10-Q

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: June 30, 2007

¨ TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from              to             

Commission File Number: 1-9481

ARCHON CORPORATION

(Exact name of registrant as specified in its charter)

Nevada	88-0304348
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification Number)

4336 Losee Road, Suite 5, North Las Vegas, Nevada 89030

(Address of principal executive office and zip code)

(702) 732-9120

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Indicate by a check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨

Indicate by a check mark whether the registrant is a large accelerated filer, an accelerated filer or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act.

Large accelerated filer  ¨    Accelerated filer  ¨    Non-accelerated filer  x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  ¨    No  x

APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY

PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.    Yes  ¨    No  ¨

APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

6,280,931 as of August 13, 2007

ARCHON CORPORATION

INDEX

		Page
PART I	FINANCIAL INFORMATION
Item 1	Condensed Consolidated Financial Statements:
	Condensed Consolidated Balance Sheets as of June 30, 2007 (Unaudited) and September 30, 2006	1
	Unaudited Condensed Consolidated Statements of Operations for the Three and Nine Months Ended June 30, 2007 and 2006	3
	Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three and Nine Months Ended June 30, 2007 and 2006	4
	Unaudited Condensed Consolidated Statement of Stockholders’ Equity for the Nine Months Ended June 30, 2007	5
	Unaudited Condensed Consolidated Statements of Cash Flows for the Nine Months Ended June 30, 2007 and 2006	6
	Notes to Unaudited Condensed Consolidated Financial Statements	7
Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	16
Item 3	Quantitative and Qualitative Disclosures About Market Risk	25
Item 4	Controls and Procedures	26
PART II	OTHER INFORMATION
Item 1	Legal Proceedings	27
Item 2	Changes in Securities, Use of Proceeds and Issuer Purchases of Equity Securities	27
Item 3	Defaults Upon Senior Securities	27
Item 4	Submission of Matters to a Vote of Security Holders	28
Item 5	Other Information	29
Item 6	Exhibits	29

PART I – FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements

Archon Corporation and Subsidiaries

Condensed Consolidated Balance Sheets

	June 30, 2007		September 30, 2006
	(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents	$	47,464,303	$	6,187,533
Investment in marketable securities		8,643,095		6,011,225
Accounts receivable, net		90,634		1,096,333
Inventories		482,818		414,033
Prepaid expenses and other		921,597		1,045,654
Total current assets		57,602,447		14,754,778
Land held for sale		21,504,400		21,504,400
Property held for investment, net		124,985,709		127,364,625
Property and equipment, net		25,327,452		26,778,164
Other assets		7,428,733		7,648,201
Total assets	$	236,848,741	$	198,050,168

The accompanying notes are an integral part of these condensed consolidated financial statements

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Archon Corporation and Subsidiaries

Condensed Consolidated Balance Sheets (continued)

	June 30, 2007		September 30, 2006
	(Unaudited)
LIABILITIES and STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	3,032,499	$	2,770,938
Interest payable		396,798		1,310,796
Accrued and other liabilities		3,581,648		3,524,408
Nonrefundable option		0		5,750,000
Current portion of debt		11,071,685		11,427,277
Current portion of non-recourse debt		2,411,505		2,195,326
Total current liabilities		20,494,135		26,978,745
Debt – less current portion		59,119		223,306
Non-recourse debt – less current portion		74,983,911		76,818,600
Nonrefundable option		47,422,500		0
Deferred income taxes		27,947,291		27,245,317
Other liabilities		42,824,479		45,051,567
Stockholders’ equity		23,117,306		21,732,633
Total liabilities and stockholders’ equity	$	236,848,741	$	198,050,168

The accompanying notes are an integral part of these condensed consolidated financial statements

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Archon Corporation and Subsidiaries

Condensed Consolidated Statements of Operations

(Unaudited)

	Three Months Ended June 30,						Nine Months Ended June 30,
	2007			2006			2007			2006
Revenues:
Casino	$	5,536,450		$	5,797,738		$	18,215,156		$	18,882,938
Hotel		763,961			829,760			2,145,522			2,161,889
Food and beverage		1,907,714			1,914,484			5,691,704			5,646,673
Investment properties		3,100,561			3,100,562			9,301,685			9,301,685
Other		1,214,736			921,222			3,332,858			2,627,461
Gross revenues		12,523,422			12,563,766			38,686,925			38,620,646
Less casino promotional allowances		(1,392,148	)		(1,438,087	)		(4,609,563	)		(4,606,884	)
Net operating revenues		11,131,274			11,125,679			34,077,362			34,013,762
Operating expenses:
Casino		3,175,479			3,387,914			10,345,423			10,342,408
Hotel		317,091			302,130			885,194			805,112
Food and beverage		1,220,027			1,097,120			3,192,850			3,017,775
Other		462,669			407,878			1,431,837			1,229,151
Selling, general and administrative		916,323			857,692			2,767,102			2,607,587
Corporate expenses		1,114,381			2,102,855			2,953,482			3,880,531
Utilities and property expenses		1,237,589			1,145,566			3,545,174			3,375,685
Depreciation and amortization		1,319,275			1,369,072			3,997,141			4,140,101
Loss on sale / disposal of assets		0			21,520			0			21,520
Total operating expenses		9,762,834			10,691,747			29,118,203			29,419,870
Operating income		1,368,440			433,932			4,959,159			4,593,892
Interest expense		(2,108,874	)		(2,213,531	)		(6,362,864	)		(6,636,453	)
Interest and other income		327,919			8,040			481,116			197,113
Loss before income tax benefit and discontinued operations		(412,515	)		(1,771,559	)		(922,589	)		(1,845,448	)
Federal income tax benefit		140,255			620,046			328,269			645,907
Loss before discontinued operations		(272,260	)		(1,151,513	)		(594,320	)		(1,199,541	)
Discontinued operations – gain on sale, net of tax provision of $510,596		0			0			948,250			0
Net income (loss)		(272,260	)		(1,151,513	)		353,930			(1,199,541	)
Dividends accrued on preferred shares		(377,819	)		(377,819	)		(1,133,458	)		(1,133,458	)
Net loss applicable to common shares	$	(650,079	)	$	(1,529,332	)	$	(779,528	)	$	(2,332,999	)
Average common shares outstanding		6,280,931			6,235,931			6,422,040			6,235,931
Average common and common equivalent shares outstanding		6,280,931			6,235,931			6,422,040			6,235,931
Loss per common share:
Basic	$	(0.10	)	$	(0.25	)	$	(0.27	)	$	(0.37	)
Diluted	$	(0.10	)	$	(0.25	)	$	(0.27	)	$	(0.37	)

The accompanying notes are an integral part of these condensed consolidated financial statements

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Archon Corporation and Subsidiaries

Condensed Consolidated Statements of Comprehensive Income (Loss)

(Unaudited)

	Three Months Ended June 30,						Nine Months Ended June 30,
	2007			2006			2007		2006
Net income (loss)	$	(272,260	)	$	(1,151,513	)	$	353,930	$	(1,199,541	)
Unrealized gain (loss) on marketable securities, net of income taxes		(222,480	)		201,140			967,607		944,633
Comprehensive income (loss)	$	(494,740	)	$	(950,373	)	$	1,321,537	$	(254,908	)

The accompanying notes are an integral part of these condensed consolidated financial statements

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Archon Corporation and Subsidiaries

Condensed Consolidated Statement of Stockholders’ Equity

For the Nine Months Ended June 30, 2007

(Unaudited)

	Common Stock			Preferred Stock		Additional Paid-In Capital		Accumulated Deficit			Accumulated Other Comprehensive Income		Treasury Stock			Total
Balances, October 1, 2006	$	66,723		$	9,445,483	$	61,482,194	$	(51,098,102	)	$	1,924,109	$	(87,774	)	$	21,732,633
Net income									353,930								353,930
Stock options exercised		450					37,250										37,700
Rescission of stock option exercise		(4,364	)														(4,364	)
Unrealized gain on marketable securities												967,607					967,607
Stock subscriptions received							29,800										29,800
Balances, June 30, 2007	$	62,809		$	9,445,483	$	61,549,244	$	(50,744,172	)	$	2,891,716	$	(87,774	)	$	23,117,306

The accompanying notes are an integral part of these condensed consolidated financial statements

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Archon Corporation and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(Unaudited)

	Nine Months Ended June 30,
	2007			2006
Net cash provided by operating activities	$	43,203,836		$	2,056,986
Cash flows from investing activities:
Proceeds from sale of property		1,809,683			54,950
Capital expenditures		(518,351	)		(187,768	)
Marketable securities purchased		(1,172,032	)		(199,131	)
Marketable securities sold		28,787			1,855,000
Investments in partnerships		0			(410,333	)
Net cash provided by investing activities		148,087			1,112,718
Cash flows from financing activities:
Proceeds from debt		0			683,069
Paid on debt and obligation under lease		(2,138,289	)		(3,195,336	)
Note receivable		29,800			0
Stock options exercised		37,700			0
Rescission of stock option exercise		(4,364	)		0
Net cash used in financing activities		(2,075,153	)		(2,512,267	)
Increase in cash and cash equivalents		41,276,770			657,437
Cash and cash equivalents, beginning of period		6,187,533			2,116,708
Cash and cash equivalents, end of period	$	47,464,303		$	2,774,145

