Posted on: January 5, 2024, 09:16h.
Last updated on: January 5, 2024, 09:19h.
Caesars Entertainment (NASDAQ: CZR) started 2024 by significantly pruning the ranks of entertainment executives with as many as 10 such employees reportedly leaving the casino operator.
The Las Vegas Review-Journal reported that on Tuesday, Jan. 2, up to 10 entertainment executives left the Horseshoe operator. That was the same day on which Amy Graca started her time as Caesars senior vice president of entertainment. The media outlet noted that neither the gaming company nor the executives returned requests for comment.
It’s believed that Mike Hodin, Amy Naples, Paul Shilsky, Jessica Tindor, Mark Weinstein, and Chris Yancey are among the entertainment executives that have left Caesars. It’s possible, though not confirmed, those moves are related to Caesars President of Entertainment Jason Gastwirth ending his 13-year stint with the company on Dec. 31, 2023.
Caesars is the second-largest operator on the Las Vegas Strip behind only MGM Resorts International (NYSE: MGM).
Implications Entertainment Shakeup at Caesars
Some executive upheaval at Caesars isn’t surprising. When Eldorado Resorts completed its $17.3 billion takeover of the Harrah’s operator in July 2020, the buyer’s management team took the lead at “new Caesars.”
It’s not clear if the aforementioned departures stem from the Eldorado takeover, but when that company’s CEO Tom Reeg took the helm at Caesars, cost cuts were promised, indicating some management pruning would likely occur.
Reeg and team were also tasked with integrating two different corporate cultures, something that’s often a thorn in the side of buyers — regardless of industry — in large mergers and acquisitions. Under Reeg’s stewardship, ERI developed a reputation for empowering managers to run individual properties as they see fit but also became known for intense scrutiny on cost efficiencies.
On the Strip, Caesars operators iconic venues, including Caesars Palace, Flamingo Las Vegas, Bally’s Las Vegas, LINQ Hotel & Casino, Paris Las Vegas, and Planet Hollywood Resort & Casino.
Margins Matter
For now, it’s just speculation, but the reconfiguration of Caesars’ entertainment executive ranks could also be the product of an increased focus on profit margins.
The Strip is one of the most competitive live entertainment environments in the US and an efficient avenue for operators to wring the most benefit from concerts and shows is to deliver big-name acts while eschewing lower margin, lesser known fare.
The Colosseum at Caesars Palace is a prime example of that theme. Acts there include residencies for Adele and Garth Brooks as well as Jerry Seinfeld – all of which have significant star power. With success, Caesars has employed a similar emphasis at Planet Hollywood while scaling back on lower tier entertainment options that don’t generate significant profits.
