LAS VEGAS SANDS CORP (LVS) FY 2024 MD&A

ITEM 7. — MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with, and is qualified in its entirety by, the audited consolidated financial statements and the notes thereto, and other financial information included in this Form 10-K. Certain statements in this “Management's Discussion and Analysis of Financial Condition and Results of Operations” are forward-looking statements. See “Special Note Regarding Forward-Looking Statements.”

Overview

We view each of our Integrated Resorts as an operating segment. Our operating segments in Macao consist of The Venetian Macao; The Londoner Macao; The Parisian Macao; The Plaza Macao and Four Seasons Macao; and the Sands Macao. Our operating segment in Singapore is Marina Bay Sands.

During 2024, we achieved milestones in advancing several of our strategic objectives. We continued work on Phase II of The Londoner Macao, which primarily includes the renovation of the rooms in the Sheraton towers, an upgrade of the gaming areas and the addition of attractions, dining, retail and entertainment offerings. The Londoner Grand casino opened on September 26, 2024. The Sheraton Grand Macao is being converted into the Londoner Grand hotel, which upon completion will have 2,405 rooms and suites and represents Macao’s first Marriott International Luxury Collection hotel. Phase II of The Londoner Macao is expected to be substantially completed during the first half of 2025. We completed the renovations of Tower 1 and Tower 2 and introduced world-class suites and other luxury amenities at Marina Bay Sands. We continue with the renovation of the Tower 3 hotel rooms into world class suites, which is expected to be completed in phases during the first half of 2025, and other property changes.

Macao

From 2020 through the beginning of 2023, our operations in Macao were negatively impacted by the reduction in travel and tourism related to the COVID-19 pandemic. The Macao government's policy regarding the management of COVID-19 and general travel restrictions was relaxed in late December 2022 and early January 2023. Since then, visitation to our Macao Integrated Resorts and operations has improved.

The Macao government announced total visitation from mainland China to Macao increased approximately 28.6% during the year ended December 31, 2024, as compared to the same period in 2023. The Macao government also announced gross gaming revenue increased approximately 23.9% during the year ended December 31, 2024, as compared to the same period in 2023.

Singapore

Our operations in Singapore continued to be positive as travel and tourism spending increased, resulting from the elimination of all remaining COVID-19 border measures in February 2023. Airlift passenger movement has increased with a total of 68 million passengers having passed through Singapore's Changi Airport during the year ended December 31, 2024, an increase of 14.8% compared to the same period in 2023.

Visitation to Marina Bay Sands continues to improve since the travel restrictions have been lifted. The STB announced total visitation to Singapore increased from approximately 13.6 million during the year ended December 31, 2023 to 16.5 million during the year ended December 31, 2024.

Summary

We have a strong balance sheet and sufficient liquidity in place, including total unrestricted cash and cash equivalents of $3.65 billion and access to $1.50 billion, $2.51 billion and $433 million of available borrowing capacity from our 2024 LVSC Revolving Facility, 2024 SCL Revolving Facility and 2012 Singapore Revolving Facility, respectively, as of December 31, 2024. We believe we are able to support our continuing operations, complete the major construction projects that are underway and maintain our share repurchase and dividend programs to continue to return excess capital to stockholders.

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Key Operating Revenue Measurements

Operating revenues at The Venetian Macao, The Londoner Macao, The Parisian Macao, The Plaza Macao and Four Seasons Macao and Marina Bay Sands are dependent upon the volume of customers who stay at the hotel, which affects the price charged for hotel rooms and our gaming volume. Operating revenues at Sands Macao are principally driven by the volume of gaming patrons who visit the property on a daily basis.

Management utilizes the following volume and pricing measures in order to evaluate past performance and assist in forecasting future revenues. The various volume measurements indicate our ability to attract customers to our Integrated Resorts. In casino operations, win and hold percentages indicate the amount of revenue to be expected based on volume. In hotel operations, average daily rate and revenue per available room indicate the demand for rooms and our ability to capture that demand. In mall operations, base rent per square foot indicates our ability to attract and maintain profitable tenants for our leasable space.

The following are the key measurements we use to evaluate operating revenues:

Casino revenue measurements for Macao and Singapore: Macao and Singapore table games are segregated into two groups: Rolling Chip play (composed of VIP players) and Non-Rolling Chip play (mostly non-VIP players). The volume measurement for Rolling Chip play is non-negotiable gaming chips wagered and lost. The volume measurement for Non-Rolling Chip play is table games drop (“drop”), which is net markers issued (credit instruments), cash deposited in the table drop boxes and gaming chips purchased and exchanged at the cage. Rolling Chip and Non-Rolling Chip volume measurements are not comparable as they are two distinct measures of volume. The amounts wagered and lost for Rolling Chip play are substantially higher than the amounts dropped for Non-Rolling Chip play. Slot handle, also a volume measurement, is the gross amount wagered for the period cited.

We view Rolling Chip win as a percentage of Rolling Chip volume, Non-Rolling Chip win as a percentage of drop and slot hold (amount won by the casino) as a percentage of slot handle. Win or hold percentage represents the percentage of Rolling Chip volume, Non-Rolling Chip drop or slot handle that is won by the casino and recorded as casino revenue. Our win and hold percentages are calculated before discounts, commissions, deferring revenue associated with our loyalty programs and allocating casino revenues related to goods and services provided to patrons on a complimentary basis. Our Rolling Chip table games are expected to produce a win percentage of 3.30% in Macao and Singapore. Actual win and hold percentages may vary from our expected win percentage and historical win and hold percentages. Generally, slot machine play is conducted on a cash basis. In Macao and Singapore, 9.5% and 10.8%, respectively, of our table games play was conducted on a credit basis for the year ended December 31, 2024.

Hotel revenue measurements: Performance indicators used are occupancy rate (a volume indicator), which is the average percentage of available hotel rooms occupied during a period, and average daily room rate (“ADR,” a price indicator), which is the average price of occupied rooms per day. Available rooms exclude those rooms unavailable for occupancy during the period due to renovation, development or other requirements (such as government mandated closure, lodging for team members and usage by the Macao government for quarantine measures). The calculations of the occupancy rate and ADR include the impact of rooms provided on a complimentary basis. Revenue per available room (“RevPAR”) represents a summary of hotel ADR and occupancy. Because not all available rooms are occupied, ADR is normally higher than RevPAR. Reserved rooms where the guests do not show up for their stay and lose their deposit, or where guests check out early, may be re-sold to walk-in guests.