The accompanying notes are an integral part of these condensed consolidated financial statements

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ARCHON CORPORATION AND SUBSIDIARIES

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. Basis of Presentation and General Information

Archon Corporation (the “Company” or “Archon”) is a Nevada corporation. The Company’s primary business operations are conducted through a wholly-owned subsidiary corporation, Pioneer Hotel Inc. (“PHI”), which operates the Pioneer Hotel & Gambling Hall (the “Pioneer”) in Laughlin, Nevada. In addition, the Company owns real estate on Las Vegas Boulevard South (the “Strip”) in Las Vegas, Nevada, and also owns investment properties in Dorchester, Massachusetts and Gaithersburg, Maryland. In June 2006, the Company announced that it had entered into an option agreement for the sale of the real estate it owns on the Strip for a total sale price of $450 million, subject to the terms of the agreement. The purchase price has since been increased and additional extension fees paid. See Note 7

The condensed consolidated financial statements included herein have been prepared by the Company pursuant to the rules and regulations of the United States Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. In the opinion of management, all adjustments (which include normal recurring adjustments) necessary for a fair presentation of results for the interim periods have been made. The results for the three and nine month periods are not necessarily indicative of results to be expected for the full fiscal year. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended September 30, 2006 and Form 10-Q for the quarter ended March 31, 2007.

2. Earnings Per Share

The Company presents its per share results in accordance with Financial Accounting Standards Board’s (“FASB”) Statement of Accounting Standards (“SFAS”) No. 128, “Earnings Per Share” (“SFAS 128”). SFAS 128 requires the presentation of basic net income (loss) per share and diluted net income (loss) per share. Basic per share amounts are computed by dividing net income (loss) by average shares outstanding during the period, while diluted per share amounts reflect the impact of additional dilution for all potentially dilutive securities, such as stock options. Potential dilutive stock options of approximately 830,000 were not used to calculate diluted per share information for the three and nine months ended June 30, 2006, as the Company incurred net losses for those periods and, therefore, the effect would be antidilutive. Potential dilutive stock options of approximately 705,000 were not used to calculate diluted per share information for the three and nine months ended June 30, 2007, as the Company incurred net losses, applicable to common shares, for those periods and, therefore, the effect would be antidilutive.

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3. Stock-Based Compensation

As of June 30, 2007, the Company has the following share-based compensation plans:

Key Employee Stock Option Plan: The Company’s Key Employee Stock Option Plan (the “Stock Option Plan”) provides for the grant of up to 1.2 million shares of its common stock to key employees. The Stock Option Plan provides for both incentive stock options and non-qualified stock options. Stock option grants generally vest over a three-year period from the employee’s hire date. During the nine months ended June 30, 2007, there were no stock options granted under the Stock Option Plan. As of June 30, 2007, there were approximately 692,000 options outstanding and exercisable under the Stock Option Plan. During the nine months ended June 30, 2007, 32,500 options were exercised and another approximately 80,000 options were cancelled and returned to the Stock Option Plan. In February, 2007, Mr. Lowden, President and Chairman of the Board, elected to not exercise 80,000 stock options, exercisable at $1.50 per share, and the stock options were cancelled and returned to the Stock Option Plan.

1995 Non-Employee Director Stock Option Plan: In December 1995, the Company adopted the 1995 Non-Employee Director Stock Option Plan (the “Non-Employee Director Plan”) that provided for the grant of up to 100,000 shares of its common stock to the directors. Under the Non-Employee Director Plan, directors were automatically granted an option to purchase 12,500 shares of the common stock at an exercise price equal to the market value of such shares on the date of such election to the board. Stock option grants vested immediately. The Non-Employee Director Plan ceased granting options on March 21, 2002. As of June 30, 2007, there were 12,500 options outstanding and exercisable under this plan. During the nine months ended June 30, 2007, 12,500 options were exercised.

Subsidiary Stock Option Plans: SFHI, Inc. (“SFHI”), Sahara Las Vegas Corp (“SLVC”) and PHI (collectively, the “Subsidiaries”), have adopted subsidiary stock option plans (the “Subsidiary Plans”). The Subsidiary Plans provide for the grant of options by each of the Subsidiaries with respect to an aggregate of up to 10% of the outstanding shares of such Subsidiary’s Common Stock to employees, non-employee directors, consultants or affiliates of the Company or the Subsidiaries. The purpose of the Subsidiary Plans is to enable the Subsidiaries and the Company to attract, retain and motivate their employees, non-employee directors, consultants and affiliates by providing for or increasing the proprietary interest of such persons in the Subsidiaries. As of June 30, 2007, no options had been granted under any of the Subsidiary Plans.

The following table summarizes stock option activity during the nine months ended June 30, 2007 under all plans:

	Number of Shares (000’s)	Weighted- Average Exercise Price Per Share		Weighted- Average Remaining Contractual Term	Aggregate Intrinsic Value ($000’s)
Options outstanding at September 30, 2006:	830	$	8.12	3.6 yrs	$	20,560
Activity during the nine months ended June 30, 2007:
Granted	0		N/A	N/A		N/A
Exercised	45		N/A	N/A		N/A
Cancelled	80		N/A	N/A		N/A
Options outstanding at June 30, 2007	705	$	9.30	3.6 yrs	$	30,301
Exercisable at June 30, 2007	705	$	9.30	3.6 yrs	$	30,301

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As of June 30, 2007, there was no unrecognized compensation cost related to unvested stock options. 45,000 options were exercised in the nine months ended June 30, 2007. The fair value of options vested in the nine months ended June 30, 2007 is not applicable as no options were vested for the first time during this quarter. There were no unvested options at June 30, 2007.

The fair value of each option award is estimated on the date of grant using the Black-Scholes-Merton option valuation model. The expected term of options granted is derived from historical data on employee exercise and post-vesting employment termination behavior. The risk-free rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant. Expected volatility is based on both the implied volatility and historical volatility on the stock.

For options granted prior to October 1, 2005, and valued in accordance with FASB SFAS No. 123, “Accounting for Stock-Based Compensation” (“FAS 123”), the expected volatility used to estimate the fair value of the options was based solely on the historical volatility of the stock; the Company used the graded vested method for expense attribution.

For options granted after October 1, 2005, and valued in accordance with SFAS No. 123(R), “Share-Based Payment”, (“FAS 123R”), the Company will use the straight-line method for expense attribution, and it will estimate forfeitures and only recognize expense for those shares expected to vest.

The Black-Scholes-Merton option valuation model requires the input of highly subjective assumptions, including the expected life of the stock-based award and stock price volatility. The Company did not calculate the fair value of stock options granted during the nine months ended June 30, 2007 and 2006 as no stock options were granted during these periods.

Estimates and Assumptions. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant estimates used by the Company include those related to customer incentives, bad debts, inventories, investments, estimated useful lives for depreciable and amortizable assets, valuation reserves and estimated cash flows in assessing the recoverability of long-lived assets, estimated liabilities for slot club bonus point programs, income taxes, contingencies and litigation. Actual results may differ from estimates.

Recently Issued Accounting Standards

SFAS NO. 159: In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities,” (“SFAS No. 159”), which provides companies an option to report selected financial assets and liabilities at fair value. SFAS No. 159 requires companies to provide information to assist financial statement users to understand the effect of a company’s choice to use fair value on its earnings, as well as to display on the face of the balance sheet the fair value of assets and liabilities chose by the company for fair value accounting. Additionally, SFAS No. 159 establishes presentation and disclosure requirements designed to simplify comparisons between companies that choose different measurement attributes for similar types of assets and liabilities. SFAS No. 159 is effective for the Company in its fiscal year beginning October 2008. The Company is currently evaluating the impact that SFAS No. 159 will have on its condensed consolidated financial statements.

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4. Other Assets

Included in Other assets at June 30, 2007 and September 30, 2006 are unamortized loan issue costs, which were incurred during the acquisition of certain rental property and certain debt, and deferred rents of $4.6 million for both periods. The unamortized loan issue costs are being amortized on the straight-line basis over the loan period, which closely approximates the effective interest method, and the deferred rents are being amortized on the straight-line basis over the lease period.

