CLSA analysts Jeffrey Kiang and Leo Pan anticipate total GGR of MOP258.43 billion (US$32.3 billion) for the coming year, “implying daily GGR of MOP709 million per day”. They further expect the gaming sector “to deliver low-teens GGR growth in the first half”.

Macau’s official budget projections are more modest. According to figures released on 21 November, the government expects GGR of MOP236 billion next year. The forecast reflects “caution amid global economic uncertainties”, officials stated.

At the end of the third quarter, CLSA projected total GGR for 2025 of MOP244.830 billion. It has since revised its estimate, “marginally [raising] that projection … by 0.4% as we insert the actual GGR print for October while keeping our forecast unchanged”.

Macau to end 2025 on a positive note

CLSA noted that revenue “momentum since June has continued into the fourth quarter of 2025”. Through October, GGR rose 8% year on year, to MOP205.43 billion.

In December 2024, Macau set a GGR target of MOP240 billion for 2025. Following a slow start to the year and ongoing economic turbulence, it reset the projected total to MOP228 billion.

Morgan Stanley, meanwhile, says the city’s gaming sector will end 2025 on a high note, with GGR up 16% for the fourth quarter following strong Golden Week performance.

An estimated 1.14 million people visited Macau for the eight-day national holiday, slightly below the government’s target of 1.2 million but surpassing the 2019 total of 974,000 arrivals.

“After a comprehensive business review and after a thorough assessment of long-term business planning … SJM Resorts will not proceed with the acquisition,” said the Hong Kong-listed company in a Wednesday statement. As part of a termination agreement with 51%-owned subsidiary Pier 16 Entertainment Group Corp, Ponte 16 will close at midnight on 28 November.

Its gaming tables and machines will move to other SJM casinos. Locals employed by SJM Resorts will “be reassigned to other casinos”, the company said. Ponte 16 workers who do not work directly for SJM can “apply for related vacancies within the group”.

SJM to proceed with L’Arc Macau acquisition

Under Macau’s amended gaming laws, satellites have until 31 December to shift from a profit-sharing model to one in which they are directly owned by licensees. The acquired casinos will then make their money through management fees, not shared revenues.

SJM originally planned to close seven of its nine satellites and acquire both Ponte 16 and L’Arc Macau. The latter deal is still on. SJM inked a deal to buy Arc of Triumph Development Co Ltd for HKD$1.75 billion (US$225 million). It described L’Arc as a “well-established” property in the peninsula’s “most concentrated and high-performing entertainment and hospitality cluster”.

SJM Chairwoman and Executive Director Daisy Ho said the casino at L’Arc Macau is “currently operating below its full potential”. However, she added, “[W]e see considerable room for growth as part of a stronger, integrated network under SJM Resorts. This acquisition will allow us to enhance coordination across our peninsula properties in a unified structure that enhances operational efficiency and unlocks cross-promotional synergies.”

Long-term effect of satellite closures

Macau Chief Executive Sam Hou Fai says the satellite closures will have minimal impact on the city’s financial system.

“As of the end of September, loans to companies managing satellites accounted for less than 1% of total bank loans, making the financial impact controllable,” Hou said.

But analysts have expressed concern about the effect on businesses in the neighbourhoods where satellites once operated.

Ricardo Siu, associate professor of business economics at the University of Macau, has warned that loss of the satellites could hamper local economies. “It’s reasonable to expect that the flow of consumers and the absolute value of spending in these areas will slow down,” Siu told Plataforma Media in June. “The vitality of businesses and employment opportunities in these areas will be negatively affected.” 

Real estate consultancy Jones Lang LaSalle added that property values in the ZAPE and NAPE districts could drop by up to 40% after the closures.

Through 2032, those investments will total an estimated US$16 billion. They are part of a larger strategy to shore up the local economy and reduce Macau’s reliance on gaming.

Through its “1+4” development strategy, Macau is committed to the growth of the medical, technical, finance and events sectors. Together, they are expected to strengthen the hospitality industry and support Macau as a global tourism destination. The government has set a target to derive 60% of gross domestic product from non-gaming attractions by 2028. It’s an ambitious goal, as in 2019 they contributed just 16% of GDP.

Ongoing global turbulence poses a risk to any economy that relies on a single industry, Sam noted. That vulnerability became plain during the Covid-19 pandemic, which shut down the city and its chief industry for three years.

Macau must move swiftly, he said, “cultivating internationally competitive new industries [and] effectively implementing the ‘1+4’ objectives”.

‘Tourism-plus’: Promoting Macau on the world stage

Currently, almost 73% of visitors to Macau come from mainland China. Maria Helena de Senna Fernandes, head of the Macao Government Tourism Office, is working to change that. She has travelled the world to promote the city in medium- to long-haul markets including India, the Middle East, Europe and other regions including Northeast Asia.

Senna Fernandes has noted Macau’s global appeal: “more than 400 years of East-meets-West historical heritage, side by side with state-of-the-art integrated resorts”.

Visitor arrivals reached nearly 30 million through September, with international tourists accounting for approximately 1.19 million. For the same period, GDP reached about MOP301.33 billion, up 4.2% year-on-year. The government collected MOP88.8 billion in tax revenue, an increase of 3.3%.

Consultant: Gaming still the star of the show

Can Macau reach its target of 60% non-gaming GDP by 2028?

“Unfortunately, this is unrealistic,” Steve Gallaway of GMA Consulting told iGaming Business. “It’s customer preference-driven. While significant enhancements and offerings of non-gaming products will help diversify the economy, gaming will still receive the majority of customer spend.”

He said concessionaires should invest in “enhanced transport infrastructure, airport upgrades, monorail extensions, roads, etc”. He added that the city should expand family- and child-friendly offerings and entertainment.

Bai Suocheng was the godfather-like head of one of Myanmar’s notorious “Four Families”. Starting in the early 2000s, the gangs turned the sleepy border town of Laukkaing into a hub of criminal activity with unregulated gaming halls and houses of prostitution. According to CNN, the illicit operations turned an impoverished community over time into “a glittering casino city”.

The group kept pace with the times, eventually adding online casinos and scams to the land-based operations. Before their arrests, the Bais ran 41 scam factories in Laukkaing on China’s northeastern border. There they conducted “pig-butchering scams”, building seemingly trusting romantic or financial relationships with online victims, then stealing their money, often via cryptocurrency transactions.

Often the scammers are themselves victims, working under threat of abuse or torture. The United States Institute of Peace said the workers are often “duped by fraudulent ads for lucrative high-tech jobs and trafficked illegally into scam compounds. … (I)n prisonlike conditions, they must run online romance and investment scams.”

According to a documentary about the Bai family, one worker said his bosses beat him, pulled out his fingernails with pliers and severed two of his fingers.

China to predators: ‘You will pay the price’

For years, the Bais operated with impunity, reaping an estimated 29 billion Chinese yuan (US$4.1 billion) in ill-gotten revenue. Bai Yingcang acknowledged that his family was “absolutely number one” among Laukkaing mafia gangs, enjoying protection from the local militia. “Our Bai family was the most powerful in both the political and military circles,” he said.

That started to change in 2023, when China pressured the Myanmar junta to arrest scammers who preyed on Chinese citizens. In September, a Chinese court sentenced 11 members of the Ming family to death on similar charges.

“Why is China making so much effort to go after the Four Families?” asked an investigator in the documentary. “It’s to warn other people, no matter who you are, where you are, as long as you commit such heinous crimes against the Chinese people, you will pay the price.”

Cost of criminal gangs in Southeast Asia

The online gambling boom has helped turned Myanmar, Cambodia and Laos into virtual scam centres. The US-based Center for Strategic and International Studies blames “the transnational nature of online gambling, lax governance … and ASEAN’s fractured regulatory environment”.

In Monday’s ruling, 16 other associates of the Bai family were given prison terms of between three years and life. In a separate case, the court sentenced Bai Yingcang for conspiring to manufacture and distribute 11 tonnes of methamphetamine.

Estimates from the city’s Public Security Police Force indicate about 1.14 million people visited Macau during the annual observance at the start of the month. That breaks down to about 143,000 people per day.

Higher annual GGR total ‘within reach’

Golden Week is prime time for travel among the mainland Chinese. It is also peak season for punters to patronise Macau’s casinos.

According to CreditSights’ Macau’s gaming outlook, Golden Week visitation should support strong gross gaming revenue for the month. It could also make the SAR’s full-year GGR target “attainable”.

In June, the Macau Gaming and Inspection Bureau revised its annual GGR forecast from MOP240 billion to MOP228 billion. It cited a drop in gaming revenue, economic turbulence and a changing visitor profile.

CreditSights now says Macau is in “a decent position” to achieve its 2025 target of MOP228 billion with monthly GGR of just MOP15.6 billion in the fourth quarter, versus the YTD average of MOP20.1 billion.

“Should the current pace of monthly GGR churn be sustained,” wrote analysts Nicholas Chen and David Bussey, “it would put the previous target of MOP240 billion within reach.”

Impact of Typhoon Matmo to be determined

Golden Week 2025 started on National Day (1 October), the anniversary of the establishment of the People’s Republic of China. It also included the Mid-Autumn Festival (6 October), which has been likened to the US Thanksgiving holiday. Most visitors entered the city at the Border Gate, Hengqin checkpoint and the Hong Kong-Zhuhai-Macao Bridge.

As usual, the majority of visitors, an estimated 943,000, came from mainland China. An additional 128,000 came from Hong Kong, and the remainder came from Taiwan and international markets.

Visitation peaked on Saturday, 4 October, with approximately 190,000 visitors. The numbers dropped to 113,000 on Sunday, 5 October, when travel was disrupted by Typhoon Matmo. According to the Macau Daily Times, the Signal 8 storm brought hurricane-force winds and heavy rains, but it caused minimal flooding.

The impact of Matmo on gaming revenue remains to be seen. In September, the impact of Typhoon Ragasa reduced September GGR by 5%-10%. That equates to about “three weekdays’ worth”, according to a 1 October report from JP Morgan.

However, Ragasa was the most powerful weather event of the year. The “super-typhoon” closed Macau casinos for 33 hours, from 23-25 September.

HKJC hands senior role to Stylsvig

The Hong Kong Jockey Club has announced Casper Stylsvig as executive director of its sports business.

Stylsvig will focus on commercial growth across horse racing, football, lottery and emerging sporting opportunities. He also will become a board member and report directly to CEO Winfried Engelbrecht-Bresges.

An experienced sports executive, Stylsvig was most recently chief revenue officer at English Premier League football club, Chelsea. Previously, he also held senior leadership roles at FC Barcelona, Manchester United, Fulham and AC Milan.

“This role represents a natural progressive next step in my career, bringing together best practices from global football to help shape the future of a truly unique, multi-sport business,” Stylsvig said.

PMU and HKJC launch new pool bet

In other news out of HKJC, the organisation has partnered with France’s Pari-Mutuel Urbain on a new common pool bet.

The International Order Couple bet will be available on all Hong Kong races. It will also cover the 95 World Pool races on the PMU calendar.

This builds on a partnership that began in October 2019 with the launch of Simple common pool bets. In 2022, PMU then joined the HKJC World Pool for International Winner and International Placer bets.

“This growing collaboration demonstrates the commitment of both institutions to offering an ever richer and more diverse betting experience to their customers, while strengthening their ties in the international horse racing world,” PMU said.

ESPN Bet fined $15,000 in Massachusetts

Penn Sports Interactive, operator of ESPN Bet, has been fined $15,000 by the Massachusetts Gaming Commission over a violation of advertising rules.

The case related to comments made by ESPN host Rece Davis during a gambling segment on “College GameDay” in 2024. Davis referred to a betting tip by analyst Erin Dolan as being a “risk-free investment”.

Massachusetts sports betting law bans terms such as “free”, “risk-free” and “can’t lose” in reference to wagering.

“Mr Davis used the prohibited language ‘risk free investment’ after he referred to a sports wager,” the commission said. “As a result of the aforementioned regulatory violations, the Commission hereby fines PSI/ESPN Bet $15,000.”

CT Interactive enters Greece with Novibet

CT Interactive has rolled out its content in Greece for the first time through a partnership with Novibet.

Customers of Novibet Greece will have access to a range of CT Interactive titles. These include Lucky Clover, Win Storm, 40 Treasures, HOT 7s X 2 and The Big Chilli.

This latest rollout follows a similar link-up between CT Interactive and Novibet in Mexico.

“Launching our content exclusively on Novibet Greece is a remarkable milestone for us,” CT Interactive Chief Commercial Officer Monika Zlateva said. “It enables us to bring our top-performing games to the Greek market.”

Wazdan builds on Canadian presence with NorthStar

Wazdan is to expand its presence in Canada through a new partnership with NorthStar Gaming.

Wazdan, an iGaming developer, will provide Playtech-powered NorthStar with a range of its content. Titles include 36 Coins, Hot Slot: 777 Cash Out Grand Diamond Edition and Mighty Fish: Blue Marlin.

The launch will also introduce Ontario audiences to engagement-boosting mechanics such as Hold the Jackpot, Cash Infinity, Collect to Infinity, Sticky to Infinity and Cash Out.

“Expanding our presence in Ontario with such a locally rooted and trusted brand as NorthStar is an exciting milestone,” said Radka Bacheva, Wazdan head of sales and business development. “Its strong position in the market, combined with our portfolio of rewarding experiences, ensures we can deliver measurable growth and enhanced entertainment to players nationwide.”

GGR was up 6% over September 2024, missing the analyst consensus of 9%. The figure was down 17.5% from August, when casinos generated a post-pandemic high of MOP22.15 billion.

September is typically a slower month in Macau following the peak July-August vacation season – so much so that the local government kicked off a 13-week city-wide stimulus campaign to offset the expected slump. The campaign, from 1 September to 30 November, drives consumer spending by offering residents a chance to win e-vouchers when they make purchases at participating businesses.

Another inhibiting factor: Typhoon Ragasa, the super-storm that closed casinos for more than 30 hours on 24-25 September. So far this year, September ranks as the second-lowest month for GGR in 2025 behind January. Vitaly Umansky of Seaport Research Partners noted the impact of the typhoon, which “likely impacted growth by ~6%-7% (12%-13% growth would have been likely)”.

But hopes are high for the Golden Week holiday, which began with National Day on Wednesday.

Macau revs up for Golden Week visitation

The Macau Government Tourism Office projects that 1.2 million people will visit the city for the eight-day celebration. Citigroup analysts George Choi and Timothy Chau estimate Macau casinos could generate daily GGR of MOP1.05 billion during the holiday.

That momentum could continue beyond Golden Week on the strength of entertainment and other special events like the NBA China Games, being held 10-12 October at the Venetian Macao. The presentation games will pit the Brooklyn Nets against the Phoenix Suns, with a special appearance by hoops great Shaquille O’Neal.

“Growth should be driven by increased marketing and, importantly, continued ease of money outflows along with robust visa issuance,” Umansky wrote. “Continued entertainment events will further help support demand.”

Indicators suggest growth into 2026-27

A US-China trade deal, which reportedly could be struck by November, could have a trickle-down effect on Macau, wrote Umansky. It would “further boost consumer confidence and willingness to spend and travel to Macau. And any improvement in China consumer confidence would help drive overnight base mass recovery.”

Seaport expects a 13% GGR increase in October and full-year growth of 8.4%, with 12.4% growth in the fourth quarter compared to 8.3% in the first half. It further forecasts 7% annual growth in 2026-2027, “helped by hotel occupancy, a stronger base mass recovery, continued money flow ease and burgeoning consumer confidence”.

Golden Week starts with National Day on Wednesday and includes the Mid-Autumn Festival on Saturday. MGTO head Maria Helena de Senna Fernandes expects an average of 150,000 visitors per day for the celebration. That would exceed last year’s average of 140,000 daily arrivals, but fall short of the 153,000 who visited during Lunar New Year celebrations. 

Still, it’s “a relatively good figure” that could fill 90% of hotel rooms, a positive trend that began in January. “We are quite optimistic and expect ideal occupancy rates,” Fernandes said.

This year’s holiday should benefit from relaxed entry permits for visitors from Zhuhai and Hengqin. The new policy launched on 1 January to boost tourism from neighbouring cities and China’s mainland.

More visitors and more side bets mean a bump in GGR

Citigroup analysts George Choi and Timothy Chau say Macau casinos could generate daily GGR of MOP1.05 billion (US$131 million) during the holiday. That momentum could continue beyond Golden Week on the strength of entertainment and other special events.

“Casino operators are strategically organising some heavyweight events after Golden Week,” like the NBA China Games at Venetian Arena, the Citi team noted. “If these events are successful in boosting gaming volumes post-Golden Week, our October GGR forecast of MOP$23 billion could prove conservative.”

They also pointed to better hold rates, as a result of more smart tables and new side bets. Smart tables reduce the time it takes to play a round of baccarat, the SAR’s most popular game. Streamlining gameplay by as little as five seconds per round can boost revenue by almost 6%. In the past, side bets accounted for a small portion of baccarat revenue and yielded less than 1% of turnover. Now, they make up 45% to 50% of baccarat turnover.

Tracking Macau transformation to global destination

In related news, a 2024 Deloitte report commissioned by the MTGO evaluated results from the city’s tourism master plan. Macau has set an ambitious goal to become a world centre of tourism and leisure, with non-gaming revenue contributing 60% of GDP by 2028. Casino concessionaires are doing their part, with plans to invest MOP130 billion in non-gaming attractions.

The Deloitte study reviewed progress from 2021 to 2024 and looked ahead to effects in 2025 to 2030. Recommended actions include strategic marketing; increased capacity at airports and other points of entry; the enhancement of visitors’ experience through smart technology; fostering of international exchange; and deepening cooperation with Hengqin and cities in the Guangdong-Hong Kong-Macau Greater Bay Area.

“Macau will actively expand its overseas markets and attract potential visitor segments such as wedding, transit travellers and Generation Z,” the Deloitte report said. “The goal is to encourage visitors to extend their length of stay and increase their spending in Macau.”

Through August, the city recorded 26.9 million arrivals, up 15% year-on-year. If the pattern continues, visitor volume could reach 40.17 million this year and 46.43 million by 2030, per Macau Business.

For 30 hours starting at 5pm Tuesday, the “super-typhoon” battered the Philippines, Taiwan and parts of Southern China. At the height of the storm, Macau raised a Typhoon Signal No 8. By 11pm Wednesday, the alert had been lowered to a Signal No 3.

According to the Macau Daily Times, Ragasa caused “more disruption than damage”. Even so, it caused an almost total shutdown of the special administrative region. Residents fled their homes for emergency shelter and schools, bridges and other businesses closed, as did Macau International Airport.

During the worst of the storm, wind speeds climbed to almost 200 km per hour. But flooding was not as grave as officials predicted, topping out at 1.5 metres above street level in some sections. The storm caused no fatalities or serious injuries in the Chinese SAR, but it killed at least 17 people in Taiwan, reported CNN.

Emergency operations praised

The Macau Civil Protection Operation Centre won high marks for its performance during the crisis, the Times reported. It was the first major test of the CPOC, established in 2024 to enhance civil protections in the event of emergency.

Initial reports warned that Ragasa could equal typhoons Hato and Mangkhut for intensity and destruction. Hato, which made landfall in August 2017, took 10 lives and left more than 240 people injured. Mangkhut hit in September 2018 at a speed of 185 kilometres per hour, causing widespread flooding and property damage.

As life gets back to normal, the Macau government advised residents and visitors to be alert for unstable weather through Thursday. Frequent heavy showers and thunderstorms could be accompanied by winds “intermittently reaching Force 7 to 8” with gusts of up to 110 kph.

IG Group to acquire Independent Reserve

IG Group has struck an agreement to acquire Australia-based cryptocurrency exchange Independent Reserve.

The deal, billed as a bolt-on transaction, has an initial enterprise value of AU$178 million (US$117.3 million). IG Group said it will accelerate its entry into cryptocurrency markets in the Asia Pacific region.

The transaction is subject to regulatory approvals from authorities in Singapore and Australia, with completion expected in early 2026.

“This acquisition marks an important step in our crypto strategy in a key region,” said Matt Macklin, managing director Asia Pacific and Middle East at IG Group. “Independent Reserve is one of Australia’s largest and fastest-growing digital asset exchanges. I am delighted that the Independent Reserve team will join IG as they embark on their next phase of growth.”

Genius Sports snaps up Sports Innovation Lab

Also making an acquisition is Genius Sports, which has purchased sports fan data specialist Sports Innovation Lab.

Financial details of the agreement were not disclosed. However, Genius said it fast-tracks the expansion of its media business, combining official game data with deep fan intelligence.

Genius also said the combination will create the most comprehensive fan database in sports and entertainment. This, Genius added, will track billions of annual transactions, including purchases, attendance and viewership.

“By integrating the most comprehensive official sports data with unmatched fan intelligence, we are strengthening our foundation and providing partners with a powerful new way to understand and engage fans at scale,” Genius CEO Mark Locke said.

Police rescue men kidnapped over casino debt in Vietnam

Police in Vietnam have rescued two Chinese men who were kidnapped after accumulating debts at a luxury casino.

According to VN Express International, the men borrowed hundreds of thousands of yuan to gamble at Hoiana Casino. Wang Xiaoci and Li Yao Zong were named as the two men that gambled at the venue in Quang Nam Province.

After being unable to repay the money, it is alleged a group of men forced them to sign debt papers. They were also said to have been assaulted and given death threats if they did not pay the money back.

Police were alerted to Wang being forced into a car outside the casino. Shortly after, police tracked the car to a nearby apartment complex and carried out a raid. As well as locating both men, police made five arrests at the same location.

FDNY uncovers illegal gambling den in New York

The Fire Department of the City of New York reported it has uncovered an illegal gambling den in Manhattan.

Officers from the FDNY Bureau of Fire Prevention found a gambling parlour with slot machines. Lithium-ion batteries were found charging throughout the illegally converted cellar, which also had storage space filled with counterfeit designer bags and accessories.

“Dangerous and unlawful conditions” were also noted at the location. These included cellar hallways converted into single room occupancies, crowded with mattresses, hot plates and space heaters.

“Illegal living conditions and unsafe battery charging can create deadly conditions for residents and for firefighters responding to emergencies,” FDNY Commissioner Robert Tucker said.

FanDuel secures online market access in West Virginia

Flutter Entertainment-owned FanDuel has secured online market access in West Virginia with Delaware North.

FanDuel will deliver online sports betting and iGaming in the state through Delaware North’s Mardi Gras Casino & Resort.

The operator will also continue to run the sportsbook at the Greenbrier Resort in White Sulphur Springs, West Virginia.

“Delaware North’s been a respected name in gaming and hospitality for decades,” FanDuel Business Development Senior Vice President Jonathan Edson said. “They are an ideal partner as we continue to operate in West Virginia.”

Anne Ling and Jingjue Pei report that Macau GGR for 1-7 September was up 10% year on year – a trend they expect to continue. They credited “rich entertainment events, new properties, more incentives to players and appreciating asset values” as boosters. They also attributed the uptick to a “new wealth” segment: consumers with more discretionary income and the willingness to spend it.  

“We expect these drivers to continue to fuel GGR growth for the rest of the year,” wrote Ling and Pei. They project growth of 13.8% for the third quarter, 15.3% for the fourth quarter and 9.5% for 2025.

Jefferies has revised its full-year forecast from MOP237 billion to MOP248 billion, versus the conservative government estimate of MOP228 billion. Longer term, the bank foresees growth of 3.5% in 2026 and 3.4% in 2027.

Superstars, side bets propel Macau GGR

Citigroup analysts agree that big-name entertainers like Jacky Cheung and Eason Chan “appeal to bigger players and boost GGR”.

“This is why casino operators are strategically organising some heavyweight events after Golden Week,” wrote George Choi and Timothy Chau. That includes the NBA China Games, to be held 10-12 October at the Venetian Arena, and Jackson Wang concerts on 11-12 October at the Galaxy Arena.

