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Financial Performance - Net revenues for the year ended December 31, 2025 increased by $72.5 million to $2.01 billion, a growth of 3.7% compared to 2024 [261]. - Operating income for 2025 was $597.4 million, reflecting a 5.1% increase from $568.7 million in 2024 [262]. - Casino revenues rose by 5.0% to $1.34 billion, while room revenues decreased by 5.2% to $190.1 million due to renovations [259][261]. - Food and beverage revenues remained stable at $362.4 million, with a 5.2% increase in guests served but a 4.4% decrease in average guest check [264]. - Net income attributable to Red Rock increased by 22.1% to $188.1 million compared to $154.1 million in 2024 [259]. - Adjusted EBITDA for 2025 was $848,591, up from $795,900 in 2024, reflecting an increase of about 6.6% [280]. - Net income for 2025 was $355,670, compared to $291,292 in 2024, indicating a growth of approximately 22.1% [280]. Expenses and Costs - SG&A expenses increased by 2.1% to $441.3 million, representing 21.9% of net revenues, effectively flat compared to the prior year [268]. - Interest expense, net, decreased by 11.8% to $201.9 million, primarily due to lower interest rates and borrowings [271]. - Cash paid for capital expenditures in 2025 was $319.0 million, compared to $283.9 million in 2024, primarily related to renovation and expansion projects [306]. Cash Flow and Liquidity - Cash and cash equivalents as of December 31, 2025, totaled $142.5 million, with borrowing availability under the revolving credit facility at $898.2 million [288]. - The company reported net cash provided by operating activities of $609,513 for the year ended December 31, 2025, compared to $548,263 in 2024 [303]. - Net cash provided by operating activities for the year ended December 31, 2025 totaled $609.5 million, an increase from $548.3 million in 2024, driven by higher revenues and changes in working capital accounts [305]. - The company anticipates that cash on hand and cash generated from operations will be sufficient to fund operations and capital requirements for the next twelve months [302]. Dividends and Share Repurchase - A quarterly cash dividend of $0.26 per share of Class A common stock is scheduled for March 31, 2026, along with a special cash dividend of $1.00 per share on February 27, 2026 [298]. - The company repurchased 1,551,576 shares in open market transactions at a weighted-average price of $51.45 per share during the year ended December 31, 2025 [301]. - The company paid $120.8 million in dividends to Class A common stockholders for the year ended December 31, 2025 [307]. Debt and Financing - As of December 31, 2025, the company had $1.7 billion of borrowings under credit agreements based on variable rates, with a potential annual interest cost increase of approximately $17.3 million for a 1% rise in rates [297]. - The company reduced its outstanding indebtedness by $15.7 million for the year ended December 31, 2025 [307]. - Total cash flows from financing activities for the year ended December 31, 2025 were $(385.6) million, compared to $(199.7) million in 2024 [303]. Taxation - The effective tax rate for 2025 was 11.6%, slightly higher than 11.2% in 2024, with income tax expense of $46.7 million [276]. - As of December 31, 2025, the company had a net deferred tax asset of $12.1 million related to the outside basis difference in its partnership investment [320]. Regulatory and Compliance - The company is subject to extensive regulation by gaming authorities, which may impact future operations and financial performance [314]. - The company is currently in compliance with all applicable covenants as of December 31, 2025 [311]. - The company is subject to a maximum total secured leverage ratio of 5.00 to 1.00 as part of its financial ratio covenants [311]. Development Projects - Development fee revenues of $17.6 million were recognized from the North Fork Project, including a $6.1 million catch-up for prior years [266]. - A gain of $8.5 million was recognized on Native American development related to the North Fork Project [275]. - The company has development agreements with the North Fork Rancheria of Mono Indians to assist in developing a gaming and entertainment facility in California [313].