Additionally, Other assets at June 30, 2007 and September 30, 2006 include $50,000 of commercial and residential mortgage loans, representing loans originally funded by J & J Mortgage to unaffiliated third parties as well as loans made directly to J & J Mortgage under a master loan agreement. The loans purchased by the Company were purchased for the principal amount, plus accrued interest, if any. The advances to J & J Mortgage under the master loan agreement bear interest at the prime rate plus 2%. J & J Mortgage is owned by LICO, which in turn is wholly-owned by Paul W. Lowden, the President, Chief Executive Officer and majority stockholder of the Company. John W. Delaney, a director of the Company, is the president of J & J Mortgage.

Other assets also include amounts for the cash surrender value of life insurance of $0.8 million on June 30, 2007 and September 30, 2006 and investments in unconsolidated entities of $1.8 million on June 30, 2007 and September 30, 2006.

One of the Company’s unconsolidated entities is a 50% owned LLC which has the following financial profile as of June 30, 2007 and 2006, (in thousands):

	June 30,
	2007		2006
Current assets	$	148	$	154
Total assets		931		961
Current liabilities		124		122
Total liabilities		195		362
Total equity		736		599

This unconsolidated entity has the following profit profile for the three and nine months ended June 30, 2007 and 2006 (in thousands):

	Three Months Ended June 30,				Nine Months Ended June 30,
	2007		2006		2007		2006
Revenues	$	352	$	404	$	1,123	$	1,279
Pretax income		45		77		190		305

This entity is indebted to a bank in the amount of $0.1 million and $0.2 million at on June 30, 2007 and 2006 respectively. The debt is secured by a deed of trust and is guaranteed by the Company.

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5. Federal Income Tax

The Company recorded a federal income tax benefit, based on estimated annual effective rates, of $0.1 million and $0.6 million for the three months ended June 30, 2007 and June 30, 2006, respectively. The Company recorded a federal income tax benefit, based on estimated annual effective rates, of $0.3 million and $0.6 million for the nine months ended June 30, 2007 and June 30, 2006, respectively. The 2007 tax provision is comprised of a $0.8 million benefit on continuing operations and a $0.5 million provision on discontinued operations.

The Company continues to record tax benefits for its taxable losses as it believes that tax provisions for future taxable income from operations or from the sales of assets will be sufficient to offset the tax benefits currently recorded.

6. Sale of Option for Strip Land

On June 24, 2006, SLVC, a Nevada corporation and subsidiary of Archon Corporation entered into an Option Agreement (the “Agreement”) between SLVC and LVTI LLC, a Delaware limited liability company (“LVTI”). Pursuant to the Agreement, SLVC granted to LVTI an option (the “Option”) to purchase an approximately 27 acre parcel of real property located on Las Vegas Boulevard South (the “Property”) or, alternatively, SLVC’s membership interest in a limited liability company (“LVT LLC”) that may be formed and into which the Property would be contributed.

The initial purchase price to be paid by LVTI for purchase of the Property or the membership interest in LVT LLC was $450 million. LVTI paid an initial deposit of $5.0 million on June 27, 2006. The Agreement also provided for a second deposit of $40.0 million due on or before September 22, 2006, and additional monthly payments of approximately $2.2 million in each month commencing on the 13^th calendar month following the date the second deposit is paid until the closing of the exercise of the Option. The 30-day due diligence period ended and LVTI did not terminate the Agreement. Upon exercise of the Option, the initial deposit and the second deposit will be credited against the total purchase price. The Agreement provides for certain adjustments to the purchase price if certain easements are entered into with respect to the Property prior to the closing. The Option may be exercised by LVTI at any time between the last day of the 12^th calendar month and the last day of the 18^th calendar month following the date on which the second deposit is paid; provided that the option term may be extended by up to 30 days if SLVC does not give written notice to LVTI of the option term expiration as required by the Agreement. The first and second deposits and any additional monthly payments paid to SLVC prior to termination of the Agreement will be retained by SLVC upon termination of the Agreement without exercise of the option, except under certain circumstances specified in the Agreement.

Pursuant to a First Amendment of the Agreement, LVTI elected to pay to the Company $750,000 to extend the date on which the second deposit of $40.0 million was due from September 22, 2006 to December 31, 2006. Pursuant to a Second Amendment, LVTI elected to pay to the Company $1,172,500 to further extend the date on which the second deposit of $40.0 million was due from December 31, 2006 to March 31, 2007. Pursuant to a Third and a Fourth Amendment to the Agreement, LVTI elected to pay to the Company two additional payments in April 2007 totaling $500,000 to further extend the date on which the second deposit was due from March 31, 2007 to May 31, 2007. LVTI paid the $40.0 million second deposit on May 25, 2007. Additionally, the initial purchase price was increased from $450 million to $475 million. Pursuant to a Fifth Amendment, three months, to be exercised in the discretion of LVTI, were added to the Option term, extending the end of the Option term from March 31, 2008 to June 30, 2008. LVTI will pay a fee of $2,866,667 (“Carry Option Payments”) for each of the three month extensions utilized, with a proration for any partial month utilized. All Carry Option Payments and all monthly option extension payments are nonrefundable and will not be applied against the purchase price under the Agreement.

The nonrefundable payment of $5.0 million and a nonrefundable extension fee of $750,000 were recorded as a deposit liability, at September 30, 2006. The Company received an additional nonrefundable extension fee of

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$1.2 million in December 2006 which was recorded as a deposit liability at March 31, 2007. The Company received additional nonrefundable extension fees of $500,000 in April 2007 and the nonrefundable second deposit payment of $40.0 million on May 25, 2007, which payments were recorded as a deposit liability at June 30, 2007.

The obligations of SLVC and LVTI to consummate the transactions contemplated by the Agreement are subject to the satisfaction or waiver of customary closing conditions.

The Company has guaranteed the obligations of SLVC under the Agreement.

7. Preferred Stock

The Company’s preferred stock provides that dividends accrue on a semi-annual basis, to the extent not declared. Prior to fiscal 1997, the Company satisfied the semiannual dividend payments on its preferred stock through the issuance of paid-in-kind dividends. The Company has not declared the semiannual preferred stock dividends since October 1, 1996. As originally drafted, the Certificate of Designation of the Exchangeable Redeemable Preferred Stock (“Certificate of Designation”) provides in part that:

“The holders of record of shares of Exchangeable Preferred Stock shall be entitled to receive, when, as and if declared by the Board of Directors out of funds legally available therefore, cumulative cash dividends at a rate per annum per share (the “Dividend Rate”) initially set at 8% of (i) $2.14 plus (ii) accrued but unpaid dividends as to which a Dividend Payment Date has occurred. Dividends shall accrue from the date of issuance and be payable semi-annually in arrears on the 31^st day of March and the 30^th day of September in each year (or if such day is a non-business day, on the next business day), commencing on March 31, 1994 (each of such dates a “Dividend Payment Date”); provided, however, that on any or all of the first six Dividend Payment Dates, the Company may, at its option, pay dividends on the Exchangeable Preferred Stock in the form of additional shares of Exchangeable Preferred Stock at the rate per annum of 0.08 shares of additional Exchangeable Preferred Stock for every share of Exchangeable Preferred Stock entitled to receive a dividend. If all Exchangeable Preferred Stock has not been redeemed prior to the tenth Dividend Payment Date, the Dividend Rate will increase on the tenth Dividend Payment Date to the rate per annum per share of 11% and will thereafter increase by an additional 0.50% per annum per share on each Dividend Payment Date until either the Dividend Rate reaches a rate per annum per share of 16% or the Exchangeable Preferred Stock is redeemed or exchanged by the Company. In no circumstances will the Dividend Rate exceed 16% per annum per share”.

In October 2003, the dividend rate increased to 16.0%. As of June 30, 2007 the aggregate liquidation preference of the preferred stock was approximately $22.9 million, or $5.18 per share.

Pursuant to the Certificate of Designation, dividends are payable only when, as and if declared by the Board of Directors and the liquidation preference is payable only upon a liquidation, dissolution or winding up of the Company. Because dividends in an amount equal to dividend payments for one dividend period have accrued and remain unpaid for at least two years, the preferred stockholders, voting as a separate class, are entitled to elect two directors. As such, two of the Company’s six directors have been elected by the preferred shareholders.

During the quarter ended June 30, 2006, a holder of the Company’s preferred stock advised the Company that the holder had concluded that the Company’s calculation of the dividends on the preferred stock should accumulate at a compounded rate and is therefore erroneous, and that as a result the aggregate liquidation preference of the preferred stock is significantly greater than that calculated by the Company. Based upon the Company’s review to date of the relevant documents, the Company does not agree with the holder’s position.

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The holder of the preferred stock filed a complaint (the “Complaint”) in November 2006. The Complaint alleged, amongst other things, that the Company has failed to properly apply the cumulative cash dividend and liquidation preferences related to certain exchangeable preferred stock issued by the Company approximately 14 years ago. The Complaint further alleged that previous disclosure by the Company with regard to the same exchangeable preferred stock is not in accord with the manner of computation the plaintiffs believe is proper and required. The Company vigorously defended this Complaint.

