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That sounds intuitive, but that's just not how revenue is defined for a business like a casino. The casino had $0.25 revenue, and its profit is whatever is left
by dmurray 3y ago
That sounds intuitive, but that's just not how revenue is defined for a business like a casino. The casino had $0.25 revenue, and its profit is whatever is left from the $0.25 after paying for heat, light, maintenance, cashiers, security, etc.
Other businesses are treated like this too. If you are a high frequency trading firm and you buy 1000 shares stock for $99.99 each and sell for $100, you didn't have $100k of revenue - you had $10, and your profit is what's left after paying for staff and computers.
Yes, if your business was a supermarket, it would indeed work the other way, and it's not obvious to the literal- minded where one treatment should stop and the other should start.
- zmgsabst 3y agoThis is similar to not counting bank deposits as revenue and withdrawals as costs. Only when your money goes to pay fees is it booked as bank revenue. The same for money transmitters like Western Union. And perhaps is more obvious when you consider what happens when there’s only players, eg, poker. The pot is held in trust, until the game ends and the losers forfeit their money to the winner. At no point does it belong to the casino. That doesn’t change when the casino is also a player.
- somenameforme 3y agoYip, I agree. I'm aware of gross gaming revenue and was involved in the industry in a past life, though obviously never filing as a casino. The thing that misled me, at a glance, was their costs - $3.5 billion. I wasn't aware there'd been massive consolidation in the casino industry, and thought I was looking at a casino's costs/revenue (in which $3.5 billion would be insane without it including losses), not a sprawling corporate enterprise.