at Wynn Interactive.

Interest expense, net of capitalized interest

The following table summarizes information related to interest expense (dollars in thousands):

Three Months Ended September 30,

2022 2021 Increase/ (Decrease) Percent Change

Interest expense

Interest cost, including amortization of debt issuance costs and original issue discount and premium $ 165,277 $ 150,325 $ 14,952 9.9

Weighted average total debt balance $ 12,222,392 $ 12,044,272

Weighted average interest rate 5.41 % 4.99 %

Interest costs increased primarily due to an increase in the weighted average interest rate.

Other non-operating income and expenses

We incurred a foreign currency remeasurement loss of $0.9 million and $11.8 million for the three months ended September 30, 2022 and 2021, respectively.

The impact of the exchange rate fluctuation of the MOP, in relation to the U.S.

dollar, on the remeasurements of U.S.

dollar denominated debt and other obligations from our Macau-related entities primarily drove the variability between periods.

We recorded a gain of $5.8 million and $1.2 million for the three months ended September 30, 2022 and 2021, respectively, from change in derivatives fair value.

We recorded an income tax expense of $1.4 million and $1.2 million for the three months ended September 30, 2022 and 2021, respectively.

Income tax expense in 2022 primarily related to changes in U.S.

deferred taxes.

Income tax expense in 2021 primarily related to the Macau dividend tax agreement that provides for an annual payment as complementary tax otherwise due by stockholders of WRM.

Net loss attributable to noncontrolling interests

Net loss attributable to noncontrolling interests was $64.9 million and $79.7 million for the three months ended September 30, 2022 and 2021, respectively.

These amounts are primarily related to the noncontrolling interests' share of net loss attributable to WML.

Financial results for the nine months ended September 30, 2022 compared to the nine months ended September 30, 2021.

The increase in operating revenues for the three months ended March 31, 2023 was primarily driven by increases of $206.0 million, $145.6 million, $95.6 million, and $25.5 million from Wynn Palace, our Las Vegas Operations, Wynn Macau, and Encore Boston Harbor, respectively, resulting from an increase in gaming volumes, hotel occupancy, and covers at restaurants.

The results of our Macau Operations for the three months ended March 31, 2022 were negatively impacted by certain travel-related restrictions and conditions, including COVID-19 testing and other mitigation procedures, related to the COVID-19 pandemic.

Over the course of December 2022 and January 2023, Macau authorities relaxed or eliminated most COVID-19 related protective measures.

Since then, and as of the date of this report, there are no remaining entry restrictions or mandatory quarantine requirements in place for travelers to Macau.

The increase in net income attributable to Wynn Resorts, Limited for the three months ended March 31, 2023 was primarily related to increased operating revenues at our Macau Operations, our Las Vegas Operations, and Encore Boston Harbor, partially offset by increased operating expenses associated with higher business volumes.

Financial results for the three months ended March 31, 2023 compared to the three months ended March 31, 2022.

Operating revenues

The following table presents our operating revenues (dollars in thousands):

Nine Months Ended September 30,

Three Months Ended March 31,

2023 2022 Increase/ (Decrease) Percent Change

9 unchanged sentences

The following table presents casino and non-casino operating revenues (dollars in thousands):

Nine Months Ended September 30,

Three Months Ended March 31,

2023 2022 Increase/ (Decrease) Percent Change

7 unchanged sentences

$ 1,423,679 $ 953,334 $ 470,345 49.3

Casino revenues for the nine months ended September 30, 2022 were 43.9% of operating revenues, compared to 59.4% for the same period of 2021.

Non-casino revenues for the nine months ended September 30, 2022 were 56.1% of operating revenues, compared to 40.6% for the same period of 2021.

Casino revenues for the three months ended March 31, 2023 were 53.9% of operating revenues, compared to 51.4% for the same period of 2022.

Non-casino revenues for the three months ended March 31, 2023 were 46.1% of operating revenues, compared to 48.6% for the same period of 2022.

Casino revenues

Casino revenues increased primarily due to higher gaming volumes at our Macau Operations following the discontinuation of pandemic-related travel restrictions in Macau in late 2022 and early 2023.

The table below sets forth our casino revenues and associated key operating measures (dollars in thousands, except for win per unit per day):

Nine Months Ended September 30,

Three Months Ended March 31,

2023 2022 Increase/ (Decrease) Percent Change

30 unchanged sentences

Slot machine win per unit per day $ 341 $ 201 $ 140 69.7

Nine Months Ended September 30,

Poker rake $ 3,936 $ — $ 3,936 NM

Three Months Ended March 31,

2023 2022 Increase/ (Decrease) Percent Change

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Slot machine win per unit per day $ 459 $ 381 $ 78 20.5

Poker rake $ 4,580 $ — $ 4,580 NM

Poker rake $ 5,682 $ 784 $ 4,898 624.7

NM - Not meaningful.

(1) On October 19, 2020, Encore at Wynn Las Vegas adjusted its operating schedule to five days/four nights each week due to reduced customer demand levels.

On April 8, 2021, Encore at Wynn Las Vegas resumed full operations.

(2) On January 25, 2021, Encore Boston Harbor restored 24-hour casino operations and reopened its hotel tower on a Thursday through Sunday weekly schedule.

The property reopened its hotel tower to seven days per week as of September 1, 2021.