In this suit, two holders of the Company’s Exchangeable Refundable Preferred Stock (the “Preferred Stock”) alleged that the Company, beginning in February 2006, had made false and misleading statements concerning the calculation of accrued but unpaid dividends and the liquidation preference for the Preferred Stock. The Complaint sought damages for violations of Section 10(b) of the Securities Exchange Act of 1934, common-law fraudulent misrepresentation, breach of contract and Connecticut’s Unfair Trade Practices Act. The Complaint sought unspecified compensatory damages and the equitable relief of an accounting.

The Company filed a motion to dismiss the Complaint in its entirety on December 19, 2006. On February 7, 2007, the plaintiffs filed a motion for leave to amend the Complaint. The Court granted the motion to amend the Complaint. The plaintiffs filed an amended Complaint and the Company renewed its motion to dismiss the Complaint in its entirety. Prior to a decision by the court as to the Company’s motion to dismiss the amended Complaint, both parties consented and stipulated that the court could enter an Order for Dismissal, and on May 15, 2007, the court ordered that the action be dismissed with prejudice as to the plaintiffs’ rights to assert any of the claims set forth in the action in the State of Connecticut, and without prejudice as to the plaintiffs’ rights to assert any of the claims set forth in the action in any other jurisdiction outside the State of Connecticut.

8. Discontinued Operations

In October 2006, the Company sold real estate with a net book value of $0.4 million for $1.8 million. A gain of $0.9 million, net of taxes of $0.5 million, on the sale was recorded as discontinued operations. The operating results from this property are insignificant and are not recorded as discontinued operations.

9. Segment Information

The Company’s operations are in the hotel/casino industry and investment properties. The Company’s hotel/casino operations are conducted at the Pioneer in Laughlin, Nevada. The Company owns investment properties in Dorchester, Massachusetts and Gaithersburg, Maryland. “Other and Eliminations” below includes financial information for the Company’s corporate operations, adjusted to reflect eliminations upon consolidation.

Set forth below is the unaudited financial information for the segments in which the Company operates for the three- month and nine month periods ended June 30, 2007 and 2006.

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	Three Months Ended June 30,
	2007			2006
	(dollars in thousands)
Pioneer Hotel / Casino:
Net operating revenues	$	7,402		$	7,624
Operating loss		(445	)		(197	)
Depreciation and amortization		500			545
Interest expense		322			356
Interest and other income		3			3
Loss before income taxes		(763	)		(550	)
Capital expenditures / transfers		212			75
Investment Properties:
Net operating revenues	$	3,101		$	3,101
Operating income		2,308			2,308
Depreciation and amortization		793			793
Interest expense		1,833			1,870
Interest and other income		1			1
Income before income taxes		475			438
Capital expenditures / transfers		0			0
Other and Eliminations:
Net operating revenues	$	628		$	401
Operating loss		(495	)		(1,677	)
Depreciation and amortization		26			31
Interest expense		(46	)		(12	)
Interest and other income		324			4
Loss before income taxes		(125	)		(1,660	)
Capital expenditures / transfers		131			0
Total:
Net operating revenues	$	11,131		$	11,126
Operating income		1,368			434
Depreciation and amortization		1,319			1,369
Interest expense		2,109			2,214
Interest and other income		328			8
Loss before income taxes		(413	)		(1,772	)
Capital expenditures / transfers		343			75

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	Nine Months Ended June 30,
	2007			2006
	(dollars in thousands)
Pioneer Hotel / Casino:
Net operating revenues	$	23,128		$	23,500
Operating income (loss)		(670	)		375
Depreciation and amortization		1,541			1,660
Interest expense		980			1,051
Interest and other income		9			9
Loss before income taxes		(1,642	)		(667	)
Capital expenditures / transfers		247			178
Identifiable assets (1)		28,415			30,660
Investment Properties:
Net operating revenues	$	9,302		$	9,302
Operating income		6,923			6,923
Depreciation and amortization		2,379			2,379
Interest expense		5,519			5,627
Interest and other income		2			2
Income before income taxes		1,406			1,298
Capital expenditures / transfers		0			0
Identifiable assets (1)		129,515			133,916
Other and Eliminations:
Net operating revenues	$	1,647		$	1,212
Operating loss		(1,294	)		(2,704	)
Depreciation and amortization		77			101
Interest expense		(136	)		(42	)
Interest and other income		470			186
Loss before income taxes		(687	)		(2,476	)
Capital expenditures / transfers		271			10
Identifiable assets (1)		78,919			31,858
Total:
Net operating revenues	$	34,077		$	34,014
Operating income		4,959			4,594
Depreciation and amortization		3,997			4,140
Interest expense		6,363			6,636
Interest and other income		481			197
Loss before income taxes		(923	)		(1,845	)
Capital expenditures / transfers		518			188
Identifiable assets (1)		236,849			196,434

⁽¹⁾ Identifiable assets represent total assets less elimination for intercompany items.

10. Subsequent Events

Redemption of the Company’s Exchangeable Redeemable Preferred Stock: Pursuant to the provisions of the Certificate of Designation, the Company provided written notice to the outstanding holders of the Preferred Stock on July 31, 2007, that the Company would redeem, in whole, the Exchangeable Redeemable Preferred Stock. The noticed date of the redemption and the delisting of all the outstanding Preferred Stock is August 31, 2007. All funds necessary for the redemption have been set aside by the Company, separate and apart from its other funds, in trust for the account of the holders of the shares to be redeemed. Instructions for redemption of Preferred Stock are attached to Form 8-K filed by the Company on July 31, 2007 or by request from the Company.

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ARCHON CORPORATION

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

This discussion is intended to further the reader’s understanding of the condensed consolidated financial condition and results of operations of Archon Corporation (the “Company” or “Archon”). It should be read in conjunction with the financial statements included in this quarterly report on Form 10-Q and the Company’s annual report on Form 10-K for the year ended September 30, 2006. These historical financial statements may not be indicative of the Company’s future performance.

General

Overview of Business Operations and Trends

The Company, historically, has owned, managed and operated hotel/casino properties through a number of acquisitions or developments, and it has subsequently divested certain of these properties. Presently, the Company operates the Pioneer Hotel & Gambling Hall (“the Pioneer”) in Laughlin, Nevada. The Company also owns property on Las Vegas Boulevard (“the Strip”) in Las Vegas, Nevada that may be sold pursuant to an option agreement entered into in fiscal 2006 whereby the optionee has the right to purchase the property from the Company for $475 million.

The Pioneer has experienced a flattening and, to a certain extent, a decline of its revenues over the last few years after experiencing strong revenue and profit growth in the early 1990’s. Management believes the growth of casino properties on Native American lands in such locations as California and Arizona within the last several years caused revenue declines and caused the Company to focus on market definition and development in Laughlin to maintain profitability. Management believes Laughlin has now become a mature market with marginal growth forecasted for the next few years based on its current plans.

The Company also owns investment properties on the East Coast but these investment properties do not contribute significant profitability or net cash flow to the Company.

Management believes the recent revenue and expense trends at the Pioneer may not change significantly over the next few years.

Investment Properties:

During fiscal year 2001, the Company acquired certain investment properties as part of a Section 1031 exchange. The investment properties are located in Gaithersburg, Maryland and Dorchester, Massachusetts. The Company acquired the properties and nonrecourse debt associated with the properties which are subject to long-term leases. Tenants remit payments to banks according to the terms of the leases and notes. The payments are used to liquidate the nonrecourse debt obligations. Rental income is recorded by the Company on a straight-line basis and totals approximately $12.4 million annually and will remain at this level until approximately 2020. The buildings are also being depreciated on a straight-line basis and the depreciation expense is approximately $3.2 million annually and will remain at this level until approximately 2020 or until the assets are sold, otherwise disposed of or become impaired. Interest expense is also recorded based on the outstanding nonrecourse debt remaining to be paid based on unamortized loan issue costs and remaining debt amortization timetables. At any time during the life of the leases and debt amortization, the fair market values of the properties may be different than its book values. Interest is presently being expensed at approximately $7.4 million annually and will decrease in relation to debt principal reductions through 2020.

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Critical Accounting Policies and Estimates

Management’s Discussion and Analysis of Financial Condition and Results of Operations discusses Archon’s unaudited, condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, management evaluates its estimates and judgments, including those related to customer incentives, bad debts, inventories, investments, estimated useful lives for depreciable and amortizable assets, valuation reserves and estimated cash flows in assessing the recoverability of long-lived assets, estimated liabilities for slot club bonus point programs, income taxes, contingencies and litigation. Management bases its estimates and judgments on historical experience and on various other factors that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

Management believes the following critical accounting policies are affected by significant judgments and estimates used by management in the preparation of the Company’s consolidated financial statements:

Allowance for Doubtful Accounts. The Company allows for an estimated amount of receivables that may not be collected. The Company estimates its allowance for doubtful accounts using a specific formula applied to aged receivables as well as a specific review of large balances. Historical experience is considered, as are customer relationships, in determining specific reserves.