“If these events are successful in boosting gaming volumes post-Golden Week, our October GGR forecast of MOP$23 billion (US$2.86 billion) could prove conservative,” the Citigroup analysts said.

In addition, the “increasing popularity” of baccarat side bets “are enhancing casino hold rates” for Macau operators. “Our [premium-mass] table survey has been telling us since April that gaming demand – especially premium mass – remains robust,” the analysts wrote.

Citigroup has raised its 2025 GGR forecast “from +7% to +10%” to MOP248.6 billion. That suggests “a +14% year-on-year growth for the rest of the year”. It has also raised its 2026 GGR forecast “from +5% [year on year] to +7%”, to MOP265.5 billion.

According to Seaport Research, August was the “strongest GGR post-Covid and the third consecutive month with double-digit y/y growth”.

A US-China trade deal would “further boost consumer confidence and willingness to spend and travel to Macau,” wrote analyst Vitaly Umansky. “And any improvement in China consumer confidence would help drive overnight base mass recovery.”

In 2024, the government set a GGR target of MOP240 billion for 2025. Following a slow start to the year, cautious officials reset the projected total to MOP228 billion, implying annual growth of just 0.5%, well below earlier estimates of almost 6%.

Stronger second half under way

Macau casinos were “busier than usual amid seasonality” in August, Morgan Stanley analysts noted. Hotel rooms were hard to come by, with occupany as high as 90%, per the DICJ. Business was lifted by non-gaming attractions including concerts and sporting events. The Morgan Stanley team forecasts a 15% year-on-year rise in GGR for the second half, reports Macao News.

The current rally could slow somewhat in September, when the city typically sees a lag in visitation. But Umansky estimates 13% year-on-year growth for the month, “driven by increased marketing, continued ease of money outflows and robust visa issuance”.

Looking ahead, Seaport expects 6.5% growth in 2026 and 7% growth in 2027, “helped by increasing hotel occupancy, a stronger base-mass recovery and supply increases”.

In April, investment bank JP Morgan downgraded its GGR forecast for the year, citing “mounting macro headwinds” including the US-China trade war. In a note Monday, however, its analysts were downright bullish. They said Macau is in an “upcycle” propelled by positive wealth effects, rising consumer confidence and regional stock rallies.

“We expect strong momentum to continue for some time,” the team said.

A Monday investor note from analysts DS Kim, Selina Li and Lindsey Qian forecast a record-breaking month, with gross gaming revenue of MOP21.9 billion (US$2.72 billion) to MOP22.5 billion. GGR for the first 24 days of August totalled MOP17.65 billion, or MOP735 million per day.

The team wrote that it was “printing the highest non-Golden Week GGR since the pandemic, thanks to strong visitation from peak summer holidays”.

According to Macau Business, through Sunday both the VIP and mass segments grew 10% to 15% year-on-year. VIP was up 30% compared to 2019. Mass saw a remarkable 125% jump over the pre-pandemic benchmark.

“We now forecast August GGR to grow 11-14% to reach MOP21.9B-22.5B,” the analysts observed, “likely breaking the post-pandemic record again.”

Positive trend began in second quarter

Last year, anticipating a surge in tourism, the Macau government set a GGR target of MOP240 billion for 2025. But following disappointing results in January and February, officials adjusted their expectations downward, resetting the yearly total to MOP228 billion.

The comeback started in May, with GGR of MOP21.19 billion, up 5% over the consensus of 2.7% for the best post-Covid month since October 2024. The trend continued in June, with GGR of MOP21.06 billion, up 19% year on year.

In July, Macau casinos generated MOP22.12 billion patacas, according to data from the Gaming Inspection and Coordination Bureau. 

The bank now projects a 13% rise in gross gaming revenue for the second half of 2025, versus just 4% in the first half. It attributed its optimism to “high-end” Chinese business owners, who make up most of the city’s premium mass and VIP cohort.

Those consumers, who are less affected by economic uncertainties on the mainland, helped propel gaming revenues from May through July.

Turnaround started in May

After a flat first quarter, Macau casinos posted GGR of MOP18.86 billion (US$2.36 billion) in April, up just 1.7% year-on-year. It was the year’s worst monthly performance since January.

Improvement began in May, with GGR of MOP$21.19 billion, up 5% year-on-year and 12.4% over April. In June, the figure surged 19% to MOP$21.06 billion. July came in at MOP$22.13 billion, up 6.5% year-on-year and 19% month-on-month, for the best month of the year so far.

As JP Morgan analysts DS Kim and Selina Li wrote: “Macau demand, even base-mass, comes from the high-end Chinese, not necessarily broad consumers.” Positive sentiment across the board “was likely lifted by wealth effects from stock rallies in China/Hong Kong/the United States, crypto surge, etc.

“We have seen similar green-shoots emerging recently across HK retail, Swiss watch exports and mainland luxury malls,” the analysts wrote.

Strong yuan, special events factor in

The JP Morgan team also credited new junkets – five more gaming promoters launched in May – and a stronger yuan. Since April, the renminbi has appreciated by about 1.4% against the US dollar. “That has helped Chinese spending power in Macau,” they wrote.

Then there is entertainment. “High-profile concerts/events provide gamblers a compelling excuse for more frequent trips,” per Kim and Li. The lineup has “[boosted] Macau’s allure, capturing greater wallet/time share from gamblers and families”.

The bank forecasts 12% EBITDA growth in the third quarter and 16% in the fourth quarter, “outpacing Street expectations”.

‘Demand waiting to be unlocked’

According to the JP Morgan team, most investors are asking: “Why is Macau thriving despite weak China macro/consumption?” The latest China Brief from McKinsey & Co describes a “complex and often contradictory picture”.

“Consumer confidence remains low, the property market is under sustained stress and households continue to save at historically high levels,” the brief states. “The preference among consumers for stashing their money in savings suggests ongoing uncertainty – but also hints at potential demand waiting to be unlocked.

“Recent data paints a picture of a Chinese consumer that is willing to spend again. The Chinese consumer has ‘moved on’.”

In the first half of 2025, retail sales edged up and air travel surpassed 2019 levels. Fewer entry restrictions and China’s expanded visa-free transit policy also helped. As of July, the policy allowed travellers from 75 countries to visit for up to 30 days without a visa. 

As a result, according to the Macau Statistics and Census Service, in the first half, visitor arrivals increased 14.9% year-on-year to 19.2 million. That puts the city on track to reach its goal of up to 39 million tourists in 2025, nearing the record 39.4 million posted in 2019.

Chinese Triads have long used casinos and casino junkets to launder money from drug trafficking and other crimes, the report states. During Covid-19 lockdowns, when land-based casinos shifted online, the criminals moved too.

Since then, they have built a worldwide financial ecosystem that lets bad actors move money freely through casino accounts, betting credits and cryptocurrency transfers. Known in Mandarin as “fei qian” (“flying money”), these networks fly under the radar, sidestepping traditional routes “in ways that frustrate law enforcement oversight”. The transactions circumvent international bank wires that could trigger AML alarms.

Shadow bankers under the radar, but not invisible

According to a July study from the Foreign Affairs Forum, the illicit brokers “have significantly outpaced traditional money laundering groups, primarily by offering exceptionally rapid transfer services, charging minimal commissions – typically less than 2% of the principal amount”. Their sophisticated methods render cash “virtually untraceable as it crosses international borders”.

Their proliferation could “exacerbate widespread problems such as drug epidemics, tax evasion and organised crime over the coming years”, the FAF warned.

However, law enforcement agencies are aware of the underground financiers and are working to fight them on their own turf: in cyberspace. As stated in the TRM report: “The same features that make cryptocurrency attractive to criminals (speed, global reach, pseudonymity) can be leveraged by investigators to track and freeze illicit assets in ways not possible before.”

The report states that with “diligent blockchain analysis, interagency collaboration and bold strategies – including going on the offensive in cyberspace – authorities can illuminate these shadowy networks” and eliminate some of them.

For the full report, click here.

Travel to Las Vegas plunged 11% in June, according to the Las Vegas Convention and Visitors Authority, providing a harbinger that customers are reconsidering a vacation to Sin City in tough economic times. But Wynn, which caters to higher-end customers, emerged from the carnage relatively unscathed.

During Wynn’s second quarter of 2025, the average daily rate for its Las Vegas hotels came in at $548, up 3% year-over-year. The metric is viewed as a key indicator for earned revenue based on occupancy levels at Strip properties. In addition, Wynn Resorts’ CEO Craig Billings appears pleased with metrics on table game and slot machines, as well as receipts at luxury restaurants at Wynn’s Vegas properties.

“We remain positive about the business in Las Vegas,” Billings said during Thursday’s Q2 earnings call. “We sit in a unique position. We’re not the best barometer of Las Vegas at large.”

Another factor stoking Billings’ optimism for Wynn’s performance in Vegas stems from booking levels in July. Last month, Wynn saw forward bookings advance as the month progressed, Billings noted. While Wynn indicated that its convention and group business looks strong heading into the fourth quarter, the company is pleased with bookings for this fall’s Formula 1 Las Vegas Grand Prix, taking place for the third year.

Wynn Q2 earnings by the numbers

Despite the strong quarter, Wynn saw profits fall sharply to $66.2 million or $0.64 per share, in comparison with $111.9 million or $0.91 a share in the same quarter in 2024. Wynn also posted adjusted earnings per share of $1.09, failing to meet analysts’ per-share expectations of $1.20.

Wynn experienced softness in Macau over the quarter, generating revenue of $343.8 million. Billings pointed to a down period from its VIP segment, which delivered lower-than-expected hold. In total, the VIP hold provided a negative impact of $13 million for the quarter.

Wynn traded at around $105 a share on Friday morning, down about 2% on the session. Wynn shares have jumped about 60% since US President Donald Trump’s tariff announcement in April. The company is also up approximately 37% over the last 12 months.

The company held Thursday’s call as reports surfaced that former NBA player Marcus Morris had charges dropped after he repaid a series of debts to two Las Vegas casinos. Morris, a 14-year NBA veteran, repaid debts totalling $250,000 to Wynn Las Vegas and the MGM Grand, CBS affiliate KLAS reported.

Over the second quarter, Wynn generated operating revenues in Las Vegas of $638.6 million, up nearly $10 million from $628.7 during the same quarter in 2024. Amid healthy demand on the casino side, Wynn saw increases in both drop and handle for the three-month period ended 30 June.

As a result, Wynn reported adjusted property EBITDA of $234.8 million for the quarter, a slight increase from $230.3 million in the year-ago quarter.

Wynn also provided an update on renovation plans for the Encore Tower in Las Vegas. Construction for the remodelling of the tower is set to begin next spring, CFO Julie Mireille Cameron-Doe said. The project, which will take about a year to complete, is estimated to cost about $330 million.

However, the strong period for Wynn’s Las Vegas segment came as profits overall fell for the company on the quarter. It is one reason why Wynn traded lower on Friday in response to the quarterly results.

Optimism for UAE project

Wynn Resorts is moving closer to the 2027 grand opening of Wynn Al Marjan Island, the first licensed casino in the United Arab Emirates. Billings indicated that construction for the project continues to “progress rapidly”, with developments on the 61st floor of a 1,000-foot tower ongoing this month.

During the quarter, Wynn continued drawing on the Al Marjan construction loan with $395 million to date, Cameron-Doe noted.

As of this week, Wynn remains the only casino to be licensed by the UAE’s General Commercial Gaming Regulatory Authority.

Various estimates have placed the total addressable market in Dubai in the range of $5 billion to $8 billion a year. Wynn Al Marjan Island will be the company’s first new project under its current management team. Consequently, the Dubai project is the company’s top priority at the moment, Billings explained.

“We’re building and opening a small city,” Billings said. “We need to be in a position to knock the cover off the ball.”

Seaport Research Partners analyst Vitaly Umansky expects gross gaming revenue for the month to rise 14.8% year-on-year, an increase of 2.5% month-on-month.

After a lacklustre first quarter, casinos in the city posted GGR of MOP$21.19 billion (US$2.62 billion) in May, up 5% year-on-year and 12.4% over April. It was the best month since borders reopened in January 2023.

June was a winner too, with GGR of MOP$21.06 billion, up 19% year-on-year. July came in at MOP$22.13 billion, up 6.5% year-on-year and 19% month-on-month, for the highest monthly figure of the year.

Among other factors, Umansky cited “increased marketing and improving China consumer sentiment, coupled with stronger higher-quality average visitation into Macau”. He also credited a strong entertainment calendar.

“August this year has more concerts and events than last year (as was also the case in June and July),” he wrote. “Visitation growth remains robust and spend per visitor is improving, so August growth could come in better than we currently forecast.”

If the upswing persists, casinos could enjoy “a stronger base mass recovery with continued premium growth later this year and in 2026”, he added.

Why US-China trade deal matters

Morgan Stanley is just as optimistic. The brokerage has raised its yearly GGR forecast to MOP$248.96 billion, up 10% year-on-year and twice its earlier estimate of 5%. That figure would also beat the local government’s cautious forecast of MOP$228 billion.

According to Macao News, Morgan Stanley analysts tied the outlook to a spike in tourism from Mainland China (up 25% year-on-year in the second quarter), prompted by relaxed visa rules. It also noted the drawing power of entertainers like Jacky Cheung. In June, when the Cantopop crooner opened at Galaxy Macau, Citi analysts noted a 16% increase in premium players and a 36% increase in the the average wager.

Morgan Stanley also credited new junkets – five more gaming promoters launched in May – and a stronger yuan.

Umansky said a US-China trade deal could further boost consumer confidence and loosen travellers’ pursestrings. But if no agreement is reached by a 12 August deadline, tariffs could “boomerang” back to higher levels, said US Treasury Secretary Scott Bessent.

Merchants in the city have worried the closures will reduce foot traffic around satellite venues. Their fears are justified, says Iun Ioc Va, president of the Industry and Commerce Federation of Islands of Macau.

“Apart from Casino Grandview, other satellite and gaming venues in the area are also set to close by year-end,” Iun told TDM, per Macau Business. “Foot traffic is expected to fall by half, which will inevitably have a significant impact on the business environment.

“We’ve seen shops in the area relocate and some nearby stores have remained vacant for some time,” he added.

In 2022, Macau amended its gaming laws. Among other changes, it directed that concessionaires run the satellites, not third-party investors that piggybacked on their licences. Lawmakers also ordered that satellites no longer share gaming revenues, but receive management fees instead.

The government gave concessionaires three years to transition to the new model. For the most part, they opted to phase out the smaller operations.

In June, the Macau government and three of the city’s gaming concessionaires announced that nine of 11 satellites would close by 31 December. Only Ponte 16 and L’Arc Macau, doing business under the SJM licence, are expected to survive. SJM plans to acquire the properties and shift them to the directly managed model.

‘End of an era’ puts thousands of jobs on the line

The remaining closures support SJM’s “long-term objectives [and] overall competitiveness”, the company said in a statement. All workers – including 159 at Casino Grandview – will receive “job opportunities within SJM Resorts’ portfolio of properties”. Citywide, the transition could affect 6,000 jobs.

SJM said it is committed to “safeguarding local employment. All local employees employed by SJM will remain employed and be reassigned to other casinos of SJM to undertake gaming-related roles according to operational needs. [They] will be provided with the necessary support, depending on the actual situation, to facilitate a smooth transition.”

Other SJM properties on the block include Casa Real, Emperor Palace, Fortuna, Kam Pek Paradise, Landmark and Legend Palace. Melco Resorts will close up shop at its only satellite, Grand Dragon Casino, also in Taipa. Galaxy Entertainment Group will shutter its sole satellite, Waldo Casino on the Macau Peninsula.

The Macau Statistics and Census Service reported an unemployment rate of 1.9% in April. According to Macao News, adding affected satellite workers would boost the jobless rate to 3.4%. That’s the highest level since 2022, when Macau was still grappling with Covid lockdowns. However, Melco and Galaxy, like SJM, have pledged to reassign most employees to similar jobs at other casinos. 

IGamix managing partner Ben Lee has compared smaller casinos to corner pubs that attract a distinctly local crowd. He said the end of satellite casinos is also “the end of an era”.

According to Bloomberg, Macau casino shares have risen 59% since April as GGR continues to outpace analyst expectations.

Casinos in the city recorded GGR of MOP$21.19 billion (US$2.62 billion) in May, up 5% year-on-year and 12.4% over April, for the best month since borders reopened in January 2023.

The trend continued in June – typically a slower month after the Golden Week holiday – with GGR of MOP$21.06 billion, a surge of 19% year-on-year.

As of mid-July, casinos had generated MOP$18.6 billion for the month, up 11.6% compared to 2024. That brought the total to MOP$132.35 billion, an improvement of 36.7% over last year. The ongoing positive direction led Seaport Research Partners to revise its annual forecast, projecting a 7% boost in GGR for the year and as much as 9% for the second half.

More tourists, tourism attractions

Data from the Macau Government Tourism Office shows that 19.22 million visitors visited the gaming mecca through June of this year, an increase of 14.9% compared to the same period in 2024. The city is making it easier for them, with relaxed visa policies and improved transportation options.

As usual, approximately 70% of tourists hail from mainland China. But international tourism is on the upswing too. Last year, more than 2.4 million visitors from outside Asia came to Macau, an increase of 66% year-on-year. The city is actively wooing them with increased non-gaming attractions like sports, entertainment and cultural events.

In a notable recent example, analysts from JP Morgan, Citi and Seaport Research all credited June’s outperformance to a spillover effect from concerts by Cantopop and K-pop stars. The standout was a Galaxy Macau residency starring Hong Kong crooner Jackie Cheung.

On Cheung’s opening night at Galaxy Macau, for instance, Citi’s table survey saw a 16% increase in premium players and a 36% increase in the average wager.

VIP play up, but mass still on top

VIP gaming revenue for the first half rose 11% year-on-year, versus just 2% for the mass market. High rollers kicked in about 26% of the half-year total. But, as Macau Business reports, mass players “still reign”, making up the balance of 74%.

The publication cited a report from CreditSights, a division of Fitch. In a Monday note, the researcher stated: “For 1H25, total GGR was up by 4% YoY to MOP118.8 billion and slightly above pace (~52%) to meet the government’s 2025 target of MOP228 billion.”

Despite all the wins, spend per visitor for the period is down. On a per-capita basis, each spent an estimated MOP6,180 in the first six months, a drop of 9% from last year. CSLA attributed the decline to “Macau’s diversification into more non-gaming offerings, such as entertainment events”, calling it a driver for more leisure visitors over gamblers.

CreditSights concurred, saying per-visitor spend could “remain constrained by visitation upside largely coming from the less affluent regions of China with lower GDP per capita”.

That leaves room to grow in the sector. Macau now has just 29 junkets, less than 58% of the maximum allowed, per Macao News.

But those berths are unlikely to be filled. Junkets have been on a steady decline since their peak in 2014. That year, 235 operators served the VIP trade and contributed an estimated 60% of casino revenues. But within a decade, the number of active junkets dropped to just 18.

Relic of a bygone era

Junkets make their money by luring free-spending high-rollers to casinos. Traditionally, organisers have arranged travel, accommodations and lines of credit for punters who don’t blanch at betting $50,000 a hand. In the past, they have also served as debt collectors.

That model started to unravel with Beijing’s crackdown on corruption, including capital flight and gamblers’ attempts to bypass foreign-exchange limits.

The government case was strengthened by scandals surrounding the two biggest junket runners in Macau. In 2023, Alvin Chau, head of the Suncity Group, was convicted on more than 100 counts of illegal gambling and fraud. He was sentenced to 18 years behind bars. Three months later, Levo Chan, head of the Tak Chun Group, was found guilty on similar charges. He received 14 years in prison.

That same year, Ji Xiaobo, onetime boss of the Hengsheng Group, was called the “head of a criminal syndicate” by a Beijing court. All three junket operations have since been dissolved, along with many others. Some have shifted their focus to other jurisdictions with less stringent regulations, such as Vietnam.

A leaner junket framework

While junkets survive in Macau, they now operate under a different regulatory structure.

According to Macau’s 2022 gaming law, operators may no longer share revenue with casinos. Instead, they earn a fixed 1.25% commission on rolling-chip turnover. They are restricted to working with just one casino concessionaire (though concessionaires can work with multiple junkets). Dedicated VIP rooms at casinos are also a thing of the past. And in 2024, the government enacted a new law that restricts the issuance of casino credit to concessionaires alone.

According to The Economist, Chinese President Xi Jinping wants to “purify the social atmosphere” by transforming Macau’s reliance on gaming as an economic driver, in part through stricter monetary controls.

Before the storm, the Macau Gaming Inspection and Inspection Bureau (DICJ) called for the closure of ports, businesses and bridges. But it ordered city casinos to remain open, to prevent their patrons from venturing into the storm.

“The gaming premises and venues will be maintained in proper condition during the typhoon,” the DICJ said in a statement Sunday. “The casino will make arrangements for the staff and guests to take a rest in the event of a typhoon.”

Macau spared a direct hit

The Macau Post Daily called Wipha “the potentially strongest tropical cyclone to  threaten Macau so far this year”. It represented the earliest time in a calendar year that a No. 10 signal was hoisted since record-keeping began in 1968. 

At the storm’s peak, ground and air transportation and ferry service were suspended or cancelled. Macau International Airport cancelled 140 flights. Wipha sent 139 people to emergency shelters and caused 163 accidents and five injuries.

Fortunately, Wipha (“lightning” in Thai) veered from a direct path toward Macau before reaching it. The storm then moved with gale-force winds toward southern China, where it caused widespread flooding. It is reported to be heading to Vietnam, with landfall expected on Tuesday. Wipha also killed at least five people in the Philippines.

In an update Monday, the Macau Municipal Affairs Bureau stated that more than 90% of open leisure areas in the city and eight public markets were open as usual. The Meteorological and Geophysical Bureau has cancelled all typhoon signals.

The opulent 13 was a pet project of Hong Kong billionaire Stephen Hung. The $1.4 billion property targeted Macau’s wealthiest patrons. The interiors were designed to evoke the Palace at Versailles (the hotel was originally known as the Louis XIII).

Outsized appointments included private butlers, massive crystal chandeliers and a fleet of 22 red and gold Rolls Royce Phantoms. Each hotel room represented an investment of $7 million.

Throwback to Macau’s high-roller era

But The 13 broke ground just as Chinese President Xi Jinping came to power, near the end of Macau’s once-dominant VIP era. The president’s strict anti-ostentation campaign – still ongoing – decimated the high-roller segment. And the local government’s accompanying crackdown on capital flight virtually ended the junket industry.

The 13 was also handicapped by its failure to win a casino licence. It had banked on offering a satellite casino with 166 table games.

As a result, the Cotai Strip property operated for under two years, from August 2018 to February 2020, before closing its doors due to Covid-19. In 2023, previous owner South Shore Holdings Ltd filed for bankruptcy. It was also delisted from the Hong Kong Stock Exchange.

Last year, the bank-owned property resumed limited operations when the Macau Government Tourism Office renewed its hotel licence.

Complete redo in the works

Loi bought The 13 at a bargain-basement price. Listed for $2.4 billion in March 2024, it sold for just $76 million. At the time of the acquisition, Mark Wong of realtor Jones Lang Lasalle told the Macau Daily Times the hotel would be “fully renovated”.

Loi just sold five historic shophouses on Pagoda Street in Singapore, pocketing $26.24 million. Sources told the Singapore Business Times the mogul may be “rebalancing [his] real estate portfolio in favour of Macau and other markets”.

According to the Macau Gaming Inspection and Coordination Bureau, casinos have generated MOP18.6 billion ($2.31 billion) in GGR for July so far, up 11.6% year on year. That brings the yearly total to MOP132.35 billion, an improvement of 36.7% compared to 2024.

‘Good start to the second half’

Last month, authorities trimmed their yearly GGR forecast by 5%, to MOP228 billion, down from the MOP240 billion projected in November, due to economic uncertainties and shifting consumer trends. They also revised expectations for tax revenue to MOP79.8 billion, versus the original target of MOP84 billion.

