I'm a bit late commenting here but, for what it's worth, something similar happened to me a few years ago.

What worked for me was telling the guy who was being racist things like "common, we all heard you, do the right thing and apologise", "you can undo this if you want to", "you know you're going to feel bad about it later, why not try to fix it now while you can?", etc. without making him feel like he was going to lose face if he apologised.

It worked in the end. He ended up apologising and saying he was just having a shitty day.

I don't think punishment works, because it doesn't get rid of the underlying feeling. If anything, it cements the anger even more. Remember, just because you censor someone's words, doesn't mean you're changing their thoughts. The goal is to change people's thoughts: thoughts precede words and actions.

I think, most racist words are said in a high-emotion situation and they're mostly said because they're ready-made words and sentences that come easily. If you talk with empathy to an adult who's being emotional, you can probably get something positive going.

Sometimes people just go over the line and feel stupid for having taken that route, but they won't go back because the situation is confrontational. It's good to give people a chance to go back without passing judgment.