Long-Lived Assets. The Company has a significant investment in long-lived property and equipment. It estimates that the undiscounted future cash flows expected to result from the use of these assets exceeds the current carrying value of these assets. Any adverse change in the estimate of these undiscounted future cash flows could necessitate an impairment charge that would adversely affect operating results. The Company estimates useful lives for its assets based on historical experience, estimates of assets’ commercial lives, and the likelihood of technological obsolescence. Should the actual useful life of a class of assets differ from the estimated useful life, the Company would record an impairment charge. The Company reviews useful lives and obsolescence and assesses commercial viability of these assets periodically.

Income Taxes. The Company records federal income provisions / benefits, based on estimated annual effective rates. The Company continues to record tax benefits for its taxable losses as it believes that tax provisions from future taxable income from operations or from the sales of assets will be sufficient to offset such tax benefits.

Recently Issued Accounting Standards. SFAS NO. 159: In February 2007, the FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities,” (“SFAS No. 159”), which provides companies an option to report selected financial assets and liabilities at fair value. SFAS No. 159 requires companies to provide information to assist financial statement users to understand the effect of a company’s choice to use fair value on its earnings, as well as to display on the face of the balance sheet the fair value of assets and liabilities selected by the company for fair value accounting. Additionally, SFAS No. 159 establishes presentation and disclosure requirements designed to simplify comparisons between companies that choose different measurement attributes for similar types of assets and liabilities. SFAS No. 159 is effective for the Company in its fiscal year beginning October 2008. The Company is currently evaluating the impact that SFAS No. 159 will have on its condensed consolidated financial statements.

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Results of Operations – Nine Months Ended June 30, 2007 and 2006

General

During the nine months ended June 30, 2007, the Company’s net operating revenues were relatively unchanged and operating expenses decreased $0.3 million, resulting in an increase in operating income of $0.4 million from the nine months ended June 30, 2006. The change in operating results was primarily due to a decrease in corporate stock based compensation expenses of $0.9 million, which was partially offset by an increase in payroll and utility expenses at the Pioneer. The operating results at the investment properties were unchanged.

Consolidated

Net Operating Revenues. Consolidated net operating revenues for the nine months ended June 30, 2007 were $34.1 million, a $0.1 million increase or 0.2%, as compared to $34.0 million for the nine months ended June 30, 2006. The change in net operating revenue was related to higher interest income from deposits received on the land sale option, which was partially offset by lower casino revenues at the Pioneer Revenues at the Pioneer for the nine months ended June 30, 2007 were $23.1 million, a $0.4 million decrease or 1.6%, as compared to $23.5 million for the nine months ended June 30, 2006. Revenues from the investment properties were $9.3 million for each of the nine months ended June 30, 2007 and 2006. Sahara Las Vegas Corp (“SLVC”) had net revenues of approximately $1.0 million during the nine months ended June 30, 2007 and 2006, respectively. Revenues at Corporate for the nine months ended June 30, 2007 increased $0.1 million as compared to the nine months ended June 30, 2006.

Operating Expenses. Total operating expenses million for the nine months ended June 30, 2007 were $29.1, a $0.3 million decrease or 1%, as compared to $29.4 million for the nine months ended June 30, 2006. The change in operating expenses resulted from a decrease in corporate stock based compensation of $0.9 million, offset by $0.4 million higher payroll and $0.2 million higher utility expenses at the Pioneer. Total operating expenses as a percentage of revenue decreased to 85.4% in the current year period from 86.5% in the prior year period, as a result of the higher revenues and lower operating expenses. Operating expenses at the Pioneer for the nine months ended June 30, 2007 were approximately $23.8 million, a $0.7 million increase or 2.9%, as compared to $23.1 million for the nine months ended June 30, 2006.

Operating Income. Consolidated operating income for the nine months ended June 30, 2007 was $5.0 million, a $0.4 million increase or 8.0%, as compared to $4.6 million for the nine months ended June 30, 2006. This increase was due to the aforementioned change in corporate and operating expenses. Operating income for the nine months ended June 30, 2007 and 2006 of $6.9 million was attributable to the investment properties. Operating income at the Pioneer decreased by $1.0 million to an operating loss of $0.7 million for the nine months ended June 30, 2007. The operating loss at Corporate improved by $1.4 million to $1.3 million for the nine months ended June 30, 2007.

Interest Expense. Consolidated interest expense for the nine months ended June 30, 2007 was $6.4 million, a $0.2 million decrease or 4.1%, as compared to $6.6 million for the nine months ended June 30, 2006. The decrease was primarily due to the reduction of non-recourse debt associated with the investment properties.

Interest and Other Income. Consolidated interest and other income for the nine months ended June 30, 2007 was $0.5 million, a $0.3 million increase or 144.1%, as compared to $0.2 million for the nine months ended June 30, 2006. The increase was primarily due to the increase in cash flows from operating activities.

Loss Before Income Tax Benefit and Discontinued Operations. Consolidated loss before income tax benefit for the nine months ended June 30, 2007 was $0.9 million, a $0.9 million improvement as compared to a loss of $1.8 million for the nine months ended June 30, 2006.

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Discontinued Operations. In October 2006, the Company sold real estate with a net book value of $0.4 million for $1.8 million. A gain of $0.9 million, net of taxes of $0.5 million. The sale was recorded as discontinued operations.

Federal Income Tax. The Company recorded a net federal income tax provision of $0.2 million for the nine months ended June 30, 2007 comprised of a $0.3 million tax benefit on continuing operations and a $0.5 million provision on discontinued operations. The Company recorded a federal income tax benefit for the nine months ended June 30, 2006 of $0.6 million based on estimated annual effective rates.

Preferred Share Dividends. Undeclared preferred share dividends are not recorded in the stockholders’ equity section of the balance sheet as the Company has elected at its sole discretion to redeem its preferred stock. However, dividends of $1.1 million for each of the nine-months ended June 30, 2007 and 2006 were accrued on the preferred stock for purposes of calculating net income (loss) applicable to common shares.

Net Loss. Consolidated net loss attributable to common shares for the nine months ended June 30, 2007 was $0.8 million, or $0.27 per common share, as compared to net loss attributable to common shares of $2.3 million, or $0.37 per common share, for the nine months ended June 30, 2006.

Pioneer

Net Operating Revenues. Net operating revenues at the Pioneer for the nine months ended June 30, 2007 were $23.1 million, a $0.4 million decrease or 2%, as compared to $23.5 million for the nine months ended June 30, 2006 primarily due to the reasons set forth below.

Casino revenues for the nine months ended June 30, 2007 were $18.2 million, a $0.7 million decrease or 4%, as compared to $18.9 million for the nine months ended June 30, 2006. Slot and video poker revenues for the nine months ended June 30, 2007 were $16.6 million, a $0.5 million decrease or 3%, as compared to $17.1 million for the nine months ended June 30, 2006. Slot handle increased by $2.7 million, but slot win decreased by $0.5 million, due to a lower hold percentage. Other gaming revenues, including table games for the nine months ended June 30, 2007 were $1.6 million, a $0.2 million decrease or 10%, from $1.8 million for the nine months ended June 30, 2006. Other gaming volume increased by $0.1 million, but win decreased by nearly $0.2 million, due to lower hold percentage. Casino promotional allowances were unchanged at $3.2 million.

Hotel revenues were relatively unchanged at $2.1 million for the nine months ended June 30, 2007 as compared to $2.2 million for the nine months ended June 30, 2006. An increase in rooms occupied was partially offset by a decrease in the average room rate. Competitive pressures in the Laughlin market in the 2007 period caused the decline in average room rate. Food and beverage revenues for the nine months ended June 30, 2007 were $5.7 million, a slight increase or 1%, as compared to $5.6 million for the nine months ended June 30, 2006. A decline in food and beverage comp revenue was offset with increases in cash sales. Other revenues for the nine months ended June 30, 2007 were $1.7 million, a $0.3 million increase or 19%, as compared to $1.4 million for the nine months ended June 30, 2006, due to increased retail sales driven by the closing of a popular local retail store.

Operating Expenses. Operating expenses for the nine months ended June 30, 2007 were approximately $23.8 million a $0.7 million increase or 3%, from $23.1 million for the nine months ended June 30, 2006. The increase was primarily a result of $0.5 million higher payroll expenses, primarily due to a change in Nevada’s minimum wage law. Operating expenses as a percentage of revenue increased to 102.9% in the current year period from 98.4% in the prior year period, a direct result of lower operating revenue and higher operating expenses.