Analysts likewise tweaked their estimates. “Based on the first-half 2025 GGR trend … we lower our 2025/26/27 GGR assumptions slightly,” wrote Jefferies analysts Anne Ling and Jingjue Pei. They look for GGR to grow 3.5% next year and 3.4% in 2027 to MOP254 billion.

The Jefferies estimate for 2025 stands at MOP237.00 billion, “in line with [the] market, but higher than government estimates”. Ling and Pei expect GGR growth of 5.7% for the third quarter, down 3.5% from Q2, but “a good start to the second half given that the third quarter is normally a low season”.

They added a disclaimer, “wondering if the strong performance in May/June … will continue in second-half, or whether VIP players just visited Macau earlier this year for the new properties”.

High-end hotels, more entertainment

The new inventory includes luxury digs designed to appeal to premium mass and VIP patrons.

In April, Sands China completed a billion-dollar upgrade of rooms and suites at its Londoner Macao. Capella at Galaxy Macau, a 17-floor tower with 36 “sky villas” and 57 suites, staged a soft opening in May. One-bedroom suites, available starting in September, will go for MOP24,898 per night. MGM China has expanded the premium gaming area and renovated its villas at MGM Macau, and it is adding 60 new suites at MGM Cotai.

Industry fortunes are also riding on the new “concert economy”, which boosted June GGR to MOP21.06 billion, up 19% year on year. According to Macau Business, JP Morgan analysts credited a concert series by crooner Jacky Cheung for the “unexpected seasonal surge”.

Citi analysts said “a glamorous event and concert line-up” could continue to buoy GGR growth into the second half.

Maria Helena de Senna Fernandes, director of the Macao Government Tourism Office, told reporters on Tuesday that the city is now on track to reach its target of 39 million visitors for the year, just shy of the pre-Covid total of 39.4 million.

“Diversifying tourism offerings remains crucial,” said de Senna Fernandes. “Not just through new infrastructure, but particularly by developing new tourism routes.

“In the second half of the year, authorities will ensure summer holiday arrivals through various activities and promotions while continuing to attract international visitors,” she added.

Going global

As usual, the overwhelming majority of Macau visitors – 71.6% – hailed from mainland China. Hong Kongers comprised 19%, with Taiwan visitors at 2.4%. Foreigners made up the balance.

The tourism office is out to expand that reach with a worldwide campaign to lure more tourists from European and Arab countries. Last year, de Senna Fernandes hosted global tourism officials at a conference in Cyprus. This year, she will continue the road show with visits to Lisbon, Kuala Lumpur and Jakarta.

The goal is to promote Macau as “a world centre of tourism and leisure” and “an international metropolis”. It’s all part of a broader effort to diversify the economy beyond gaming.

A 2024 report from Macau Polytechnic University said the local casino industry can expect “stable” growth going forward, without the explosive growth of the past. Researchers cited growing competition in Southeast Asia, the decline of casino junkets and a new emphasis on mass visitors over VIP gamblers.

Importance of entertainment

“Non-gaming elements are becoming increasingly important to the city’s tourism and leisure companies,” the report stated. And integrated resorts with “outstanding non-gaming offerings” will be better positioned for success.

In a notable recent example, gross gaming revenue for June reached MOP21.06 billion ($2.6 billion), up 19% year on year. Analysts from JP Morgan, Citi and Seaport Research all credited the spill-over effect from concerts by Cantopop and K-pop stars. The standout was a Galaxy Macau residency starring Hong Kong’s “God of Song” Jackie Cheung.

“The ‘concert economy’ has emerged as one of the most compelling success stories in the post-pandemic period,” according to Macau Business. “Clearly this momentum must be sustained” and expanded to stimulate the greater community, beyond casinos.

The amended law would ban any ads that “draw public attention or evoke associations with gambling activities” or “encourage anyone to participate in any form of gambling activity”.

Targeting minors would be strictly prohibited. The law would also apply to alcohol and cigarettes.

“The nature of advertising, including its content, format and dissemination channels, has changed significantly,” said Yau Yun Wah, director of the Economic and Technological Development Bureau, in a Friday press briefing.

New Macau casino advertising law will regulate influencers

The amended regulations will also address new forms of marketing such as livestreaming and influencer content.

“Participants in online promotional activities and live marketing – such as advertisers, advertising agencies, platform owners and presenters – are subject to the Advertising Activity Law and must comply with its provisions when their actions constitute advertising,” said Yau.

Influencers must demonstrate “truthfulness” and confirm that they actually use the products or services they endorse

“We hope that, in the future, advertising ambassadors will be clearly identified in advertisements,” the director added. In case of complaints or false claims, the law may add provisions for legal redress. Also, according to Macau Business, influencers from outside Macau cannot work inside the city without a permit.

A 30-day consultation period will “gather public and industry views to ensure the law is both relevant and enforceable”, Yau said.

Macau’s casinos reported a GGR of MOP21.06 billion ($2.6 billion) in June, up 19% year on year. Added to a robust performance in May – a 5% boost in GGR versus the consensus of 2.7% – it brings total GGR so far to MOP118.77 billion, up 4.4% over 2024.

It’s a welcome development for the Asian gaming mecca, which started the year strongly only to see the momentum dwindle.

Last year, anticipating a bump in tourism, government officials set a GGR target of MOP240 billion for 2025. Industry analysts were even more upbeat. Citi’s George Choi and Timothy Chau projected a 7% increase in GGR year-over-year, for a total of MOP244 billion.

But those hopes soon dimmed. Following lacklustre revenues in January and February, the government adjusted its expectations downward, resetting the yearly total to MOP228 billion.

June boost tied to ‘God of song’

June’s results put Macau on track to meet and surpass the government’s revised forecast – and all because of a 60ish crooner called the “Heavenly King of Cantopop”.

According to Macau Business, JP Morgan analysts credited superstar Jacky Cheung – also known as “the God of song” – for the “unexpected seasonal surge”.

The Citi team concurred. “We conducted our June 2025 table survey on the first night Cheung performed,” wrote Choi and Chau. “And we attribute all the positive findings from our survey to him” – including a 16% increase in premium players that night and a 36% increase in the the average wager.

Vitaly Umansky of Seaport Research Partners, too, cited “strong entertainment events [and] high hold” for the upturn. Bloomberg also tied the revenue boost to “concert fervour”.

Renewed optimism for second half

With more special events planned for July – Cheung’s “60-Plus” concert series continues at Galaxy Macau through Sunday – Seaport expects GGR to rise 10.2% year on year for the month. The investment firm has also upped its forecast for the second half, estimating 6.8% growth for the period and total annual GGR growth of 5.6%.

“Growth should be driven by increased marketing efforts by operators and improving consumer trends in China,” Umansky wrote. “China stimulus and policy measures are likely to help shore up China’s economy and improve consumer confidence later this year.”

This week: World Pool bets on Royal Ascot were up 10%, controversy continues to dog South Africa’s lottery licence award and Romania has changed its advertising rules.

World Pool up at Royal Ascot

World Pool bet types for Royal Ascot 2025 were up 10% from 2024, rising to HK$1.57 billion ($200 million) for the five days.

Including a record-high on Wednesday of HK$330.7m, the most bet on the second day of the meeting since the inaugural World Pool meeting at Royal Ascot in 2019, turnover was up year-on-year every day.

Turnover at the 2022 meeting remains the highest at HK$1.61 billion, approximately 2% higher than this year’s level. In 2025, punters from across the globe were able to access commingled pools on the event for the seventh consecutive season.

Sam Nati, head of commingling at the HKJC, said: “In terms of quality, quantity and competitiveness, the fields were fantastic all week. There was also some good international representation, both in the horses running and the jockeys taking part, so it was a good mix of key factors for both local and overseas punters.”

Tycoon defends SA lottery link

South African tycoon Moses Tembe has dismissed accusations that a consortium he headed was awarded the country’s next National Lottery licence contract due to political influence.

Concerns have been raised about Sizekhaya Holdings’ links to South African Deputy President Paul Mashatile. Bellamont Gaming, a company owned by Tembe and Mashatile’s wife’s sister, Khumo Bogatsu, has shares in Sizekhaya.

However, Tembe told Times Live that Bellamont has a minimal share of Sizekhaya stock.

Tembe added: “We have indicated previously that Sizekhaya [Holdings] won the right to operate the fourth national lottery licence because of the strength of our bid, the deep knowledge of gaming that we bring to the table, our pledge to propel the lottery to new heights by generating more money for the government, for good causes and for players.”

Romania bans celebs from gambling ads

Romania’s National Audiovisual Council (CNA) has banned celebrities from appearing in gambling promotions.

CNA members unanimously approved the ban during a public session on Thursday.

They amended the Audiovisual Regulatory Code to prohibit celebrity appearances in gambling ads on TV, radio and online platforms.

Romanian outlet PaginaDeMedia published the updated wording of the regulation. The new rule states: “It is prohibited to broadcast gambling ads featuring public, cultural, scientific, or sports personalities.”

Gambling ads previously featured celebrities such as footballers Florin Răducioiu and Ilie Dumitrescu and singers Antonia and Alex Velea.

Kaizen to sponsor CONMEBOL Copa América Femenina 2025

Kaizen Gaming has been named as official sponsor of the CONMEBOL Copa América Femenina 2025.

Hosted in Ecuador in July and August, the tournament will bring together South America’s 10 women’s football teams.

The sponsorship of CONMEBOL Copa América Femenina 2025 is part of Betano and CONMEBOL’s broader partnership, which started with the CONMEBOL Copa América 2024 and extends through 2028.

Alejandro Domínguez, president of CONMEBOL, said: “Having Betano’s support encourages us to continue raising the level of the tournament and to provide more opportunities for our athletes to shine on the field and keep leaving their mark both on and off the pitch.”

F1 and Allwyn launch community award

Formula 1 and lottery operator Allwyn have announced the launch of the F1 Allwyn Global Community Award.

The programme will spotlight community-focused initiatives across the world of Formula 1 to showcase their positive impact on society. As well as global recognition, winning initiatives will each receive a €100,000 donation from Allwyn to further transform communities around the world.

Winners must demonstrate a meaningful contribution to society away from the racetrack, which could include advancements in education, culture, well-being or sustainability. For each race, the local promoter will identify Formula 1-linked community initiatives run by teams, partners and media that have had an impact in their country.

Stefano Domenicali, president and chief executive of Formula 1, said: “We will give the local initiatives that go the extra mile for making their communities and make the world a better place the recognition and global platform they deserve.”

The 199-room luxury tower, a pet project of flamboyant entrepreneur Stephen Hung, targeted Macau’s once-dominant VIP sector. Designed by Hung with French Princess Tania de Bourbon Parme, it offered ornate suites with marble Roman baths and massive crystal chandeliers.

Other appointments included 24-hour butler service, private elevators and a fleet of 30 bespoke Rolls Royce Phantoms in a custom colour: “Stephen red”. One high-end suite went for $127,400 a night.

Ill-timed venture in post-VIP era

Hung, a Hong Kong billionaire and former Merrill Lynch advisor, once topped a South China Morning Post list of “crazy rich Asians” featured in the Netflix series “Bling Empire”. He envisioned a hotel on Macau’s Cotai Strip to rival the Palace of Versailles.

But the timing was wrong from the start. The 13 broke ground in 2013, the year Xi Jinping became president of the People’s Republic of China. The combination of Xi’s anti-ostentation campaign and a government crackdown on capital flight decimated Macau’s VIP segment.

Worse, The 13, which planned to operate a satellite casino with 66 gaming tables, was denied a gaming licence. That was a body blow, as its target demographic – big-spending high rollers – preferred to stay where they play. 

The hotel operated for less than two years, from August 2018 to February 2020, closed at the start of the pandemic and went bankrupt in 2023. It finally reopened last year, when the Macau Government Tourism Office renewed its hotel licence.

Buyer ‘confident’ in Macau market

The new owner, identified by Macau realtor Jones Lang Lasalle only as “a local buyer”, got a deal, if not a steal.

According to Macau Daily Times, the hotel, listed for $2.4 billion in March 2024, sold for just $76 million. It will be “fully renovated”, per Mark Wong, senior manager of JLL Macau.

Though mass-market gambling has supplanted VIP as the chief revenue driver, the buyer “is very confident about the local market”, Wong added. “The property will remain a hotel and the buyer will invest and revitalise it.”

In a news release Monday, Melco Resorts & Entertainment announced it will close its Grand Dragon Casino and three slot lounges operating under the Mocha Club brand. Melco said the closures are in line with “the company’s overall development strategy and in accordance with Macau law”.

It plans to maintain Mocha Inner Harbour, Mocha Hotel Sintra and Mocha Golden Dragon, subject to government approval.

Galaxy Entertainment Group announced, meanwhile, it will close the Waldo Casino “due to commercial considerations”. It, too, pledged to shift workers to other properties in Macau.

SJM Holdings is wielding the biggest axe. The concessionaire will shut down seven of its nine satellites this year while making plans to acquire the two others – Ponte 16 and L’Arc Macau – and shift them to the directly managed model.

SJM said the move supports its “long-term objectives [and] overall competitiveness”. Properties on the block include Casa Real, Emperor Palace, Fortuna, Grandview, Kam Pek Paradise, Landmark and Legend Palace. Their current service agreements will expire on 31 December.

All affected workers will receive “job opportunities within SJM Resorts’ portfolio of properties”, said the company.

New industry template, tied to management fees

In 2022, the Macau government amended its gaming laws prior to granting six new 10-year casino concessions. It gave satellites three years to shift from a profit-sharing model to a structure in which they are directly owned by licensees. Those that survive the transition will make their money through management fees, not shared revenues.

Gaming analyst Chan Chi Leong told Macau Business that satellites are traditionally responsible for all operational costs, including salaries. The concessionaires, meanwhile, pay gaming taxes, about 40% of gross revenue. Historically, satellites have earned from 55% to 57% of GGR, with concessionaires picking up the rest.

Satellites will remain part of the Macau gaming mix, possibly with management fees adjusted for inflation.

Citywide, up to 6,000 jobs at 11 satellite casinos may be affected. The Macau Labour Affairs Bureau promised to “closely monitor the situation” to ensure operators make good on their pledge to reassign employees.

Gross gambling revenue in Macau reached its highest monthly total since before the Covid-19 pandemic during May, with year-to-date revenue just short of MOP100 billion ($12.38 billion). This, analysts said, was boosted by an extra weekend during the month and popular national holidays that drew increased activity.

Macau’s previous post-pandemic monthly high came in October 2024, when revenue topped MOP20.79 billion. The May total surpassed this by 2%, according to data from the Gaming Inspection and Coordination Bureau.

The May total means that year-to-date revenue in Macau stood at MOP97.71 billion. This is 1.7% more than at the same point in 2024.

Macau beats estimates in May

Analysts Seaport Research Partners said Macau surpassed expectations in May, while benefitting from an extra Saturday during the month. Weekend days are, on average, 20% higher in revenue terms than weekdays, analysts said.

Macau’s Dragon Boat Festival fell early this year (31 May to 2 June), whereas in 2024, it was in mid-June. This also helped to drive additional activity during the period.

Seaport had estimated a 5.3% year-on-year growth rate for the market in May.

Looking to June, Seaport estimated a 3.4% year-on-year rise in revenue, but a 13.7% fall from May. Analysts said Macau should benefit from several large concerts, as well as the early Dragon Boat holiday.

The analysts warned their June estimate was “conservative” as performance could be impacted by typhoons as the season approaches in June.

As for the full-year, Seaport anticipates a 4% rise in gross gaming revenue across Macau. This, it said, should be driven by increased marketing efforts by operators and improving consumer trends in China.

“China stimulus and policy measures are likely to help shore up China’s economy and improve consumer confidence later this year,” Seaport said in a note published Sunday.

Last June, Beijing launched a crackdown on illicit money changers, who help gamblers skirt government controls on capital flight. Last October, the Macau Legislative Assembly passed legislation making it a crime.

According to the ministry of public security, the exchanges facilitate money laundering and lead to “fights, fraud, thefts, illegal immigration and other crimes” including kidnapping and murder.

The amended Law on Combating Gambling Crimes includes prison terms of up to five years for offenders. Convictions could lead to a 10-year ban from city casinos.

The new law also increased the penalties for illegal gambling. Side bets and parallel bets are now punishable by as much as eight years in prison. In addition, the law gives police more power to enter and search suspected illegal gambling dens.

Crime up despite fewer casinos

The rise in criminal incidents occurred despite a drop in the total number of casinos, reported Macau Business, from 40 in 2019 to just 30 today.

Suspicious transaction reports filed by gaming operators reached a record 3,837 last year, up 11.8% year-on-year. That’s the highest volume since 2006, when Macau established its Financial Intelligence Office.

The surge in money changers coincided with the shift in the VIP business, including the near-extinction of the junket trade. China’s State Administration of Foreign Exchange limits overseas withdrawals from Chinese banks to just CNY100,000 ($14,000) per year – chump change for whales who don’t blink at playing $25,000 a hand.

Among the 567 cases recorded in Q1, 132 involved money changers, more than 60% of the increase. Fraud was next, with 152 cases or 26.8%. Rounding out the total were usury, theft, misappropriation and defiance of casino exclusion orders.

“Casinos and gambling are widely considered to be breeding grounds for a range of deviant behaviour and criminal offences,” says researcher Quan Fang of the School of Law at Macau University of Science and Technology.

Sonny Shiu-Hing Lo, who has written about crime in Macau, agrees that “casinos lead to activities such as white money laundering, loan sharking and prostitution”.

The amendment to criminalise money exchanges followed on the heels of the murder of a money changer. He had just won big at a local casino, raking in about CNY2.3 million. He was later found stabbed to death in his room at the Wynn Palace on Cotai.

On Monday, share value of Wynn Resorts, Las Vegas Sands and MGM Resorts – three of Macau’s Big Six casino concessionaires – rose by roughly 8%, 7% and 5%, respectively, Investopedia reported. On the same day, the S&P 500 was up 3%.

Chief executive offers reassurance

The Asia-facing units may also be reassured by comments from Macau Chief Executive Sam Hou Fai. At a press conference on Tuesday, Sam said the Chinese special administrative region will not punish American operators for actions out of Washington.

“As long as they follow Macau’s laws and conduct their activities in an orderly and lawful manner, [the operators] are protected and supported” by the SAR, he said.

Sam acknowledged “profound changes reshaping the international geopolitical landscape” and “intensifying competition in the tourism and gaming sectors”. Those factors, along with Macau’s over-reliance on gaming for tax revenue, limits the city’s “capacity to withstand economic shocks”.

He reiterated the call for “appropriate economic diversification fostering the city’s sustainable socioeconomic development”.

The government’s “1+4” plan for growth, established in 2023, emphasises the development of international tourism and hospitality bolstered by four new economic pillars. They include Chinese health, finance, technology and the meetings and convention trade.

In comments before his December retirement, former chief executive Ho Iat-Seng said the government’s goal is not “to compress the gaming industry”. It is, rather, to “grow the pie” by expanding other sectors. Chinese President Xi Jinping has also stressed the importance of “new industries with international competitiveness”.

Casino operators are required to do their part. Through 2023, they must invest a collective MOP130 billion ($16.1 billion) in non-gaming attractions and local infrastructure.

US operators ‘unlikely’ to face ouster

As recently as April, Fitch Ratings warned that American operators in Macau could be “subject to retaliation” by the government due to US-China tensions. The soft Chinese economy was “likely to pressure gaming revenues and earnings”. However, the agency added, “healthy balance sheets and ratings headroom” could mitigate the risks.

Fitch said Sands had “ample rating headroom” and abundant liquidity. MGM and Wynn also had “adequate rating headroom at current levels”.

Moreover, as Sam noted: “Foreign investments are highly welcomed in the Macau SAR. This is one of the goals outlined in my recent policy address. As long as they comply with local regulations, all foreign investments will be protected and supported.”

Presently, the gaming industry contributes about 80% of Macau tax revenue. Wynn, Sands and MGM represent more than half of gross gaming revenue in the jurisdiction. Termination or non-renewal of their licences is “highly unlikely”, per Fitch.

Ng succeeds Adriano Marques Ho, who became customs director general under incoming Chief Executive Sam Hou Fai last year.

The appointment was announced on 7 May in the government’s Official Bulletin. It completes the transition from the administration of former chief executive Ho Iat-Seng and Sam, who took the reins in mid-December.

‘Professional competence, aptitude’

Ng is the first woman appointed to head the DICJ, which oversees Macau’s multibillion-dollar gaming industry.

Her resume includes leadership roles from 1999 to 2017 at the Macau Labour Affairs Bureau. She served as deputy director of the Public Administration Bureau before assuming the directorial role in September 2023.

According to Macao News, Ng is a graduate of Sun Yat-Sen University with a master’s degree in criminal law.

Secretary for Economy and Finance Tai Kin Ip, who announced the appointment, said Ng’s “professional competence and aptitude” qualify her for the position. She will serve an initial one-year term.

Transitional moment for Macau gaming

Ng steps in as DICJ head at a crucial time for the world’s No 1 gaming jurisdiction.

Macau’s primary industry generated gross revenue of MOP226.8 billion ($28.1 billion) in 2024 (Las Vegas was a distant second with $15.8 billion and Singapore came in third with almost $6 billion).

But that revenue stream ran dry during the pandemic, which closed borders to the city for almost three years. Macau is now under pressure to diversify, with a “1+4” development strategy launched under Ho. Its goal is to advance four additional economic pillars – finance, technology, health and the meetings trade – anchored by a strong gaming sector.

Casino operators, two years into their 10-year concessions, are on order to contribute $16.2 billion toward non-gaming attractions in the city. With the virtual collapse of the VIP industry, they are also pivoting toward the mass and premium mass segments.

Competition waits in the wings

The market also faces the prospect of future competition throughout Southeast Asia. Japan will open its first casino, the $9 billion MGM Osaka, in 2030. Meanwhile, lawmakers in Thailand are debating the merits of an Entertainment Complex Bill that would introduce five casino resorts in that country.

CSLA analysts say a mature Thai gaming industry could generate revenue of up to $15.1 billion yearly – not in the Macau range, but enough to rival Vegas, supplant Singapore and shake up global tourism as well as gaming.

The Hong Kong-listed operator runs integrated resorts in Macau, Manila and Cyprus and is preparing to open its Sri Lanka casino later this year.

‘Firing on all cylinders in Macau’

Melco’s market share in Macau grew from 14.7% in Q4 2024 to 15.7% in Q1 2025 “and remained stable at this level in April”, Ho said. Property EBITDA grew 32% quarter-over-quarter

Mass drop increased throughout the quarter and reached record highs at both City of Dreams and Studio City. That momentum continued into April and Golden Week, the national holiday celebrated 1-5 May in China.

Despite new supply in Macau – specifically the Londoner Grand, which opened in April and targets the premium mass segment – traffic at Melco resorts grew by 30% year on year.

“I don’t think there’s been any cannibalisation… or material impact” from the Londoner, said Ho. “I think we’ve found our groove again and rediscovered our identity.”

The return of House of Dancing Water, a signature spectacle at City of Dreams Macau, “was a resounding success” and is expected to increase footfall by about 4,000 visitors per day, he added. “Other initiatives to drive traffic [include] a revamp of our retail area and renovation of the main entrance to City of Dreams and Studio City.”

Following some disruption during now-complete renovations at the latter resort, “the sequential growth in its property EBITDA demonstrates the impact of these initiatives”, Ho continued. Melco is “firing on all cylinders in Macau”.

Manila for sale, Mediterranean improves

City of Dreams Manila felt the impact of increased competition in that market, Ho continued. “We’re adjusting our cost structure and reviewing our marketing programmes to enhance EBITDA contribution from the business.”

Melco continues its quest to offload the IR in the Philippines Entertainment City casino zone. The move would free up capital for a Thailand bid, if and when that nation legalises entertainment resorts with gaming.

“Potential buyers are signing NDAs,” Ho told analysts. “Over time we will whittle down that group to a short list for the bidding process. We’ll come back when there’s something to announce.”

