MGM Resorts International, one of the leading hospitality and entertainment companies, has revealed that it expects to suffer a cash flow loss of $100 million as a result of a recent nine-day cyberattack. The company has pledged to offer free identity protection and credit-monitoring services to individuals whose information has been compromised.
While this is the first time MGM has officially acknowledged the incident as a cyberattack, previous statements had alluded to collaboration with the FBI. The company stated that there was no compromise of customer bank account numbers or payment card information.
The cyberattack resulted in the unauthorized acquisition of certain personal data of customers who had transacted with MGM before March 2019. The information obtained includes names, contact details, gender, dates of birth, and driver’s license numbers. A limited number of Social Security numbers and passport numbers may also have been compromised. MGM, however, maintains that there is no evidence of the criminals using the data for identity theft or account fraud.
In response to the incident, MGM Resorts CEO Bill Hornbuckle expressed his apologies for any inconvenience caused and extended his gratitude to employees for their resilience during the recovery process. To address customer concerns, the company has set up a dedicated telephone call center and a webpage for information.
While MGM expects the cyberattack to impact its third-quarter financial results, it believes that the fourth quarter will show minimal effects, particularly for its Las Vegas operations. The company is anticipating a strong fourth quarter, largely due to its proximity to the Formula One Las Vegas Grand Prix race scheduled for November 16-18. MGM is confident that it will fully rebound from the attack, expecting record results and high occupancy rates in November.
Regarding financial implications, MGM stated that it spent less than $10 million in the third quarter on expenses related to the cyberattack. The company expects its cybersecurity insurance to cover the financial impact of the operational disruptions, expenses incurred, and any future potential expenses. However, as the full costs and impacts are still being assessed, the complete scope of the issue remains uncertain.
Industry analysts, such as John DeCree of CBRE Equity Research, remain optimistic about MGM’s outlook. They highlight the company’s confident outlook, emphasizing that cybersecurity insurance should cover all financial impacts, including business interruption and one-time expenses.
As investigations into the cyberattack continue, MGM reassures customers that the unauthorized third-party activity is currently contained. The company remains committed to ensuring the safety and privacy of its customers’ data.
For more information and assistance, affected customers can contact MGM Resorts International’s dedicated telephone call center at (800) 621-9437, Monday through Friday 6 a.m. to 8 p.m., or Saturday and Sunday 8 a.m. to 5 p.m., excluding major U.S. holidays. They can also visit the webpage www.mgmresorts.com/importantinformation.
MGM expects to release its third-quarter earnings information in late October or early November and believes that the incident will not have a material effect on its overall financial condition and results of operations for the year.
As cybersecurity threats continue to grow, incidents like these serve as a reminder of the importance of maintaining robust security measures to protect sensitive customer data.