Casino expenses for the nine months ended June 30, 2007 were unchanged from the prior year at $10.3 million. Casino expenses as a percentage of revenue increased to 56.8% in the current year period from 54.8% in the prior year period.

Hotel expenses for the nine months ended June 30, 2007 were $0.9 million, a $0.1 million increase or 10%, as compared to $0.8 million for the nine months ended June 30, 2006, due to the increase in occupied rooms and

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payroll expense. Hotel expenses as a percentage of revenue increased to 41.3% in the current year period from 37.2% in the prior period. Food and beverage expenses for the nine months ended June 30, 2007 were $3.2 million, a $0.2 million increase or 6%, as compared to $3.0 million for the nine months ended June 30, 2006, primarily due to the increase in the Nevada minimum wage rate. Food and beverage expenses as a percentage of revenue increased to 56.1% in the current year period from 53.4% in the prior period. Other expenses for the nine months ended June 30, 2007 were $1.4 million, a $0.2 million increase or 17%, as compared to $1.2 million for the nine months ended June 30, 2006. Other expenses as a percentage of revenue declined to 83.8% in the current year period from 85.6% in the prior year period.

Selling, general and administrative expenses for the nine months ended June 30, 2007 were $3.4 million, a $0.1 million increase or 4%, as compared to $3.3 million for the nine months ended June 30, 2006. Selling, general and administrative expenses as a percentage of revenue increased to 14.8% in the current year period from 14.1% in the prior year period. Pioneer’s selling, general and administrative expenses are greater than the consolidated total due to the elimination of intercompany transactions in consolidation. Utilities and property expenses for the nine months ended June 30, 2007 were $3.0 million, a $0.2 million increase or 8%, as compared to $2.8 million for the nine months ended June 30, 2006. Aggressive measures have been taken to moderate the rising electricity rates, through the installation of energy efficient lighting and signage. Utilities and property expenses as a percentage of revenue increased to 12.9% in the current year period from 11.8% in the prior year period. Depreciation and amortization expenses for the nine months ended June 30, 2007 were $1.5 million, a $0.2 million decrease or 7%, as compared to $1.7 million for the nine months ended June 30, 2006, due to a reduction in the amortization of loan issue costs.

Results of Operations – Three Months Ended June 30, 2007 and 2006

General

During the three months ended June 30, 2007, the Company’s net operating revenues were relatively unchanged and operating expenses decreased $0.9 million, resulting in an increase in operating income of $0.9 million as compared to the three months ended June 30, 2006. The change in operating results was primarily due to a decrease in corporate stock based compensation expense of $0.9 million, which was partially offset by an increase in payroll and utility expenses at the Pioneer. The operating results at the investment properties were unchanged.

Consolidated

Net Operating Revenues. Consolidated net operating revenues for the three months ended June 30, 2007 were $11.1 million, relatively unchanged from the three months ended June 30, 2006. Revenues at the Pioneer for the three months ended June 30, 2007 were $7.4 million, a $0.2 million decrease or 3%, as compared to $7.6 million for the three months ended June 30, 2006 primarily caused by lower casino revenues. Income from the investment properties was approximately $3.1 million for the three months ended June 30, 2007 and 2006. Revenues at Corporate increased $0.2 million for the three months ended June 30, 2007 as compared to the three months ended June 30, 2006, related to higher interest income from deposits received on the land sale option. SLVC had net revenues of approximately $0.3 million during the three months ended June 30, 2007 and 2006.

Operating Expenses. Total operating expenses for the three months ended June 30, 2007 were $9.8 million, a $0.9 million decrease or 9%, as compared to $10.7 million for the three months ended June 30, 2006. The change in operating expenses resulted from a decrease in corporate stock based compensation of $0.9 million, offset by $0.1 million higher payroll and utility expenses at the Pioneer. Total operating expenses as a percentage of revenue decreased to 87.7% for the three months ended June 30, 2007 from 96.1% for the three months ended June 30, 2006 in the prior year period, as a result of the lower operating expenses.

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Operating Income. Consolidated operating income for the three months ended June 30, 2007 was $1.4 million, a $1.0 million increase or 215%, as compared to $0.4 million for the three months ended June 30, 2006. The increase was due to the aforementioned decrease in operating expenses. Operating income of $3.1 million for each of the three months ended June 30, 2007 and 2006 is attributable to the investment properties. Operating loss at the Pioneer for the three months ended June 30, 2007 was $0.4 million, a $0.2 million decrease, or 126%, as compared to $0.2 million for the three months ended June 30, 2006. The operating losses at Corporate improved by $1.2 million to $0.5 million. Operating income changes are a result of the aforementioned changes in operating revenues and expenses.

Interest Expense. Consolidated interest expense for the three months ended June 30, 2007 was $2.1 million, a $0.1 million decrease or 5%, as compared to $2.2 million for the three months ended June 30, 2006. The decrease was primarily due to the reduction of non-recourse debt associated with the investment properties.

Interest and Other Income. Consolidated interest and other income for the three months ended June 30, 2007 was $0.3 million, a $0.3 million increase over the three months ended June 30, 2006. The increase was primarily due to the increase in cash flows from operating activities.

Loss Before Income Tax and Discontinued Operations. Consolidated loss before income tax and discontinued operations for the three months ended June 30, 2007 was $0.4 million, a $1.4 million increase or 77%, as compared to a $1.8 million loss for the three months ended June 30, 2006.

Federal Income Tax. The Company recorded a federal income tax benefit for the three months ended June 30, 2007 of $0.1 million as compared to a $0.6 million benefit for the three months ended June 30, 2006 based on estimated annual effective rates.

Preferred Share Dividends. Undeclared preferred share dividends are not recorded in the stockholders’ equity section of the balance sheet as the Company may elect at its sole discretion whether to redeem its preferred stock. However, dividends of approximately $0.4 million for each of the three months ended June 30, 2007 and 2006 accrued on the preferred stock for purposes of calculating net loss applicable to common shares.

Net Loss. Consolidated net loss attributable to common shares for the three months ended June 30, 2007 was $0.7 million, or $0.10 per common share, as compared to net loss attributable to common shares of $1.5 million, or $0.25 per common share, for the three months ended June 30, 2006.

Pioneer

Net Operating Revenues. Net operating revenues at the Pioneer for the three months ended June 30, 2007 were $7.4 million, a $0.2 million decrease or 3%, as compared to $7.6 million for the three months ended June 30, 2006, primarily for the reasons set forth below.

Casino revenues for the three months ended June 30, 2007 were $5.5 million, a $0.3 million decrease or 5%, as compared to $5.8 million for the three months ended June 30, 2006. Slot and video poker revenues for the three months ended June 30, 2007 were $5.0 million, a $0.2 million decrease or 4%, as compared to $5.2 million for the three months ended June 30, 2006. Lower slot handle was offset by a higher hold percentage. Other gaming revenues, including table games, for the three months ended June 30, 2007 were $0.7 million, a $0.1 million decrease or 12%, as compared to $0.6 million for the three months ended June 30, 2006. Lower table games hold percentage was offset by a slightly improved hold in keno. Casino promotional allowances were relatively unchanged at $1.4 million for the three months ended June 30, 2007 and 2006.

Hotel revenues were unchanged at $0.8 million for the three months ended June 30, 2007 and 2006. Food and beverage revenues were unchanged at $1.9 million for the three months ended June 30, 2007 and 2006. Other revenues for the three months ended June 30, 2007 were $0.6 million, a $0.1 million increase or 13%, as compared to $0.5 million for the three months ended June 30, 2006, due to increased retail sales, driven by the closing of a popular local retail store.

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Operating Expenses. Operating expenses were unchanged at $7.8 million for the three months ended June 30, 2007 and 2006. Payroll expense increased $0.1 million, primarily due to a change in Nevada’s minimum wage law, but was offset by reductions in supplies, outside services, and other expenses. Operating expenses as a percentage of revenue increased to 106.0% from 102.6% as a result of the aforementioned lower revenues.

Casino expenses for the three months ended June 30, 2007 were $3.2 million, a $0.2 million decrease or 6%, as compared to $3.4 million for the three months ended June 30, 2006. Increases in payroll expenses were offset by decreases in participation and bonus point expenses. Casino expenses as a percentage of revenue decreased to 57.4% for the three months ended June 30, 2007 from 58.4% for the three months ended June 30, 2006.

Hotel expenses were relatively unchanged at $0.3 million in both of the three months ended June 30, 2007 and 2006. Hotel expenses as a percentage of revenue increased to 41.5% for the three months ended June 30, 2007 from 36.4% for the three months ended June 30, 2006. Food and beverage expenses for the three months ended June 30, 2007 were $1.2 million, a $0.1 million increase or 11%, as compared to $1.1 million for the three months ended June 30, 2006, primarily due to the increase in the Nevada minimum wage rate. Food and beverage expenses as a percentage of revenue increased to 64.0% for the three months ended June 30, 2007 from 57.3% for the three months ended June 30, 2006. Other expenses for the three months ended June 30, 2007 were $0.5 million, a $0.1 million increase or 14%, as compared to $0.4 million for the three months ended June 30, 2006, due to the aforementioned increase in retail sales. Other expenses as a percentage of revenue increased to 77.8% for the three months ended June 30, 2007 from 77.3% for the three months ended June 30, 2006.