Non-casino revenues

The table below sets forth our room revenues and associated key operating measures:

Nine Months Ended September 30,

Three Months Ended March 31,

2023 2022 Increase/ (Decrease) Percent Change

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REVPAR $ 309 $ 261 $ 48 18.4

(1) Encore Boston Harbor room statistics have been computed based on 158 days of operation in the nine months ended September 30, 2021, representing the number of nights hotel rooms were offered for sale to the public.

The property reopened its hotel tower to seven days per week as of September 1, 2021.

Room revenues increased $181.1 million, primarily due to higher occupancy and ADR at our Las Vegas Operations and Encore Boston Harbor.

Food and beverage revenues increased $193.4 million, primarily due to increased restaurant covers and nightlife revenues at our Las Vegas Operations.

Entertainment, retail and other revenues increased $61.8 million, primarily due to an increase in visitation to our Las Vegas Operations.

Room revenues increased $102.2 million, primarily due to higher occupancy and ADR at our Macau Operations and our Las Vegas Operations.

Food and beverage revenues increased $58.6 million, primarily due to increased restaurant covers at our Las Vegas Operations.

Entertainment, retail and other revenues increased $32.5 million, primarily due to increased convention support services, revenues from our owned and leased retail outlets, and entertainment venue sales at our Las Vegas Operations.

Operating expenses

The table below presents operating expenses (dollars in thousands):

Nine Months Ended September 30,

Three Months Ended March 31,

2023 2022 Increase/ (Decrease) Percent Change

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NM - Not meaningful.

Total operating expenses decreased $58.6 million compared to the nine months ended September 30, 2021, primarily due to decreased casino, entertainment, retail and other, provision for credit losses, and depreciation and amortization expenses, partially offset by increased room, food and beverage, general and administrative, pre-opening, and property charges and other expenses.

Casino expenses decreased $192.8 million and $124.2 million at Wynn Palace and Wynn Macau, respectively.

These decreases were primarily due to reductions in gaming tax expense driven by the declines in casino revenues at each of Wynn Palace and Wynn Macau, resulting from the effects of the COVID-19 pandemic, partially offset by increased casino expenses of $40.6 million and $35.6 million at our Las Vegas Operations and Encore Boston Harbor, respectively primarily due to increased operating costs, including gaming tax expense, driven by the increase in casino revenues.

Total operating expenses increased $206.0 million compared to the three months ended March 31, 2022, primarily due to increased operating costs associated with higher business volumes at each of our properties, partially offset by decreased depreciation and amortization and property charges and other expenses.

Casino expenses increased $91.9 million, $40.4 million, $7.6 million, and $9.5 million at Wynn Palace, Wynn Macau, our Las Vegas Operations, and Encore Boston Harbor, respectively.

These increases were primarily due to increased operating costs, including gaming tax expense, driven by the increase in casino revenues.

Room expenses increased $9.1 million and $2.1 million at our Las Vegas Operations and Encore Boston Harbor, respectively.

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Food and beverage expenses increased $24.9 million and $4.3 million at our Las Vegas Operations and Encore Boston Harbor, respectively.

Entertainment, retail and other expenses decreased $105.6 million at Wynn Interactive, primarily due to decreased marketing costs, partially offset by an increase of $32.7 million at our Las Vegas operations, primarily due to higher operating costs associated with increased levels of business.

General and administrative expenses increased primarily due to increases of $33.6 million and $13.8 million at our Las Vegas Operations and Encore Boston Harbor, respectively.

These increases were attributable to increased payroll, operating costs, and general and administrative expenses required to support higher business volumes, partially offset by decreased general and administrative expenses of $13.9 million and $13.2 million, at Wynn Palace and Wynn Macau, respectively, due to decreased payroll and operating costs attributable to lower business volumes.

The provision for credit losses decreased $7.6 million, $6.0 million, and $5.4 million at our Las Vegas Operations, Wynn Palace, and Wynn Macau, respectively.

The decreases were primarily due to the impact of historical collection patterns and expectations of current and future collection trends, as well as the specific review of customer accounts, on our estimated credit loss for the respective periods.

For the nine months ended September 30, 2022, pre-opening expenses totaled $13.4 million, which primarily related to reconfiguring the theater space at Wynn Las Vegas to host an all-new, exclusive theatrical production, Awakening , which

premiered in November 2022.

For the nine months ended September 30, 2021, pre-opening expenses totaled $5.5 million, which primarily related to restaurant remodels at our Las Vegas Operations.

Depreciation and amortization decreased $38.7 million at Wynn Palace primarily due to certain furniture, fixture and equipment assets reaching the end of their useful lives in the first quarter of 2022.

Property charges and other expenses for the nine months ended September 30, 2022 consisted primarily of impairment of goodwill and other finite-lived intangible assets of $37.8 million and $10.3 million, respectively, $7.1 million of restructuring costs related to Wynn Interactive's BetBull operations, as well as other contract termination expenses of $10.7 million and asset abandonments of $2.1 million related to Wynn Interactive, and other contingency expenses of $6.8 million at Wynn Macau.

Property charges and other expenses for the nine months ended September 30, 2021 consisted primarily of advocacy-related expenses of $12.5 million at Wynn Interactive and asset abandonments of $4.3 million and $4.1 million at our Las Vegas Operations and Wynn Palace, respectively.

