Shares of casino operator Melco Resorts & Entertainment (MLCO 1.73%) fell as much as 15.6% in trading Thursday after the company reported third-quarter financial results. At 1:40 p.m., EST shares were still down 10.8% on the day.
Quarterly revenue fell 11% to $1.22 billion, and adjusted EBITDA, which is a measure of cash flow from a resort, was down 26% to $295.4 million. Net income declined from $115.9 million a year ago to just $9.6 million, or $0.02 per share. Analysts were expecting $0.22 per share in earnings on $1.34 billion of revenue.
Melco Resorts is already seeing it, but Wynn Resorts' CEO said there's a slowdown taking place in Macau's high-end gaming market, which is also spooking investors today.
On top of the overall market slowdown, Melco Resorts is dealing with increased competition in Macau from new resorts like Wynn Palace and MGM Cotai. They're pulling market share away from Melco and causing the decline in earnings you see above. And if Macau starts shrinking gaming revenue on top of market share losses, it could be a rough end to 2018 for Melco Resorts.