Mall revenue measurements: Occupancy, base rent per square foot and tenant sales per square foot are used as performance indicators. Occupancy represents gross leasable occupied area (“GLOA”) divided by gross leasable area (“GLA”) at the end of the reporting period. GLOA is the sum of: (1) tenant occupied space under lease and (2) tenants no longer occupying space, but paying rent. GLA does not include space currently under development or not on the market for lease. Base rent per square foot is the weighted average base or minimum rent charge, excluding rent concessions, in effect at the end of the reporting period for all tenants that would qualify to be included in occupancy. Tenant sales per square foot is the sum of reported comparable sales for the trailing 12 months divided by the comparable square footage for the same period. Only tenants that have been open for a minimum of 12 months are included in the tenant sales per square foot calculation.

Year Ended December 31, 2024 Compared to the Year Ended December 31, 2023

Summary Financial Results

We continued to see positive financial results for the year ended December 31, 2024, due to increased visitation at our Integrated Resorts. Macao visitation from mainland China increased 28.6% compared to the year ended December 31, 2023, due to a more supportive travel environment that included further recovery in scheduled airline capacity to Macao Airport and other airports that serve the Macao market, more frequent ferry services to Macao from locations, such as Hong Kong, and increases in flexibility and availability of certain visa types. Due to the elimination of all remaining COVID-19 border measures in February 2023 and airlift passenger movement increasing 14.8% compared to the year ended December 31, 2023, Singapore visitation increased 21.4% compared to the year ended December 31, 2023.

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Net revenues for the year ended December 31, 2024, were $11.30 billion, compared to $10.37 billion for the year ended December 31, 2023. Operating income was $2.40 billion for the year ended December 31, 2024, compared to $2.31 billion for the year ended December 31, 2023. Net income was $1.75 billion for the year ended December 31, 2024, compared to $1.43 billion for the year ended December 31, 2023.

Operating Revenues

Our net revenues consisted of the following:

Consolidated net revenues were $11.30 billion for the year ended December 31, 2024, an increase of $926 million compared to $10.37 billion for the year ended December 31, 2023, due to increases of $546 million and $380 million at our Macao operations and Marina Bay Sands, respectively.

Net casino revenues increased $781 million compared to the year ended December 31, 2023, due to increases of $505 million and $276 million at our Macao operations and Marina Bay Sands, respectively. Casino revenues at our Macao operations increased due to increased table games and slot volumes and Non-Rolling Chip win percentages, partially offset by decreased Rolling Chip win and slot hold percentages. Casino revenues at Marina Bay Sands increased due to increased table games and slot volumes and Non-Rolling win percentage, partially offset by decreased Rolling Chip win percentage. The following table summarizes the results of our casino activity:

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In our experience, average win percentages remain fairly consistent when measured over extended periods of time with a significant volume of wagers, but can vary considerably within shorter time periods as a result of the statistical variances associated with games of chance in which large amounts are wagered.

Room revenues increased $70 million compared to the year ended December 31, 2023, due to increases of $57 million and $13 million at Marina Bay Sands and our Macao operations, respectively. Marina Bay Sands room revenues increased due to an increase in ADR, partially offset by a decrease in available rooms and decreased occupancy. Macao room revenues increased due to increases in occupancy rates and ADR, partially offset by decreased available rooms in connection with the conversion of the Sheraton towers to the Londoner Grand. The following table summarizes the results of our room activity:

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(1)During the year ended December 31, 2024, a daily average of approximately 1,850 rooms were excluded from available rooms in connection with the renovations related to the conversion of the Sheraton towers to the Londoner Grand in connection with Phase II of The Londoner Macao.

(2)During the years ended December 31, 2024 and 2023, approximately 1,800 and 2,100 rooms, respectively, were available for occupancy.

Food and beverage revenues increased $23 million compared to the year ended December 31, 2023, due to increases of $20 million and $3 million at our Macao operations and Marina Bay Sands, respectively. The increase at our Macao operations was primarily driven by increased visitation across our properties and new food and beverage outlets. The increase at Marina Bay Sands was primarily due to increased banquet revenue and new food and beverage outlets.

Mall revenues decreased $12 million compared to the year ended December 31, 2023. The decrease was due to a $20 million decrease at our Macao operations, driven by a decrease in overage rent, which was partially offset by an $8 million increase at Marina Bay Sands, driven by an increase in base rent.

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For further information related to the financial performance of our malls, see “Additional Information Regarding our Retail Mall Operations.” The following table summarizes the results of our malls on the Cotai Strip in Macao and in Singapore:

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Note: This table excludes the results of our retail outlets at Sands Macao.

(1)Tenant sales per square foot is the sum of reported comparable sales for the trailing 12 months divided by the comparable square footage for the same period.

Convention, retail, and other revenues increased $64 million compared to the year ended December 31, 2023, due to increases of $36 million and $28 million at Marina Bay Sands and our Macao operations, respectively. The increase at Marina Bay Sands was driven by increases of $15 million in convention revenue, $6 million at the SkyPark, $4 million in museum revenue and $3 million in entertainment revenue, as well as an $8 million nonrecurring adjustment related to a change in accounting estimate of our non-gaming club points accrual. The increase at our Macao operations was driven by $14 million in ferry operations due to increased sailings resulting from increased visitation, $13 million in entertainment revenue and $1 million in convention revenue.

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Operating Expenses

Our operating expenses consisted of the following:

Operating expenses were $8.90 billion for the year ended December 31, 2024, an increase of $837 million compared to $8.06 billion for the year ended December 31, 2023. The increase was driven by increases of $459 million in casino expenses, $100 million in depreciation and amortization, and $60 million in corporate expenses.

Casino expenses increased $459 million compared to the year ended December 31, 2023. The increase was primarily attributable to increases of $283 million and $99 million in gaming taxes at our Macao operations and Marina Bay Sands, respectively, consistent with increased casino revenues across our properties, a 1% increase in goods and services tax as of January 1, 2024, and an increased tax rate from 8% to 12% on premium play during November and December 2024 due to the tiered tax structure in Singapore.

Room expenses increased $30 million compared to the year ended December 31, 2023. The increase was due to increases of $18 million and $12 million at Marina Bay Sands and our Macao operations, respectively, driven by higher costs associated with new and elevated rooms introduced at Marina Bay Sands throughout 2023 and 2024 and increased occupancy in Macao.

Food and beverage expenses increased $31 million compared to the year ended December 31, 2023. The increase was due to increases of $24 million and $7 million at our Macao operations and Marina Bay Sands, respectively, driven by increased business volume at food outlets and banquets and consistent with increased property visitation.

Convention, retail and other expenses increased $53 million compared to the year ended December 31, 2023, due to increases of $40 million and $13 million at our Macao operations and Marina Bay Sands, respectively. The increase at our Macao operations was primarily due to increases of $17 million in entertainment due to increased event volume, $15 million in ferry operations due to higher repairs and maintenance, contract labor costs and fuel costs driven by additional sailings resulting from increased visitation, and $8 million in other operating expenses (e.g., limo, exhibits, spa). The increase at Marina Bay Sands was driven by increases of $3 million in entertainment, $3 million in convention and $7 million in other operating expenses (e.g., limo, ArtScience Museum).