Interest expense, net of capitalized interest

The following table summarizes information related to interest expense (dollars in thousands):

Nine Months Ended September 30,

2022 2021 Increase/ (Decrease) Percent Change

Interest expense

Interest cost, including amortization of debt issuance costs and original issue discount and premium $ 472,265 $ 453,601 $ 18,664 4.1

Weighted average total debt balance $ 12,106,968 $ 12,257,424

Weighted average interest rate 5.20 % 4.93 %

Interest costs increased primarily due to an increase in the weighted average interest rate.

These increases were primarily a result of increased operating costs related to an increase in food and beverage revenues at our Las Vegas Operations and Encore Boston Harbor.

Entertainment, retail and other expenses increased $17.3 million at our Las Vegas operations, primarily due to higher operating costs associated with live and theatrical entertainment, partially offset by a decrease of $14.1 million at Wynn Interactive, primarily due to decreased marketing costs.

General and administrative expenses increased primarily due to increases of $35.3 million and $14.6 million at Encore Boston Harbor and our Las Vegas Operations, respectively.

These increases were attributable to triple-net operating lease expense at Encore Boston Harbor following the sale-leaseback transaction in December 2022, and increases in payroll and other general and administrative expenses at our Las Vegas Operations required to support higher business volumes during the three months ended March 31, 2023.

In addition, corporate and other general and administrative expenses increased $12.1 million, primarily due to increased development costs.

For the three months ended March 31, 2023, pre-opening expenses totaled $4.5 million, which primarily related to the launch of Wynn Interactive operations in Massachusetts.

For the three months ended March 31, 2022, pre-opening expenses totaled $2.4 million, which primarily related to reconfiguring the theater space at Wynn Las Vegas.

Depreciation and amortization decreased $15.7 million, primarily due to the derecognition of certain real estate assets in connection with the Encore Boston Harbor sale-leaseback transaction in December 2022.

Property charges and other expenses for the three months ended March 31, 2023 consisted primarily of asset abandonments of $2.2 million at Wynn Palace.

Our property charges and other expenses for the quarter ended March 31, 2022 consisted primarily of impairment of goodwill of $30.3 million at Wynn Interactive, asset abandonments of $1.0 million and

$2.1 million at our Las Vegas Operations and Wynn Interactive, respectively, and contract termination expenses of $9.6 million at Wynn Interactive.

Other non-operating income and expenses

We incurred a foreign currency remeasurement loss of $26.1 million and $17.3 million for the nine months ended September 30, 2022 and 2021, respectively.

Interest expense, net of capitalized interest, increased $35.6 million primarily due to an increase in the weighted average total debt balance and an increase in the weighted average interest rate to 5.95% for the three months ended March 31, 2023, from 5.05% for the three months ended March 31, 2022.

We recorded interest income of $40.2 million for the three months ended March 31, 2023, primarily related to interest earned on cash and cash equivalents held at financial institutions.

We incurred a foreign currency remeasurement loss of $30.6 million and $15.1 million for the three months ended March 31, 2023 and 2022, respectively.

The impact of the exchange rate fluctuation of the Macau pataca, in relation to the U.S.

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dollar denominated debt and other obligations from our Macau-related entities drove the variability between periods.

We recorded a gain of $14.8 million and $6.6 million for the nine months ended September 30, 2022 and 2021, respectively, from change in derivatives fair value.

We recorded a $2.1 million loss on extinguishment of debt for the nine months ended September 30, 2021 related to the partial prepayment of the Wynn Macau Term Loan and the prepayment of the Wynn Macau Credit Facilities.

We recorded an income tax expense of $3.2 million and $2.3 million for the nine months ended September 30, 2022 and 2021, respectively.

Income tax expense in 2022 primarily related to changes in U.S.

deferred taxes.

We recorded a gain of $23.0 million and $7.4 million for the three months ended March 31, 2023 and 2022, respectively, from change in derivatives fair value.

The change in derivatives fair value for the three months ended March 31, 2023 included a gain of $24.9 million recorded in relation to the conversion feature of the WML Convertible Bonds.

We recorded a $12.2 million loss on debt financing transactions for the three months ended March 31, 2023, primarily related to the issuance of the 2031 WRF Senior Notes and the repurchase of the tendered 2025 WRF Senior Notes.

We recorded income tax expense of $1.0 million and $1.1 million for the three months ended March 31, 2023 and 2022, respectively.

Income tax expense in 2023 primarily relates to U.S.

operating profits.

Income tax expense in 2022 primarily related to the Macau dividend tax agreement that provides for an annual payment as complementary tax otherwise due by stockholders of WRM.

Net loss attributable to noncontrolling interests

Net loss attributable to noncontrolling interests was $219.6 million and $177.0 million for the nine months ended September 30, 2022 and 2021, respectively.

Net loss attributable to noncontrolling interests was $11.2 million and $71.3 million for the three months ended March 31, 2023 and 2022, respectively.

These amounts are primarily related to the noncontrolling interests' share of net loss from WML.

Adjusted Property EBITDA

We use Adjusted Property EBITDA to manage the operating results of our segments.

Adjusted Property EBITDA is net loss before interest, income taxes, depreciation and amortization, pre-opening expenses, property charges and other, management and license fees, corporate expenses and other (including intercompany golf course, meeting and convention, and water rights leases), stock-based compensation, change in derivatives fair value, loss on extinguishment of debt, and other non-operating income and expenses.

We use Adjusted Property EBITDA to manage the operating results of our segments.

Adjusted Property EBITDA is presented exclusively as a supplemental disclosure because management believes that it is widely used to measure the performance, and as a basis for valuation, of gaming companies.