Selling, general and administrative expenses were unchanged at $1.1 million in both of the three months ended June 30, 2007 and 2006. Selling, general and administrative expenses as a percentage of revenue increased to 15.3% for the three months ended June 30, 2007 from 14.4% for the three months ended June 30, 2006. Pioneer’s selling, general and administrative expenses are greater than the consolidated total due to the elimination of intercompany transactions in consolidation. Utilities and property expenses were relatively unchanged at $1.0 million in both of the three months ended June 30, 2007 and 2006. Utilities and property expenses as a percentage of revenue increased to 14.2% for the three months ended June 30, 2007 from 12.7% for the three months ended June 30, 2006. Depreciation and amortization expenses were relatively unchanged at $0.5 million for the three months ended June 30, 2007 and 2006.

Liquidity and Capital Resources; Trends and Factors Relevant to Future Operations

Contractual Obligations and Commitments: There have been no material changes from the information reported in the Company’s annual report on form 10-K for the fiscal year ended September 30, 2006.

The Company’s ability to service its contractual obligations and commitments, other than the non-recourse debt, will be dependent on the future performance of the Pioneer, which will be affected by, among other things, prevailing economic conditions and financial, business and other factors, including competitive pressure from the expansion of Native American gaming facilities in the southwest United States, certain of which are beyond the Company’s control. In addition, the Company will be dependent on the continued ability of the tenants in the investment properties in Gaithersburg, Maryland and Dorchester, Massachusetts to make payments pursuant to the leases with the Company. The payments under the leases are contractually committed to be used to make payments on the Company’s non-recourse debt obligations related to the properties.

Under an existing debt agreement with a bank, the Company is obligated to make a balloon payment of approximately $9.8 million in January 2008. At December 31, 2006, under the original loan terms, the loan balance of $10.0 million was due as of December 15, 2006. In January 2007, the loan was modified to extend the maturity date until January 15, 2008. The Company has cash reserves sufficient to pay the obligation in full when it becomes due and payable on January 15, 2008. The debt is guaranteed by the Company’s primary shareholder, who is also the CEO and Chairman of the Board.

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Liquidity. The investment properties are structured such that future tenants’ payments cover future required mortgage payments including any balloon payments. Management believes that the Company will have sufficient available cash and cash resources to meet its cash requirements for a reasonable period of time.

The Company has a balloon payment due in January 2008 of approximately $9.8 million related to debt owed to a bank. The Company has cash reserves sufficient to pay the obligation in full when it becomes due and payable on January 15, 2008. The debt obligation is secured by 27 acres of land owned on the Las Vegas Strip and is personally guaranteed by Paul W. Lowden, the Company’s CEO, Chairman of the Board and primary stockholder.

Cash Flows from Operating Activities. The Company’s cash provided by operating activities was $43.2 million for the nine months ended June 30, 2007 as compared to $2.1 million for the nine months ended June 30, 2006.

Cash Flows from Investing Activities. Cash provided by investing activities was $0.1 million for the nine months ended June 30, 2007, as compared to cash provided by investing activities of $1.1 million for the nine months ended June 30, 2006. In the current year period, the Company received $1.8 million from the sale of property and equipment, which was offset by purchases of marketable securities of $2.5 million and $0.5 million in capital expenditures. In the prior year period, the Company received $1.9 million from the sale of marketable securities, which was offset by purchases of marketable securities of $0.2 million, investments of $0.4 million in a partnership and $0.2 million in capital expenditures.

Cash Used in Financing Activities. Cash used in financing activities was $2.1 million for the nine months ended June 30, 2007 as compared to $2.5 million for the nine months ended June 30, 2006. In the current year period, $2.1 million was used for debt payments. In the prior year period, $3.2 million was used for debt payments, and $0.7 million was provided by debt borrowings.

The Company’s primary source of operating cash is from the Pioneer operations, from interest income on available cash and cash equivalents and investments in marketable securities and, to a lesser extent, from net cash generated from the leasing of certain land owned on the Las Vegas strip. Rental income from the Company’s two investment properties is contractually committed to reducing the non-recourse indebtedness issued or assumed in connection with the acquisition of the investment properties. Under the two leases, the tenants are responsible for substantially all obligations related to the property. Sahara Las Vegas Corp. (“SLVC”), an indirect wholly-owned subsidiary of the Company, owns an approximately 27-acre parcel of real property on Las Vegas Boulevard South which is subject to a lease with the adjacent property owner to facilitate development of the adjacent property.

Pioneer

Pioneer’s principal uses of cash are for payments of slot machine debt obligations, ground lease rent and capital expenditures to maintain the facility. The Company has implemented changes in personnel and promotional programs and installed new slot equipment to address the decreases in revenues and operating income. One of management’s main focuses is to recapture market share in the Laughlin market. Management, however, can give no assurance that market share will be recaptured in its Laughlin market as its competition in the market typically has greater capital resources than does the Pioneer.

Payments of rent were approximately $0.3 and $0.1 million for the nine months ended June 30, 2007 and 2006, respectively. Capital expenditures to maintain the facility in fiscal 2007 are expected to be less than $1.0 million.

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Preferred Stock

The Company’s preferred stock provides that dividends accrue on a semi-annual basis, to the extent not declared. Prior to fiscal 1997, the Company satisfied the semiannual dividend payments on its preferred stock through the issuance of paid-in-kind dividends. The Company has not declared the semiannual preferred stock dividends since October 1, 1996. The dividend rate per annum was equal to 8% of $2.14 for each share of preferred stock until September 30, 1998, at which date the dividend rate increased to 11%; the dividend rate continued to increase by an additional 50 basis points on each succeeding semiannual dividend payment date up to a maximum of 16% per annum. In October 2003, the dividend rate increased to 16%. As of June 30, 2007, the aggregate liquidation preference of the preferred stock was approximately $22.9 million, or $5.18 per share.

Pursuant to the Certificate of Designation of Preferred Stock, dividends are payable only when, as and if declared by the Board of Directors and the liquidation preference is payable only upon a liquidation, dissolution or winding up of the Company. Because dividends in an amount equal to dividend payments for one dividend period have accrued and remain unpaid for at least two years, the preferred stockholders, voting as a separate class, are entitled to elect two directors. As such, two of the Company’s six directors have been elected by the preferred shareholders.

The Board of Directors of the Company authorized an increase in the amount of cash that may be used to purchase preferred stock to $2.5 million. As of August 11, 2007, the Company had purchased 709,305 shares of preferred stock for $1.4 million under this program. Previously, the Company had purchased 276,627 shares for $500,000. During the nine months ended June 30, 2007, the Company did not purchase any of its outstanding preferred shares.

During the three months ended June 30, 2006, a holder of the Company’s preferred stock advised the Company that the holder had concluded that the Company’s calculation of the dividends on the preferred stock should accumulate at a compounded rate and is therefore erroneous, and that as a result the aggregate liquidation preference of the preferred stock is significantly greater than that calculated by the Company. Based upon the Company’s review to date of the relevant documents, the Company does not agree with the holder’s position.

The holder of the preferred stock filed a complaint (the “Complaint”) in November 2006. The Complaint alleged, amongst other things, that the Company has failed to properly apply the cumulative cash dividend and liquidation preferences related to certain exchangeable preferred stock issued by the Company approximately 14 years ago. The Complaint further alleged that previous disclosure by the Company with regard to the same exchangeable preferred stock is not in accord with the manner of computation the plaintiffs believe is proper and required. The Company vigorously defended this Complaint.

In this suit, two holders of the Company’s Exchangeable Refundable Preferred Stock (the “Preferred Stock”) alleged that the Company, beginning in February 2006, had made false and misleading statements concerning the calculation of accrued but unpaid dividends and the liquidation preference for the Preferred Stock. The Complaint sought damages for violations of Section 10(b) of the Securities Exchange Act of 1934, common-law fraudulent misrepresentation, breach of contract and Connecticut’s Unfair Trade Practices Act. The Complaint sought unspecified compensatory damages and the equitable relief of an accounting.

The Company filed a motion to dismiss the Complaint in its entirety on December 19, 2006. On February 7, 2007, the plaintiffs filed a motion for leave to amend the Complaint. The Court granted the motion to amend the Complaint. The plaintiffs filed an amended Complaint and the Company renewed its motion to dismiss the Complaint in its entirety. Prior to a decision by the court as to the Company’s motion to dismiss the amended Complaint, both parties consented and stipulated that the court could enter an Order for Dismissal, and on May 15, 2007, the court ordered that the action be dismissed with prejudice as to the plaintiffs’ rights to assert any of the claims set forth in the action in the State of Connecticut, and without prejudice as to the plaintiffs’ rights to assert any of the claims set forth in the action in any other jurisdiction outside the State of Connecticut.