The provision for credit losses was $19 million for the year ended December 31, 2024, compared to $4 million for the year ended December 31, 2023. The $15 million increase was primarily driven by increases of $13 million and $2 million at our Macao operations and Marina Bay Sands, respectively. The increase at our Macao operations was due to an $18 million decrease in collections on previously reserved accounts, partially offset by a $5 million decrease in the provision for the current year. The increase at Marina Bay Sands was due to a $26 million increase in provision for the current year, partially offset by a $24 million increase in collections on previously reserved accounts. The amount of this provision can vary over short periods of time because of factors specific to the patrons who owe us money from gaming activities. We believe the amount of our provision for credit losses in the future will depend upon the state of the economy, our credit standards, our risk assessments and the judgment of our employees responsible for granting credit.

General and administrative expenses increased $43 million compared to the year ended December 31, 2023. The increase was primarily driven by increases of $27 million and $16 million at Marina Bay Sands and our Macao operations, respectively, driven by increases in payroll, marketing expenses and facility and utilities costs.

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Corporate expenses increased $60 million compared to the year ended December 31, 2023. The increase was primarily due to $22 million related to the shareholder dividend tax agreement with the Macao government ($10 million of which related to the year ended December 31, 2023), which agreement was finalized on February 7, 2024, and covers the years from 2023 to 2025, a $20 million increase in payroll and a $12 million charitable contribution commitment to the University of Nevada, Las Vegas to establish the Sands Institute for Chinese Language and Culture.

Pre-opening expenses represent personnel and other costs incurred prior to the opening of new ventures, which are expensed as incurred. Pre-opening expenses for the year ended December 31, 2024, primarily related to the Londoner Grand, the MBS Expansion Project and new guest rooms at Marina Bay Sands. Pre-opening expenses for the year ended December 31, 2023, primarily related to the grand opening of The Londoner Macao and new guest rooms at Marina Bay Sands.

Development expenses were $228 million for the year ended December 31, 2024, compared to $205 million for the year ended December 31, 2023. During the year ended December 31, 2024, the costs were associated with our evaluation and pursuit of new business opportunities, primarily $157 million for our digital gaming related efforts and $65 million in New York and Texas. During the year ended December 31, 2023, the costs were primarily related to $109 million for our digital gaming related efforts and $93 million in New York and Texas. Development costs are expensed as incurred.

Depreciation and amortization increased $100 million compared to the year ended December 31, 2023. The increase was primarily due to a $151 million increase at Marina Bay Sands, as a result of the completion of renovations that were placed into service throughout 2023 and 2024. This increase was partially offset by a $55 million decrease at our Macao operations primarily due to assets fully depreciated during the prior year and throughout 2024 and a reduction in accelerated depreciation in 2024 primarily related to the Sheraton towers and Venetian Arena, partially offset by an increase in depreciation for assets placed into service during the current year.

Loss on disposal or impairment of assets was $50 million for the year ended December 31, 2024, compared to $27 million for the year ended December 31, 2023. The losses incurred for the year ended December 31, 2024, were primarily due to a $32 million loss at our Macao operations, including $24 million in demolition costs, primarily related to the upgrade of the Venetian Arena and Phase II of The Londoner Macao, a $9 million loss in Singapore, including $7 million in demolition costs related to room renovations at Marina Bay Sands, and a $9 million loss at corporate, primarily due to the sale of an aircraft. The losses incurred for the year ended December 31, 2023, were $14 million at Marina Bay Sands primarily due to demolition costs related to renovations and $12 million in disposals and demolition costs at our Macao operations.

Segment Adjusted Property EBITDA

The following table summarizes information related to our segments (see “Item 8 — Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 20 — Segment Information” for discussion of our operating segments):

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(1)Consolidated adjusted property EBITDA, which is a non-GAAP financial measure, is used by management as the primary measure of the operating performance of our segments. Consolidated adjusted property EBITDA is net income (loss) before stock-based compensation expense, corporate expense, pre-opening expense, development expense, depreciation and amortization, amortization of leasehold interests in land, gain or loss on disposal or impairment of assets, interest, other income or expense, gain or loss on modification or early retirement of debt and income taxes. Consolidated adjusted property EBITDA is a supplemental non-GAAP financial measure used by management, as well as industry analysts, to evaluate operations and operating performance. In particular, management utilizes consolidated adjusted property EBITDA to compare the operating profitability of our operations with those of our competitors, as well as a basis for determining certain incentive compensation. Integrated Resort companies, including LVSC, have historically reported adjusted property EBITDA as a supplemental performance measure to GAAP financial

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measures. In order to view the operations of their properties on a more stand-alone basis, Integrated Resort companies, including LVSC, have historically excluded certain expenses that do not relate to the management of specific properties, such as pre-opening expense, development expense and corporate expense, from their adjusted property EBITDA calculations. Consolidated adjusted property EBITDA should not be interpreted as an alternative to income from operations (as an indicator of operating performance) or to cash flows from operations (as a measure of liquidity), in each case, as determined in accordance with GAAP. We have significant uses of cash flow, including capital expenditures, dividend payments, interest payments, debt principal repayments and income taxes, which are not reflected in consolidated adjusted property EBITDA. Not all companies calculate adjusted property EBITDA in the same manner. As a result, our presentation of consolidated adjusted property EBITDA may not be directly comparable to similarly titled measures presented by other companies.

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a)During the years ended December 31, 2024 and 2023, the Company recorded stock-based compensation expense of $78 million and $72 million, respectively, of which $51 million and $43 million, respectively, was included in corporate expense in “Part II — Item 8 — Financial Statements and Supplementary Data — Consolidated Statements of Operations.”

Adjusted property EBITDA at our Macao operations increased $103 million compared to the year ended December 31, 2023. The increase was primarily due to increased revenues across our operations driven by increased visitation at our Integrated Resorts in Macao.

Adjusted property EBITDA at Marina Bay Sands increased $191 million compared to the year ended December 31, 2023. The increase was primarily due to increased revenues across our operations driven by increased visitation, as well as new and elevated suites and rooms and other amenities introduced at Marina Bay Sands.

Interest Expense

The following table summarizes information related to interest expense:

Interest cost decreased $84 million compared to the year ended December 31, 2023, primarily due to decreases in both our weighted average total debt balance and weighted average interest rate. The weighted average total debt balance decreased primarily due to the repayment of $1.95 billion on the 2018 SCL Revolving Facility by October 2023 and repurchases totaling $175 million of the $1.80 billion 5.125% Senior Notes during the three months ended June 30, 2024. The weighted average interest rate decreased primarily due to lower

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interest rates on the SCL Senior Notes in connection with the credit rating upgrades for the Company and SCL to BBB- by S&P on July 26, 2023 and Fitch on February 1, 2024, and a decrease in the interest rates on our Singapore Credit Facility. The decrease was partially offset by higher rates on the LVSC Senior Notes issued on May 16, 2024, to refinance the $1.75 billion 3.200% Senior Notes. We also recorded $30 million in imputed interest expense on the VML Concession financial liability in 2024 and 2023 (see “Item 8 — Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 9 —Goodwill and Intangible Assets, Net”).