Management uses Adjusted Property EBITDA as a measure of the operating performance of its segments and to compare the operating performance of its properties with those of its competitors, as well as a basis for determining certain incentive compensation.

We also present Adjusted Property EBITDA because it is used by some investors to measure a company's ability to incur and service debt, make capital expenditures and meet working capital requirements.

Gaming companies have historically reported EBITDA as a supplement to GAAP.

In order to view the operations of their casinos on a more stand-alone basis, gaming companies, including us, have historically excluded from their EBITDA calculations preopening expenses, property charges, corporate expenses and stock-based compensation, that do not relate to the management of specific casino properties.

However, Adjusted Property EBITDA should not be considered as an alternative to operating income as an indicator of our performance, as an alternative to cash flows from operating activities as a measure of liquidity, or as an alternative to any other measure determined in accordance with GAAP.

Unlike net loss, Adjusted Property EBITDA does not include depreciation or interest expense and therefore does not reflect current or future capital expenditures or the cost of capital.

We have significant uses of cash flows, including capital expenditures, interest payments, debt principal repayments, income taxes and other non-recurring charges, which are not reflected in Adjusted Property EBITDA.

Also, our calculation of Adjusted Property EBITDA may be different from the calculation methods used by other companies and, therefore, comparability may be limited.

The following table summarizes Adjusted Property EBITDA (dollars in thousands) for Wynn Palace, Wynn Macau, Las Vegas Operations, Encore Boston Harbor, and Wynn Interactive as reviewed by management and summarized in Item 1—"Notes to Condensed Consolidated Financial Statements," Note 18, "Segment Information." That footnote also presents a reconciliation of Adjusted Property EBITDA to net loss attributable to Wynn Resorts, Limited.

Three Months Ended September 30, Nine Months Ended September 30,

2022 2021 Increase/ (Decrease) Percent Change 2022 2021 Increase/ (Decrease) Percent Change

Wynn Palace $ (21,808) $ 12,112 $ (33,920) NM $ (72,622) $ 93,036 $ (165,658) NM

Wynn Macau (43,806) (1,939) (41,867) NM (88,878) 28,703 (117,581) NM

Segment Information

As further described in Item 1—"Notes to Condensed Consolidated Financial Statements," Note 18, "Segment Information," we use Adjusted Property EBITDAR to manage the operating results of our segments.

Adjusted Property EBITDAR is net income (loss) before interest, income taxes, depreciation and amortization, pre-opening expenses, property charges and other, triple-net operating lease rent expense related to Encore Boston Harbor, management and license fees, corporate expenses and other (including intercompany golf course, meeting and convention, and water rights leases), stock-based compensation, change in derivatives fair value, loss on debt financing transactions, and other non-operating income and expenses.

Adjusted Property EBITDAR is presented exclusively as a supplemental disclosure because management believes that it is widely used to measure the performance, and as a basis for valuation, of gaming companies.

Management uses Adjusted Property EBITDAR as a measure of the operating performance of its segments and to compare the operating performance of its properties with those of its competitors, as well as a basis for determining certain incentive compensation.

We also present Adjusted Property EBITDAR because it is used by some investors to measure a company's ability to incur and service debt, make capital expenditures and meet working capital requirements.

Gaming companies have historically reported EBITDAR as a supplement to GAAP.

In order to view the operations of their casinos on a more stand-alone basis, gaming companies, including us, have historically excluded from their EBITDAR calculations preopening expenses, property charges, corporate expenses and stock-based compensation, that do not relate to the management of specific casino properties.

However, Adjusted Property EBITDAR should not be considered as an alternative to operating income (loss) as an indicator of our performance, as an alternative to cash flows from operating activities as a measure of liquidity, or as an alternative to any other measure determined in accordance with GAAP.

Unlike net income (loss), Adjusted Property EBITDAR does not include depreciation or interest expense and therefore does not reflect current or future capital expenditures or the cost of capital.

We have significant uses of cash flows, including capital expenditures, triple-net operating lease rent expense related to Encore Boston Harbor, interest payments, debt principal repayments, income taxes and other non-recurring charges, which are not reflected in Adjusted Property EBITDAR.

Also, our calculation of Adjusted Property EBITDAR may be different from the calculation methods used by other companies and, therefore, comparability may be limited.

The following table summarizes Adjusted Property EBITDAR (dollars in thousands) for Wynn Palace, Wynn Macau, Las Vegas Operations, Encore Boston Harbor, and Wynn Interactive as reviewed by management and summarized in Item 1—"Notes to Condensed Consolidated Financial Statements," Note 18, "Segment Information." That footnote also presents a reconciliation of Adjusted Property EBITDAR to net income (loss) attributable to Wynn Resorts, Limited.

Three Months Ended March 31,

2023 2022 Increase/ (Decrease) Percent Change

Wynn Palace $ 111,058 $ (864) $ 111,922 NM

Wynn Macau 44,745 (4,682) 49,427 NM

Las Vegas Operations 231,597 159,378 72,219 45.3

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NM - Not meaningful.

Adjusted Property EBITDA at Wynn Palace and Wynn Macau decreased $33.9 million and $41.9 million for the three months ended September 30, 2022 and $165.7 million and $117.6 million for the nine months ended September 30, 2022, respectively, primarily due to a decrease in operating revenues, partially offset by a decrease in operating expenses.