Meanwhile, City of Dreams Mediterranean in Cyprus “achieved 10% year-over-year growth in property EBITDA” for Q1.

“Despite continued noise in the region,” said Ho – meaning impacts on tourism from the Ukraine and Israel-Hamas conflicts – the Melco property “is starting to ramp up” for the coming summer. Bookings are “materially higher than what we had this time last year. We’re optimistic about the results that Cyprus can deliver over the rest of the year.”

Last but not least, preparations continue for the opening of a Melco casino at City of Dreams Sri Lanka. Doors are expected to open in the third quarter.

Looking ahead: more ‘rational’ reinvestment

Ho said Macau concessionaires are being “more rational” about market reinvestment in 2025.

“Post-Covid, we started slow. Then last year, we’d gone overboard with regards to reinvestment. We offer a premium product, so we should never be the most competitive and most aggressive in terms of marketing schemes. At the end of the day, we have probably the two best hotels in Macau at City of Dreams and Epic at Studio City, which is also an amazing new product.”

Those products along with a family-friendly indoor water park at Studio City are “enough to attract a very broad customer base”, said Ho. “All the non-gaming attractions that we have built years in advance will be great for us going forward.” Now is the time to “be disciplined and… continue to focus on improving our margin”.

The Chinese government is lending a hand through recent stimulus measures.

“Chinese policy is the most important thing to us, even more than the Chinese economy,” Ho concluded. Beijing has been “super-supportive and is now focusing on increasing domestic consumption, discretionary spending and domestic travel. These are all key criteria for us.”

Group net income was halved from $144.2 million a year ago to $72.7 million this quarter. Diluted net income per share was also cut approximately in half from $1.30 per share in 2024’s first quarter to $0.69 this year.

The company said in a release that “operating revenues decreased $81.8 million, $51.0 million, $11.3 million and $8.6 million at Wynn Macau, Wynn Palace, our Las Vegas Operations and Encore Boston Harbor, respectively, from the first quarter of 2024.”

Group adjusted property EBITDAR for the quarter was $532.9 million, a 17.5% decrease YoY. Wynn Macau, Wynn Palace, Las Vegas operations and Encore Boston Harbor saw adjusted EBITDAR declines of $40.7 million, $40.5 million, $22.9 million and $5.7 million, respectively.

Impact on opex ‘low and entirely manageable’

Much like other Las Vegas-facing casino operators, Wynn attributed these declines in part to tough comparisons from hosting the Super Bowl last year. When excluding Super Bowl weekend from calculations, the company said, there were actually a number of YoY increases for the period.

But analysts were eager to see how Wynn CEO Craig Billings would react to the current economic environment, especially as Wynn is perhaps the highest-end luxury brand in gaming. Billings addressed the topic right away, opening Tuesday’s investor call with it.

“We expect the direct impact from tariffs on OpEx to be low and entirely manageable with most of the impact in the US stemming from food and beverage, where we are actively working though alternative sourcing for the most impactful items,” he said in prepared remarks.

Billings later said in response to questions that there will likely be a decrease in travel, but “it doesn’t really impact us much at all”. While he did caution that things could change, right now “everything is pretty good, actually”.

CapEx, however, “is a different story”, he said.

$375 million worth of projects delayed

The company announced it is “reassessing the timing, scope and sourcing” of projects at Wynn Las Vegas “representing approximately $375 million of previously disclosed project capital expenditures”.

“While we’re staying nimble, the pace of change at the moment is just too significant to commit to any revised timing on that CapEx,” Billings said on the call.

The biggest item from the budget was a renovation project at the Encore tower in Las Vegas. Billings estimated that to be in the “high $200s” of the $375 million total. He indicated to analysts that the projects were not cancelled altogether, just placed on hold.

Despite this, Wynn managed to buy back $200 million worth of shares during the quarter and the company announced on Tuesday that its board has declared a $0.25 per share cash dividend, payable on 30 May. As of 31 March, Wynn had $2.07 billion in cash on hand and $10.5 billion in total debt.

Al Marjan progressing

Company officials gave updates on the Al Marjan Island joint venture in the United Arab Emirates, which Billings has repeatedly called the most promising gaming development any company currently boasts. Wynn owns 40% of the venture, alongside partners Marjan and RAK Hospitality Holdings.

During Q1, Wynn contributed a total of $51.2 million in cash toward the development, which now has reached the 47th floor. The company’s total contributions now sit at $682.9 million.

When asked how tariffs might impact construction, Billings asserted that everything is still on track for a 2027 opening. Most of the materials have already been purchased, he said, which will help avoid extra costs.

New York still alive

The chance for a New York casino licence was another topic of interest on Tuesday, given Wynn’s $12 billion Hudson Yards bid with Related Companies and Oxford Properties Group. Two initial applicants – Hudson’s Bay Co and Las Vegas Sands – have formally pulled their bids ahead of the 27 June deadline. LVS is a noteworthy comparison to Wynn, as both are luxury resort operators with concerns about competition from online gaming.

Billings said New York is “a great potential market”, but also “a complicated market with a lot of considerations”. Like LVS, he said the threat of iGaming legalisation in New York was “a point of concern”. He did not indicate any plan, however, to pull the bid outright.

The partners’ Hudson Yards proposal was changed significantly in late April by more than doubling the housing commitment from 1,500 units to 4,000. This had been the biggest contention from opponents, but several hurdles remain between now and when licences are awarded at the end of the year.

“We continue to be in the running in New York, but we absolutely will not get over our skis to win a licence there,” Billings told analysts.

Elsewhere in Asia

Other two notable locales discussed on the earnings call were Japan and Thailand, which both have had ups and downs in terms of attractiveness for gaming investment. Japan, which once had several potential bidders, has been whittled to just one project – MGM Osaka – whereas Thailand came very close to a massive casino expansion this spring before pulling legislation for further review.

With regard to Thailand, Billings said there were some “components of the bill that probably won’t work”. This might have been an allusion to extensive wealth and background checks for patrons, which have been controversial thus far.

In Japan, there have been reports the country may open a second round of bidding for up to two additional licences. Wynn previously signalled interest in the market but ceased operations there in 2020. Billings said there were “structural challenges” there and seemed bearish on the market overall .

“We’ve got plenty of development opportunities,” he said. “We’d only look at Japan if the setup was right.”

The boost portends a good start to Golden Week, the five-day Chinese holiday that started on 1 May.

Historically, according to data cited by Macau Business, Macau casinos post the highest revenue in May, August and October. During those months, millions of mainland tourists flood the special administrative region, the only place in China where casino gambling is legal.

China stimulus driving upturn in Macau GGR

The bump in GGR has been linked to an improving Chinese economy.

Analyst Vitaly Umansky of Seaport Research Partners said consumer confidence, especially among the upper-middle class, is the “key to driving upward growth in Macau”.

“[E]scalation of US tariffs remains an overhang and parts of the China economy remain weak (i.e., consumer spend, real estate),” Umansky continued. But stimulus measures from the central government should “improve economic activity and consumer confidence in 2025”.

The US-China trade war could also prompt Beijing to “more forcefully implement stimulative measures to help drive consumption,” he noted. “Such policy initiatives should have a positive tailwind to Macau revenues.”

Golden Week an important barometer

Year-to-date, Macau casinos have generated MOP76.51 billion, up 0.8% over the same period in 2024. But the monthly average of MOP19.12 billion is still short of the MOP20 billion necessary to meet the yearly target of MOP240 billion.

The Macau Government Tourism Office expects 127,000 to 140,000 daily visitors for the Golden Week holiday, which Bloomberg called “the next important data point”. Casinos and the local government are ramping up after-hours entertainment in a bid for more overnight stays.

In 2024, gaming contributed about 80% of total tax revenue in Macau, Sam pointed out. That’s an unsustainable imbalance, especially as competition in the gaming industry increases.

Sam’s plan, reported by Macau Business, includes MOP38.2 billion (£3.5 billion/€4.167 billion/$4.75 billion) in investments in the Greater Bay Area. The GBA consists of the special administrative regions (SARs) of Macau and Hong Kong and nine cities in Guangdong Province. 

Gaming operators are on the hook for at least some of the improvements, as a condition of the concessions that were renewed in 2023. The projects should be complete in the next eight to 10 years.

Advancing education, culture, aviation, tech

The projects, unveiled by Sam at a press briefing on 27 April, include:

•  A MOP20 billion investment in the Macau-Hengqin International Education University Town and the addition of a MOP12 billion Integrated Cultural and Tourism Zone.
• An MOP12 billion Integrated Cultural and Tourism Zone that includes a National Museum, an International Arts Centre and an International Exhibition Centre. All will highlight Macau’s unique fusion of Portuguese and Chinese cultures.
• The MOP6 billion expansion of Macau International Airport, designed to increase passenger capacity from 10 million to 15 million per year by 2030.
• A Macau Technology R&D Industrial Park, which Sam hopes will bring more international research and development business to the SAR.
  

Effects of US tariffs “indirect” but meaningful

Sam said recent US-China trade tensions may not directly affect Macau. But the impact of tariff hikes on other countries could negatively affect tourism to the gaming hub. And that, by extension, could take a bite out of gaming revenue, still the lifeblood of the SAR budget.

For that reason, Sam said, the city must develop new industries internally and also deepen alliances with other cities in the GBA.

Diversification is a recurring theme for Sam, as it was for his predecessor, former chief executive Ho Iat-Seng, who stepped down in December.

“Macau cannot remain unscathed as competition in tourism and gaming from neighbouring cities intensifies and looms,” Sam said in February. “Such risks and challenges must not be overlooked.”

Mass baccarat dropped 0.76% year-on-year in 2024, but it grew almost 15% from the same period in 2019. Meanwhile, VIP baccarat generated MOP14.45 billion, up 0.54% over last year, but down 61% compared to 2019.  

In comments before the legislative assembly on 14 April, Macau chief executive Sam Hou Fai acknowledged that GGR for the year will likely fall short of the government’s target of MOP240 billion – a goal that requires MOP19.2 billion in GGR per month. If revenue slips below that level, Macau “would immediately be running a budget deficit” for the year, said Sam.

But if China stimulus measures work as planned, visitors to the city may be more willing to open their wallets. On 18 April, China Daily reported that Asia’s largest economy expanded 5.4% in the first three months of the year, exceeding the projected 5.2%. 

Morgan Stanley strategist Xu Changtai called first-quarter GDP growth a “modestly positive indicator” of healthy momentum.

Mass market edging VIP segment

The shift to mass-market gaming is a sign of the changing times. In recent years, Beijing has intensified its crackdown on capital flight, unlicensed money exchanges and junket operations, putting a dent in the once-dominant VIP segment.

According to Macao News, junkets, which provide transportation, accommodations and casino credit for high rollers visiting Macau, once accounted for as much as 60% of GGR. Their downfall began when two industry kingpins were arrested and charged with illegal gambling and fraud.

In 2023, Suncity boss Alvin Chau was sentenced to 18 years in prison. Several months later, Tak Chun founder Levo Chan got 14 years. Their convictions sent some VIPs into hiding and caused a shift toward mass and premium-mass gaming in Macau. Since 2014, the number of junket operations in the city has dropped from 235 to just 24.

Growth should accelerate in Q2

CSLA analysts Jeffrey Kiang and Leo Pan have tied the slump to a weaker yuan and simmering US-China trade tensions. They predict GGR will grow an anemic 1.8% this year, reaching just MOP230.8 billion.

“While we think growth in 2025 will be minimal, this should accelerate in 2026 based on our property team’s view that Chinese property prices will gradually bottom out in [H2 2025], which we see as a key driver for consumer confidence in China,” they said. They also expect tourism to Macau to expand 2.6% in 2025 and 2026 and grow 4.6% in 2027.

Seaport Research analyst Vitaly Umansky advises casino investors to look for improvement in the second quarter of 2025 and the rest of the year, “especially with heightened concern around any potential slowdown in Asia due to the Trump tariff regime and a potential US recession”.

However, he added, “gaming stocks remain intrinsically undervalued, especially the Macau companies.… In Macau, growth has hit a wall, and we reduced our growth expectations for 2025. But we do expect an acceleration of growth in the second half of the year…. We now forecast GGR growth of 3%” in the world’s foremost gaming market, he said.

Now owned by a bank, The 13 is listed for sale for a cool HK$2.4 billion (£411.6 million/€354 million/$309 million). Real estate consultancy Jones Lang LaSalle (JLL) represents the seller.

“It’s a super-luxury hotel,” JLL senior director Mark Wong told the South China Morning Post. “The hotel market is recovering after the Covid-19 pandemic and tourists are coming back quickly.”

Macau expects 35 million visitors in 2025, up by almost 25% over last year.

VIP palace on the Cotai Strip

The property was the brainchild of former Merrill Lynch Asian investment banker Stephen Hung. The flamboyant Hong Kong entrepreneur promised to replicate the Palace of Versailles on Macau’s Cotai Strip and even called his company Louis XIII Holdings Ltd. He later rebranded it as The 13 Holdings Limited.

Outsized appointments included luxury villas with 24-hour butlers, private elevators, a fleet of 30 bespoke Rolls Royce Phantoms in “Stephen red” and “the very first sauna in Macau built with Himalayan salt bricks”. One VIP suite went for more than HK$1 million a night.

The project broke ground in 2013, the same year Xi Jinping became president of the People’s Republic of China. It was bad timing for The 13, as Xi’s anti-ostentation campaign put a damper on Macau’s VIP sector. In addition, The 13 was denied a gaming licence. That was a big drawback, as its target demographic – big-spending high rollers – preferred to stay where they play. 

Will The 13 finally get lucky?

According to Macau Business, the property has multiple bankruptcies in its past.

Former majority investor, South Shore Holdings Limited, went belly-up in 2021 and was delisted from the Hong Kong Stock Exchange. Its affiliate, The 13 Hotel Management Limited, filed for bankruptcy in 2023. And New Concordia Hotel Limited, which owns the rights to the project site, was liquidated in the same year. It has been since taken over by its creditor, Bank of Communications Macau. The 13 itself was declared officially bankrupt in February 2023.

JLL failed in an effort to sell the property in March 2024, but Wong contends that interest is higher this time around.

“With excellent transport links, including a nearby railway station just three minutes away, the property’s potential for appreciation is further enhanced,” he said. “The opportunity to acquire the entire hotel is exceptionally rare in the market and is expected to be highly sought after by investors.”

One-time hotelier Stephen Hung, for his part, continues to live large. With a net worth estimated at $400 million, he travels around the world in private jets and, per Tatler Asia, is often front and centre at events like Paris Fashion Week and the Cannes Film Festival. He and his wife, Mexican supermodel Deborah Valdez Hung, starred in the 2023 edition of the Netflix reality series Bling Empire.

Investors interested in his palatial but ill-timed property must submit their bids by 19 May.

If it slips below that level, “[W]e would immediately be running a budget deficit,” said Sam.

From January through March, GGR rose just 0.6% year-on-year, for a monthly average of MOP19.2 billion. To meet government expectations of MOP240 billion for the year, gaming must generate MOP20 billion a month.

“The imbalance in our fiscal structure is serious” and demands “a strong sense of crisis awareness”, Sam added. “Macau is a small city, yet our regular expenditure is substantial – and it will continue to grow unless we face extreme circumstances.”

Concessionaires responsible for Hengqin investments

Sam wants stepped-up efforts to diversify the local economy, “focusing on sectors such as healthcare and finance to build a more sustainable fiscal foundation for Macau”.

The government also plans a review of non-gaming contributions by the city’s six casino concessionaires. As a condition of their licences, operators are required to invest MOP130.4 billion in non-gaming attractions and infrastructure, not just in Macau but on the neighbouring island of Hengqin.

“We will… guide the concessionaires to invest more resources in priority industrial projects in Macau and Hengqin, as well as in brands that support the enhancement of Macau’s overall global competitiveness,” said the chief executive, according to Macau Business. “The public is paying close attention to what qualifies as non-gaming development. The government shares this concern and will establish clear criteria for standards, evaluation and assessment.”

The New York Times has reported that China is “merging and blurring the boundaries between major southern Chinese cities as well as Hong Kong”. For example, shortly before President Xi Jinping’s December visit to Macau, casino operator SJM Holdings said it would acquire nine floors of office space in Hengqin and turn it into a three-star hotel.

Effect of US-China trade war will be “minimal” in Macau

Meanwhile, the accelerating US-China trade war should have a “minimal” effect on Macau, according to José Carlos Matias.

In a recent editorial, the Macau Business director pointed out that Macau’s “overwhelmingly service-based economy” relied on the US for just 5.5% of exports last year.

He agreed with Sam that concerns are “understandably mounting in the face of the SAR’s conspicuous reliance on gaming”. In 2024, he noted, gaming taxes still accounted for 80.5% of the government’s total revenue, only slightly less than the 84.8% recorded in 2019.

“And come the first day of each new month, all eyes are on the single figure that truly matters for the city’s wealth and public finances: the monthly GGR tally.”

The city cannot be fully insulated from “surrounding patterns and trends”, he added. However, despite the “disruptor-in-chief” in Washington, Matias wrote, “the glass is still half-full”.

On 2 April, Trump announced new trade tariffs from 10% to 50% affecting 60-plus trade partners around the world. China was hit with a 34% tariff on imports, in addition to two rounds of 10% imposed in February and March.

In response, Beijing announced a 34% tariff on US goods, to take effect from 10 April. In the next salvo, Trump threatened an additional 50% tariff against China, for a potential total of 104%.

The administration of Xi Jingping has also filed a lawsuit against the US with the World Trade Organisation.

Macau operators feeling the pain

In the tariff war, Macau casino concessionaires took it on the chin. SJM Holdings, Melco International Development and Galaxy Entertainment hit three-year lows today (7 April), dropping 18%, 16% and 12.44%, respectively.

US-based operators – Sands China, Wynn Macau and MGM China Holdings – also went south, losing 14%, 13% and nearly 12%. All are listed on the Hong Kong Stock Exchange.

Last week, Morningstar Investment Research warned of heightened risks for American companies doing business in the Chinese gaming hub.

“We have adjusted our cost of equity assumptions for Wynn, Las Vegas Sands and MGM due to their exposure to Macao,” wrote analyst Dan Wasiolek, citing “increasing geopolitical tensions” between the superpowers.

In another jab at China, the US has added Macau to a list of “foreign adversaries”, joining Russia, Iran and North Korea.

Long term, US operators protected by expertise

Trump is defending his actions despite some economists warning of a looming global recession.

“Sometimes you have to take medicine to fix something,” he said. “We have been treated so badly by other countries. They took our businesses, they took our money, they took our jobs. They moved it to Mexico, they moved it to Canada, they moved a lot of it to China.”

Morningstar’s Wasiolek says the trade war is “moving the US further toward protectionism, a shift we see lasting for the foreseeable future”. But he believes US gaming operators in Macau will outlast the turbulence.

“While we will continue to monitor the macroeconomic enironment for our Macau-related coverage, we maintain our view that all six gaming concessions will get renewed and extended beyond the 2032 period,” when the current concessions end.

“Our stance is based on China’s desire that Macau be a world destination resort,” he said. That goal demands “the integrated resort expertise of Las Vegas Sands, MGM Resorts and Wynn Resorts”.

What had been a trickle became a flood after Las Vegas Sands Corporation’s Sands Macao changed the game in the city and its Venetian Macao launched a brave new world in Cotai, transforming an unwanted swampy landfill into the most lucrative casino cluster on the planet. 

The money flow out of China through the American-led growth of Macau’s casinos seemed to be an incredibly obvious potential friction point, the proverbial 800-pound gorilla on the gaming floor, but hardly anyone mentioned it back then. No publisher bought the book and the question went unanswered. 

While publishers were rejecting my book pitch, Xi Jinping appears to have had the same question on his mind and he didn’t need a publisher. When he became China’s leader in 2012, he wrote his own book. Xi’s administration cracked down on funds leaving the mainland beyond the legal limit of roughly US$5,000 per traveller per trip, culminating in the crackdown on leading junket promoters facilitating excessive money movements.

Macau and other Asian markets are still struggling to come to terms with the post-junket era. 

Irony rich formula 

As trade and political tensions escalate between the United States and China with Donald Trump’s return to the White House, Macau’s American casino operators seem like tempting targets for retaliation by Beijing. Not only do US-owned entities run three of Macau’s six casino concessionaires but, in a potentially irresistibly delicious irony, Trump once ran his own casinos – straight into bankruptcy. 

Via Hong Kong listed subsidies they control, American companies LVS, Wynn Resorts and MGM Resorts International have multi-billion dollar investments in seven integrated resorts in Macau, accounting for roughly half of the city’s gaming revenue (and gaming tax receipts). Melco Resorts, helmed by Lawrence Ho, has a US stock listing for its operating company. 

Moreover, Wynn Resorts founder Steve Wynn was a major Trump supporter in that failed casino mogul’s first presidential run. They became political allies despite a very public and publicised feud during the 1980s when they had Atlantic City properties bearing their names.

In 2018, when sexual harassment allegations arose that ultimately cost Wynn his ownership and executive control of the company he founded, his first act of recognition, if not contrition, was to resign as finance chairman of the Trump-led Republican party. 

LVS founder Sheldon Adelson was the largest donor to Republican candidates in 2016 and to Trump’s 2020 re-election campaign. His widow Miriam Adelson, now the LVS controlling shareholder, continued the family tradition in 2024. In 2018, Trump awarded Israeli-born Dr Adelson – she is an accomplished physician – the Presidential Medal of Freedom, the highest US civilian honour. 

Former US ambassador to Singapore Frank Lavin, now a visiting fellow at The Hoover Institution, Stanford University, tells iGB, “In my view, China is unlikely to directly challenge the ownership of Sands because they respect Miriam Adelson and her relationship with Trump – perhaps a little like their respect for [Elon] Musk.” 

Blurred lines for Macau’s casinos

“I no longer think about whether an IR operator in Macau is American or not since the passing of Sheldon Adelson and the retirement of Steve Wynn,” Intelligence Macau managing director Anthony Lawrance writes in an email.

“The corporate cultures of those two firms – Sands China and Wynn Macau – are now largely indistinguishable from their rivals (with the obvious exception of SJM, owned by a fragmented and largely dysfunctional family).”  

Lawrance adds: “I have never considered MGM China [chaired by US educated Pansy Ho and majority owned by MGM Resort International] or Melco to be foreign-owned. Their corporate cultures are a hybrid of American and Canadian Chinese, reflecting the mixed nature of their respective owners.” 

“I see the industry as international, with portable operators, each bringing a combination of attributes – and, potentially, challenges,” the Innovation Group president Michael Soll says.

“American operators in Asia have built a segment that is adapted from the US IR market, yet a fully Asian product being run collectively by primarily American companies and their Chinese counterparts.” 

High cost of winning 

In the round of concession bidding completed in 2023, all three American companies retained their Macau casino licences. All concessionaires are subject to the same policy directives and combined non-gaming investment obligations of more than $13.5 billion. LVS has the largest investment obligation of any concessionaire at $3.75 billion, with Wynn at $2.2 billion and MGM at $2.1 billion 

“With the emphasis on supporting Macau’s further development, such as rejuvenating the old area and its appropriate economic diversification, Macau would expect these companies to assume greater level of social responsibility,” Macau Polytechnic University gaming scholar Carlos Lam Siu says.

“Furthermore, as most Macau visitors are from China, it is critical for American companies to reinforce the ‘we are all in the same boat’ image despite the recent imposition of the US tariffs.” 

An associate professor at MPU’s Centre for Gaming and Tourism Studies, Siu says: “These corporations have demonstrated how the non-gaming segment could work with casinos, starting from fine dining and hotel accommodation to spectacular shows and concerts. Later, they have shown how to link shopping malls, artistic and antique displays with gambling, in the attempt of adding different flavours to gambling.” 

Siu adds: “With the need for Macau’s economic diversification, casino operators not only need to develop their own business, but also work with government to support other related industries like culture and sports, big health and high technology, not only for Macau but also for the Greater Bay Area,” encompassing Macau, Hong Kong and mainland China’s Guangdong province. 