Other Factors Affecting Earnings

Interest income was $275 million for the year ended December 31, 2024, compared to $288 million for the year ended December 31, 2023. Interest income for the year ended December 31, 2024, primarily consisted of $200 million in interest income on money market funds, bank deposits and U.S. Treasury bills. The decrease compared to the year ended December 31, 2023, was primarily attributable to a decrease in cash available to invest in the U.S. due to share repurchases, dividends and development-related spend in the last twelve months. The decrease was partially offset by a $41 million increase due to an increased paid-in-kind interest rate on the seller financing loan in connection with the sale of the Las Vegas real property and operations.

Other income was $10 million for the year ended December 31, 2024, compared to other expense of $8 million for the year ended December 31, 2023. Other income for the year ended December 31, 2024, was primarily attributable to foreign currency transaction gains driven by the U.S. dollar-denominated debt held by SCL and MBS, partially offset by an equity investment impairment loss.

Our income tax expense was $208 million on income before income taxes of $1.96 billion for the year ended December 31, 2024, resulting in a 10.6% effective income tax rate. This compares to a 19.4% effective income tax rate for the year ended December 31, 2023. The income tax expense for the year ended December 31, 2024, reflects a 17% statutory tax rate on our Singapore operations, a 21% corporate income tax rate on our U.S. operations, and a zero percent rate on our Macao gaming operations due to our income tax exemption in Macao.

On February 5, 2024, the Macao government provided notice that VML and the other concessionaires received an exemption from Macao’s corporate income tax on profits generated by the operation of casino games of chance for the period from January 1, 2023 through December 31, 2027. Additionally, we entered into a shareholder dividend tax agreement with the Macao government in February 2024, effective from January 1, 2023 through December 31, 2025, providing an annual payment as a substitution for a 12% tax otherwise due from VML shareholders on dividend distributions paid from VML gaming profits. For the year ended December 31, 2023, income tax expense included an anticipated $57 million shareholder dividend tax based on the information available at the balance sheet date. During the three months ended March 31, 2024, the Company reversed the $57 million of income tax expense and recorded $10 million to corporate expense related to the year ended December 31, 2023, to reflect the terms of the new shareholder dividend tax agreement.

The net income attributable to our noncontrolling interests was $306 million for the year ended December 31, 2024, compared to $210 million for the year ended December 31, 2023. These amounts were related to the noncontrolling interest of SCL.

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Additional Information Regarding our Retail Mall Operations

The following tables summarize the results of our mall operations on the Cotai Strip and at Marina Bay Sands for the years ended December 31, 2024 and 2023:

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Note:    This table excludes the results of our mall operations at Sands Macao.

(1)    Minimum rents include base rents and straight-line adjustments of base rents.

(2)    Commercial property that generates rental income is exempt from property tax for the first six years for newly constructed buildings in Cotai. If the property also qualifies for Tourism Utility Status, the property tax exemption can be extended to twelve years with effect from the opening of the property. To date, The Venetian Macao, The Plaza Macao and Four Seasons Macao, The Londoner Macao and The Parisian Macao have obtained an extended exemption. The exemption for The Venetian Macao and The Plaza Macao and Four Seasons Macao expired in August 2019 and August 2020, respectively, and the exemption for The Londoner Macao and The Parisian Macao will be expiring in December 2027 and September 2028, respectively.

(3)     Mall-related expenses consist of CAM, marketing fees and other direct operating expenses, property taxes and provision for credit losses, but excludes depreciation and amortization and general and administrative costs.

It is common in the mall operating industry for companies to disclose mall net operating income (“NOI”) as a useful supplemental measure of a mall's operating performance. Because NOI excludes general and administrative expenses, interest expense, impairment losses, depreciation and amortization, gains and losses from property dispositions, allocations to noncontrolling interests and provision for income taxes, it provides a performance measure that, when compared year over year, reflects the revenues and expenses directly associated with owning and operating commercial real estate properties and the impact on operations from trends in occupancy rates, rental rates and operating costs.

In the table above, we believe taking total mall revenues less mall-related expenses provides an operating performance measure for our malls. Other mall operating companies may use different methodologies for deriving mall-related expenses. As such, this calculation may not be comparable to the NOI of other mall operating companies.

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Year Ended December 31, 2023 Compared to the Year Ended December 31, 2022

A discussion of changes in our results of operations between 2023 and 2022 has been omitted from this Form 10-K and can be found in “Item 7 — Management's Discussion and Analysis of Financial Condition and Results of Operations — Year Ended December 31, 2023 Compared to the Year Ended December 31, 2022” of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

Liquidity and Capital Resources

Cash Flows — Summary

Our cash flows consisted of the following:

A discussion of changes in cash flows between 2023 and 2022 has been omitted from this Form 10-K and can be found in “Item 7 — Management's Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources” of the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

Cash Flows — Operating Activities

Table games play at our properties is conducted on a cash and credit basis, while slot machine play is primarily conducted on a cash basis. Our rooms, food and beverage and other non-gaming revenues are conducted primarily on a cash basis and to a lesser extent as a trade receivable. Operating cash flows are generally affected by changes in operating income, accounts receivable, gaming related liabilities and interest payments. For the year ended December 31, 2024, cash generated from operations was $3.20 billion, a decrease of $23 million compared to $3.23 billion for the year ended December 31, 2023. The decrease in cash generated from operations was primarily due to decreases in cash related to changes in working capital, primarily from decreases in accruals from our gaming operations, partially offset by an increase in net income.

Cash Flows — Investing Activities

Capital expenditures for the year ended December 31, 2024, totaled $1.57 billion. Included in this amount was $879 million for construction and development activities in Macao, which consisted of $545 million for The Londoner Macao, $262 million for The Venetian Macao, $39 million for The Parisian Macao, $16 million for Sands Macao, $14 million for The Plaza Macao and Four Seasons Macao and $3 million for ferry operations and other, and $648 million for construction activities at Marina Bay Sands in Singapore, primarily due to the room renovations being completed across the property. Additionally, we funded $40 million for corporate and other costs.

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Capital expenditures for the year ended December 31, 2023, totaled $1.02 billion. Included in this amount was $584 million at Marina Bay Sands in Singapore, primarily due to Towers 1 and 2 room renovations. Capital expenditures were $233 million for construction and development activities in Macao, which consisted of $132 million for The Londoner Macao, $71 million for The Venetian Macao, $15 million for The Plaza Macao and Four Seasons Macao, $9 million for The Parisian Macao and $6 million for Sands Macao. Additionally, we funded $200 million for corporate and other.