Our Macau Operations for the three and nine months ended September 30, 2022 continued to be negatively impacted by certain travel-related restrictions and conditions, including COVID-19 testing and other procedures related to the COVID-19 pandemic.

Adjusted Property EBITDA at our Las Vegas Operations increased $12.3 million and $237.1 million for the three and nine months ended September 30, 2022, primarily due to an increase in operating revenues, partially offset by an increase in operating expenses.

Adjusted Property EBITDA at Encore Boston Harbor decreased $3.4 million for the three months ended September 30, 2022, primarily due to an increase in operating expenses, partially offset by an increase in operating revenues.

Adjusted Property EBITDA at Encore Boston Harbor increased $38.3 million for the nine months ended September 30, 2022, primarily due to an increase in operating revenues, partially offset by an increase in operating expenses.

Adjusted Property EBITDA at Wynn Interactive increased $85.8 million and $117.8 million for the three and nine months ended September 30, 2022, primarily due to increased operating revenues due to the continued expansion and ramp up of operations and decreased marketing and promotional expenses.

Adjusted Property EBITDAR at Wynn Palace and Wynn Macau increased $111.9 million and $49.4 million for the three months ended March 31, 2023, respectively, primarily due to an increase in operating revenues, partially offset by an increase in operating expenses.

In December 2022 and early January 2023, the Macau government relaxed or eliminated most of COVID-19 related protective measures, which resulted in increased business volumes at our Macau Operations for the three months ended March 31, 2023.

Our Macau Operations for the three months ended March 31, 2022 were negatively impacted by certain travel-related restrictions and conditions related to the COVID-19 pandemic.

Adjusted Property EBITDAR at our Las Vegas Operations increased $72.2 million for the three months ended March 31, 2023, primarily due to an increase in revenues from casino, hotel, and food and beverage operations, partially offset by increased operating expenses.

Adjusted Property EBITDAR at Encore Boston Harbor increased $8.2 million for the three months ended March 31, 2023, primarily due to an increase in revenues from casino operations, partially offset by increased operating expenses.

Adjusted Property EBITDAR at Wynn Interactive increased $10.4 million for the three months ended March 31, 2023, primarily due to a decrease in marketing and promotional expenses, depreciation and amortization, and property charges and other expenses.

Refer to the discussions above regarding the specific details of our results of operations.

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Our cash flows were as follows (in thousands):

Nine Months Ended September 30,

Three Months Ended March 31,

Cash Flows - Summary 2023 2022

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Repayments of long-term debt (1,018,973) (12,500)

Proceeds from issuance of Wynn Resorts, Limited common stock — 841,896

Repurchase of common stock (10,834) (11,667)

Proceeds from issuance of subsidiary common stock 2,895 4,662

Proceeds from sale of additional interest in joint venture 50,033 —

Proceeds from sale of noncontrolling interest in subsidiary — 50,033

Distribution to noncontrolling interest (4,502) (9,279)

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Payments for financing costs (31,330) (109)

Net cash provided by (used in) financing activities 9,441 (555,569)

Other (7,773) —

Net cash provided by financing activities 121,003 10,872

Effect of exchange rate on cash, cash equivalents and restricted cash (2,567) (925)

Decrease in cash, cash equivalents and restricted cash $ (428,401) $ (1,003,230)

Increase (decrease) in cash, cash equivalents and restricted cash $ 155,977 $ (204,653)

Operating Activities

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Accordingly, operating cash flows will be impacted by changes in operating income and accounts receivable, net.

During the nine months ended September 30, 2022, the decrease in net cash used in operating activities was primarily due to increased revenues from our Las Vegas Operations and Encore Boston Harbor, which was partially offset by decreases in revenues from Wynn Palace and Wynn Macau.

During the nine months ended September 30, 2021, the decrease in net cash used in operating activities was primarily due to increased operating revenues, partially offset by an increase in operating expenses and changes in working capital accounts.

During the three months ended March 31, 2023, the increase in cash flows from operating activities was primarily due to increased revenues from our Macau Operations, our Las Vegas Operations, and Encore Boston Harbor, which was partially offset by an increase in operating expenses associated with higher business volumes.

During the three months ended March 31, 2022, the decrease in net cash used in operating activities was primarily due to increased operating revenues, partially offset by an increase in operating expenses.

Investing Activities

Our investing activities primarily consist of project capital expenditures and maintenance capital expenditures associated with maintaining and continually refining our world-class integrated resort properties.

During the nine months ended September 30, 2022, we incurred capital expenditures of $214.1 million at our Las Vegas Operations primarily related to the Wynn Las Vegas room remodel and theater reconfiguration, and $14.7 million at Encore Boston Harbor, $27.9 million at Wynn Palace, and $9.6 million at Wynn Macau primarily related to maintenance capital expenditures.

During the nine months ended September 30, 2021, we incurred capital expenditures of $118.7 million at our Las Vegas Operations primarily related to the Wynn Las Vegas room remodel, and $33.4 million at Encore Boston Harbor, $24.4 million at Wynn Palace, and $18.3 million at Wynn Macau primarily related to maintenance capital expenditures.

During the three months ended March 31, 2023, we incurred capital expenditures of $38.5 million at our Las Vegas Operations, $30.1 million at Encore Boston Harbor, $6.4 million at Wynn Palace, and $3.0 million at Wynn Macau primarily related to maintenance capital expenditures, and $46.5 million at Corporate and other primarily related to future development projects.