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Effects of Inflation

The Company has been generally successful in recovering costs associated with inflation through price adjustments in its hotel. Any such future increases in costs associated with casino operations and maintenance of properties may not be completely recovered by the Company.

Private Securities Litigation Reform Act

Certain statements in this Quarterly Report on Form 10-Q which are not historical facts are forward-looking statements, such as statements relating to future operating results, existing and expected competition, financing and refinancing sources and availability and plans for future development or expansion activities, capital expenditures and expansion of business operations into new areas. Such forward-looking statements involve a number of risks and uncertainties that may significantly affect the Company’s liquidity and operating results in the future and, accordingly, actual results may differ materially from those expressed in any forward-looking statements. Such risks and uncertainties include, but are not limited to, those related to effects of competition, leverage and debt service, general economic conditions, changes in gaming laws or regulations (including the legalization of gaming in various jurisdictions) and risks related to development activities and the startup of non-gaming operations.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Market risk is the risk of loss arising from changes in market rates and prices, such as interest rates, foreign currency exchange rates and commodity prices. Excluding its non-recourse debt, the Company has total interest-bearing debt at June 30, 2007 of approximately $11.3 million, of which approximately $9.9 million bears interest at a variable rate (approximately 9.25% at June 30, 2007). Therefore, the Company maintains certain market rate risk related to this debt. A change in the interest rates of 1% would cause an approximate $99,000 change in the amount of interest the Company would incur based on the amount of variable-interest rate debt outstanding for any current or future year in which this debt is outstanding. Future borrowings related to this debt will be exposed to this same market rate risk.

The Company holds investments in various available-for-sale securities; however, management believes that exposure to price risk arising from the ownership of these investments is not material to the Company’s consolidated financial position, results of operations or cash flow as historically price fluctuations of these securities have not been material.

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Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures:

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our Securities Exchange Act of 1934 reports is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Principal Accounting Officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management necessarily is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of management, including our Chief Executive Officer and Principal Accounting Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on the foregoing, our Chief Executive Officer and Principal Accounting Officer concluded that Archon’s disclosure controls and procedures are effective.

As a part of our normal operations, we update our internal controls as necessary to accommodate any modifications to our business processes or accounting procedures. There have not been any other changes in our internal controls or in other factors that materially affected, or are reasonably likely to materially affect these controls as of the end of the period covered by this report.

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ARCHON CORPORATION

PART II – OTHER INFORMATION

Item 1. Legal Proceedings

During the three months ended June 30, 2007, a holder of the Company’s preferred stock advised the Company that the holder had concluded that the Company’s calculation of the dividends on the preferred stock would accumulate at a compounded rate and is therefore erroneous, and that as a result the aggregate liquidation preference of the preferred stock is significantly greater than that calculated by the Company. Based upon the Company’s review to date of the relevant documents, the Company does not agree with the holder’s position.

The holder of the preferred stock filed a complaint (the “Complaint”) in November 2006. The Complaint alleged, amongst other things, that the Company has failed to properly apply the cumulative cash dividend and liquidation preferences related to certain exchangeable preferred stock issued by the Company approximately 14 years ago. The Complaint further alleged that previous disclosure by the Company with regard to the same exchangeable preferred stock is not in accord with the manner of computation the plaintiffs believe is proper and required. The Company vigorously defended this Complaint.

In this suit, two holders of the Company’s Exchangeable Refundable Preferred Stock (the “Preferred Stock”) alleged that the Company, beginning in February 2006, had made false and misleading statements concerning the calculation of accrued but unpaid dividends and the liquidation preference for the Preferred Stock. The Complaint sought damages for violations of Section 10(b) of the Securities Exchange Act of 1934, common-law fraudulent misrepresentation, breach of contract and Connecticut’s Unfair Trade Practices Act. The Complaint sought unspecified compensatory damages and the equitable relief of an accounting.

The Company filed a motion to dismiss the Complaint in its entirety on December 19, 2006. On February 7, 2007, the plaintiffs filed a motion for leave to amend the Complaint. The Court granted the motion to amend the Complaint. The plaintiffs filed an amended Complaint and the Company renewed its motion to dismiss the Complaint in its entirety. Prior to a decision by the court as to the Company’s motion to dismiss the amended Complaint, both parties consented and stipulated that the court could enter an Order for Dismissal, and on May 15, 2007, the court ordered that the action be dismissed with prejudice as to the plaintiffs’ rights to assert any of the claims set forth in the action in the State of Connecticut, and without prejudice as to the plaintiffs’ rights to assert any of the claims set forth in the action in any other jurisdiction outside the State of Connecticut.

Item 2. Changes in Securities, Use of Proceeds and Issuer Purchases of Equity Securities

None

Item 3. Defaults Upon Senior Securities

None

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Item 4. Submission of Matters to a Vote of Security Holders

Stockholders and investors may obtain a free copy of the information statement (when available) and other related documents filed by the Company with the SEC at its website at www.sec.gov.

At the Annual Meeting of Stockholders held on June 22, 2007, common stockholders elected one director and voted on a proposal to ratify the selection of Piercy Bowler Taylor & Kern (“PBTK”) as the Company’s public accountants. Preferred stockholders elected one special director.

The Directors whose terms in office continued after the meeting are as follows:

	Term Expires
Paul W. Lowden	2008
William J. Raggio	2008
John W. Delaney	2009
Suzanne Lowden	2010

There were 6,280,931 shares of Common Stock entitled to vote at the meeting. A total of 6,233,231 votes (99.2%) were represented at the meeting. The result of the vote taken on the election of Directors elected by the common stockholders to hold office until the 2010 Annual Meeting of Stockholders and until her successor is elected and has qualified is as follows:

	For	Withheld
Suzanne Lowden	5,634,866	597,543

The result of the vote taken for ratification of the selection of PBTK as the Company’s independent registered public accounting firm and approval of the Company’s financial statements as of September 30, 2006 are as follows:

For	Against	Abstain	Broker Non-Vote
6,208,794	23,161	454	0

The special directors elected by the preferred stockholders whose terms in office continued after the meeting are as follows:

	Term Expires
Howard E. Foster	2009
Richard H. Taggart	2010

There were 4,413,777 shares of Preferred Stock entitled to vote at the meeting. A total of 4,066,146 votes (92.1%) were represented at the meeting. The result of the vote taken for the election of the special director by the preferred stockholders was as follows:

	For	Withheld
Richard H. Taggart	2,975,118	1,091,028

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Item 5. Other Information

None

Item 6. Exhibits

a. Exhibits.

Exhibit Number	Description of Exhibit
31.1	Certification of Chief Executive Officer Pursuant to Section 302 of Sarbanes-Oxley Act of 2002.
31.2	Certification of Principal Accounting Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32	Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

ARCHON CORPORATION, Registrant
By:	/s/ Paul W. Lowden
	Paul W. Lowden Chairman of the Board, President and Chief Executive Officer

Date: August 20, 2007

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EX-31.1

Exhibit 31.1

CERTIFICATION PURSUANT TO RULE 13a – 14(a) OF THE EXCHANGE ACT

As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Paul W. Lowden, certify that:

1. I have reviewed this report on Form 10-Q of Archon Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

c) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s third fiscal quarter in the case of a quarterly report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting;

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 20, 2007

/s/ Paul W. Lowden

Paul W. Lowden

Chairman of the Board and President

(Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION PURSUANT TO RULE 13a – 14(a) OF THE EXCHANGE ACT

As Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Grant Siler, certify that:

1. I have reviewed this report on Form 10-Q of Archon Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

c) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s third fiscal quarter in the case of a quarterly report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting;

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 20, 2007

/s/ Grant Siler

Grant Siler

Principal Accounting Officer

(Principal Accounting and Financial Officer)

EX-32

Exhibit 32

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Archon Corporation (the “Company”) on Form 10-Q for the period ended June 30, 2007 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), we, Paul W. Lowden, Chief Executive Officer of the Company, and Grant Siler, Principal Accounting Officer of the Company, certify, pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2003, that to our knowledge:

(i) the Report fully complies with the requirements of section 13(a) and 15(d) of the Securities Exchange Act of 1934; and

(ii) the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: August 20, 2007

/s/ Paul W. Lowden

Paul W. Lowden

Chairman of the Board and President

(Principal Executive Officer)

/s/ Grant Siler

Grant Siler

Principal Accounting Officer

(Principal Accounting and Financial Officer)

This certification accompanies the above-described Report on Form 10-Q pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by

such Act, be deemed filed by the Company for purposes of Section 18 of the Securities Exchange Act of 1934.