Cash Flows — Financing Activities

Net cash flows used in financing activities were $3.06 billion for the year ended December 31, 2024. We utilized $1.75 billion for common stock repurchases and $590 million for dividend payments related to our stockholder return of capital program, funded $250 million to purchase common stock of SCL to increase our equity ownership in SCL and funded our capped call contracts for $48 million, net of cash premiums received. There were net repayments of debt of $326 million primarily related to the repurchase of $175 million of SCL Senior Notes for $174 million and $139 million of repayments on the 2012 Singapore Term Facility. Lastly, we paid $60 million in deferred offering costs, primarily related to the 2024 SCL Credit Facility and the issuance of the new LVSC Senior Notes, and $32 million in other financial liability payments.

Net cash flows used in financing activities were $3.19 billion for the year ended December 31, 2023. There were $2.07 billion in repayments on debt, primarily related to the repayment on the 2018 SCL Revolving Facility of $1.95 billion. We also utilized $505 million for common stock repurchases and $305 million for dividend payments related to our stockholder return of capital program, and funded $250 million to purchase common stock of SCL to increase our equity ownership in SCL. Lastly, we paid $32 million in deferred offering costs, primarily related to the amendment and restatement of the 2018 SCL Credit Facility, and $29 million in other financial liability payments

As of December 31, 2024, we had $4.44 billion available for borrowing under our U.S., Macao and Singapore revolving facilities, net of letters of credit.

Capital Financing Overview

We fund our development projects primarily through operating cash flows and borrowings from our debt instruments (see “Item 8 — Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 12 — Debt”).

On April 3, 2024, LVSC entered into a revolving credit agreement with the arrangers and lenders named therein and The Bank of Nova Scotia, as administrative agent for the lenders (the “2024 LVSC Revolving Credit Agreement”), pursuant to which the lenders provided unsecured, revolving credit commitments to LVSC in an aggregate principal amount of $1.50 billion (the “2024 LVSC Revolving Facility”), which are available until April 3, 2029, and include a $150 million sub-facility for letters of credit. LVSC may utilize the proceeds of the loans for general corporate purposes and working capital requirements of LVSC and its subsidiaries and any other purpose not prohibited by the 2024 LVSC Revolving Credit Agreement. Upon entering into the 2024 LVSC Revolving Credit Agreement, the existing LVSC Revolving Credit Agreement was terminated. The terms and conditions under the 2024 LVSC Revolving Credit Agreement are similar to those under the LVSC Revolving Credit Facility. Refer to “Part II — Item 8 — Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 12 — Debt” for further details.

On May 16, 2024, we issued, in an underwritten public offering, three series of senior unsecured notes in an aggregate principal amount of $1.75 billion (see “Part II — Item 8 — Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 12 — Debt”). The net proceeds from the offering and cash on hand were used to repay in full the outstanding borrowings under the $1.75 billion 3.200% Senior Notes, resulting in a loss on early retirement of debt of $1 million.

During the three months ended June 30, 2024, SCL repurchased $175 million of the outstanding principal amount of the $1.80 billion 5.125% Senior Notes, resulting in a gain on early retirement of debt of approximately $1 million. As of December 31, 2024, the $1.80 billion 5.125% Senior Notes had a remaining aggregate principal amount of $1.63 billion.

On October 23, 2024, SCL entered into a new facility agreement (the “2024 SCL Credit Facility”) with the arrangers and lenders named therein and Bank of China Limited, Macau Branch, as agent for the lenders. In connection with the entry into the 2024 SCL Credit Facility, the commitments under SCL’s existing 2018 SCL Credit Facility terminated.

The 2024 SCL Credit Facility provides for a 19.50 billion Hong Kong dollars (“HKD,” approximately $2.51 billion at exchange rates in effect on December 31, 2024) unsecured revolving credit facility (the “2024 SCL Revolving Facility”). SCL may draw revolving loans under the 2024 SCL Revolving Facility from time to time until September 24, 2029 (or if that day is not a business day in Hong Kong or Macao, the next business day), for general corporate and working capital requirements of SCL and its subsidiaries, subject to certain restrictions set forth in the 2024 SCL Credit Facility. The final maturity date of all loans drawn under the 2024 SCL Revolving Facility is October 23, 2029.

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The 2024 SCL Credit Facility also makes available an HKD 12.95 billion (approximately $1.67 billion at exchange rates in effect on December 31, 2024) unsecured term loan facility (the “2024 SCL Term Loan Facility”). SCL may make a drawdown under the 2024 SCL Term Loan Facility at any time until August 31, 2025, for the purpose of repaying amounts outstanding under its unsecured $1.80 billion 5.125% Senior Notes. The final maturity date of such loan drawn under the 2024 SCL Term Loan Facility is the date falling on the fifth anniversary of the date on which such loan is drawn. Refer to “Part II — Item 8 — Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 12 — Debt” for further details.

Our U.S., SCL and Singapore credit facilities, as amended, contain various financial covenants, which include maintaining a maximum leverage ratio, as defined per the respective facility agreements. As of December 31, 2024, our U.S., SCL and Singapore leverage ratios, as defined per the respective credit facility agreements, were 2.51x, 3.22x and 1.49x, respectively, compared to the maximum leverage ratios allowed of 4.00x, 4.00x and 4.50x, respectively. If we are unable to maintain compliance with the financial covenants under these credit facilities, we would be in default under the respective credit facilities.

We held unrestricted cash and cash equivalents of $3.65 billion and restricted cash of $125 million as of December 31, 2024, of which approximately $2.69 billion of the unrestricted amount is held by non-U.S. subsidiaries. Of the $2.69 billion, approximately $2.14 billion is available to be repatriated, either in the form of dividends or via intercompany loans or advances, to the U.S., subject to levels of earnings, cash flow generated from gaming operations and various other factors, including dividend requirements to third-party public stockholders in the case of funds being repatriated from SCL, compliance with certain local statutes, laws and regulations currently applicable to our subsidiaries and restrictions in connection with their contractual arrangements. We do not expect withholding taxes or other foreign income taxes to apply should these earnings be distributed in the form of dividends or otherwise.

We believe we have a strong balance sheet and sufficient liquidity in place, including unrestricted cash and cash equivalents of $3.65 billion and cash flow generated from operations, as well as $4.44 billion available for borrowing under our U.S., SCL and Singapore revolving credit facilities, net of outstanding letters of credit.

We believe we are well positioned to support our operations, maintain compliance with the financial covenants of our credit facilities and fund our working capital needs, committed and planned capital expenditures, development opportunities, debt obligations and dividend commitments, as well as meet our commitments under the Macao Concession. In the normal course of our activities, we will continue to evaluate global capital markets to consider future opportunities for enhancements of our capital structure.