Core Viewpoint - Jefferies has raised the price target for Red Rock Resorts (RRR) to $79 from $73 while maintaining a Buy rating, citing better-than-expected Q4 results and the company's leadership in the LVL market [1] Financial Performance - Red Rock Resorts reported better-than-expected Q4 results, which are likely to positively impact the share price [1] - The firm continues to demonstrate strong execution in capital projects, which are on time and on budget [1] Strategic Initiatives - A new phase has been announced at Sunset Station, indicating ongoing development and expansion efforts [1] - While construction may temporarily affect near-term growth, the company's proven track record supports confidence in achieving or exceeding return targets [1]

Fund Performance - Baron Partners Fund achieved a return of 19.07% in Q4 2025, significantly outperforming the Russell Midcap Growth Index, which returned -3.70%, and the Russell 3000 Index, which returned 2.40% [1] - For the calendar year 2025, the Fund returned 24.86%, compared to 8.66% for the Russell Midcap Growth Index and 17.15% for the Russell 3000 Index [1] - The Fund focuses on long-term investments in a non-diversified portfolio of well-managed growth businesses at attractive prices across various market caps [1] Red Rock Resorts, Inc. Overview - Red Rock Resorts, Inc. operates casino and entertainment properties, with a one-month return of 7.95% and a 52-week return of 29.51% [2] - As of February 10, 2026, Red Rock Resorts, Inc. stock closed at $66.79 per share, with a market capitalization of $6.874 billion [2] Investment Insights on Red Rock Resorts, Inc. - Red Rock Resorts invested over $800 million in developing the Durango property, which is generating robust returns and strengthening performance across its six core Las Vegas Locals casinos [3] - The company reports strong visitation and robust gaming activity, with improving engagement from uncarded and non-rewards customers [3] - Management is increasing capital investment in response to market strength, which is expected to support ongoing revenue and EBITDA growth in the coming years [3] - The stock appreciated 39.4% in 2025 [3]

Core Insights - Red Rock Resorts reported revenue of $511.78 million for the quarter ended December 2025, reflecting a 3.2% increase year-over-year and surpassing the Zacks Consensus Estimate of $501.41 million by 2.07% [1] - The company's EPS was $0.75, slightly down from $0.76 in the same quarter last year, but significantly exceeding the consensus estimate of $0.41 with a surprise of 81.07% [1] Revenue Performance - Net Revenue from Las Vegas operations was $504.99 million, exceeding the four-analyst average estimate of $493.61 million, with a year-over-year increase of 2.5% [4] - Net Revenue from Corporate and other was $3.06 million, aligning closely with the average estimate of $3.05 million, showing no year-over-year change [4] - Net Revenue from Native American management reached $3.73 million, surpassing the average estimate of $3.35 million [4] Operating Revenues - Operating Revenues from Casino operations were $343 million, exceeding the average estimate of $329.62 million, with a year-over-year increase of 5% [4] - Operating Revenues from Food and Beverage were $93.26 million, slightly above the average estimate of $91.93 million, reflecting a year-over-year increase of 1.3% [4] - Operating Revenues from Room services were $47.2 million, below the average estimate of $48.6 million, showing a year-over-year decline of 9.8% [4] - Operating Revenues from Other sources were $24.59 million, falling short of the average estimate of $25.58 million, with a year-over-year decrease of 0.7% [4] Adjusted EBITDA - Adjusted EBITDA for Las Vegas operations was $231.13 million, exceeding the average estimate of $217.31 million [4] - Adjusted EBITDA for Corporate and other was reported at -$21.58 million, slightly worse than the average estimate of -$21.42 million [4] - Adjusted EBITDA for Native American management was $3.73 million, surpassing the average estimate of $3.3 million [4] Stock Performance - Shares of Red Rock Resorts have returned +5.9% over the past month, while the Zacks S&P 500 composite remained unchanged [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the broader market in the near term [3]

