MGM Resorts International (MGM) - Get Report shares rose after reports said the casino company would cut 18,000 workers, as gamblers have been reluctant to travel to casinos amid the coronavirus pandemic.
The reduction amounts to more than 25% of MGM’s headcount prior to the pandemic - about 70,000. MGM has 29 hotels and casinos in the U.S. and Macau.
It’s the largest casino operator on the Las Vegas Strip and has struggled there since Nevada started reopening from the pandemic in early June, Bloomberg reports.
One of its casinos in Las Vegas and one in New York remain shuttered.
“While we have safely resumed operations at many of our properties and have returned tens of thousands of our colleagues to work, our industry - and country - continues to be impacted by the pandemic, and we have not returned to full operating capacity,” Chief Executive Bill Hornbuckle wrote in a memorandum to MGM workers.
MGM shares recently traded at $24.08, up 5.6%. They have slumped 27% this year but have rebounded 62% in the past month.
“What initially attracted us to MGM, besides its leadership in leisure, hospitality and gaming, was an area that currently comprises a tiny portion of its revenue - online gaming,” IAC Chairman Barry Diller said in a statement.
"IAC's foundational concept of seeking opportunities to build interactive businesses is our base rationale. There is a digital first opportunity within MGM Resorts' already impressive offline businesses, and with our experience we hope we can strongly contribute to the growth of online gaming," he added.