On February 14, May 15, August 14 and November 13, 2024, we paid a quarterly dividend of $0.20 per common share as part of a regular cash dividend program and, for the year ended December 31, 2024, we recorded $591 million as a distribution against retained earnings. In January 2025, our Board of Directors declared a quarterly dividend of $0.25 per common share (a total estimated to be approximately $179 million) to be paid on February 19, 2025, to stockholders of record on February 10, 2025. We expect this level of dividend to continue quarterly through the remainder of 2025. Our Board of Directors will continue to assess the level of appropriateness of any cash dividends.

On September 9, October 30 and December 4, 2024, the Company’s wholly owned subsidiary, Venetian Venture Development II (“VVDI II”), entered into various agreements (collectively, the “Purchase Agreements”) with financial institutions (the “Dealers/Agents”) relating to the purchase of the common stock of SCL (the “Purchase Transactions”), in which VVDI II in each transaction made upfront payments of HKD 800 million (approximately $103 million at exchange rates as of the date of the transaction). All purchases under the Purchase Transactions were completed by October 22, 2024, November 26, 2024 and January 7, 2025, respectively. The Dealers/Agents delivered approximately 23 million, 41 million and 39 million shares, respectively, of SCL common stock to us, representing an average price of HKD 14.64, HKD 19.72 and HKD 20.68 per share, respectively. The additional shares resulted in an increase of our ownership of SCL to approximately 72.29% as of January 7, 2025. Under the Purchase Transaction entered into on September 9, 2024, the Cap Amount (as defined in the agreement) was reached during the term of the agreement and as a result approximately $59 million was returned to VVDI II in the form of cash.

Share Repurchase Program

On October 22, 2024, the Company’s Board of Directors authorized increasing the remaining share repurchase amount from $195 million to $2.0 billion and extending the share repurchase program’s expiration date to November 3, 2026. During the year ended December 31, 2024, we repurchased 37,552,614 shares of our common stock for $1.77 billion (including $1 million in commissions and $17 million in excise tax) under our current program. All share repurchases of our common stock have been recorded as treasury stock.

We have approximately $1.55 billion remaining under our authorized share repurchase program. Repurchases of our common stock are made at our discretion in accordance with applicable federal securities laws in the open market or otherwise. The timing and actual number of shares to be repurchased in the future will depend on a variety of factors, including our financial position, earnings, cash flows, legal requirements, other investment opportunities and market conditions.

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Aggregate Indebtedness and Other Contractual Obligations

Our total long-term indebtedness and other contractual obligations are summarized below as of December 31, 2024:

_______________________

(1)As of December 31, 2024, we had a $110 million liability related to uncertain tax positions. We do not expect this liability to result in a payment of cash within the next 12 months. We are unable to reasonably estimate the timing of the liability in individual years beyond 12 months due to uncertainties in the timing of the effective settlement of tax positions; therefore, such amounts are not included in the table.

(2)See “Item 8 — Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 12 — Debt” for further details on these financing transactions and “Item 8 — Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 16 — Leases” for further details on finance leases.

(3)Other consists of finance leases, including imputed interest, and other financed purchased obligations, including the related interest.

(4)Based on the 1-month rate as of December 31, 2024, Secured Overnight Financing Rate (“SOFR”) of 4.49%, Hong Kong Inter-Bank Offer Rate (“HIBOR”) of 4.58% and Singapore Overnight Rate Average (“SORA”) of 2.11%, plus the applicable interest rate spread in accordance with the respective debt agreements.

(5)In addition to the amounts listed in the table above, under the Macao Concession, we have committed to spend 35.80 billion patacas (approximately $4.48 billion at exchange rates in effect on December 31, 2024) through 2032 on both capital and operating projects, including 33.36 billion patacas (approximately $4.17 billion at exchange rates in effect on December 31, 2024) in non-gaming projects. For the year ending December 31, 2023, we spent approximately $168 million on these projects. This amount was reviewed and confirmed as qualified spend under the Concession by the Macao government following an audit conducted in July 2024, with results issued in November 2024. The Macao government conducts an annual audit to confirm qualified concession investments for the prior year. As of the date of this filing, the audit process for 2024 investments has not yet commenced.

We are also required to pay a 35% gross gaming revenue special gaming tax and a 5% gross gaming revenue contribution in Macao, which amounts we pay are variable in nature. Under the Concession, however, we are obligated to pay a special annual gaming premium if the average of the gross gaming revenues of our gaming tables and our electrical or mechanical gaming machines, including slot machines, is lower than a certain minimum amount determined by the Macao government; such special premium being the difference between the gaming tax based on the actual gross gaming revenues and that of the specified minimum amount. Based on the maximum number of gaming tables and gaming machines we are currently authorized to operate, if the monthly special gaming taxes paid during the year aggregates to less than 4.50 billion patacas (approximately $563 million at exchange rates in effect on December 31, 2024), we would be required to pay the difference as the special annual gaming premium.

(6)We are required to pay an annual premium with a fixed portion and a variable portion, which is based on the number and type of gaming tables and gaming machines we operate. Based on the gaming tables and gaming machines (which is at the maximum number of tables and machines currently allowed by the Macao government) in operation and the mix of type of gaming tables as of December 31, 2024, the annual premium payable to the

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Macao government is approximately $41 million for the years ending December 31, 2025 through December 31, 2029, respectively, and $122 million in aggregate thereafter through the termination of the Concession in December 2032.

(7)Under the Handover Record, we are required to make annual payments of 750 patacas per square meter for the first three years and 2,500 patacas per square meter for the following seven years (approximately $94 and $313, respectively, at exchange rates in effect on December 31, 2024). The annual payment of 750 patacas per square meter will be adjusted with the Macao average price index of the corresponding preceding year for years two and three and the annual payment of 2,500 patacas per square meter will be adjusted with the Macao average price index of the corresponding preceding year for years five through ten.

(8)We are party to certain operating leases for real estate, which primarily include $285 million related to long-term land leases in Macao with an anticipated lease term of 50 years, $15 million related to a long-term land lease in Las Vegas with a 40-year lease term, and $15 million related to office space in Singapore with a 5-year lease term. See “Item 8 — Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 16 — Leases” for further details on operating leases.

(9)Mall deposits consist of refundable security deposits received from mall tenants.

(10)Primarily consists of all other non-cancellable contractual obligations and primarily relates to certain hotel management and service agreements, as described below. The amounts exclude open purchase orders with our suppliers that have not yet been received as these agreements generally allow us the option to cancel, reschedule and adjust terms based on our business needs prior to the delivery of goods or performance of services.