Making Macau casinos world-class 

“Reflecting on the past 23 years, it’s clear that American investment has significantly influenced the development of Macau’s gaming and tourism industries,” Lektou Avogados managing partner Pedro Cortes says. “Since the liberalisation of the gaming sector in 2002, US affiliated operators have brought substantial expertise, innovation and operational excellence, helping to establish Macau as a world-class tourism and entertainment destination. 

“Over the last two decades, these companies have diversified Macau’s casino offerings by developing integrated resorts with a strong emphasis on non-gaming amenities, entertainment and international hospitality standards. Their contributions have supported Macau’s goal of becoming a global tourism and leisure centre, in line with the policies of the central government [of China] and the Macau SAR [Special Administrative Region] government.” 

“Francis Lui’s stewardship of Galaxy has shown that Chinese can own and operate an IR group just as well as Americans can,” Lawrance says. 

Adding value and variety 

Personalities and politics aside, Galaxy’s success, challenging Sands as the market leader and Stanley Ho’s successors and scions as Macau’s local champion, underscores a practical question: In 2025, are American companies still adding value in Macau? 

“From my observation, yes,” University of Macau assistant professor of business economics Ricardo Chi Sen Siu says. “The international brand name and reputation of American ownership and its market network still help to add value to the gaming industry in Macau. This is especially important when Macau is now putting in much effort to diversify its sources of visitors and to push forward the city’s development as a world-class tourism and leisure centre. 

“In addition, through competition between the American and non-American companies, variety and vitality of the market are maintained for Macau as an attractive casino tourism destination.” 

Exporting American ingenuity 

Soll says, “In the sense that American ingenuity in gaming has typically driven the global bricks and mortar expansion model, they will show up with the same or better tools to adapt to a new form of resort.”   

“American casino owners have demonstrated that they know how to turn a gaming-centric market into a non-gaming success story with the gradual evolution of Las Vegas into a multi-faceted tourism destination,” GMA Consulting founding partners Steve Gallaway, Josh Swissman and Kit Szybala write. 

“It’s about more than just building the non-gaming, you must make money on the non-gaming in order for them to be sustainable into the future. Americans bring that know-how.” 

Vegas leads the pack 

GMA adds, “Above all, Las Vegas is the bellwether for integrated resorts due to the natural evolution of non-gaming overtaking gaming revenue. Americans lead the way not only in this initiative, but also how to reward guests for both their non-gaming and gaming spend. In order to appropriately grow an IR market, both gaming and non-gaming must be respected.” 

“American companies still add value to the gaming sector with their entertainment options like movies and music related to the non-gaming segment,” Carlos Siu says. “Moreover, the Macau casinos sector can benefit from their multiple licences in different jurisdictions.” 

“I believe these companies will remain key stakeholders in Macau’s future, provided they continue to adapt to evolving policy priorities and actively contribute to the region’s economic and social objectives,” Cortes says. 

Fire sale or stable landscape? 

If the Americans in Macau want to sell, there’s the practical question of who might purchase their properties. Macau authorities would have to approve any buyer. 

“Potential buyers of American-owned casinos in Macau will be shaped by why the American operators are leaving the market,” the GMA triumvirate says. “If the landscape is stable and the operators are not forced to leave, there will be a multitude of interested parties; however, if American owned casinos depart the market due to geopolitical pressures, it will very likely limit interest in taking over their concessions.” 

“I cannot imagine a Chinese group from outside Macau coming in to buy out one of the American owners,” Lawrance says. “I think the only way Tillman Fertitta could offload Wynn’s assets in Macau would be to one of the existing concessionaires.” 

Ambassador Lavin doubts Beijing will relax rules barring mainland Chinese ownership of Macau casinos. 

To boldly go… away 

Las Vegas Sands’ 2021 sale of its Vegas Strip assets demonstrates US gaming giants will make bold moves to exit a valuable market. Since the announcement, I have suspected that sale was a prelude to Adelson’s heirs exiting gaming altogether.

In my mind, selling the iconic Venetian complex didn’t make sense otherwise: there’s no right price for priceless assets. Patrick Dumont, Miriam Adelson’s son-in-law, succeeding Robert Goldstein as CEO underscores that LVS is a family affair, capable of decisive action with the consent of the controlling shareholder. 

Beyond Macau, LVS still has Marina Bay Sands in Singapore, the world’s most profitable integrated resorts, and its most admired, along with high hopes for New York and Texas, where Adelson acquired the Dallas Mavericks basketball team and its arena. Beyond Macau, Wynn and MGM still have Vegas and more in the US, plus aspirations in the Gulf emirates. But all of that pales in comparison to Macau. 

American gaming companies in Macau have successfully written their own story, making themselves and Macau great again. They have adapted their US models to Macau casinos with sufficient aplomb for Macau to become several multiples bigger than Las Vegas in terms of gaming revenue, $28.3 billion last year to the Strip’s $8.8 billion. 

Seizing the narrative 

Now powers beyond their control in Washington and Beijing are largely writing American casinos’ Macau stories for them. Tensions that Trump stoked during his first term continued to simmer under Joe Biden and they’re boiling again with Trump’s return to the Oval Office. Geopolitical realities will almost certainly heighten those tensions for the foreseeable future. 

Furthermore, Macau depends on Beijing’s goodwill for its success now more than ever. For American gaming executives who abhor uncertainty, helplessness in the face of superpower machinations must keep them up at night, or at least give them agita before they sleep.

While experts contend all will be well, they said the same thing about those earlier massive cross border money movements. It seems something has got to give. 

For the Americans in the Macau casinos sector, there’s still a chance – for who knows how long – to write their own story. They can still seize the narrative to escape a relationship that began with ping pong diplomacy now devolved to a potential toxic tit-for-tat with their Macau casino assets poised for paddling.

Yet, given the stakes involved and their limited options, LVS, Wynn and MGM may be best served by taking the advice I have given my daughter for as long as she can remember: Don’t become a writer unless you absolutely have to. 

Muhammad Cohen is a former US diplomat and current iGB Asia editor at large. He has covered the casino business in Asia since 2006, most recently for Forbes, and wrote Hong Kong On Air, a novel set during the 1997 handover about TV news, love, betrayal, high finance and cheap lingerie.

Analyst Vitaly Umansky said the results were not “materially impacted” by the 25 March arrests of dozens of alleged illegal money-changers. But the crackdown could briefly discourage visitation.

Millions in illicit cross-border transfers

Money-changers, known colloquially as “huanqiandang”, help gamblers sidestep government controls on capital flight. Last October, the Macau Legislative Assembly criminalised the unlicensed exchanges, whose agents work in and around casinos. Authorities said the operations lead to “fights, fraud, thefts, illegal immigration and other crimes”, including kidnapping and murder.

The latest sting netted 42 money-changers, including “ringleaders and gang members”, according to Macau Business. They allegedly facilitated HK$790 million (£78 million/€94 million/$101.5 million) in cross-border transfers, for estimated profits exceeding HK$21 million.

April GGR could be “slightly affected by near-term potential headwinds” from the crackdown, Umansky wrote. “Customers may stay away from pawnshops and others may forego a near-term trip to Macau,” he wrote. But long term, the effect should be negligeable.

Jefferies Equity Research said the arrests are “likely to impact sentiment and hence, GGR in the next few weeks”. However, analysts Anne Ling, David Katz and Jingjue Pei believe the impact will be “temporary and generally minimal on fundamentals”.

Flat April should precede stronger second half

Seaport projects a 0.1% year-on-year GGR decline for April (or -5.8% month-on-month), on par with the “historical average”. However, Umansky anticipates a 10.9% lift in the second half, for a 6.5% year-on-year increase for 2025.

“Growth should be driven by increase in marketing efforts by operators and consumer trends in China,” he wrote. “China stimulus and policy measures are likely to help China’s economy and improve consumer confidence later this year.”

The Jefferies team noted that March and April are typically the lowest GGR months. “The potential next catalyst for Macau is performance during the May public holiday,” they added.

Labour Day Golden Week, 1-5 May, typically drives a surge of travel to Macau. In 2024, Macau welcomed some 605,000 visitors, exceeding the 2023 total but still short of 2019 figures, according to the Macau Government Tourism Office.

Net liabilities of HK$2.51 billion, including loans of HK$2.41 billion, “will be due for repayment within the next 12 months”, MLD acknowledged in a 28 March filing.

Past failure to comply with “certain loan covenants” has rendered loans of HK$2 billion “immediately repayable if demanded by the creditor banks”, MLD added. The Macau-based firm said those loans “may not be repayable. Even the current HK$166.4 million in default is unlikely to be repayable.”

The cash crunch casts “significant doubt on the group’s ability to continue as a going concern”.

Kicked out of Cabo Verde

Established in 1997, Macau Legend operates Macau Fisherman’s Wharf, touting it as the “largest leisure and entertainment complex on the Macau Peninsula”. A casino inside the Legend Palace Hotel operates under the SJM Holdings concession.

The group once had global aspirations. But in 2023, MLD president and CEO Li Chu Kwan announced the group would withdraw from overseas gaming projects to focus on core operations in Macau. In December of that year, it sold its Savan Legend casino in Laos for HK$303 million, citing “increasingly onerous restraints” that limited profitability.

At the time, Macau Business reported that profit from the sale was “likely to strengthen the group’s cash flow, enhancing its liquidity”.

But no such luck. Late last year, the West African nation of Cabo Verde severed an almost decade-long relationship with MLD, accusing it of “flagrantly and repeatedly” violating its obligations related to a planned HK$2 billion casino complex.

In 2015, MLD signed a deal to build the 160,000 sqm project in the capital city of Praia. But according to Macao News, development “did not proceed beyond some empty, rudimentary structures”.  

In November 2024, Cabo Verde prime minister Ulisses Correia e Silva accused MLD of contractual violations including “transferring, without authorisation from the government of Cape Verde, the ownership of more than 20% of the share capital” of the venture.

He also referred to “convictions… of shareholders, administrators and others with rights and responsibilities in MLD”.

In April 2023, a Macau court convicted former MLD co-chairman and majority shareholder Levo Chan of illegal gambling and money laundering. Chan was sentenced to 14 years in prison. He was also ordered to repay HK$780 million to the Macau government and five of the city’s Big 6 casino concessionaires.

Survival depends on lenders

Now MLD is at the mercy of lenders. The Friday filing said its survival hangs on “the group’s ability to generate sufficient financing and operating cash flows”.

“This would only be possible via continual support from the lending banks to not take actions to demand immediate repayment of outstanding borrowings as a result of non-compliance with loan covenants.”

The group said it is “actively seeking support from the banks for the restructuring of the group’s outstanding installments due in 2025. The group is further seeking support from the controlling shareholder and substantial shareholders to not request repayment of shareholders’ loans of HK$339.4 million.”

Finally, it noted, it is “undertaking mitigating measures, including a cost control programme”.

Non-gaming attractions are key to the “1+4” strategy established under former Macau chief executive Ho Iat-Seng.

Ho’s plan emphasised the growth of international tourism (the “1” in “1+4”) bolstered by four new economic pillars. They include Chinese health, finance, technology and the meetings and convention trade.

In comments before his 2024 retirement, Ho said the government’s goal is not “to compress the gaming industry”. It is, rather, to “grow the pie” by expanding other sectors.

Chinese president Xi Jinping has stressed the importance of “new industries with international competitiveness”.

And Ho’s successor, chief executive Sam Hou Fai, has pledged to “promote moderate economic diversification and focus on cultivating new industries with international competitiveness”.

Rebalancing the economic scale

The six incumbent gaming operators – Sands China, Wynn Macau, Galaxy Entertainment, MGM China, Melco Resorts and SJM Holdings – signed new licence agreements in December 2022.

The 10-year terms, which began on 1 January 2023, require them to support diversification with MOP130 billlion (£12.4 billion/€15 billion/$16.1 billion) in non-gaming investments, like theme parks, sporting arenas and cultural facilities.

The government has set a target for non-gaming revenue to contribute 60% of gross domestic product by 2028. Gaming would pick up the remaining 40%.

It’s an ambitious goal. In 2019, before the Covid-19 pandemic, gaming accounted for more than 50% of GDP, while non-gaming kicked in less than 10%.

However, the balance has already shifted. By 2023, gaming’s contribution had decreased to 37.2% and the combined value of the plus-four industries rose 6.9% over 2019, reported Macau Post Daily.

“The growing share of key non-gaming industries in Macau’s economy over the past years is enhancing its stability and resilience,” said Ho in an interview with Xinhua News Agency in December.

More rooms to stoke tourism

New entertainment venues are not enough to attract international tourism, according to Alidad Tash. In a January article in Macao News, the Melco Resorts executive said the city is “desperately short of hotel rooms”.

Current inventory is just 46,000 keys, compared to 153,000 in Las Vegas. The shortage inhibits multi-day stays and all the spending that goes with them.

In 2019, noted Tash, almost 21 million day-trippers visited Macau, spending a collective MOP14.12 billion, or MOP680 each. Overnight visitors, by contrast, spent a total of MOP50 billion, or MOP2,681 each.

By that calculation, Macau only needs “an additional 5.27 million visitors to spend the night to match the entire economic contribution of all same-day visitors”, wrote Tash.

The call has not gone unheeded. According to Macau’s Land and Urban Construction Bureau, the city added 2,900 hotel rooms in 2024. The 17-storey Capella at Galaxy Macau is set to open this year, with 36 sky villas and 57 suites. Sands China’s Londoner Grand Hotel will debut 2,405 new deluxe rooms and suites in May and 10 more hotel projects are in the approval stages.

Together, non-gaming attractions, more places to stay and a little promotional push may help to entice more global travellers.

Last year, Macau government tourism office director Helena Senna de Fernandes launched a worldwide promotional crusade, “Experience Macau Limited Edition”, to build a pipeline of new, high-value patrons from European and Arab countries.

Currently, 90% of visitors to the gaming mecca hail from greater China, including Hong Kong and Taiwan.

Founded in 2001, the UK company has long occupied a grey area in China. Gambling in the People’s Republic is strictly prohibited with the exception of two special administrative regions (SARs): Macau and Hong Kong.

Even so, a 2024 Financial Times report called China a “cash machine” for the family business helmed by Denise Coates. Bet365 reportedly sought out unregulated markets as UK sports betting reached saturation.

By 2014, per Regulus Partners, China “was probably Bet365’s second largest market behind the UK”, although it kicked in less than 20% of revenue at the time.

“Mirror sites” foiled China censors

A 2022 article in Business Insider described Bet365 as a major player in China’s “shadowy world of online gambling”. It and other recognised operators used dozens of “mirror sites” hosted by subsidiaries to evade detection by authorities.

As soon as monitors found and blocked the sites, new ones popped up to replace them. Ben Lee, managing partner at IGamiX Management and Consulting in Macau, called it “a game of whack-a-mole”.

Yet Bet365 has repeatedly denied breaking Chinese law or imperilling Chinese consumers, who face fines and detention for illegal gambling.

In 2020, a Bet365 representative told the Telegraph: “There is no legislation which expressly prohibits the supply of remote gambling by offshore operators into China. In the view of Bet365 and its lawyers, Chinese law does not extend to the provision of services into China by offshore gambling operators.”

Beyond China, greener pastures

For Bet365, the grass is likely to be greener (not to mention legal) elsewhere.

The company reportedly is looking to expand in regulated markets, including Brazil, which opened its legal online sports betting market on 1 January. There, Bet365 joins a throng of competitors including Entain, MGM, Flutter and Stake.

But Eilers & Krejcik analyst Alun Bowden told Covers that Coates is really “gunning for US market share” and will make stateside expansion a top priority.

The sportsbook is already live in 13 US states. It launched in Illinois just in time for March Madness and will debut in Missouri this fall. On 24 March, it signed a deal with the St Louis Cardinals to become the team’s first mobile sports betting partner.

Analysts: China not worth the hassle

Regulus analysts called China “Bet365’s last material ‘dark grey’ market”. Its departure leaves the group “with a domestically regulated mix of over 90%”, now that Brazil is licensed.

At bottom, with China’s ongoing crackdown on illegal gambling – citizens are not even permitted to gamble in legal casinos outside the PRC – China is more trouble than its worth.

Regulus cited “deliberate declining operational focus on China, increasingly effective state disruption and growth elsewhere…. As a controversial and increasingly difficult market to operate in, China has therefore become relatively easy for Bet365 to exit.”

But the industry must generate monthly GGR of MOP20 billion to meet government projections of MOP240 billion for the year.

For an economy that historically has relied on gaming for some 80% of government revenue, the year’s fiscal outlook “may not be as optimistic as expected” said Macau chief executive Sam Hou Fai at a 13 March Two Sessions briefing with Chinese government delegates. “And the future economic situation must be assessed with caution.”

A stimulus package from Beijing may help.

Stimulus should support moderate growth

According to Seaport Research Partners, the plan outlined at the briefing emphasises “income growth amid US tariffs, building on September’s stimulus and property market support”. All should do their part to “lift consumer confidence and demand” and increase Macau’s demand in the medium term.

Starting 24 September 2024, the Chinese central bank launched what Reuters called “the most aggressive monetary stimulus measures since Covid-19”. It featured an MOP10.88 trillion debt package, a higher budget deficit, broad interest rate cuts and looser monetary policies.

The easing of travel restrictions for Zhuhai residents, which began 1 January, has contributed to a tourism surge, for greater economic momentum.

Seaport analyst Vitaly Umansky projects 6.7% GGR growth for 2025, with mass growing 7%.

Investment firm Jefferies, which last year forecast yearly GGR of MOP245 billion, recently trimmed that GGR by 2%, to MOP240 billion. But that’s still up 5.8% year-on-year and in line with conservative government projections. 

Bracing for more competition

Amid all these challenges, Macau gaming operators are also preparing for more regional competition. Japan will open its first casino resort, MGM Osaka, in 2030. Thailand could debut its first legal casinos by 2029 and, ahead of the pack is Wynn Resorts, which will open the first casino resort in the United Arab Emirates in 2027.

In the March issue of Macau Business magazine, editorial director José Carlos Matias said the developments, following Macau’s “much-cherished integrated resorts model”, make the next five years critical in determining “whether we retain our crown as a gaming-tourism hub or fall behind the curve and lose competitiveness in the long term”.

While it looks to develop new, viable industries to support casinos, Matias said the city must “enhance our existing strengths. By embedding targeted diversification efforts into the core business models of key industry players, we not only adopt a pragmatic approach, but also achieve tangible results.

“Gaming and integrated resort operators are levelling up their game,” he wrote, “and this is likely just the beginning.”

So far this year, gross gaming revenue (GGR) has fallen short of expectations. City casinos generated MOP18.25 billion (£1.75 billion/€2 billion/$2.28 billion) in January and MOP19.74 billion in February, foiling hopes for a Lunar New Year bump. To achieve lawmakers’ estimate of MOP240 billion for the year, gaming must generate average monthly GGR of MOP20 billion.

“This year’s fiscal revenue may not be as optimistic as expected,” Sam said at a 13 March Two Sessions briefing with Chinese government delegates. “And the future economic situation must be assessed with caution.”

“1+4” strategy a multi-year initiative

Covid-19 decimated the Macau economy. When it reopened for business in 2023, former chief executive Ho Iat Seng announced a “1+4” strategy to expand the economy.

Sam endorses the five-year plan, meant to build on Macau’s strength as an international tourism destination while also developing “four nascent industries”. They include “Big Health”; modern financial services; high and new technology; and convention and exhibition, sports and the commercial and trade industries.

But diversification won’t happen overnight. As Sam has acknowledged, reliance on gaming is a “structural problem” that will “persist for a long time”.

With new and emerging competition nearby – Japan will open its first casino resort in 2030 and Thailand is angling to open even sooner – the industry in Macau can expect further contraction.

“Many difficulties and challenges”

Competition isn’t Sam’s only concern. As he warned at a 19 February meeting of the Macau Economic Development Commission, global economic turbulence and protectionism also pose challenges for Macau.

“As a small-scale economy, Macau cannot remain unscathed, especially as competition in tourism and gaming from neighbouring cities intensifies and looms,” said Sam, as quoted by the Macau Daily Times.

“Our country’s economy continues to face many difficulties and challenges,” he said. Among them: insufficient domestic demand, production and operational struggles for some enterprises and difficulties in employment and income growth for residents.

“These new situations require us to pay close attention and respond appropriately. Macau’s economy is based on the integrated tourism and leisure industry and is highly dependent on the visitor market from mainland China.”

The Macao Government Tourism Office expects up to 39 million visitors in 2025, just short of the pre-pandemic volume of 2019.

But that figure, and annual estimated GGR, may need recalibration based on the results so far.

According to Macau Business, CBRE Equity Research believes satellites may not be “financially viable going forward”. It also speculated that SJM Holdings may close its satellites to drive traffic to Grand Lisboa Palace.

The move could “reallocate some of that table capacity (and potentially customers)” to the Cotai flagship, CBRE wrote. That could help SJM “grow its mass market business”.

Satellite casinos, managed and promoted by third parties, now operate under a profit-sharing model. Of 11 such properties in Macau, nine operate under the SJM licence. The remainder piggyback on the licences of Melco and Galaxy.

But that is all about to change. In 2022, when Macau amended its gaming law, it gave satellite casinos three years to shift to a different model. By the end of 2025, all satellites must be directly owned by licensed concessionaires. Those that survive the shakeup will make their money through management fees, not shared revenues.

SJM swings to profitability, commits to efficiency

In its fourth-quarter earnings report, issued 4 March, SJM was back in the black, returning to profitability for the first time since the pandemic. Net gaming revenue reached HK$27 billion (£2.7 billion/€3.18 billion/$3.5 billion), up from HK$20 billion in 2023.

Citywide, SJM controlled 13.1% share of gross gaming revenue, including 15.8% of the mass segment, and 5.1% of VIP GGR.

In comments last week, SJM chair Daisy Ho hailed the performance of Grand Lisboa Palace, which posted gross revenue of HK$6.58 billion for the year. The resort is “gaining momentum”, she said, “strengthening its market position with an expanding portfolio of non-gaming attractions that cater to a broad spectrum of customers.”

Ho also emphasised the firm’s commitment to “operational efficiencies and… long-term sustainable growth”.

Will that commitment mean the ax for SJM satellites? To date, according to Seaport Research analyst Vitaly Umansky, there has been “no clarity from either the government or from SJM… on the outcome.”

Macau satellite workers will be “severely impacted”

Lawmaker José Maria Pereira Coutinho says the government must act now to safeguard the livelihoods of satellite casino workers, most of whom work on the peninsula. He has asked the government to extend unemployment benefits from 90 days to 360 days.

“In these trying times, extending benefits is not just a suggestion,” said Coutinho. “It is a necessity for the people who will be severely impacted.” He also suggested early retirement as an option for some casino workers.

He also recommended career counselling, help with job applications and vocational training for displaced casino employees.

“What will happen to these workers if they are suddenly thrust into roles they are unprepared for?” he asked. “It is the government’s responsibility to ensure their transition is smooth and supportive.”

Coutinho has raised these concerns before. Last October, he urged creation of a solid contingency plan for workers whose jobs hang in the balance.

“We cannot overlook the fact that the closure of these casinos will have a domino effect on the local economy,” he wrote. It will have repercussions “not just [for] the workers but also the small businesses that depend on them.”

In his new role, Goldstein will assist management with government relations activities, efforts to pursue new physical development opportunities and gaming strategies.

The Sands board intends to name Patrick Dumont, currently president and chief operating officer, as the new CEO. This remains subject to final approval.

Replacing Adelson as CEO

Goldstein has led Sands as CEO since January 2021, taking over following the passing of the operator’s founder, Sheldon Adelson.

He initially served in the role on a temporary basis when Adelson took an initial medical leave of absence to undergo treatment for non-Hodgkin’s lymphoma. Adelson died in January 2021, having steered Sands since its founding in 1988.

