MGM Resorts Under Siege: Ongoing Cyberattack Drips Millions Daily

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The MGM cyberattack, initiated Sunday, September 10, continues to massively disrupt operations at the resort facilities spanning Las Vegas and the rest of the company’s U.S. empire, presumably burning through millions each day in losses incurred by the casino behemoth.

Indeed, the picture in the normally bustling Luxor casino floor is a study in grim irony, with a notice informing visitors of the cyber security breach effectuating the unavailability of some gaming machines as MGM bleeds millions with every passing day due to the incessant havoc from the cyberattack.

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In his recent briefing, David Katz, who helms equity research at Jefferies, noted that MGM Resorts is potentially leaking millions daily due to the unrelenting cyber assault. Albeit the casino resort’s websites did make a comeback last week, a palpable sense of discontent prevails as online room reservations persist in limbo.

In the wake of these disturbances, customers face daunting queues for check-in at MGM properties. To add to their woes, gamblers sit out on the convenience of self-service gaming cashier kiosks to cash in their vouchers, settling instead for a manual payout from a floor attendant.

As per Katz, the service and operational interruptions could translate into as much as a daily loss of $8.4 million in revenue and $1 million in cash flow for Bellagio’s operator. His projections draw on the estimates that MGM is enduring a daily 10%-20% dip in both revenue and cash flow until resolution of the cyber onslaught.

In a disheartening revelation, MGM’s 2022 earnings report indicated that MGM amasses around $42 million in resort revenue and $8 million in cash flow, domestically, every 24 hours.

Shockingly, the nefarious cybercriminal collective Scattered Spider has openly declared themselves the architects of the ongoing cyberattacks on MGM and Caesars Entertainment. Caesars reportedly side-stepped operational disruptions with a ransom payment of $15 million.

Adopting a dissimilar strategy, MGM brass is avoiding any ransom payments to the online extortionists, though encountering resistance. Scattered Spider claimed successful procurement of six terabytes of sensitive data on the two casino operations.

MGM’s stock price has seen a slump in line with the cyberattack, with considerable revenue and cash flow losses. MGM shares have faulted over 7% following the websites going dark and casino slot machines facing technical troubles.

Thus far, neither MGM nor Scattered Spider have disclosed the nature of any confidential data potentially compromised due to the hack. A regulatory filing confirmed Caesars Rewards database as the target in Caesars’ case, and resulting costs and impacts remain to be ascertained.

In a recent update, MGM Resorts announced limited capacity functionality of their websites and mobile app. Restaurants and nightlife reservations are online, but room bookings continue to be unavailable. Bookings through third-party sites, however, are still possible.

The company has relaxed the cancellation terms for guests with reservations through September 24 and would refund any one-night reservation charges incurred at booking.