分组1 - Red Rock Resorts reported quarterly earnings of $0.75 per share, exceeding the Zacks Consensus Estimate of $0.41 per share, with a year-over-year comparison showing a slight decrease from $0.76 per share [1] - The company achieved revenues of $511.78 million for the quarter ended December 2025, surpassing the Zacks Consensus Estimate by 2.07% and showing an increase from $495.7 million year-over-year [2] - Over the last four quarters, Red Rock Resorts has consistently surpassed consensus EPS estimates, achieving this four times [2] 分组2 - The stock has gained approximately 5.8% since the beginning of the year, outperforming the S&P 500, which has gained 1.7% [3] - The current consensus EPS estimate for the upcoming quarter is $0.53, with expected revenues of $510.47 million, and for the current fiscal year, the estimate is $1.93 on $2.04 billion in revenues [7] - The Zacks Industry Rank indicates that the Gaming industry is currently in the bottom 29% of over 250 Zacks industries, suggesting potential challenges for stock performance [8]

Core Insights - The company reported strong financial results for 2025, achieving record net revenue and adjusted EBITDA for the second consecutive year, highlighting the strength and consistency of its operating platform [2][3] - The expansion of Durango Casino Resort is a key growth driver, with positive customer response and operational results validating capital investments in high-limit gaming areas [6][7] - The company is focused on executing its development pipeline and maintaining operational discipline while delivering enhanced shareholder returns through disciplined capital allocation [31][32] Financial Performance - In Q4, Las Vegas operations generated net revenue of $505 million, a 2.5% increase year-over-year, with adjusted EBITDA of $231 million, up 3.2% [9] - For the full year, Las Vegas operations achieved nearly $2 billion in net revenue, a 2.9% increase, and adjusted EBITDA of $915.9 million, up 4.2% [11] - The company converted 62% of adjusted EBITDA to operating free cash flow in Q4, generating $131.5 million, and 55% for the full year, totaling $466.3 million [13] Expansion and Development - The latest expansion at Durango added over 25,000 square feet of casino space and nearly 2,000 parking spaces, with further phases planned to enhance the property [7][8] - The company is investing approximately $385 million in the next phase of Durango's master plan, which includes new amenities and gaming options to attract more visitors [8][21] - Ongoing renovations at Sunset Station and Green Valley Ranch are also part of the strategy to enhance customer appeal and capture market share [21][24] Shareholder Returns - The Board of Directors declared a special cash dividend of $1 per Class A common share, reflecting confidence in the company's long-term earnings power [29] - Total distributions to shareholders in 2025 amounted to approximately $296.9 million, demonstrating a commitment to returning capital while investing in growth [19] Market Position and Strategy - The company continues to focus on local guests while expanding its regional and national customer base, achieving record revenue and profitability in gaming operations [14] - The competitive position is strengthened by strategic locations and ongoing investments in property enhancements, which are expected to drive increased visitation [41][56] - The company is optimistic about capturing market share from the Strip, particularly among high-end customers, due to improved amenities and services [56][57]

Financial Data and Key Metrics Changes - In Q4 2025, Las Vegas operations achieved net revenue of $505 million, a 2.5% increase year-over-year, and adjusted EBITDA of $231 million, up 3.2% from the previous year [8][9] - For the full year 2025, net revenue was just under $2 billion, a 2.9% increase, and adjusted EBITDA reached $915.9 million, up 4.2% from the prior year [9][10] - The consolidated Q4 net revenue was $511.8 million, up 3.2%, and adjusted EBITDA was $213 million, up 5.4% year-over-year [8][9] Business Line Data and Key Metrics Changes - Durango Casino Resort continues to expand its local market presence, contributing to incremental play and reinforcing its growth driver status within the portfolio [5] - Non-gaming operations, including hotel and food and beverage, achieved near-record revenue and profitability, with hotel operations performing exceptionally well despite renovations [11][12] Market Data and Key Metrics Changes - The Las Vegas locals market remains strong, with 50% of guests visiting more than eight times a month, indicating a robust customer base [31] - The company is strategically located in areas of new housing growth, enhancing its competitive position in the locals market [32] Company Strategy and Development Direction - The company is focused on executing its development pipeline, including significant investments in Durango, Sunset Station, and Green Valley Ranch, to enhance competitive