During the three months ended March 31, 2022, we incurred capital expenditures of $67.8 million at our Las Vegas Operations primarily related to the Wynn Las Vegas room remodel, and $7.5 million at Encore Boston Harbor, $13.1 million at Wynn Palace, and $4.2 million at Wynn Macau, each primarily related to maintenance capital expenditures.

Financing Activities

During the nine months ended September 30, 2022, we repurchased 2,873,431 shares of our common stock for approximately $166.4 million.

We also borrowed $211.4 million under the WM Cayman II Revolver and made quarterly amortization payments under the WRF Term Loan totaling $37.5 million.

In addition, we received a $50.0 million contribution from a noncontrolling interest holder in exchange for a 49.9% interest in certain retail space contributed by the Company to the Retail Joint Venture and used cash of $21.5 million for distributions to noncontrolling interest holders of the Retail Joint Venture.

During the nine months ended September 30, 2021, we received proceeds of $841.9 million from our February 2021 equity offering and used $716.0 million of the proceeds from the equity offering to repay the outstanding borrowings under the WRF Revolver.

We also paid $464.7 million of outstanding principal owed under the Wynn Macau Term Loan and prepaid the outstanding $1.26 billion of borrowings under the Wynn Macau Credit Facilities along with related financing costs, using proceeds from the borrowing of $1.09 billion under the WM Cayman II Revolver along with $200.0 million of cash.

In addition, we made quarterly amortization payments under the WRF Term Loan totaling $37.5 million.

During the three months ended March 31, 2023, the cash flows from financing activities was primarily due to the following debt issuances and repayments (in thousands):

Proceeds from issuance Repayments

WRF 7 1/8% Senior Notes, due 2031 $ 600,000 $ —

WML 4 1/2% Convertible Bonds, due 2029 600,000 —

WRF 7 3/4% Senior Notes, due 2025 — 506,473

Wynn Las Vegas 4 1/4% Senior Notes, due 2023

WRF Term Loan, due 2024 — 12,500

Total $ 1,200,000 $ 1,018,973

In addition, during the three months ended March 31, 2023, we paid $31.3 million for financing costs related to the financing activities above.

During the three months ended March 31, 2022, we received a $50.0 million contribution from a noncontrolling interest holder in exchange for a 49.9% interest in certain retail space contributed by the Company to the Retail Joint Venture.

In addition, we made a $12.5 million quarterly amortization payment under the WRF Term Loan Facility.

Capital Resources

The COVID-19 pandemic has materially impacted and is likely to continue to materially impact, our business, financial condition and results of operations.

While we believe our unrestricted cash, cash flows from operations and revolver borrowing capacity will enable us to fund our current obligations for the foreseeable future, COVID-19 has resulted in significant disruptions to our operations and to the U.S.

and other global economies, which has had and will likely continue to have a negative impact on our operating income and could have a negative impact on our ability to access capital in the future.

The following table summarizes our unrestricted cash and cash equivalents and available revolver borrowing capacity, excluding capacity under intercompany loan agreements, as of September 30, 2022 (in thousands):

The following table summarizes our unrestricted cash and cash equivalents and available revolver borrowing capacity presented by significant financing entity as of March 31, 2023 (in thousands):

Total Cash and Cash Equivalents Revolver Borrowing Capacity

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Wynn Macau, Limited and subsidiaries .

WML generates cash from our Macau Operations and may utilize proceeds from the WM Cayman II Revolver and its intercompany revolving loan facility with Wynn Resorts, Limited to fund working capital requirements as needed.

In July 2022, we drew $211.4 million on the WM Cayman II Revolver for general corporate purposes.

We expect to use this cash to fund working capital and capital expenditure requirements at WML and our Macau Operations, and to service our WML Senior Notes and WM Cayman II Revolver.

WML paid no dividends during 2021 or the nine months ended September 30, 2022.

The borrowings under the WM Cayman II Revolver bear interest at LIBOR or HIBOR plus a margin of 2.625% per annum until June 30, 2022, the date from which the margin will be 1.875% to 2.875% per annum based on WM Cayman II’s leverage ratio on a consolidated basis, subject to a floor on the interest rate margin of 2.625% per annum through June 30, 2023.

WML generates cash from our Macau Operations.

We expect to use this cash to fund working capital and capital expenditure requirements at WML and our Macau Operations, and to service our WML Senior Notes, WM Cayman II Revolver, and WML Convertible Bonds.

WML paid no dividends during 2022 or the three months ended March 31, 2023.

The borrowings under the WM Cayman II Revolver bear interest at LIBOR or HIBOR plus a margin of 2.625% per annum until June 30, 2023, the date from which the margin will be 1.875% to 2.875% per annum based on WM Cayman II’s leverage ratio on a consolidated basis.

The final maturity of all outstanding loans under the Revolving Facility is September 16, 2025.

On May 5, 2022, WM Cayman II and its lenders agreed to waive certain financial covenants in the facility agreement under the WM Cayman II Revolver in respect of the relevant periods ending on the following applicable test dates:

(a) June 30, 2022;

(b) September 30, 2022;

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WML , as guarantor, may be subject to certain restrictions on payments of dividends or distributions to its shareholders, unless certain financial criteria have been satisfied through the facility agreement.

On March 7, 2023, WML completed an offering (the "Offering") of $600.0 million 4.50% convertible bonds due 2029 (the "WML Convertible Bonds").

The WML Convertible Bonds are constituted by a trust deed dated March 7, 2023 (the "Trust Deed").

