Wynn Macau Trademark Payments to Parent Limited to $140M

Wynn Macau’s 2024 intellectual property payments to parent company Wynn Resorts (NASDAQ: WYNN) will be limited to $140 million.

That’s according to a recent regulatory filing with the Hong Kong Stock Exchange (HKSE), which is the listing venue for shares of Wynn Macau. The $140 million cap exceeds the $115.1 million limit imposed last year. In 2021 and 2022, the Macau concessionaire paid its Las Vegas-based parent a combined $74.8 million for the use of its brands and trademarks.

As for Wynn and its Macau entity, the agreement pertains to the Macau operator’s rights to use Wynn’s intellectual property, including logos, trademarks, and related fare. In the world’s largest casino hub, Wynn Macau runs its eponymous venue and Wynn Palace. The limit on intellectual property costs is being set by Wynn to comply with Hong Kong listing rules.

Wynn Licensing Agreement Small, but Important

For gaming operators with strong brand recognition, of which Wynn is one, licensing agreements are common. That’s particularly true in Macau, where Wynn is synonymous with plush integrated resorts and for luring VIP bettors.

There are also new caps on design services provided by Wynn Design & Development LLC to the Macau entities. This year, the Wynn Macau companies will pay no more than $10.9 million to the design unit. That limit increases to $12.3 million next year and $13.6 million in 2026.

Good Timing

Capping the intellectual property fees Wynn Macau pays to its parent company comes as Macau concessionaires posted a stellar 2023 in which gross gaming revenue (GGR) more than quadrupled.

The level of GGR posted last year triggered an increased level of nongaming capital commitments from the concessionaires, indicating it’s prudent of Wynn Resorts to cap trademark payments from its Macau unit.