Prior to becoming CEO, Goldstein worked in a series of roles across the business, having joined Sands in 1995. These include spells as president of global gaming operations and executive vice president, then president and chief operating officer of The Venetian and The Palazzo Las Vegas.

His most recent role before CEO was president and chief operating officer for the casino group. He has also served on the Sands board since January 2015.

Goldstein and his wife, Sheryl, have also been actively involved in many Las Vegas charitable and civic causes over the years. They have served on numerous boards and been generous donors to a variety of organisations, including Opportunity Village, Cleveland Clinic Lou Ruvo Center for Brain Health, Las Vegas.

Sands’ appreciation for Goldstein

Commenting on his departure, Goldstein said that he will continue to support the group’s growth over the coming year and in his new advisory role.

“This company transformed the industry from a gaming-centric model to the integrated resort model,” he said. “Through a different strategic approach in each market, [it] meaningfully changed the tourism landscape in Las Vegas, Macao and Singapore

“I look forward to using the years ahead to help the team build toward another great chapter in this company’s history.”

Miriam Adelson, co-founder and majority shareholder of Sands and Adelson’s widow, paid tribute to the outgoing Goldstein. She spoke of her family’s “great appreciation” for his leadership and contributions to the business.

“He has left an indelible mark on the history of the company and our family will always be thankful for it,” Adelson said. “Sheldon deeply appreciated Rob’s friendship and counsel and he would be very grateful for everything Rob has given over the past three decades.”

Growth at Sands in 2024

The announcement follows a positive 2024 for Sands, during which it reported a rise in both revenue and net profit.

Published in January, the results show revenue for the 12 months to 31 December reached $11.30 billion (£8.76 billion/€10.43 billion). This surpasses the previous year by 9.0%.

The market outperformed analyst forecasts of 0.8% year on year, but it remains below 2019 figures, before the Covid-19 pandemic. The February results represent an 8.1% increase from January. The first two months of 2025 combined were up marginally over 2024, at 0.5%.

February gaming revenue reaches MOP19.74 bln, up 6.8 pct | Macau Business

Macau casino revenues flat in CNY

The uptick was heartening news for Macau casino operators, who had expected a considerable bump in January as Chinese New Year celebrations kicked off. But those numbers fell short, with GGR down 5.6% year on year.

At the time, JP Morgan analysts accurately forecast a lift in February, with GGR of about MOP19 billion.

Macau on track for MOP240 billion in 2025

In comments reported by Macau Business, Galaxy Entertainment Group chairman Francis Lui said February is a sign of good things to come. Authorities in the Chinese special administrative region (SAR) have set a target of MOP240 billion in GGR for the year.

“Although gaming revenue for this January’s Lunar New Year may have been lower than expected, the performance in the second half of February has improved and exceeded expectations,” Lui told reporters last week, before the DICJ issued its report.

“January and February have been very close to our expectations. And we remain confident in achieving the annual target of MOP240 billion.”

Jefferies analysts: “Making up lost ground”

Analysis released by Jefferies Equity Research indicates room for optimism as “the macro environment” in Macau improves.

The city’s gaming industry “[made] up lost ground after a weak performance” in January, the Jefferies team wrote.

“Several of the operators, including Wynn, MGM, Galaxy and Melco, provided positive commentary surrounding post-CNY GGR trends…. Galaxy and Melco also indicated that both of saw a long tail effect from the CNY holiday, driven by the premium mass segment.

“Outlook for rest of 2025 remain modest-solid,” they continued, provided GGR increases 6.9% in each month for the rest of the year.

A similar proposal failed to gain traction in the 2024 legislative session. But this year, the odds may be in its favour for financial reasons.

The Chinese special administrative region (SAR) faces a budget deficit of more than HK$100 billion (£102 million/€124 million/$128.6 million). That’s more than twice the shortfall projected at the start of 2024.

Hong Kong’s economy grew 2.5% in 2024, down from 3.2% in 2023. Trade tensions with the United States could deepen the SAR’s fiscal crisis. In response, the cash-strapped government is laying off tens of thousands of civil servants and searching for new sources of revenue. An expanded gaming industry could help.

Tapping a billion-dollar revenue stream

In his annual budget speech on 26 February, Hong Kong finance secretary Paul Chan said legal hoops betting could eventually add HK$1.5 billion per year to government coffers.

It would also “combat illegal betting activities in an effective manner”. Turnover for underground sportsbooks were estimated at HK$70 billion to HK$90 billion last year.

Hong Kong bettors may now legally wager on horse racing, football matches and public lotteries, all run by the Hong Kong Jockey Club. The HKJC will soon submit a proposal to add NBA betting.

The South China Morning Post reports that the deal could be done as early as September. The 2025-26 NBA season begins in mid-October.

Activist group: more sports betting “disastrous”

Critics of the plan are already warning about the potential risks of legal sports betting, especially the potential for addiction.

In a statement issued yesterday, the Hong Kong Committee on Children’s Rights called the government proposal a “disastrous move” that could glamourise sports betting and make it more accessible to vulnerable populations, including the young.

“We must not take gambling problems too lightly and underestimate the bad effects of gambling on children and youngsters,” the group wrote. “Once the scope of legalised gambling is expanded, another wave of expansion will be inevitable.”

According to the Hong Kong Free Press, the government will call for a public-comment period before legalising the bets. If the measure is approved, sports bettors would reportedly be restricted to online bets only.

Sources close to the company told Bloomberg that MGM China Holdings Ltd has approached a dozen banks in search of a syndicated loan with a five-year Hong Kong dollar-denominated facility.

It would be the group’s first syndicated loan since the Covid-19 pandemic, the news outlet reported.

“Record performance from China” buoyed 2024 revenue

On 12 February, US-based parent MGM Resorts International posted $17.24 billion in consolidated net revenue, a new record. Total revenue exceeded the 2023 total of $16.16 billion by 6.7%.

CEO Bill Hornbuckle called it “the best full-year consolidated net revenues in the history of the company. This was driven by a record performance from MGM China. We’re also encouraged by the strong demand we’re seeing in the business so far in 2025, which positions us well for continued growth.”

Revenue from MGM China rose 27.6% to $4.02 billion. That was the second-biggest slice of the revenue pie for MGM, after the Las Vegas Strip.

“In Macau, we achieved the best full-year segment-adjusted EBITDA in the history of MGM China,” Hornbuckle said. “We continue to be a high-performing outlier in the market with exceptional execution by the team.

“Macau 2049, our first residency show at MGM Cotai and the Poly Art Museum at MGM Macau, which sold over 10,000 people in one day during Chinese New Year’s, are both important steps to drive non-gaming revenues and visitation to Macau.”

MGM China commanded about 15.8% of market share for the year, up from about 10% before the pandemic.

MGM looking to draw more mass-market players

The proposed expansion of MGM properties in Macau is not new.

Since mid-2024, the company has been formulating capital-expenditure projects at MGM Macau and MGM Cotai. The move is designed to diversify its offerings beyond gaming, in alignment with government mandates, and also to grow its appeal among mass and premium-mass players.

In a November earnings call reported by the Macau Daily Times, MGM announced it would expand the premium gaming area at MGM Macau and increase the number of villas by 25%. At MGM Cotai, it revealed plans to transform 160 standard hotel rooms into 60 high-end suites.

The renovations are due to be complete in the second half of 2025, said MGM China President Kenneth Feng. “Once the projects are finished, we believe we are going to continue to lead our Macau market,” he said.

The company has also considered adding new hotel rooms, spas and other wellness centers. Presently, it offers 2,000 rooms in Macau, the smallest portfolio among the Big 6 casino concessionaries.

Support for legal hoops betting in Hong Kong is apparently on the rise as a way to generate tax revenue and also stamp out black-market operations. 

The move would help the Chinese special administrative region (SAR) address a whopping budget deficit of more than HK$100 billion (£101.6 million/€122.5 million/$128.6 million) for the year. That’s more than twice the figure projected at the start of 2024.

PwC Hong Kong reports that the SAR government will have fiscal reserves of HK$639.8 billion at the end of March, enough to cover just 10 months of total government expenditures.

Reaping new revenue

Hong Kong bettors can already legally wager on horse races, football matches and public lotteries. All are run by the Hong Kong Jockey Club.

A proposal to add NBA wagers was floated last year, but it did not pass muster with finance secretary Paul Chan. Jockey Club chief executive Winfried Engelbrecht-Bresges, however, is all for it. In 2024, he estimated that about HK$350 billion in illegal bets per year are made in Hong Kong. Basketball represented about 15% of that.

A legal, regulated industry could capture up to 60% of bettors who now patronise underground bookies, Engelbrecht-Bresges has suggested. That could mean HK$52.5 billion in turnover a year and HK$1.5 billion in new taxes.

Those benefits would not accrue for some time, however. According to the Dimsum Daily, the Jockey Club would need at least a few years to get the system up and running. Football bets, for example, were legalised in 2001 but did not go live until 2003.

Then as now, lawmakers justified the expansion due to “large and persistent demand” and the proliferation of illegal operations. The underground market is “linked to other criminal activities… and cannot practically and fully be tackled by law enforcement alone”.

An about-face for Chan?

Despite the potential windfall, Chan continued to express concern about the social costs. In the past, he has rejected calls for expanded betting solely as a government cash cow.

Home and youth affairs secretary Alice Mak also has reservations. In a December note to the Hong Kong Legislative Council, she wrote: “It is the government’s policy not to encourage gambling.”

Hong Kong currently allots HK$26.4 million to combat gambling addiction. It must “optimise efforts to prevent and alleviate problems related” to the pastime, Mak added.

“In recent years, the rise of unilateralism and protectionism has posed significant challenges to the global economy,” he observed. “Macau cannot remain unscathed, especially as competition in tourism and gaming from neighbouring cities intensifies and looms. Such risks and challenges must not be overlooked.”

The onetime appeals court judge succeeded Ho Iat-Seng as city leader in December. Like Ho, he is committed to the diversification of the city’s economy, through the development of four supporting industries: finance, healthcare, technology and meetings and conventions.

Sam said Macau must also promote itself as a global destination beyond mainland China. Last year, tourism chief Maria Helena de Senna Fernandes launched a road show – “Experience Macao Limited Edition” – to draw new, high-value patrons from European and Arab countries.

While tourism to the Chinese special administrative region (SAR) has rebounded in the post-pandemic era, with 34.9 million visitors in 2024, mainlanders still account for 70% of the total.

Gaming presents an “economic structural problem”

During his campaign, Sam blasted gaming’s “negative impact” on the Chinese special administrative region (SAR). Later, he expressed appreciation for its contribution to the local economy and told the city’s six gaming concessionaires the industry must “develop healthily” for Macau’s long-term viability.

Sam did not identify specific rivals to Macau as a gaming market. But established jurisdictions like Singapore and the Philippines are working to expand their already successful gaming sectors. And new competition looms in Japan, where MGM will open a multibillion-dollar casino resort in 2030. Thailand is fast-tracking its own casino legislation, in hopes of opening even earlier, by 2029.

Diversification will not happen overnight, Sam acknowledged. “The economic structural problem of reliance on the gaming industry is expected to persist for a long time. By adopting new mindsets, better strategies and stronger commitment, we can drive economic diversification.”

Slow start to the year, but upturn expected

In 2024, Macau’s gross gaming revenue (GGR) rose 23.9% year-on-year to MOP226.78 billion (£22.5 billion/€27 billion/$28.3 billion). But it has not yet returned to pre-Covid levels.

GGR fell 2% year-on-year in December and stumbled again in January, with a decline of 5.6%, despite the start of the Lunar New Year. Analysts from Citigroup say the trend is unlikely to change until the second half of 2025.

However, in a January special report, Macau Business saw hopeful signs. For one thing, Macau gaming operators are once again issuing dividends, after a three-year pause. In 2024, MGM China and Wynn Macau resumed the payments, joining Galaxy, which started in 2023. The remaining Big 6 – Melco, SJM and Melco – are expected to follow suit, according to Morgan Stanley.

Jenny Lao-Phillips, of the Faculty of Business and Law at the University of Saint Joseph, says the surge in premium-mass play will propel growth. “It may take some time to return to pre-2019 levels,” she said. “But with a new market and strategies targeting this group, the future remains optimistic.”

The government, meanwhile, anticipates MOP240 billion in GGR for the year.

Revenue was flat across two of MGM’s four core divisions – Las Vegas Strip Resorts and Regional Operations. However, significant growth in China, accompanied by a similar increase in digital revenue, pushed the yearly total up.

“We are proud to report the best full-year consolidated net revenues in the history of the company,” CEO Bill Hornbuckle said. “This was driven by a record performance from MGM China. We’re also encouraged by the strong demand we’re seeing in the business so far in 2025, which positions us well for continued growth.”

MGM China revenue rises 27.6%

The stand-out performance in 2024 was MGM China, with revenue here jumping 27.6% to $4.02 billion. This is now the second-highest source of revenue for MGM, overtaking the group’s Regional Operations and second only to Las Vegas Strip.

MGM put this down to the recovery of operations after the removal of all remaining Covid-19 measures that were still in place in early 2023. These included entry restrictions in Macau, but the region is now fully open again to tourists.

“In Macau, we achieved the best full-year segment-adjusted EBITDA in the history of MGM China,” Hornbuckle said. “We continue to be a high-performing outlier in the market with exceptional execution by the team.

“Macau 2049, our first residency show at MGM Cotai and the Poly Art Museum at MGM Macau, which sold over 10,000 people in one day during Chinese New Year’s are both important steps to drive non-gaming revenues and visitation to Macau.”

Digital dreams for MGM

Another highlight for MGM in 2024 was digital. For the 12-month period, MGM introduced a new reporting segment in the form of MGM Digital.

This comprises its LeoVegas operations, but not its BetMGM JV with Entain in North America. However its joint Brazilian venture with Grupo Globo will fall under this reporting segment.

Annual net revenue for this segment amounted to $552 million. This is 27.7% higher than the comparable period in the previous year, representing a growth rate similar to that of MGM China.

However, adjusted EBITDAR for the year was a loss of $77 million, compared to a loss of $32 million in the prior year.

Hornbuckle told analysts the digital business was solidly profitable in 2024, when excluding new brands. He said the operator was beginning to realise operating leverage against LeoVegas and Push’s more mature operations, including the UK. Therefore the cost burden from building these businesses is subsiding.

“We’ve added features to this business such as content development with the acquisition of Push and sports betting with the purchase of Tipico’s US betting technology,” he said.

LeoVegas’ BetMGM brand in Europe and Brazil is leveraging the MGM branding across its online casino portfolio, particularly its live-streamed tables from the MGM Grand and Bellagio in Las Vegas.

“Our digital businesses are also on a positive trajectory, with our BetMGM venture in North America expected to be profitable this year and our global MGM Digital business integrating and scaling to address its significant $41 billion market opportunity,” Hornbuckle said.

Hornbuckle has set the digital business a target of achieving $1 billion in top line revenue, as well as healthy margins, in the medium-term.

The operator expects to go live with Tipico’s in-house betting platform in its core market as soon as next week, while additional markets will roll out the tech in Q2. The integration of these assets is expected to complete by the end of H1.

MGM CFO Jonathan Halkyard said although losses are narrowing in the UK from decreased marketing spend, increased spending related to the launch of BetMGM in Brazil will result in MGM Digital’s 2025 EBITDAR losses remaining relatively consistent with those in 2024.

In Brazil MGM expects its BetMGM online business to gain a 10% market share in the long-term, while in Europe the LeoVegas business should maintain a 1% to 5% share of the total addressable market.

Revenue flat in the US

As for the other two divisions, revenue was largely flat year-on-year. The Las Vegas Strip Resorts segment remains MGM’s primary source of revenue at $8.82 billion.

Revenue from its Regional Operations was also flat for the year at $3.72 billion. This now ranks behind MGM China in terms of the amount of yearly revenue generated for MGM.

An additional $129.7 million in revenue came from management and other operations.

As for overall revenue, casino generated $8.79 billion in total, rooms $3.69 billion, food and beverage $3.08 billion and entertainment, retail and other, $1.69 billion.

Gold Strike Tunica sale skews bottom line comparison

In terms of costs, 2024 group operating expenses were up 10.6% to $15.70 billion, while operating profit dropped 21.2% to $1.49 billion.

After non-operating expenses, pre-tax profit for the year hit $1.12 billion, a decline of 23.8%. MGM paid $52.5 million in tax and discounted $318.1 million in profit from non-controlling interests. As such, it ended the year with a net profit of $746.6 million, down 34.6%.

However, MGM said the bottom line comparison was impacted by the sale of operations at Gold Strike Tunica Resort in Mississippi to CNE Gaming Holdings in February 2023.

Consolidated adjusted EBITDA, on the other hand, made for more positive reading, rising by 3.2% to $2.41 billion.

Q4 on par with 2023

Looking to the final quarter of the year, group revenue in Q4 was almost level year-on-year at $4.35 billion. Growth was apparent across the MGM China, MGM Digital and Regional Operations divisions, but Las Vegas revenue declined.

Operating costs increased 1.3%, while after also including non-operating expenses, pre-tax profit dropped 35.7% to $205.7 million. MGM received $32.3 million in tax benefit but, after excluding profit from non-controlling interests, bottom line net profit was down 49.8% to $157.4 million.

As for consolidated adjusted EBITDA in Q4, this was 16.4% lower at $528.5 million.

The week-long festival typically bodes well for city casinos, as punters travel en masse to the only place in China where gambling is legal.

This year, results for the week-long national holiday were below expectations. But a revenue bump followed CNY, the official start of the Year of the Snake.

In a 10 February note, Jefferies Group analysts said holiday weakness should give way to “neutral to modestly positive” returns as the quarter progresses.

“The trend post-CNY was slightly better than the actual CNY performance,” the Jefferies team wrote, with daily revenue of MOP822M through 9 February.

“Post-CNY (6-9 February) ADR was MOP725M/day,” they wrote. “This is higher than 2024 post-CNY week’s MOP544M/day (19-29 February), as high rollers appeared to stay beyond the holiday period.” Mass and VIP GGR were up month-on-month by 35%-40% and 42%-47% respectively, they added.

In 2024, visitation up, GGR down

Last year, record visitation kicked off the Year of the Dragon, exceeding 2019 figures by 3.7%, according to the Macao Government Tourism Office (MGTO).

But gross gaming revenue (GGR) for the period was MOP18.46 billion (£806 billion/€966.2 billion/$2.29 billion), “a tad lighter” than the consensus of MOP19-20 billion, said JP Morgan analysts. A Bloomberg report attributed the 2024 results to a “cautious spending outlook among tourists”.

However, March 2024 saw the start of an uptick. GGR rose 5.5% month-on-month to slightly more than MOP19.50 billion.

Analysts: Recovery should continue

Likewise this year, Jefferies expects “the recovery to continue going forward”, with projected GGR of MOP18.4 billion to MOP19.4 billion for the month, versus MOP18.5 billion in February 2024, during a leap year.

According to Macau Business, JP Morgan analysts DS Kim, Mufan Shi and Selina Li observed “post-LNY GGR (that was) be better-than-feared at MOP725 million/day thanks to solid ‘tail-end’ demand, somewhat offsetting the weakness from LNY.”

The JP Morgan analysts project monthly GGR of MOP18.3 billion to MOP19.4 billion.

Meanwhile, the Macau government has forecast full-year GGR of MOP240 billion, up 11% year-on-year.

But the outlook could improve this month. JP Morgan analysts cited by Macau Business say GGR for February could reach MOP19 billion.

Despite “flattish” returns so far, the team of DS Kim, Mufan Shi and Selina Li said the results “can still allow the industry to grow GGR by ~5% in FY2025E to meet our forecasts”.

Visitation slightly down

Lunar New Year traffic was brisk, but also short of projections.

Maria Helena Senna de Fernandes, of the Macau Government Tourism Office (MGTO), had expected up to 185,000 visitors per day during the holiday, which started 29 January and ends today.

The first five days saw about 874,000 visitor arrivals – on average, about 10,000 fewer entries per day. Friday was the busiest day, as the Chinese special administrative region (SAR) welcomed 219,000 visitors, mostly from the mainland.

Macau is working to lure more international tourists. But the effort has yet to bear fruit: just 4% of holiday visitors this year were foreign passport holders.

The MGTO is on a global campaign to attract more westerners. Last year, the Brussels-based European Travel Agents and Tour Operators Association named Macau a 2025 “preferred destination” for European travellers.

Emphasising non-gaming, cuisine, culture

Under newly installed chief executive Sam Hou Fai, who succeeded Ho-Iat Seng in December, the SAR is continuing its push for more non-gaming attractions.

It’s a cornerstone of the government’s five-year plan to diversify the economy, introduce new industry and reduce the city’s reliance on gaming. The goal is to have non-gaming industries account for about 60% of GDP by 2028.

The strategy includes an emphasis on local culture, which is on full display during Lunar New Year festivities. In 2005, Macau was added to the UNESCO World Heritage List, a nod to its unique blend of Chinese and Portuguese architecture. And last year, Macau joined UNESCO’s Intangible Cultural Heritage List, which preserves traditional art, dance, food, language, craftsmanship and rites of passage.

The new year celebrations showcase both, with dragon and lion dances and East-West or Macanese food, known as the first “fusion” cuisine.

Chinese New Year just one indicator

In a 2 February note, Seaport analyst Vitaly Umansky called the Chinese New Year holiday “an important sentiment driver for Macau” among investors.

But it’s not a true barometer, he added: “The actual holiday is often mixed in terms of results.” In 2019, for example, Chinese New Year GGR represented only 2% of the total. In 2024, it was only slightly higher, at 2.7%.

Despite the soft start, new secretary for economy and finance Tai Kin Yip has expressed optimism about the full-year outlook, due to the city’s “stable fundamentals”.

Chinese New Year (CNY) is prime time for travel by mainlanders, with the gaming mecca a popular destination. According to financial news site Seeking Alpha, as of last week more than 21 luxury hotels had already sold out for the early days of CNY.

Individual Visa Schemes (IVS), “fully relaxed and optimised” by the People’s Republic of China, are also boosting tourism. Last year, the central government added eight mainland cities to IVS rolls and, since 1 January, Zhuhai and Hengqin residents have been eligible to apply for multiple-entry visas to Macau. That policy could increase daily visitation from the cities by 20,000.

Home for the holiday

CNY is often called “the largest human migration on the planet”, as native Chinese and people of Chinese descent head home for the holiday. This year, RTHK News reports, travel could “hit record highs”, with 510 million arrivals by rail and 90 million by air.

For the national holiday, which continues through 4 February, the Macao Government Tourism Office expects up to 185,000 visitors per day.

Chinese president Xi Jinping is optimistic about Macau’s performance, despite “complex and severe situations” in recent months. To stoke the flagging economy, Beijing has trimmed interest rates and “pushed a basket of incremental policies to promote economic recovery”, said Xi.

Analysts differ on full-year returns

These indicators bode well for the Macau’s gaming industry, in the short and longer term. But analysts are divided about full-year returns in the Year of the Snake.

Last month, S&P Global warned that continuing economic turbulence could “impair Macau cash flow and (compromise) improvement”.

But the Macquarie team believes consensus forecasts of +6% growth in gross gaming revenue (GGR) for 2025 are “too bearish”. Along with stimulus measures, they pointed to international roadshows designed to lure more overseas travellers to Macau.

“China values Macau and continues to endorse the destination,” the team wrote.

In a Macau Business roundup, Vitaly Umansky of Seaport Research said GGR could grow by 7% “if the Chinese economy grows and consumer confidence levels improve”.

And CreditSights’ Nicholas Chen, by contrast, expects a modest increase of 4.7%, due to cautious consumer spending. “If the outlook for Chinese consumers is not good, they may tighten their belts (and) cut back on travel and spending,” Chen said.

For the year, JP Morgan’s DS Kim, Mufan Shi and Selina Li expect moderate gains. “We model industry GGR growth of +4% for 1H25 versus +7% in 2H25 to produce +5% in FY25,” they said.