The net proceeds from the Offering, after deduction of commission and other related expenses, were $585.9 million.

WML intends to use the proceeds for general corporate purposes.

The WML Convertible Bonds bear interest on their outstanding principal amount from and including March 7, 2023 at the rate of 4.50% per annum.

The WML Convertible Bonds are convertible at the option of the holder thereof into fully paid ordinary shares of WML, at the initial conversion price of approximately HK$10.24 (equivalent to approximately $1.30) per share, subject to and upon compliance with the terms and conditions of the WML Convertible Bonds (the "Terms and Conditions," and such right, the "Conversion Right").

The conversion price is at the fixed rate of HK$7.8497 (equivalent to US$1.00), subject to standard adjustments for certain dilutive events as described in the Terms and Conditions.

WML has the option, in its sole discretion, to pay to the relevant bondholder an amount of cash equivalent in order to satisfy the Conversion Right in whole or in part.

The holders of the WML Convertible Bonds have the option to require WML to redeem all or some only of such holder’s Bonds (i) on March 7, 2027 at their principal amount together with interest accrued but unpaid to (but excluding) the date fixed for redemption;

or (ii) on the Relevant Event Redemption Date (as defined in the Terms and Conditions) at their principal amount together with interest accrued but unpaid to, but excluding such date, following the occurrence of (a) when the Ordinary Shares cease to be listed or admitted to trading or are suspended from trading for a period equal to or exceeding 10 consecutive trading days on the Stock Exchange of Hong Kong Limited, or if applicable, the alternative stock exchange, (b) when there is a Change of Control (as defined in the Terms and Conditions), or (c) when less than 25% of WML’s total number of issued Ordinary Shares are held by the public (as interpreted under Rule 8.24 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited).

The WML Convertible Bonds may also be redeemed at the option of WML in whole, but not in part, at any time after March 7, 2027, but prior to March 7, 2029, upon giving notice to the bondholders in accordance with the Terms and Conditions, under certain circumstances specified in the Trust Deed.

If our portion of our cash and cash equivalents were repatriated to the U.S.

on September 30, 2022, it would be subject to minimal U.S.

on March 31, 2023, it would be subject to minimal U.S.

taxes in the year of repatriation.

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In addition, WRF may utilize its available revolving borrowing capacity as needed.

We expect to use this cash to service our WRF Credit Facilities, the WRF Senior Notes due 2025, the WRF Senior Notes due 2029, and the Wynn Las Vegas (WLV) Senior Notes, and to fund working capital and capital expenditure requirements as needed.

We expect to use this cash to service our WRF Credit Facilities, the WRF Senior Notes and the Wynn Las Vegas Senior Notes, and to fund working capital and capital expenditure requirements as needed.

WRF is a holding company and, as a result, its ability to pay dividends to Wynn Resorts is dependent on WRF receiving distributions from its subsidiaries, which include WML, Wynn Las Vegas, LLC, and Wynn MA.

The WRF Credit Agreement contains customary negative and financial covenants, including, but not limited to, covenants that restrict WRF's ability to pay dividends or distributions and incur additional indebtedness.

In June 2022, Wynn Las Vegas completed its hotel room remodel for total project costs of approximately $215 million.

In October 2022, Wynn Las Vegas completed its theater reconfiguration for total project costs of approximately $110 million, inclusive of approximately $25 million of remaining project costs.

The specially redesigned theater was custom designed to host an all-new, exclusive theatrical production, Awakening , which premiered in November 2022.

As previously discussed, on February 15, 2022, we announced our entry into a sale-leaseback arrangement with respect to certain real estate assets related to Encore Boston Harbor.

Upon closing of the related transactions, currently expected to take place in the fourth quarter of 2022, subject to regulatory approvals and customary closing conditions, we expect to receive cash consideration of approximately $1.7 billion in exchange for the sale of such real estate assets to an unrelated third party, and to concurrently enter into a lease agreement whereby the Company will lease such real estate assets for the purpose of continuing to operate the Encore Boston Harbor property.

The lease agreement provides for an initial annual minimum rent of $100.0 million for an initial term of 30 years, subject to certain annual rent escalations and renewal provisions.

We expect to use the cash proceeds from the sale of the real estate assets for general corporate purposes, which may include the repayment of certain debt obligations.

On February 16, 2023, WRF and its subsidiary Wynn Resorts Capital Corp.

(together with WRF, the “WRF Issuers”) issued $600.0 million aggregate principal amount of 7 1/8% Senior Notes due 2031 (the "2031 WRF Senior Notes") in a private offering.

The 2031 WRF Senior Notes were issued at par, for proceeds of $596.2 million, net of $3.8 million of related fees and expenses.

Also on February 16, 2023, WRF completed a cash tender offer for any and all of the outstanding principal amount of the 2025 WRF Senior Notes, and accepted for purchase valid tenders with respect to $506.4 million and paid a tender premium of $12.4 million.

We used a portion of the net proceeds from the offering of the 2031 WRF Senior Notes to purchase such tendered 2025 WRF Senior Notes and to pay related fees and expenses, and intend to use the remaining net proceeds for general corporate purposes.

In April 2023, we repurchased the remaining outstanding 2025 WRF Senior Notes using the remaining net proceeds from the issuance of the 2031 WRF Senior Notes and cash held by WRF, at a price equal to 101.938% of the principal amount plus accrued interest under the terms of its indenture.

