Here’s why MGM stock is on the move

Online sports betting saw a huge spike in revenue in Q1.

MGM Resorts International (NYSE:MGM) stock was surging on Monday, rising some 3% after the gambling stock released promising first quarter results within its BetMGM business.

In its first quarter business update released on Monday, BetMGM reported a 34% year-over-year revenue increase in Q1.

The net gaming revenue (NGR) revenue hold percentage rose 110 basis points to 4.8% in the quarter.

Overall, BetMGM’s handle, the total amount wagered, grew 29% to $4.1 billion, while total monthly active users jumped 6% to 1.1 million.

This helped generate positive EBITDA of $22 million, up from a net loss of $154 million in the same quarter a year ago.

The strong performance was led by a huge surge in its online sports betting and iGaming.

“2025 is off to an encouraging start for BetMGM as we execute our revised strategic plan. The momentum we built in the second half of 2024 continued into the first quarter as we implement our powerful iGaming strategy, enabling us to grow faster than the market and at scale,” BetMGM CEO Adam Greenblatt said. “In Online Sports, we are elevating our brand and delivering improved performance, even in the face of unfavorable sports outcomes during key moments in the quarter.’

68% increase in online sports betting revenue

First quarter revenue for online sports betting via the BetMGM app rose 68% to $194 million. BetMGM online sports betting benefitted from having a broader market range, improved pricing, and enhanced parlay offerings. It saw a 4.8 percentage-point jump in parlay bets, while bets per active user increased 28%.

The firm also refined its approach to player retention with improved segmentation and increased promotion. Overall, the handle per active user was up 37% year-over-year while active player days climbed 20%.

Its iGaming business also had a strong quarter, with revenue climbing 27% to $443 million.

The surge was attributing to a spike in iGaming players. Within iGaming, the number of average monthly active users rose 43% due mostly to its robust offerings and focused marketing investment. The company also improved is cross-selling with a 13 percentage-point rise in online sports players also engaging in iGaming.

In addition, iGaming attributed $133 million to the quarterly EBITDA.

BetMGM offers both online sports betting and iGaming in five markets, and sports betting only in 24 markets. It has 225 market share in iGaming and 8% market share in sports betting.

Outlook calls for positive EBITDA

BetMGM affirmed its outlook for positive EBITDA in fiscal 2025 with net revenue targeted at $2.4 billion to $2.5 billion. It also reiterated its guidance for online sports betting to have positive EBITDA for the year.

Further, it expressed confidence in hitting its goal of $500 million in EBITDA in the coming years

“As we approach May, we remain confident in achieving full year positive EBITDA in 2025, supported by solid underlying activity trends and our successful delivery of positive EBITDA in the first quarter,” Greenblatt said.

These results are focused on the BetMGM business. MGM will release its full earnings report on Wednesday, April 30 after the market closes.

MGM stock is down 6% YTD but it has a media price target of $48 per share, which suggests 48% growth over its current price. It is reasonably valued with a P/E of 13.