VICI's AFFO per share rose 4.6% to $0.62 on the Golden Entertainment acquisition, rent escalators and a growing loan book, while GAAP EPS fell 41% to $0.48 because of a $271 million non-cash credit-loss reserve build.
Revenue
$1.1B
+5.7% YoY
Net income
$527M
-39.1% YoY
Diluted EPS
$0.48
-41.0% YoY
How VICI compares with Real Estate peers
Figure
VICI
Peer median
Rank
Revenue growth (YoY)
+5.7%
+6.8%
15th of 28
EPS growth (YoY)
-41.0%
+5.9%
22nd of 27
Rank 1 = fastest revenue growth, fastest EPS growth. Peers are the other Real Estate companies with a 2026 report on this site, each at its latest period we've analyzed; fiscal calendars differ, so periods are not always the same months.
Headline: rent and loan income up, AFFO per share up 4.6%, and GAAP profit down 39% because of an accounting reserve
VICI Properties owns the land and buildings under casinos and other leisure venues, including Caesars Palace, MGM Grand and The Venetian in Las Vegas, and rents them back to the operators. The leases are triple-net, meaning the tenant pays property taxes, insurance and maintenance, so almost all of the rent VICI collects is profit. In the second quarter of 2026 (April–June), total revenue rose 5.7% to $1,058.5 million. Three new tenants were added: Clairvest at MGM Northfield Park, Blake Sartini's company at the former Golden Entertainment casinos, and Club Med in St. Croix. AFFO per share, the cash-earnings figure REIT investors mostly judge VICI by, rose 4.6% to $0.62. GAAP net income attributable to common stockholders fell 39.1% to $526.5 million ($0.48 per share, down from $0.82). That drop came almost entirely from a non-cash reserve for possible future credit losses, not from any fall in rent collected.
At a glance
$0.62 AFFO per share, +4.6% YoY. Total AFFO grew faster (+7.8%) but was spread over 3.1% more shares, mostly the 24.3 million new shares issued to buy Golden Entertainment's casinos.
$271.1 million added to credit-loss reserves. This one non-cash line explains the whole GAAP profit decline. A year earlier VICI released $142.0 million of reserves, so the year-over-year swing is $413.1 million.
About 70% of contractual rent comes from two tenants. Caesars accounted for 36% and MGM for 34% (37% and 36% a year earlier). The concentration is falling as new tenants are added, but slowly.
The numbers
Metric
Q2 2026
Q2 2025
YoY Change
Total revenue
$1,058.5M
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For the first half, AFFO per share was $1.23, up 4.2% from $1.18. GAAP EPS was $1.30 versus $1.33.
Why GAAP profit and AFFO tell different stories at VICI
At most REITs, GAAP net income understates cash earnings mainly because of depreciation, an accounting charge for buildings wearing out that involves no cash. VICI is different. Its leases are accounted for as "sales-type leases" and "financing receivables", which treats the properties more like loans than like buildings. As a result, VICI records zero real-estate depreciation, and its FFO (funds from operations, the industry-standard profit measure that adds back depreciation) equals net income exactly: $526.5 million.
The gap to AFFO (adjusted FFO) comes from two other non-cash items:
The CECL allowance. CECL stands for "current expected credit losses". Accounting rules require VICI to reserve now for losses it might suffer if tenants or borrowers default at some point over decades-long leases. The reserve moves with tenant credit ratings, tenants' share prices and the economic forecast. This quarter's $271.1 million increase had three causes, per the 10-Q: (i) a $72.6 million initial reserve booked on the newly acquired Golden and Gamehost portfolios, (ii) a higher long-term default-probability estimate for one tenant after it issued new senior secured debt at a lower credit rating than VICI had assumed, and (iii) a weaker macroeconomic forecast. Better share-price performance by tenants partly offset these. No rent went unpaid because of this charge.
Non-cash leasing and financing adjustments ($139.1 million this quarter, versus $130.0 million). Under this accounting, rent is booked on an "effective interest" basis, which smooths income over the whole lease. As a result, GAAP revenue includes about $139 million a quarter that isn't collected in cash yet. AFFO subtracts it. This is why AFFO is not simply "net income plus add-backs": in a quarter with no CECL swing, AFFO would come out below net income.
If you set the CECL line aside in both years, net income plus the reserve change was $797.6 million versus $723.1 million, an increase of about 10%. That figure still includes the non-cash revenue, so AFFO's +7.8% is the more reliable measure of underlying growth.
Where the growth came from
Acquisitions, mainly Golden Entertainment. On April 30 VICI closed its $1.16 billion purchase of seven Nevada casino properties at a 7.5% cap rate. The cap rate is the first-year rent as a share of the price paid, here $87.0 million a year. It contributed $14.5 million of rent in its first two months. The 10-Q names this deal, along with annual rent escalators, as the main driver of the $30.9 million (+3.9%) rise in contractual leasing revenue. Rent on this lease only starts escalating (2% a year) in lease year 3, so it adds rent volume now but no built-in growth until 2028.
Rent escalators on the big leases. The two Caesars Las Vegas and regional leases grew about 2.1% each ($126.4M vs $123.9M, and $140.5M vs $137.7M). MGM Grand/Mandalay Bay rose 2.0%, and The Venetian rose 2.2%. These contractual step-ups are VICI's baseline organic growth. The main MGM Master Lease line actually fell to $185.8 million from $192.4 million because MGM sold the operations of Northfield Park. That rent now sits under the new Clairvest lease ($10.5 million this quarter; $54.0 million a year after its May escalation), with an offsetting cut to MGM's rent. The money is the same, but it now comes from a different, smaller tenant.