Meanwhile, the Macau government forecasts full-year GGR of MOP240 billion, up 11% over 2024.

According to Macau Business, JP Morgan analysts DS Kim, Mufan Shi and Selina Li said demand was “solid” in the run-up to to the Chinese New Year (CNY) holiday. The eight-day celebration kicking off the Year of the Snake begins 29 January.

“We expect Chinese New Year GGR to grow moderately at low-to-mid-single digits year-on-year,” the analysts wrote. “(We) model industry GGR growth of +4% year-on-year for 1H25 versus +7% in 2H25 to produce +5% in FY25.”

S&P Global expects GGR growth of 5%-6% this year, with mass gaming 15%-20% above pre-pandemic volumes. “Junket (or VIP) volume will likely stay near current low levels unless regulations change,” the credit agency noted. “Total GGR, therefore, will likely be 80%-85% of 2019 levels.”

Headwinds could hamper growth

The Macao Government Tourism Office (MGTO) hails the Year of the Snake as one “full of auspicious wishes, unfolding bright prospects and development potential” for the “international metropolis”.

But S&P warned that unrelenting economic turbulence affecting China could “impair Macau cash flow and (compromise) improvement” at a time casino operators are trying to lure more premium-mass players.

Meanwhile, the local government has forecast full-year GGR of MOP240 billion, up 11% over the 2024 forecast.

Tourism-plus the new approach

The upcoming holiday is an opportunity for Macau to continue its policy of “tourism-plus” aimed at expanding the economy and attracting more international travellers.

MGTO director Maria Helena de Senna Fernandes expects up to 39 million visitors this year, close to the 39.4 million recorded in 2019 and well over the 33 million who visited in 2024. But mainland China remains the largest feeder market and the Macau government wants to change that.

Last year, mainlanders accounted for 70.1% of visitation. Hong Kongers were next at 20.6%. The remaining 9% included a mix of Taiwanese and global tourists, reports Macao News. And of 185,000 daily visitors bound for Macau during CNY, just 4.3% are expected to arrive from outside Asia.

That’s why Senna Fernandes has launched a campaign to promote Macau to overseas markets. In September 2024, she visited Cyprus as part of MGTO’s worldwide promotional road show, ‘Experience Macao Limited Edition’. Its aim is to cultivate new, high-value patrons from European and Arab countries.

The campaign will continue this year. By July, the MGTO will stage travel shows in Tokyo, Seoul, Bangkok, Kuala Lumpur and Jakarta.

Casinos in the world’s premier gaming hub saw a 2% dip in gross gaming revenue (GGR) last month, to MOP18.2 billion (£1.813 billion/€2.184 billion/$2.27 billion). But it was the only monthly decline since the city reopened for business in January 2023.

The drop was widely attributed to a three-day visit from Chinese president Xi Jinping. Xi was in town 18-20 December to celebrate the 25th anniversary of the former Portuguese colony’s return to Chinese rule.

He also presided over the inauguration of Macau’s new chief executive, Sam Hou Fai, who succeeded Ho Iat-Seng. The inauguration was 20 December. Sam heads up the special administrative region’s (SAR) sixth government, continuing a campaign to diversify the local economy beyond gaming.

Macau’s winning streak expected to continue

Last year, GGR in Macau grew 23.9% to MOP226.78 billion, beating the official target of MOP216 billion. That’s about 78% of the MOP292.5 billion achieved in 2019. And next year, Jeffries analyst David Katz contends, the industry could rise to that level again.

As reported by financial website Seeking Alpha, Katz says the SAR will get a lift from “monetary policy initiatives focused on improving the health of the overall consumer” in Macau.

Other positive indicators include stronger tourism and a growing mass gaming segment.

Macau expects 35 million visitors in 2025, up by almost a quarter over last year. As usual, about 70% will hail from mainland China, aided by relaxed visa rules that allow longer stays. But international tourism is on the upswing too. Last year, more than 2.4 million visitors from outside Asia came to Macau, an increase of 66% year-on-year. The city is actively wooing them with increased non-gaming attractions like sporting and cultural events, showcased at conventions like ITB Berlin, the world’s largest travel trade show, coming 4-6 March.

Last year, Fitch Ratings forecast an 8% increase in Macau’s gross domestic product (GGR) for 2025, reported Macau Business. “This will be supported by the ongoing revival in the gaming tourism sector, expanded handling capacity and favourable policy initiatives,” said analysts George Xu and Jeremy Zook.

Macau could exceed GGR target

This year’s official GGR target is MOP240 billion, per the Macau Gaming Inspection and Coordination Bureau (DICJ). But in a 2024 report, Citigroup analysts pointed out that the DICJ tends to underestimate the totals.

According to the Macau Daily Times, Citi’s George Choi and Timothy Chau projected a 7% increase in GGR year-over-year, for a total of MOP244 billion. They forecast that earnings before interest, taxes, depreciation and amortisation (EBITDA) would be up 13% for 2025.

“If past trends continue, there could be considerable upside potential to Citi’s GGR forecast,” the team added. More smart tables “will also allow casinos to better understand the true value of their players through detailed data collection on their gaming behaviours.”

He also presided over the inauguration of Sam Hou Fai. On 20 December, the former appeals court judge succeeded Ho Iat-Seng as the city’s new chief executive.

Xi visit kept VIPs at bay

Gross gaming revenue (GGR) for December was MOP18.2 billion (£1.843 billion/€2.224 billion/$2.3 billion), according to figures from the Gaming Inspection and Coordination Bureau (DICJ).

That’s 2% short of the median analyst estimate for the month and 20% lower than 2019, pre-pandemic, when GGR peaked at MOP292.5 billion. Notably, December was the only month last year to fall short of projections.

Industry observers attributed the dip to tighter security around Xi’s 18-20 December visit. His presence also may have dampened enthusiasm among mainland high rollers, a frequent target of Beijing’s war on corruption, illegal gambling and capital flight.

Total GGR for the year reached MOP226.8 billion, up 23.9% from 2023.

Xi, Sam push “diversified development”

During his visit, Xi urged Macau “to promote appropriate economic diversification”, with a goal of ending its dependence on the gaming industry. He said the special administrative region (SAR) must “cultivate internationally competitive new sectors”.

Sam concurred. In his inaugural address, the new CE pledged to pursue the economic strategy introduced under Ho Iat-Seng. Known as the ‘1+4’ model, it is meant to underpin the leisure and tourism sector through the development of four new industries: medicine, technology, finance and MICE (meetings, incentives, conferences and events).

As part of their licence agreements, the city’s Big Six casino operators must invest a collective MOP130 billion in non-gaming amenities such as cultural attractions, theme parks and concert arenas through 2032.

“Solid recovery” in store

Despite the drop in December GGR, JP Morgan Securities is upbeat about Macau’s prospects heading into the new year.

“We didn’t have to change our forecasts despite well-documented consumption and macro headwinds,” analysts wrote, as reported by Macau Business. “Macau demand has been (surprisingly) in line thanks to a solid recovery in visitation and thus also in grind/base mass.”

Goldman Sachs foresees an 8% rise in GGR for 2025. The local government has forecast total GGR of MOP240 billion, up 5.8% year-on-year.

Davis Fong Ka Chio, of the Institute for the Study of Commercial Gaming at Macau University, is even more optimistic. Last week, he told public broadcaster TDM that GGR could jump 10% to MOP250 billion this year, spurred by mass gaming and the ongoing tourism recovery.

At the inauguration of new chief executive Sam Hou Dai, Xi hailed Macau’s drive “to promote appropriate economic diversification” and reduce its reliance on the gaming industry.

He said the territory must “step up policy and funding support so as to cultivate internationally competitive new sectors”.

Covid sped diversification

Ieong Meng U, assistant political professor at the University of Macau, told Agence France Presse Beijing has been pushing for a more diverse economy for “at least a decade”, but Macau “didn’t budge”.

“With gaming,” he said, “the money came too easily. (Macau) basically didn’t have to do much for a robust income.”

That changed after Covid-19, which closed city borders for three years and crippled the top industry. In the depths of the crisis, in the first half of 2022, casino operators shed gross gaming revenue of HKD25.4 billion year-on-year (£2.6 billion/€3.1 billion/$3.2 billion), according to Macau’s Gaming Inspection and Coordination Bureau.

After the city reopened, in 2023, former chief executive Ho Iat Seng announced his “1+4” strategy to expand the economy. The five-year plan will build on Macau’s strength as an international tourism destination and also develop “four nascent industries, namely: ‘Big Health’; modern financial services; high and new technology; and convention and exhibition, sports and the commercial and trade industries”.

That’s a tall order, Seaport Research analyst Vitaly Umansky told AFP. “[The government] would like other industries to start developing,” but it will be “very, very difficult” for Macau to develop robust finance, technology and medicine sectors without an influx of foreign talent.

Casino concessionaires kick in

The city’s six casino operators must do their part to support the end goal, which will see their contributions to gross domestic product drop from a high of 63% to about 40%. Their licence terms, renewed for 10 years in 2022, are contingent on HKD115.8 billion in non-gaming investments such as theme parks, waterfront developments and conference facilities.

Ben Lee, managing partner of consultancy IGamiX, said the operators must hew to the central government’s command. “The casinos are rational economic entities” who would prefer “easy wins”, he told AFP. “They will only do as little as they think they can get away with.”

However, in a mid-year estimate reported in Macao News, Umansky said the approach is already working. Operators’ non-gaming revenue for 2024 is expected to increase 17.7%, which would “equate to 15% of all revenues” he said.

Xi sees Macau as China’s link to the world

Once called China’s most powerful leader since Mao Zedong, Xi has overseen the virtual downfall of Macau’s lucrative junket industry, a crackdown on illegal money exchanges and stronger safeguards against cross-border gambling, capital flight and money laundering.

According to Radio Free Asia, he envisions Macau as China’s link to the wider world, a role once ascribed to Hong Kong. The former British colony, like Macau a special administrative region (SAR), returned to Chinese rule in 1997. But it has repeatedly pushed back against Beijing’s authoritarian rule and anti-communist sentiment continues to run high.

Macau, for its part, has earned a reputation as more compliant.

“Macau has followed the directive from the central government, the people have accepted it and there hasn’t been much protest or noise from the community,” Larry So Man-yum, former professor of social work at Macau Polytechnic Institute, told the New York Times.

During his visit, Xi flattered the preferred SAR, calling it “a shining pearl… a treasured place of the great motherland, one that, under Sam Hou Fai, will continue to grow a multifaceted economy that shores up the mainland”.

Xi arrived yesterday (18 December) for a three-day visit, marking the 25th anniversary of the city’s return to Chinese rule. He will also preside over a change in leadership. Ho Iat-Seng, chief executive since August 2019, will step down tomorrow (20 December). Xi will attend the inauguration of his successor, former judge Sam Hou Fai.

Leadership in unprecedented times

According to the Macau Daily Times, Xi thanked Ho for his leadership during the Covid-19 pandemic, which shut down the city for almost three years. The crisis reinforced Macau’s need to diversify the local economy beyond gaming.

“You have faced difficulties and been pragmatic,” Xi told Ho.

In particular, Ho has championed Macau’s “1+4” strategy for economic development. That plan emphasises tourism while also developing the healthcare, finance, technology and special events sectors. Designed to reduce the city’s reliance on a single industry, the plan is already working.

Pre-pandemic, gaming contributed more than half of Macau’s gross domestic product and generated 80% of local tax revenue. This year, Ho predicts, gross gaming revenue will contribute 40% of GDP, with other industries contributing 60%.

The city continues its post-pandemic rebound. According to new government figures, it welcomed 2.8 million visitors in November, up 9.6% year-on-year.

Sam willing to work with Big Six

The incoming chief executive also advocates a shift away from gaming for a more resilient economy. According to Macau Business, early in his candidacy Sam Hou Fai slammed the industry’s “barbaric expansion” and “negative impacts”.

To the relief of gaming operators, he later softened his tone, saying only that Macau’s primary industry must “develop healthily” for the city’s long-term viability. Sam promised his administration would “protect and supervise the healthy and orderly development of the six (gaming) concessionaires”.

Collectively, MGM Resorts, Wynn Resorts, the Las Vegas Sands Corporation, SJM, Galaxy Entertainment and Melco Resorts must invest a collective MOP130 billion (£12 billion/€14.6 billion/US$16.2 billion) in non-gaming amenities, such as urban renewal and cultural attractions.

Casino expert Ben Lee told international news channel Agence France Presse that Xi “will probably want to inspect the non-gaming investments that concessionaires promised two years ago”, when their licences were renewed for another 10 years.

Xi applauds “world-recognised success”

On his first day in Macau, Xi praised the Macau special administrative region (MSAR) as a shining example of “one country, two systems”, the government policy that grants special autonomy to both Macau and Hong Kong.

“Over the past 25 years, the ‘one country, two systems’ principle with Macau characteristics has achieved a world-recognised success,” Xi remarked. “It has demonstrated vitality and a unique appeal.”

VIP play, once more than 70% of Macau’s total gaming revenue, US$29.8 billion in 2013 and halved to $14.2 billion in 2019, will total $3.3 billion this year, Morgan Stanley Asia managing director Praveen Choudhary estimates. Overall, Choudhary forecasts Macau’s total gaming revenue at $28.4billion, 22% below $36.2 billion in 2019 and 37% below the 2013 all-time high of US$45.1 billion. It’s a similar story for China-facing destinations across Asia in this post-Covid period.

Casino operators are adjusting to market realities – a process that began a decade ago when China’s policy directions became clear – but much remains to be done.

Trendy paradoxes

“Quite a bit has changed,” Platinum Consulting Group managing director Mary Mendoza says. The Macau based marketing specialist’s observations highlight two seemingly paradoxical trends.

“You have lot of mass market tourists, but they’re spending less. They take pictures, cruise for free stuff and then go back to hotels in Zhuhai and Hengqin,” the mainland China island a stone’s throw from Cotai.

On the other hand, Mendoza says, “On the mass floor, you don’t see many low limit tables under HK$1,000 (US$128).” Operators’ strategy, she says, is moving lower level players to electronic table games to keep live tables for rated players or players that can become rated.

That trend fits what Seaport Research Partners senior analyst Vitaly Umansky dubs the “premiumisation of Macau and its customer base.”

For example, Sands China rebranded Sands Cotai Central, opened in 2012, as The Londoner Macao, across the street from its Venetian and Parisian counterparts.

Bland to glam

“Renovations converted Londoner from a bland property that no one really wanted to go to,” Umansky says. “There wasn’t a lot of spend going on at that property.” He notes that Sands Cotai Central had more hotel rooms than Venetian Macao and nearly as much gaming space but generated a fraction of the revenues.

“Now that property has become more sticky,” Westar Architects principal Paul Heretakis says of Londoner. “If you’re only in Macau for a short period of time, and you might only visit half or a third of the properties, [Londoner] has become one of the ones you would visit now.”

On the lodging side, Sands Cotai Central’s conversion to Londoner includes upgrading the Holiday Inn and Sheraton hotels to Londoner and Londoner Court with larger rooms and higher suite counts. When completed, the renovations will reduce the number of keys by more than 25%, from 6,000, initially envisioned to support Sands’ US developed convention based integrated resort concept, to fewer than 4,500.

“Trading up on product quality, sometimes at the expense of volume, appears to be a common competitive strategy across the leading integrated resort operators in Macau over the past three-four years in particular,” former Galaxy Entertainment and Sands China executive Kevin Clayton says.

“That’s most likely to be in response to increasing demands and preferences of higher value customers, particularly in the premium gaming and premium leisure segments, and while MICE is an important sector for most operators and the Macau government, it’s not yielding anything like the expected volumes some 10 years ago.”

Beyond value tourism

“Mass tourism should not be confused with value-oriented tourism,” Klebanow Consulting principal Andrew Klebanow says. “The new [Londoner Grand] suite product will allow Sands to command a higher average daily rate and attract visitors who are not price sensitive. Those new visitors will also spend more on retail, dining, and gaming. 

“There will always be a value lodging option in Macau, just not at the Londoner.”

Premiumisation is succeeding at some levels in Macau casinos. Mass gaming spending through October was 12% ahead of 2019, with higher per capita growth. According to Macau’s Statistics and Census Service, visitor non-gaming spending (in constant dollars) for the first three quarters of 2024 is 7.5% higher than 2019, despite 16.5% fewer visitors.

Per capita non-gaming spend is 29% higher. Year-on-year those figures are down by 6% and 15% respectively, casting a pall over retail in particular, despite the broader positive trend.

With non-gaming spend for the first nine months of US$7 billion alongside its US$21 billion gaming revenue, non-gaming accounts for roughly 25% of Macau visitor spending (Macau citizens’ gaming notwithstanding). While that non-gaming spend represents a major uptick from pre-pandemic levels that strained to reach double digits, it’s a far cry from Las Vegas, where two-thirds of revenue comes from non-gaming. Also note that Macau’s non-gaming progress stems in part from reduced gaming spend.

Most telling, perhaps, combined 2024 EBITDA for Macau concessionaires of US$8.1 billion will be 18% below 2019, as estimated by JP Morgan head of Asia gaming and leisure research DS Kim, though margins have improved slightly.

Disneyland in the distance

“The government may want to turn Macau into Disneyland, but that’s not where revenues and profits lie,” GamePlan Consultants founder and CEO Sudhir Kalè says. “In my lifetime, Macau will always be a gambling-centric destination and all operators know that.”

Macau has a long way to go to create a non-gaming ecosystem to meet public policy aspirations. “Las Vegas has 220,000 theater, sports and entertainment seats. In Vegas, sports, entertainment and conventions fill Las Vegas hotel rooms consistently,” Steelman Partners CEO Paul Steelman says. “Once Macau continues with the diversification plan, the entertainment in the city will require additional hotel rooms.”

On the gaming side, Steelman says, “A casino designed for Saturday night, which was every night in early Macau, will not be designed and constructed. Many large casinos, particularly the Venetian Macao, which spans over 50,000 square meters, will need to be reimagined to incorporate non-gaming attractions both at the edges and in the center of the gaming floor.”

Non-gaming roundabout

One template: Resorts World Genting’s Bar 360 featuring entertainment at the center of the main gaming floor. Genting brought the concept from Malaysia to Manila’s first IR as a partner in the predecessor to Newport World Resort and to its Resorts World New York City and RW Catskills properties. The latter IR in New York’s famed Borscht Belt also features SportsBook 360, with betting counters and kiosks, plus monitors to follow the action, arranged around a bar.

“Gaming should be viewed as a complementary activity that thrives alongside other attractions, not surrounded by four walls or a gaming room,” Steelman says.

“Asian casinos typically consist of integrated blocks of space, combining casinos, retail malls, and hotels. These elements need to be seamlessly integrated and stratified to guide non-gaming activities toward different levels of gaming. For instance, buffets can cater to the mass market, while signature restaurants, such as [Wynn Resorts’] SW Steakhouse or Delilah’s, can serve high-end clientele.”

Gladiators of the felt

Steelman notes, “An important trend to consider is the changing preferences of younger Asians, who are increasingly seeking Las Vegas-style vacations filled with diverse activities. They are less likely to be all-night gamblers who eat a quick bowl of noodles and continue playing.

“When we designed the Sands [Macao] in 2003, we embraced the idea that gambling is a sport for Asians, whereas it is viewed as entertainment for Westerners. This distinction is crucial in shaping the future of gaming and hospitality in these markets.

“Younger Asian gamblers will probably still consider gaming a sport, but will demand a more complete experience similar to Las Vegas.”

The renowned resort architect says, “Sports events, conventions, and large theatrical experiences are essential, but modern facilities also need to deliver Instagram-worthy moments. Our Digital Street [an image extravaganza – think of Fremont Street Experience in downtown Las Vegas – in Incheon at Mohegan Gaming’s] Inspire Aurora has been a tremendous success, attracting 20,000 visitors and generating 1,000 social media posts daily. Macau casinos must embrace this kind of creative, artful thinking to attract new customers and extend guest stays.”

Cash conversion

A formidable hurdle Mendoza identifies is ensuring those social media posters are also paying customers.

“Those IR operators, including hotel partners embedded in a resort, that continuously advance operating brand standards so the resort brand is synonymous with a set of premium experiences will more likely lead the market by revenue and EBITDA,” Clayton, a Mohegan Inspire Entertainment director, says. “These IR experiences in themselves are at the forefront of marketing when they are shared by customers’ with friends and family.” 

“When Macau casinos were very, very popular and you had a huge VIP customer base, a lot of other levels and facets of the business were ignored,” Heretakis says. “You need to start to go after those segments.”

That can begin with something as simple as guiding guest movement. “It is imperative to undertake a comprehensive spatial reconfiguration that enhances both accessibility and flow,” Nikau Design Group managing director Nicola Greenaway says. “This involves the strategic delineation of gaming areas, the augmentation of seating and amenity provisions, and the implementation of sophisticated signage systems and way-finding to facilitate navigation.

“Integrating technology to monitor real time game availability and ensuring robust staff allocation will significantly enhance the overall player experience, fostering a more engaging and efficient gaming environment.”

Crazy eights

Technology can also significantly enhance understanding of player behavior. “Improved player tracking systems allow casinos to appropriately track carded as well as uncarded players,” Kalè says. “Rating systems using dealer or pit boss discretion are inherently flawed.

“For example, in a recent trip to the Horseshoe in Las Vegas, I dropped around four grand in three days. And guess what? My comps earned were around eight dollars!

“This would never happen with table tracking systems as each bet would be tabulated and the punter is rewarded based on their bets and the resultant theo[retical daily loss].”

The marketing PhD adds, “Player points, to me involve ‘earn and burn.’ Loyalty, on the other hand, encompasses both behavioral loyalty as well as attitudinal loyalty. Attitudinal loyalty has to be earned and cannot be purchased with points awarded to players. It is the outcome of a compelling customer experience.”

Strategic rebalancing at Macau casinos

“Mass market gaming necessitates a more balanced approach to promotional strategies,” Mendoza, whose resume includes stints at Sands China and Vietnam’s Hoiana, says. “Casinos often allocate a smaller percentage of revenue for reinvestment in mass market segments compared to high-value players.”

“While promotional expenses have been growing as the industry continues to shift away from VIP junket play and compete for mass market and premium mass customers, those marketing expenses remain far lower than the commissions that casinos once paid to junket promoters,” Klebanow says.

Mendoza’s research indicates gaming incentives such as free play or match play are yielding diminishing returns, so operators need to expand their promotional horizons. She suggests tournaments and lucky draws “to create excitement and engagement” on the gaming floor, as well as promotions combining gaming with non-gaming attractions such as entertainment or a host destination sightseeing treasure hunts.

“First to market exclusive retail product launches work well as headline attractions, particularly if these are thematic in-property installations providing a unique photo opportunity for social media,” Clayton says.

“Events like food festivals or wine tastings paired with gaming also draw in tourists looking for a comprehensive experience, making casinos more than just gaming venues but vibrant social hubs,” Mendoza says. “This multifaceted approach helps to cater to varying interests and preferences among visitors.”

“In Las Vegas, 40% of hotel rooms are marketed directly to known customers using the casinos’ highly valuable customer databases,” Steelman says. “Asian casinos should adopt a broader strategy, shifting their focus beyond just attracting high volumes of gamblers to cultivating and retaining high value customers.”

“Macau was a very special place for a period of time where it was just seeing incredible amounts of money,” Heretakis says. “It”s a more competitive market environment now, more like most environments around the world.”

At a 13 December press briefing, ministry officials announced the arrests of 846 people swept up in five raids linked to 100 “underground banks”, reports the China Daily.

Chen Shiqu, of the MPS criminal investigation department, said the banks were involved in transactions worth RMB80 billion (£8.68 billion/€10.472 billion/$11 billion).

The ministry has also identified 263 organisations suspected of related crimes, including fraud.

Post-pandemic spike

According to a special report in Macau Business, such operations have increased since the end of the Covid-19 pandemic. Macau shut down intermittently for almost three years during the crisis. In January 2023, when the borders reopened, gamblers returned in droves to its dozens of casinos.