Some of our hotel properties operate pursuant to management agreements with various experienced third-party hotel operators (management companies), whereby the management company controls the day-to-day operations of each of these hotels, and we are granted limited approval rights with respect to certain of the management company’s actions. The non-cancelable period of our management agreements ranges from 14 to 40 years with various extension provisions and some with early termination options. Each management company receives a base management fee, generally a percentage of revenue as defined. There are also monthly fees for certain support services and some also include incentive fees based on attaining certain financial thresholds. Additionally, we have a franchise agreement granting us the right to operate the Londoner Grand as a franchisee under Marriott International’s “Luxury Collection Hotel” brand, which primarily consists of a fixed and variable franchise fee. The non-cancelable period for the franchise agreement is 15 years.

The Company's non-cancelable contractual obligations also include agreements with certain celebrities and professional sports leagues and teams for the hosting of events, advertising, marketing, promotional and sponsorship opportunities in order to promote the Company’s brand and services.

Off-Balance Sheet Arrangements

We have not entered into any transactions with special purpose entities, nor have we engaged in any derivative transactions other than foreign currency swaps. Refer to “Item 8 — Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 11 — Derivative Instruments” for outstanding foreign currency swaps as of December 31, 2024.

Restrictions on Distributions

We are a parent company with limited business operations. Our main asset is the stock and ownership interests of our subsidiaries. Certain of our debt instruments contain restrictions that, among other things, limit the ability of certain subsidiaries to incur additional indebtedness, issue disqualified stock or equity interests, pay dividends or make other distributions, repurchase equity interests or certain indebtedness, create certain liens, enter into certain transactions with affiliates, enter into certain mergers or consolidations or sell certain of our assets without prior approval of the lenders or noteholders.

Under the Concession, although not a restriction, we have to provide a five-day prior notification to the Macao government for any major financial decisions exceeding 10% of the share capital of VML.

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Special Note Regarding Forward-Looking Statements

This Annual Report on Form 10-K contains forward-looking statements made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include the discussions of our business strategies and expectations concerning future operations, margins, profitability, liquidity and capital resources. In addition, in certain portions included in this Annual Report on Form 10-K, the words: “anticipates,” “believes,” “continues,” “estimates,” “expects,” “intends,” “may,” “plans,” “positions,” “remains,” “seeks,” “will,” “would,” and similar expressions, as they relate to our Company or management, are intended to identify forward-looking statements. Although we believe these forward-looking statements are reasonable, we cannot assure you any forward-looking statements will prove to be correct. These statements represent our expectations, beliefs, intentions or strategies concerning future events that, by their nature, involve known and unknown risks, uncertainties and other factors beyond our control, which may cause our actual results, performance, achievements or other expectations to be materially different from any future results, performance, achievements or other expectations expressed or implied by these forward-looking statements. These factors include, but are not limited to, the risks associated with:

•Our business is particularly sensitive to reductions in discretionary consumer and corporate spending as a result of downturns in the economy;

•Natural or man-made disasters, an outbreak of highly infectious or contagious disease, political instability, civil unrest, terrorist activity or war could materially adversely affect the number of visitors to our facilities and disrupt our operations;

•Our business is sensitive to the willingness of our customers to travel;

•We are subject to extensive regulations that govern our operations in any jurisdiction where we operate;

•Certain local gaming laws apply to our gaming activities and associations in jurisdictions where we operate or plan to operate;

•We depend primarily on our properties in two markets for all of our cash flow, and because we are a parent company, our primary source of cash is and will be distributions from our subsidiaries;

•Our debt instruments, current debt service obligations and substantial indebtedness may restrict our current and future operations;

•We are subject to fluctuations in foreign currency exchange rates;

•We extend credit to a portion of our patrons, and we may not be able to collect gaming receivables from our credit patrons;

•Win rates for our gaming operations depend on a variety of factors, some beyond our control, and the winnings of our gaming patrons could exceed our casino winnings;

•We face the risk of fraud and cheating;

•Our operations face significant competition, which may increase in the future;

•Our attempts to expand our business into new markets and new ventures, including through acquisitions or strategic transactions, may not be successful;

•Our loan receivable is subject to certain risks, which could materially adversely affect our financial position, results of operations and cash flows;

•There are significant risks associated with our current and planned construction projects;

•Our Macao Concession and Singapore development agreements and casino license can be terminated or redeemed under certain circumstances without compensation to us;

•The number of visitors to our Integrated Resorts, particularly visitors from mainland China, may decline or travel may be disrupted;

•The Macao and Singapore governments could grant additional rights to conduct gaming in the future and increase competition we face;

•Conducting business in Macao and Singapore has certain political and economic risks;

•Our tax arrangements with the Macao government may not be extended on terms favorable to us or at all beyond their expiration dates;

•We are subject to limitations on the transfers of cash to and from our subsidiaries, limitations of the pataca and HKD exchange markets and restrictions on the export of the Renminbi;

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•VML may have financial and other obligations to foreign workers seconded to its contractors under government labor quotas;

•Our business, financial condition and results of operations and/or the value of our securities or our ability to offer or continue to offer securities to investors may be materially and adversely affected to the extent the laws and regulations of mainland China become applicable to our operations in Macao and Hong Kong or economic, political and legal developments in Macao adversely affect our Macao operations;

•The interests of our principal stockholders in our business may be different from yours;

•Conflicts of interest may arise because certain of our directors and officers are also directors of SCL;

•We depend on the continued services of key officers;

•We compete for limited management and labor resources in Macao and Singapore, and policies of those governments may also affect our ability to employ imported managers or labor;

•Failure to maintain the integrity of our information and information systems or comply with applicable privacy and cybersecurity requirements and regulations could harm our reputation and adversely affect our business;

•We may fail to establish and protect our IP rights and could be subject to claims of IP infringement;

•The licensing of our trademarks to third parties could result in reputational harm for us;

•Our insurance coverage may not be adequate to cover all possible losses that our properties could suffer, and our insurance costs may increase in the future;

•We are subject to changes in tax laws and regulations;

•We could be negatively impacted by environmental, social and governance and sustainability matters; and

•Other risks and uncertainties detailed in Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q filed by the Company with the SEC.

All future written and verbal forward-looking statements attributable to us or any person acting on our behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this section. New risks and uncertainties arise from time to time, and it is impossible for us to predict these events or how they may affect us. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date such statement is made. The Company assumes no obligation to update any forward-looking statements, except as required by federal securities laws.

Investors and others should note we announce material financial information using our investor relations website (https://investor.sands.com), our company website, SEC filings, investor events, news and earnings releases, public conference calls and webcasts. We use these channels to communicate with our investors and the public about our company, our products and services, and other issues.

In addition, we post certain information regarding SCL, a subsidiary of LVSC with ordinary shares listed on The Stock Exchange of Hong Kong Limited, from time to time on our company website and our investor relations website. It is possible the information we post regarding SCL could be deemed to be material information.