The loan book. Income from loans and securities rose $16.9 million to $71.6 million, "primarily driven by the origination and subsequent funding" of new debt investments, according to the 10-Q. Principal outstanding was $3.03 billion at a 9.4% weighted-average rate, with $1.18 billion more committed but not yet funded. The largest new commitment is a $1.5 billion mezzanine loan (a loan ranking behind the senior lender, so higher-yielding and higher-risk) for the One Beverly Hills development, made in March. Its initial funding was $650 million, and construction is due to finish in 2028.
Smaller deals. VICI bought two casinos and two hotels in Alberta for US$141.0 million and added them to its lease with PURE Canadian Gaming, raising rent by US$11.3 million a year. It also bought the Carambola Beach Resort in St. Croix for $20.3 million, leased it to Club Med, and committed about $55.2 million to its redevelopment, targeting a Q4 2027 reopening. The Club Med deal is small, but it is VICI's first resort deal outside gaming with a global hotel brand.
Takeaway: The 39% drop in GAAP profit is an accounting reserve, not a business problem: cash rent grew 3.9% and AFFO per share grew 4.6%. The one real signal inside the reserve is that VICI raised the default-risk estimate for one tenant after that tenant borrowed at a worse credit rating. Tenant credit is the thing to watch here, not rent growth.
What the headline numbers hide
Cash conversion is good, with a one-time boost. First-half operating cash flow was $1,360.0 million, compared with AFFO of $1,330.5 million and net income of $1,398.9 million. The 10-Q attributes part of the $128.3 million year-over-year rise to the "receipt of payment-in-kind interest": $51.1 million of interest that had been accruing on loans (payment-in-kind, or PIK, means interest added to the loan balance instead of paid in cash) was collected this half, against none a year ago. Without it, operating cash flow would be about $1,309 million. That is still close to AFFO, so the AFFO figure is backed by real cash, but part of the rise in operating cash flow won't recur.
Share issuance diluted per-share growth. Total AFFO grew 7.8%, but per-share growth was only 4.6%. The gap came from shares issued for the Golden deal and the settlement of 7.75 million forward-sale shares ($242.1 million of proceeds in April). Acquisitions paid for with new shares add to AFFO per share only if they earn more than the cost of the equity issued.
One-offs are small this year. Transaction and acquisition expenses were $1.8 million, down from $7.4 million, and AFFO excludes them anyway. The CECL swing is the only large one-off, and it runs in opposite directions in the two years (a $271.1 million charge now, a $142.0 million release then). That makes GAAP growth rates meaningless in either direction.
Two credit issues in the loan book. An $80.7 million senior secured loan on a luxury golf-resort development is on non-accrual, meaning VICI has stopped booking interest on it. A separate $90.0 million loan (3.0% of the loan portfolio) was restructured to a lower interest rate and a later maturity date because the underlying asset was "experiencing operational challenges". In exchange, VICI got faster principal repayment and extra collateral. Both loans are small next to a $3.03 billion loan book and 2026 AFFO guidance of about $2.7 billion, but they are the first stress points visible in a business line whose income grew about 31% this quarter.
Tenant concentration is the main risk. Caesars (36% of contractual rent) and MGM (34%) together account for roughly 70% of rent, and Las Vegas Strip properties account for about 49% of lease revenue. Those shares fell only 1–2 points in a year that added three new tenants. The leases are guaranteed by the parent companies, but a serious problem at either operator would matter far more than anything else in this report.
Guidance moved up slightly. Full-year AFFO guidance is now $2.45–$2.47 per share ($2,675–$2,695 million), up from $2.44–$2.47. Only the low end was raised. The first half produced $1.23, so the guidance implies $1.22–$1.24 for the second half, or about $0.61–$0.62 a quarter. That is flat with Q2, not rising.
Refinancing costs are rising
VICI had $500 million of debt due September 1, 2026 and $1.25 billion due December 1, 2026, at coupons of 4.50% and 4.25%. After the quarter ended (8-Ks dated August 6 and August 14), it sold $900 million of 5.40% notes due 2031 and $850 million of 5.75% notes due 2036 to repay them. By our rough arithmetic, replacing that debt costs about $22 million more in interest a year before hedges, or roughly $0.02 per share of annual AFFO. VICI also held $600 million of forward-starting interest-rate swaps at quarter-end, taken out to lock in rates on future bond issues, which should soften part of this. Another $1.5 billion of notes matures in February 2027. This is a slow, predictable drag rather than a shock. It helps explain why guidance implies no quarterly growth in the second half despite contractual rent increases.
Outlook
Management's guidance calls for 2026 AFFO of $2.45–$2.47 per share. At the midpoint, the $0.45 quarterly dividend is about 73% of AFFO, which leaves room for reinvestment. Guidance excludes acquisitions that don't yet have announced closing dates.
Our read: the built-in growth is steady but modest. Most of VICI's rent escalates about 2% a year, and the MGM Master Lease (plus the Clairvest lease carved out of it) only moves to a CPI-linked escalator, capped at 3%, in 2032. The loan book yields 9.4% and adds income faster than the leases, but it also produced this quarter's only visible credit problems. The combination of 2% rent escalators, higher refinancing costs and share issuance points to per-share AFFO growth in the low-to-mid single digits. The Q3 2026 report, expected around late October, will be the first full quarter with the Golden, Gamehost and Clairvest leases. It will also show whether the CECL reserve keeps rising for the tenant whose credit estimate was cut.