In March 2023, we repurchased all of the outstanding Wynn Las Vegas 4.25% Senior Notes due 2023 of $500.0 million using cash held by WRF, at a price equal to 100% of the principal amount plus accrued interest under the terms of their indenture.

Wynn Resorts, Limited and other subsidiaries.

Wynn Resorts, Limited is a holding company and, as a result, our ability to pay dividends is dependent on our ability to obtain funds and our subsidiaries' ability to provide funds to us.

Wynn Resorts, Limited and other primarily generates cash from royalty and management agreements with our resorts, dividends and distributions from our subsidiaries, and the operations of the Retail Joint Venture of which we own 50.1%.

We expect to use this cash to service our Retail Term Loan, to fund working capital needs of our subsidiaries, and for general corporate purposes.

Wynn Resorts, Limited and other primarily generates cash from royalty (including intellectual property license) and management agreements with our resorts, dividends and distributions from our subsidiaries, and the operations of the Retail Joint Venture of which we own 50.1%.

Fees payable by Wynn Macau SA to Wynn Resorts, Limited under its intellectual property license agreement are capped at $75.2 million for the year ended December 31, 2023.

We expect to use cash held by Wynn Resorts, Limited and other to service our Retail Term Loan, to pay dividends, to fund future development projects, and for general corporate purposes.

Wynn Resorts, Limited has resumed its quarterly dividend program, with a cash dividend of $0.25 per share declared on May 9, 2023, payable on June 6, 2023 to stockholders of record as of May 23, 2023.

Other Factors Affecting Liquidity

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Under the equity repurchase program, we may repurchase the Company's outstanding shares from time to time through open market purchases, in privately negotiated transactions, and under plans complying with Rules 10b5-1 and 10b-18 under the Securities Exchange Act of 1934, as amended (the "Exchange Act").

We repurchased 2,873,431 shares of our common stock at an average price of

$57.91 per share, for an aggregate cost of $166.4 million under this equity repurchase program during the nine months ended September 30, 2022.

As of September 30, 2022, we had $633.7 million in repurchase authority remaining under the program.

During the three months ended March 31, 2023, we did not repurchase any shares of our common stock under this equity repurchase program.

As of March 31, 2023, we had $628.8 million in repurchase authority remaining under the program.

We have in the past repurchased, and in the future, we may periodically consider repurchasing our outstanding notes for cash.

The amount of any shares and/or notes to be repurchased, as well as the timing of any repurchases, will be based on business, market and other conditions and factors, including price, contractual requirements or consents, and capital availability.

New business developments or other unforeseen events, including related to COVID-19, may occur, resulting in the need to raise additional funds.

New business developments or other unforeseen events may occur, resulting in the need to raise additional funds.

We continue to explore opportunities to develop additional gaming or related businesses in domestic and international markets.

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We may decide to conduct any such development through Wynn Resorts, Limited or through subsidiaries separate from the Las Vegas, Boston or Macau-related entities.

Contractual Commitments

During the three months ended March 31, 2023, except as described below, there have been no material changes to the contractual obligations previously reported in our Annual Report on Form 10-K for the year ended December 31, 2022.

During the three months ended March 31, 2023, our fixed interest rate long-term debt obligations increased by a net amount of $193.5 million, as a result of $1.20 billion in long-term debt issuances, net of $1.01 billion in debt repayments.

Additionally, our annual fixed interest payments are expected to increase $15.6 million in 2023, $30.5 million in 2024, $58.3 million in 2025, $69.8 million in each of 2026 and 2027, and $166.2 million thereafter, primarily as a result of the issuance of the WRF 2031 Senior Notes and the WML Convertible Bonds and the repurchase of the tendered 2025 WRF Senior Notes and the 2023 Wynn Las Vegas Senior Notes, each as described above.

Critical Accounting Policies and Estimates

A description of our critical accounting policies is included in Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2022.

There have been no significant changes to these policies for the nine months ended September 30, 2022.

Except as described below, there have been no significant changes to these policies for the three months ended March 31, 2023:

WML Convertible Bond Conversion Option Derivative

On March 7, 2023, WML completed the Offering of the WML Convertible Bonds.

The Company determined that the conversion feature contained within the WML Convertible Bonds is not indexed to WML's equity and, as such, is required to be bifurcated from the debt host contract and accounted for as a free-standing derivative (the "WML Convertible Bonds Conversion Option Derivative").

In accordance with applicable accounting standards, the WML Convertible Bond Conversion Option Derivative will be recorded at fair value each reporting period, with changes recognized in the statement of operations.

The Company used a binomial lattice model in order to estimate the fair value of the embedded derivative in the WML Convertible Bonds.

Inherent in a binomial options pricing model are unobservable (Level 3) inputs and assumptions related to expected share-price volatility, risk-free interest rate, expected term, and dividend yield.

The Company estimates the volatility of shares of WML common stock based on historical volatility that matches the expected remaining term to maturity of the WML Convertible Bonds.

The risk-free interest rate is based on the Hong Kong and United States benchmark yield curves on the valuation date for a maturity similar to the expected remaining term of the WML Convertible Bonds.

The expected life of the WML Convertible Bonds is assumed to be equivalent to their remaining term to maturity.

The dividend yield is based on the historical WML dividend rate over the last several years.

The output of the lattice model can be highly sensitive to fluctuations in its inputs.

Recently Adopted Accounting Standards and Accounting Standards Issued But Not Yet Adopted

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Item 2. Management’s Discussion and Analysis