Critical Accounting Policies and Estimates

The preparation of our consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires our management to make estimates and judgments that affect the reported amounts of assets and liabilities, revenues and expenses, and related disclosures of contingent assets and liabilities. These estimates and judgments are based on historical information, information currently available to us and on various other assumptions management believes to be reasonable under the circumstances. Actual results could vary from those estimates, and we may change our estimates and assumptions in future evaluations. Changes in these estimates and assumptions may have a material effect on our results of operations and financial condition. We believe the critical accounting policies and estimates discussed below affect our more significant judgments and estimates used in the preparation of our consolidated financial statements.

Provision for Expected Credit Losses

We maintain a provision for expected credit losses on casino, hotel and mall receivables and regularly evaluate the balances. We apply standard reserve percentages to aged account balances, which are grouped based on shared credit risk characteristics and days past due. The reserve percentages are based on estimated loss rates supported by historical observed default rates over the expected life of the receivable and are adjusted for forward-looking information. We also specifically analyze the collectability of each account with a balance over a specified dollar amount, based upon the age of the account, the customer's financial condition, collection history and any other

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known information and adjust the aforementioned reserve with the results from the individual reserve analysis. We also monitor regional and global economic conditions and forecasts in our evaluation of the adequacy of the recorded reserves.

Account balances are written off against the provision when we believe it is probable the receivable will not be recovered. Credit or marker play was 9.5% and 10.8% of table games play at our Macao properties and Marina Bay Sands, respectively, during the year ended December 31, 2024. Our provision for casino credit losses was 39.0% and 40.2% of gross casino receivables as of December 31, 2024 and 2023, respectively. Our provision for credit losses from our hotel and other receivables is not material.

Litigation Accrual

We are subject to various claims and legal actions. We estimate the accruals for these claims and legal actions based on all relevant facts and circumstances currently available and include such accruals in other accrued liabilities in the consolidated balance sheets when it is determined such contingencies are both probable and reasonably estimable.

Property and Equipment

As of December 31, 2024, we had net property and equipment of $11.99 billion, representing 58.0% of our total assets. We depreciate property and equipment on a straight-line basis over their estimated useful lives. The estimated useful lives are based on the nature of the assets as well as current operating strategy and legal considerations, such as contractual life. Future events, such as property expansions, property developments, new competition or new regulations, could result in a change in the manner in which we use certain assets requiring a change in the estimated useful lives of such assets. The estimated useful lives of assets are periodically reviewed and adjusted as necessary on a prospective basis.

For assets to be held and used (including projects under development), fixed assets are reviewed for impairment whenever indicators of impairment exist. If an indicator of impairment exists, we first group our assets with other assets and liabilities at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities (the “asset group”). Secondly, we estimate the undiscounted future cash flows directly associated with and expected to arise from the completion, use and eventual disposition of such asset group. We estimate the undiscounted cash flows over the remaining useful life of the primary asset within the asset group. If the undiscounted cash flows exceed the carrying value, no impairment is indicated. If the undiscounted cash flows do not exceed the carrying value, then an impairment is measured based on fair value compared to carrying value, with fair value typically based on a discounted cash flow model. If an asset is still under development, future cash flows include remaining construction costs.

To estimate the undiscounted cash flows of our asset groups, we consider all potential cash flows scenarios, which are probability weighted based on management's estimates given current conditions. Determining the recoverability of our asset groups is judgmental in nature and requires the use of significant estimates and assumptions, including estimated cash flows, probability weighting of potential scenarios, costs to complete construction for assets under development, growth rates and future market conditions, among others. Future changes to our estimates and assumptions based upon changes in macro-economic factors, regulatory environments, operating results or management's intentions may result in future changes to the recoverability of our asset groups.

Gaming Assets under the Macao Concession

As we continue to operate the Gaming Assets, as defined in “Item 8 — Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 7 — Property and Equipment, Net,” in the same manner as under the previous subconcession, obtain substantially all of the economic benefits and bear all of the risks arising from the use of these assets, as well as assume VML will be successful in being awarded a new concession upon expiry of the current concession, we continue to recognize these Gaming Assets as property and equipment over their remaining estimated useful lives.

Income Taxes

We are subject to income taxes in the U.S. (including federal and state) and numerous foreign jurisdictions in which we operate. We record income taxes under the asset and liability method, whereby deferred tax assets and liabilities are recognized based on the future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases, and attributable to operating loss and tax credit carryforwards.

Our foreign and U.S. tax rate differential reflects the fact that U.S. tax rates are higher than the statutory tax rates in Singapore and Macao of 17% and 12%, respectively. On February 5, 2024, we received an exemption from Macao's corporate income tax on profits generated by the operation of casino games of chance for the period from January 1, 2023 through December 31, 2027.

Accounting standards regarding income taxes require a reduction of the carrying amounts of deferred tax assets by a valuation allowance if it is “more-likely-than-not” such assets will not be realized based on the available evidence. Accordingly, the need to establish valuation allowances for deferred tax assets is assessed at each reporting period based on a “more-likely-than-not” realization threshold. This assessment considers, among other matters, the nature, frequency and severity of current and cumulative losses, forecasts

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of future profitability, the duration of statutory carryforward periods, our experience with operating loss and tax credit carryforwards not expiring and tax planning strategies.

We recorded a valuation allowance on the net deferred tax assets of certain foreign jurisdictions of $314 million and $394 million as of December 31, 2024 and 2023, respectively, and a valuation allowance on certain U.S. foreign tax credit carryforwards of $2.46 billion and $3.49 billion as of December 31, 2024 and 2023, respectively. Management will reassess the realization of deferred tax assets at each reporting period and consider the scheduled reversal of deferred tax liabilities, sources of taxable income and tax planning strategies. To the extent the financial results of these operations improve and it becomes “more-likely-than-not” the deferred tax assets are realizable, we will be able to reduce the valuation allowance in the period such determination is made, as appropriate.

Significant judgment is required in evaluating our tax positions and determining our provision for income taxes. During the ordinary course of business, there are many transactions for which the ultimate tax determination is uncertain. Accounting standards regarding uncertainty in income taxes provide a two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates it is “more-likely-than-not” the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount that is more than 50% likely, based solely on the technical merits of being sustained on examination. We recorded unrecognized tax benefits and related interest and penalties of $148 million and $141 million as of December 31, 2024 and 2023, respectively. We consider many factors when evaluating and estimating our tax positions and tax benefits, which may require periodic adjustments and for which actual outcomes may be different.

Our major tax jurisdictions are the U.S., Macao, and Singapore. We could be subject to examination for tax years beginning in 2020 in Macao and Singapore and tax years 2010 through 2015 and 2020 through 2023 in the U.S.

Recent Accounting Pronouncements

See related disclosure at “Item 8 — Financial Statements and Supplementary Data — Notes to Consolidated Financial Statements — Note 2 — Summary of Significant Accounting Policies — Recent Accounting Pronouncements.”