positioning and customer appeal [15][17][23] - A special cash dividend of $1 per Class A common share was declared, reflecting confidence in the long-term earnings power of the operating model [21][22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength and resilience of the business, despite expected near-term disruptions from ongoing construction projects [12][23] - The company anticipates capturing additional market share and driving sustained growth in the local market through strategic expansions and enhancements [8][19] Other Important Information - The company reported a net debt-to-EBITDA ratio of 3.87 times, marking the seventh consecutive quarter of deleveraging [13] - Total capital spend for 2025 was $319 million, with expectations to increase to $375-$425 million in 2026 [14] Q&A Session Summary Question: Demand levels in Las Vegas Valley - Management noted strong performance in hotel operations and gaming, with a differentiated value proposition compared to the Strip [28][31] Question: Construction disruption in 2026 - Management estimated approximately $9 million in disruption for Q1 2026, primarily from ongoing renovations [42][44] Question: Seasonal EBITDA expectations - Management indicated that while disruption may impact Q1, they remain confident in achieving expected returns [48][49] Question: Impact of the One Big Beautiful Bill - Management expressed optimism about capturing discretionary income from tax refunds, positioning the company well in the locals market [53] Question: Higher-end customer contributions - Management highlighted strength in higher-end play across various properties, indicating a broad appeal to different customer segments [80][81]

Financial Data and Key Metrics Changes - In Q4 2025, Las Vegas operations achieved net revenue of $505 million, a 2.5% increase year-over-year, and adjusted EBITDA of $231 million, up 3.2% from the prior year [8][9] - For the full year 2025, Las Vegas operations reported net revenue just under $2 billion, a 2.9% increase, and adjusted EBITDA of $915.9 million, up 4.2% from the previous year [9][10] - Consolidated Q4 net revenue was $511.8 million, a 3.2% increase, with adjusted EBITDA of $213 million, up 5.4% year-over-year [8][9] Business Line Data and Key Metrics Changes - Durango Casino Resort continues to expand its local market presence, contributing to incremental play and revenue growth [5] - Non-gaming operations, including hotel and food and beverage, achieved near-record revenue and profitability, with hotel operations performing exceptionally well despite renovations [11][12] Market Data and Key Metrics Changes - The Las Vegas locals market remains strong, with continued robust visitation and net theoretical win across local and regional customers [11][12] - The company is positioned to benefit from demographic trends, with over 6,000 new households expected within a three-mile radius of Durango [7] Company Strategy and Development Direction - The company is focused on long-term growth through significant investments in existing properties, including expansions at Durango, Sunset Station, and Green Valley Ranch [15][16][18] - A balanced capital allocation strategy is in place, with a commitment to returning capital to shareholders while investing in property enhancements [14][23] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength and resilience of the business, despite expected near-term disruptions from ongoing construction projects [12][22] - The company anticipates continued growth in adjusted EBITDA and market share, driven by strategic investments and a focus on high-end customer segments [21][23] Other Important Information - The company declared a special cash dividend of $1 per Class A common share, reflecting confidence in long-term earnings power [21][22] - Total capital expenditures for 2025 were $319 million, with expectations for 2026 spending between $375-$425 million [14] Q&A Session Summary Question: Update on demand levels in Las Vegas Valley - Management noted strong performance in hotel operations despite renovations, with a differentiated value proposition compared to the Strip [28][30] Question: Construction disruption impact in 2026 - Management estimated approximately $9 million in disruption for Q1 2026, with ongoing efforts to minimize operational impacts during renovations [41][43] Question: Expectations for Q1 EBITDA growth - Management indicated confidence in achieving typical seasonal growth despite disruptions, with a focus on maintaining operational performance [47][98] Question: Impact of the One Big Beautiful bill on top-line performance - Management expressed optimism about benefiting from increased discretionary income in the locals market due to tax refunds [52] Question: Competitive promotional environment in the locals market - Management reported a stable promotional environment, with consistent competitive behavior from small operators [73] Question: Contribution from higher-end properties - Management highlighted strong performance across the portfolio, with increasing high-end play at various properties [81]

