The recent cyberattack that caused many services at MGM Resorts International to be unavailable is expected to reduce its third-quarter profit by $100 million, according to the company’s 8-K filing on Thursday. The negative impact is expected predominantly in its Las Vegas operations but will have a minimal impact during the fourth quarter.
MGM said it spent less than $10 million defending against the attack, the bulk of which went to legal fees and technical consulting services. The casino giant believes its cybersecurity insurance is enough to cover the financial impact on its businesses, but acknowledged that the one-time and future expenses, plus the entire scope of the costs and related impacts of the attack have not been determined.
“We responded swiftly, shut down our systems to mitigate risk to customer information, and began a thorough investigation of the attack, including coordinating with federal law enforcement agencies and working with external cybersecurity experts,” said Bill Hornbuckle, CEO and president, said in a letter to customers. “While we experienced disruptions at some of our properties, operations at our affected properties have returned to normal, and the vast majority of our systems have been restored. We also believe that this attack is contained,” he added.
On September 12, MGM announced that it had detected a cyberattack that affected some of its IT systems in the US. The attack disrupted operations at some of its domestic properties and prompted a 10-day computer shutdown.
Perpetrators obtained personal information of some customers who transacted with the company before March 2019, including phone number, email address and postal address, gender, date of birth, and driver’s license numbers. A few customers also had their Social Security numbers and passport numbers taken.
MGM said it is expecting a strong fourth quarter, with record results in November primarily driven by Formula 1, the company stated in its filing. MGM also forecasts occupancy to be 93% in October, versus 94% in the prior year period, and to fully rebound in November for its Las Vegas Strip Resorts.