Financial Data and Key Metrics Changes - In Q4 2025, Las Vegas operations achieved net revenue of $505 million, up 2.5% year-over-year, and adjusted EBITDA of $231 million, up 3.2% year-over-year, with an adjusted EBITDA margin of 45.8%, an increase of 32 basis points [6][3] - For the full year 2025, net revenue was just under $2 billion, up 2.9% from the previous year, and adjusted EBITDA was $915.9 million, up 4.2% year-over-year, with an adjusted EBITDA margin of 46.2%, an increase of 56 basis points [8][9] - Consolidated Q4 net revenue was $511.8 million, up 3.2% year-over-year, and adjusted EBITDA was $213 million, up 5.4% year-over-year, with an adjusted EBITDA margin of 41.7%, an increase of 84 basis points [7][9] Business Line Data and Key Metrics Changes - The Durango Casino Resort continues to expand its local market presence, contributing to incremental play and reinforcing its growth potential within the portfolio [4] - Non-gaming operations, including hotel and food and beverage, achieved near-record revenue and profitability, with hotel operations performing exceptionally well despite renovations [10] - Group sales and catering delivered near-record revenue in Q4, indicating positive momentum into 2026 [11] Market Data and Key Metrics Changes - The Las Vegas market is supported by strong fundamentals, with over 6,000 new households expected within a three-mile radius of Durango over the next few years [5] - The company is well-positioned to capture additional market share and drive sustained growth in the local market through ongoing expansions and enhancements [6] Company Strategy and Development Direction - The company is focused on executing its development pipeline, maintaining operational discipline, and delivering enhanced shareholder returns through a balanced capital allocation strategy [23] - Significant investments are being made in Durango, Sunset Station, and Green Valley Ranch to enhance competitive positioning and broaden customer appeal [14][17] - The company aims to capitalize on favorable demographic trends and high barriers to entry in the Las Vegas locals market [22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength and resilience of the business, despite expected near-term disruptions from ongoing construction projects [11][21] - The company anticipates continued stability in its core slot business and positive impacts from tax refunds on discretionary spending in the locals market [35][36] - Management remains optimistic about the long-term growth prospects, supported by a strong balance sheet and ongoing investments in property enhancements [12][23] Other Important Information - The company declared a special cash dividend of $1 per Class A common share and a regular cash dividend of $0.26 per Class A common share, reflecting confidence in the business's strength [20][21] - The company returned approximately $296.9 million to shareholders in 2025 through dividends and share repurchases, demonstrating a commitment to disciplined capital allocation [13] Q&A Session Summary Question: Demand levels in Las Vegas Valley - Management noted strong performance in hotel operations despite renovations, with a differentiated product compared to the Strip, and highlighted robust gaming revenue driven by high-limit rooms [26][27] Question: Construction disruption in 2026 - Management estimated approximately $9 million in disruption costs for Q1 2026, primarily due to ongoing renovations at Green Valley Ranch, but emphasized that these disruptions are short-term [30][31] Question: Expectations for Q1 EBITDA - Management indicated that despite disruptions, they expect to achieve typical seasonal growth in EBITDA, with no significant negative impacts anticipated [34] Question: Impact of the One Big Beautiful bill - Management expressed optimism about potential benefits from tax refunds and the overall economic environment, positioning the company to capitalize on increased discretionary income [35][36] Question: Competitive behavior in the locals market - Management described a stable promotional environment, with consistent competitive behavior from small operators, and noted strong performance in group sales and catering [45]