Government figures show that police intercepted almost 12,000 people involved in illegal money exchanges last year, up a whopping 239% over 2022 and 41.3% over 2019.

Gaming law expert António Lobo Vilela called the surge “the elephant in the room that nobody wants to see. This growth is definitely linked to the void created by the disappearance of junkets, whose activity was worth something like $17 billion in 2019.”

These shady operations aren’t new, added lawyer José Abecasis. People are always “attempting to circumvent China’s restrictions on capital flows out of the country”, he said. But the activity flourishes in Macau, where gaming “is the main economic driver”.

Beyond casino doors

Officials say illegal money exchanges contribute to greater lawlessness, leading to theft, money laundering and illegal immigration. They also have spread beyond the gaming industry, infecting society at large.

Peng Peng, executive director of the Guangdong Society of Reform, told the South China Morning Post: “The illegal money-exchange business might have stemmed from the gambling industry, [but is now] a very common channel for corruption and illegal money outflow.

“To protect China’s financial security, tackle corruption and prevent the illegal outflow, the government needs to hinder” bogus banks.

In October, the Macau Legislative Assembly (AL) passed legislation making it a crime to run an unlicensed currency exchange. The amended Law on Combatting Gambling Crimes includes prison terms of up to five years for offenders. Individuals convicted of such crimes could be banned from entering city casinos for up to a decade.

In a 14 December retrospective, Macau Business acknowledged the elder Lui as a key player in the development of Cotai as a centre of gaming and hospitality. GEG operates two resorts in the district, Galaxy Macau and Broadway Macau, as well as StarWorld Macau on the peninsula.

Lui, 67, joined the group in 1979. He became an executive director in 1987 and was appointed deputy chairman in 1997. He also serves as a vice chair of the Macau Institute for Tourism Studies.

In 2005, GEG became the first integrated Macau casino concessionaire to be listed on the Hong Kong Stock Exchange. It joined the Hang Seng Index as a constituent in 2013.

In a statement, Lui expressed thanks for his father’s leadership. He pledged to make GEG the “world’s leading integrated tourism and leisure company”, to contribute to Macau’s diversification beyond gaming.

Macau’s most ambitious development pipeline

Galaxy Macau is the world’s fifth-largest casino. It offers a 37,000sqm gaming floor, dozens of restaurants and a 14,000-capacity entertainment venue, Galaxy Arena.

GEG boasts what it calls the largest development pipeline of any casino concessionaire in Macau. Phase 4 of its HK$5.1 billion (£519 billion/€624.75 billion/$651.6 billion) Galaxy Macau expansion will add six hotels and a 4,000-seat theatre. In total, it will bring GEG’s Cotai footprint to more than two million square metres. The expansion is expected to be complete in 2027.

This year, Galaxy Macau was named the “Best Integrated Resort in Asia Pacific” in the Travel Leisure Luxury Awards.

In a January interview with Macau Business, father and son agreed with the government’s push to make the local economy less reliant on gaming.

“We will continue to… help enrich the mix of Macau’s tourist source markets”, said Lui Che Woo.

In a third-quarter earnings statement, GEG confirmed Phase 4’s “strong focus on non-gaming, primarily targeting entertainment (and) family facilities”.

MICE plus entertainment

According to Meetings & Conventions Asia, the Luis created the concept called “MICE-E,” which adds entertainment to the existing acronym MICE, for meetings, incentives, conventions and exhibitions. MICE tourism is a linchpin of the government’s “4+1” strategy to transform Macau from a gambling town into an international destination.

“I’m confident Macau can compete to attract international visitors,” Lui has said, “but not because it’s cheaper.… We will be competing because we have better quality.”

Tom Chan Pak-lam of the Institute of Securities Dealers, told the South China Morning Post that “the business direction and leadership of (GEG) should not see a big change following Lui’s appointment. It will be a smooth transition.”

A former Chinese footballer who played in the English Premier League for Everton has been jailed for 20 years for match-fixing.

Li Tie, who also managed China’s national team, pleaded guilty in March to taking over $16.0 million (£12.7 million/€15.2 million) in bribes. The BBC reports that Li also admitted to both accepting and offering bribes.

The court said the offences occurred while Li was an assistant coach at the Hebei China Fortune Club, which previously played in the Chinese Super League but was declared defunct last year. Li worked for the club from 2015 until 2021, when he quit as national coach.

Li would accept bribes to select certain players for the national team. He also helped certain clubs win competitions.

During his playing career, Li made 92 appearances for China and played at the 2002 World Cup. Li initially joined Everton on loan in 2002 before making the move permanent a year later. He made 40 appearances in total for Everton and also had a brief spell at Sheffield United before returning to China.

Norsk Tipping distributes millions to sports organisations

In more positive sports news, the Norwegian Gambling Authority has revealed that Norsk Tipping has distributed NOK930 million to sports organisations in the country.

Most of the funding is going to the Norwegian Sports Federation and the Olympic and Paralympic Committee (NIF). The total being distributed is NOK60 million more than last year.

The grant supports the NIF with its work on sports inclusion in Norway, including children and young people and people with disabilities.

In addition, NOK11 million is being allocated to Tverga, a resource centre for self-organised sports in Norway.

Veikkaus scores extension with Finnish Ice Hockey Association

Staying in the Nordics, Veikkaus has signed a long-term extension to its partnership with the Finnish Ice Hockey Association.

The new deal, confirmed by Veikkaus, will run through to 2030. Veikkaus has been working with the Association for a number of years across various activities and initiatives.

The multi-year partnership covers the Finnish men’s and women’s national teams, the under-20 national team and the Aurora League.

“At Veikkaus, we have a long-standing and successful cooperation with Finnish ice hockey,” said Reija Laaksonen, executive vice president for people, culture and communications at Veikkaus. “It’s very important to us that this long and successful journey continues for many years to come.”

The Pools confirms more senior appointments

In the UK, The Pools has continued its restructuring with a double senior appointment. Chris Williams is becoming head of product and Matt Knowles is taking on the role of head of CRM.

Williams joins with a decade of experience in the sports betting industry. He has previously worked for SIS Betting, Sky Betting & Gaming and LiveScore Group.

Knowles has spent time at BV Group, Betfair, Gamesys and, most recently, the Betway Group. In his previous role at Betway, Knowles led global projects aimed at optimising customer engagement and retention, loyalty and satisfaction.

In recent weeks, The Pools has also named Sharon Wright as marketing director and Phillip Donegan as chief technology officer.

Zeal celebrates 25 years

Finally this week, Zeal Network has been celebrating a major milestone, marking 25 years in business.

Founded in 1999 as Tipp24, the company was the first in German to offer online lottery sales. An IPO in 2005 saw the business rebrand as Zeal Network, while it grew further in 2019 when it acquired Lotto24.

Now headquartered in Hamburg, Zeal Network has over 1.3 million monthly users across its various brands.

“We are very proud of a quarter century of Zeal,” CEO Helmut Becker said. “What began 25 years ago as a two-man start-up in Hamburg has now developed into a group of companies with more than 250 employees.

“We are more successful than ever in our core business of lottery brokerage and are continuously expanding our market share and our business model.”

The games will tip off in October 2025, when the Brooklyn Nets and Phoenix Suns meet for two pre-season games at the 14,000-seat Venetian Arena.

NBA teams previously played in multiple big cities in China between 2004 and 2019.

“Bringing pre-season games to Macau will showcase the excitement of the NBA to fans in one of the world’s emerging hubs for sports”, said Mark Tatum, NBA deputy commissioner and chief operating officer. “We have a long history of being here in China.”

That history was interrupted in 2019. At that time, Houston Rockets general manager Daryl Morey expressed support for anti-government protests in Hong Kong. Morey soon back-pedalled, but it was too late from the Chinese government’s perspective. The plug was pulled on the popular games.

A year later, the country shut down due to Covid-19. The special administrative region of Macau did not fully reopen its borders until January 2023.

“Fantastic for the fans”

The China games began in 2004 in Shanghai and Beijing and continued unabated for 15 years. There were also games in Shenzhen and Guangzhou. The league also made a one-shot appearance in Macau in 2007.

“So the return now through a partnership with Sands China, I think, is fantastic for the fans”, said Tatum. “And it’ll give an opportunity for fans to experience live NBA basketball in their market once again.”

Basketball is hugely popular among the Chinese, with millions of fans watching games through streaming platforms. The Rockets, in particular, gained a massive following in 2002, when they signed Shanghai native Yao Ming as centre. He went on to become an eight-time NBA all-star.

According to WION News China is the largest global market for NBA sports.

Dumont: Deal a “win-win-win”

With the return of the NBA, Sands China is doing its part to diversify entertainment offerings in the city, as mandated by the government.

The deal was brokered by Sands president and COO Patrick Dumont in an example of what the Dallas Morning News called “ping-pong diplomacy”.

Dumont is also part owner of the NBA Dallas Mavericks with Miriam Adelson. Chinese billionaire Joe Tsai, chairman of technology giant Alibaba Group, owns the Nets.

Dumont called the deal a “win-win-win, where the NBA wins, the city of Macau wins and China wins”.

Mainland games in the future?

Tatum said the NBA has “no current plans” to return to cities on the Chinese mainland.

“We have a limited number of teams… a limited number of opportunities to play internationally. That being said, we have a long history of playing games in mainland China and I think at some point down the road we would consider it, But right now, our focus is on Macau.

“We know we’re going to be here in Macau and China, so that’s our focus for the next several years.”

Basketball Hall of Famers Tony Parker, Ray Allen and Tracy McGrady marked the occasion with a celebrity game on 7 December.

The US-based Sands Corporation will promote the events with an NBA Flagship Store at the Londoner Macao, one of five properties Sands owns in Macau.

Citigroup analysts say that figure is too modest. George Choi and Timothy Chau predict GGR will reach MOP245 billion, 7% over the government projection. That’s 83% of 2019 levels, when casinos reaped a total of MOP292.46 billion.

The team tied this growth to several factors. Among them: more smart tables on casino floors and the government’s approval of new baccarat side bets.

Macau Business reports that tourism will do its part, with almost 36 million arrivals fuelled by Beijing’s expanded Individual Visitor Scheme (IVS). In May, the central government added eight mainland cities to IVS rolls. Outgoing chief executive Ho Iat Seng hailed the development, saying it would “enhance the city’s capabilities to receive visitors [and] contribute to economic development”.

Ho promised the MSAR “would fully seize the opportunities brought by this favourable measure”.

More heads, more beds

In anticipation of more guests, casino resorts have expanded their occupancy, with an emphasis on luxury suites.

According to the Macau Daily Times, MGM Macau will renovate former VIP junket areas into luxury suites and guest villas. Sands China is expected to add 1,500 luxury suites at the Londoner Macau.

Next year, Galaxy Macau will debut the exclusive Capella boutique hotel with 57 suites and 36 sky villas. And SJM Holdings recently announced it will convert former VIP rooms at Grand Lisboa Palace into luxury accommodations, including “exclusive villas, mansions and suites, further enhancing guest experiences”, said chairwoman Daisy Ho.

As the Citi team acknowledged, “bigger hotel rooms get bigger players” and additional supply will serve the premium mass players who have supplanted VIPs in the gambling mecca.

Stabilising the economy

But tourism growth hangs on consumer sentiment in a still-wobbly Chinese economy, added Jeffries analysts led by Anne Ling.

China’s consumer confidence index reached a near-low of 86 in July. In late September, per the South China Morning Post, Chinese president Xi Jinping ordered “incremental policies” including a cut in interest rates. It fell short of the comprehensive stimulus package investors were hoping for.

“With 70% of [Macau’s] annual visitors from mainland China, the state of economic environment is most important,” the team wrote, according to Seeking Alpha. “2024 has been a tough year in attracting tourists, with visa approvals in other destinations relaxing and air fares normalising. That said, visitor arrivals growth was a respectable 30% year-on-year for 9M24, recovering to 86% of 2019’s level.

“We expect 5% visitor growth in 2025… from 2025 onward, we believe the base effect to normalise. In addition, both gaming and non-gaming infrastructure should continue to attract players and visitors.”

“At present, Macau’s economy is steadily recovering,” he said, according to the Macau Daily Times. “Major economic indicators are stabilising and demonstrating improvement and some even surpassing 2019 levels.”

Ho took office in August 2019, three months before China’s first Covid cases and served during one of the city’s most turbulent periods.

The Chinese special administrative region (SAR) closed to travel for almost three years and didn’t fully reopen until January 2023. Tourism plummeted along with gross gaming revenue – the life blood of the world’s top gaming market.

Crisis equals opportunity

But the shutdown had an unexpected benefit, as the city moved to end its reliance on gaming as the main economic driver.

Ho’s “1+4” strategy for economic development emphasises tourism while building four new economic pillars: healthcare, finance, technology and a catch-all fourth category that includes events and conventions, trade, commerce, culture and sports.

In his Tuesday address, the CE said the government’s goal is not to “to compress the gaming industry; rather, we’re trying to grow the pie” by expanding other sectors.

Before Covid, the gaming sector contributed more than half of the city’s GDP and generated 80% of local tax revenue. It also employed 17% of residents. This year, by contrast, gross gaming revenue (GGR) will contribute 40% of gross domestic product (GDP), with other industries kicking in 60%, said Ho.

Last year, the total value added of the “plus-four” industries was MOP39.05 billion (£3.8 billion/€4.56 billion/$4.88 billion), up 6.9% from 2019. Ho’s tenure also saw a crackdown on capital flight, money laundering, cross border gambling and illicit money-changers and a shift from VIP gaming to mass and premium mass players.

“These measures have effectively regulated the development of the gaming industry,” said Ho.

Concessionaires as collaborators

“The gaming operators have started to understand our goals and are seeing the benefits,” Ho said in his farewell address. “They lost a lot of money during the pandemic, but now they are profiting from both gaming and non-gaming activities. We are focusing on attracting different types of visitors.”

According to government figures, 40% of Macau gamblers now hail from outside mainland China. And while mainland visitation grew 36.3% year-on-year to 18.2 million through September, international visitors comprised 40% of arrivals, growing 95.1% year-on-year in the same period. Philippine visitors topped the list, followed by Indonesia, Thailand and Singapore.

“Our approach is working,” said Ho. “Some of the non-gaming activities may not directly generate revenue, but they benefit Macau by attracting new groups of people.”

Macau casino concessionaires have been asked to do their part, kicking in MOP108.2 billion in nongaming investments as conditions of their concessions, which will last through December 2032.

“Now, the gaming industry in Macau has entered healthy development and the industry has become more planned,” Ho reflected.

GGR continues to grow

Ho added that the 2024 GGR could reach MOP$228 billion this year and MOP$240 billion next year.

“We are adding 6% to this year’s estimate of gross gaming revenue, which is about MOP$240 billion,” he said. “This is not a high estimate, it is a conservative estimate. I do not think it is a difficult target to achieve.”

Ho noted that the economy grew by 86% year-on-year in 2023 – a strong rebound from the pandemic – with an additional 11% boost projected for 2024, per Macao News.

In August, Ho announced he would step down for health reasons. On 20 December, he will pass the baton to incoming chief executive Sam Hou Fai, a one-time judge.

In concluding remarks, the 67-year-old Ho said it was “a great honour to lead Macau out of the worst”. 

“I’m quite old,” said Ho. “I should let someone younger take over the position.”

Reuters called Lui a visionary who “helped Macau eclipse rival Las Vegas in gambling revenues”. He ranks alongside other trailblazers in the market, including Steve Wynn, founder of Wynn Resorts; Sheldon Adelson, founder of the Las Vegas Sands Corp; and Stanley Ho, the father of Macau gaming, who established SJM Holdings in the early 1960s.

Young entrepreneur, diverse interests

Born in Guangdong, China in 1929, Lui moved to Hong Kong at age four. According to Channel News Asia, he began working in food service at 13. Over time, he launched a number of businesses, trading first in heavy machinery and selling quarrying and construction materials. Later, in the 1960s, he began adding hotels to the portfolio.

In 2002, after Macau opened its casino industry to global investment, Lui won one of the first gaming concessions. In 2006, he opened his flagship casino resort, StarWorld, on the Macau peninsula.

According to the company website, Lui’s resort company succeeded by “delivering innovative, spectacular and award-winning properties, products and services”. Its “world-class, ‘Asian Heart’ service philosophy” enabled it to “consistently outperform the market in Macau”.

Galaxy released its third-quarter results on 7 November, posting an 11% increase in net profit over 2023.

In 2011, GEG opened the massive Galaxy Macau on the Cotai Strip. Phase 3 of development, completed in December, added two new hotels and the 40,000sqm Galaxy International Convention Centre. Phase 4 will add 600,000sqm of non-gaming attractions, “primarily… MICE, entertainment [and] family facilities,” according to GEG.

“Significant contributions” to Macau

The Straits Times estimated Lui’s net worth at HK$112.8 billion (£11.4 billion/€13.75 billion/$14.5 billion). He was known for his trademark flat cap and also for his generosity.

In 2015, he established the Lui Che Woo Prize for World Civilisation. Each year, it awards three prizes of HK$20 million each to individuals or organisations that promote “lasting serenity and shared harmony” through sustainable development, “contributions to mankind and promotion of positive life energy”.

Incoming Macau chief executive Sam Hou Fai called Lui “a highly respected entrepreneur and philanthropist.… [We] commend him for his significant contributions to the appropriate and diversified development of the Macau economy over the years.”

GEG said it will appoint a new chairman “in due course”.

Net gaming revenue came to HK$6,995 million. Adjusted EBITDA was up 83.2% year-on-year to HK$1.04 billion.

According to Macau Business, the group’s gross gaming revenue (GGR) share increased from 12.1% to 13.9% for the 2024 Q3.

SJM credited the growth to strong performance of the Grand Lisboa Palace Macau (GLP) in Cotai, which opened in 2021. GLP’s market share rose from 1.7% in the third quarter of 2023 to 2.6% for the same quarter this year. The company said the increase was spurred by growth in both the gaming and non-gaming sectors.

Ho lauds “unfolding potential”

A statement from Daisy Ho, SJM chairwoman and SJM Resorts managing director, acknowledged “the unfolding potential” of GLP. She said its ongoing “ramp-up underscores the group’s strong recovery from challenging times to renewed growth”.

Ho added: “In the coming quarters, SJM will launch a series of key visitation drivers to strategically enhance our offering.” The group will add new dining options and increased MICE capacity at GLP. It will also expand hotel capacity by 10% with an expansion at Grand Lisboa, which opened in 2007 on the Macau peninsula.

SJM “renaissance” continues

A June note from CBRE Equity Research called SJM “a renaissance story in the making”. In the memo, reported by Macao News, analysts John DeCree and Max Marsh noted that SJM is repositioning GLP “to better cater to base mass customers, increase visitation to the property and identify operating efficiencies.” 

Mass market players are increasingly important to Macau’s player mix due to the shrinking VIP segment. In the third quarter, mass play represented a 76.5% share of total GGR.

GLP management “hopes to more than double Grand Lisboa Palace’s [GGR] market share to 5%” through mid-2026, the CBRE team added. “While management recognises this is an ambitious target, the company has an array of strategic initiatives aimed at improving market share.”

They include prudent capital investments, enhanced marketing and “improved connectivity across its entire asset base.”

Adjusted earnings before interest taxes, depreciation and amortisation (EBITDA) rose 6% from Q3 2023 to HK$2.9 billion (US$373 million), but “played unlucky” quarter-on-quarter, down 7%.

In a statement, Galaxy chairman Lui Che Woo said the balance sheet is “healthy and liquid” and positions GEG to “pursue international expansion” as well as local growth.

GEG is working to complete Phase 4 of development at Galaxy Macau, an ambitious undertaking spanning 600,000 square metres. The $HK43 billion project will add several luxury hotel brands along with a 4,000-seat theatre, a water resort deck and a new casino. The lavish Capella at Galaxy Macau will open in 2025.

On 25 October 2024, the Hong Kong-listed firm paid an interim dividend of HK$0.50 per share.

Golden Week a good harbinger

Lui pointed to robust Golden Week visitation in Macau as a strong fourth-quarter predictor. The Chinese gaming hub welcomed a total of 993,117 visitors during the seven-day holiday, with daily average arrivals at nearly 102% of pre-pandemic levels. “Macau hotels’ average guestroom occupancy stood at 95% during the period,” GEG noted.

According to a breakdown by Macao News, net revenue by property was HK$8.4 billion for Galaxy Macau; HK$1.3 billion for StarWorld Macau and HK$62 million for Broadway Macau. Occupancy at Galaxy Macau’s seven hotels was 98% from July through September, versus the citywide average of 95%.

In keeping with the city’s drive to grow international tourism, GEG has opened a new “overseas business development” office in Bangkok. It has similar offices in Tokyo and Seoul. 

Poised for growth

Seaport Research Partners analyst Vitaly Umansky agreed that GEG opened strong in the fourth quarter. According to Macau Business, he added that the surge may level off in November and December.

However, Umansky said the company’s “competitive advantage… is its entertainment/event offerings, scale, service and product offering. Large music performances drive outsized business with the fourth-quarter schedule supporting Galaxy Macau share gains.” Galaxy Arena at the Cotai resort is the city’s largest indoor entertainment space, with a 16,000-seat capacity.

“With a re-focused marketing effort and smart digital tables up and running before Chinese New Year,” Umansky added, “we expect share gains to continue at Galaxy Macau over the next few quarters and into 2025.”

According to Macau Business, Melco’s flagship City of Dreams recorded three of its best mass-table drop days of all time during the national holiday, 1-7 October. CoD sister property Studio City enjoyed four of its best days for mass table drop during the same period.

Melco also operates City of Dreams Manila in the Philippines, which opened in 2015. Last year, it opened City of Dreams Mediterranean in Limassol, Cyprus, which the company describes as “the first integrated resort in Europe”. That property has been a slow starter, although revenue – including three satellite casinos in Cyprus – jumped 20.6% to $64.4 million in Q3.

The Hong Kong-based operator is currently developing a new casino resort, City of Dreams Sri Lanka. Phase 1 of the project debuted 15 October, with the opening of the Cinnamon Life luxury hotel. Phase 2 will add a casino and additional non-gaming amenities.

By the numbers

Company-wide, total operating revenues for Q3 came to $1.18 billion, up 16% from $1.02 billion during the same period in 2023. Casino gaming accounted for $944.4 million of that total, with a further $111.0 million coming from room revenue. Food and beverage revenue added another $73.5 million, with $46.3 million generated from entertainment and retail offerings across its properties.

Operating income totalled $138.6 million, compared to $94.7 million last year.

Earnings before interest, taxes, depreciation and amortisation (EBITDA) were $322.5 million compared to $280.6 million in 2023. Net income was $27.3 million, reversing a net loss of $16.3 million last year. 

Melco chairman and CEO Lawrence Ho credited “initiatives to activate areas throughout our properties and drive visitation”.

Those initiatives include the new Signature Club for premium-mass players and an upgraded loyalty programme with exclusive benefits. “This renewed loyalty programme is starting to show the benefits of increasing efficiency in our player reinvestment,” Ho said.

The company has also introduced a premium slot area at City of Dreams and the new Dragon Zone slot floor at Studio City, in partnership with Aristocrat Gaming. It is also installing new “smart tables”, equipped with radiofrequency identification technology (RFiD), at baccarat tables at Studio City, according to Macao News.

Finally, Melco has installed a “new light tunnel entrance complemented by live performances” at City of Dreams to dazzle incoming patrons, Ho said. “We expect to continue to unveil new and exciting projects to support the ongoing growth in Macau.”

On the upswing

CBRE Equity Research analyst John DeCree says the positive results suggest an upward trend for Melco in the Chinese gaming hub. Melco is “upping its game in Macau, with a renewed focus on its highest-value customers,” said DeCree, per investment website Seeking Alpha. The renewed momentum should grow with the addition of more RFiD-enabled tables.

Overall, the results justify Ho’s optimism in the company’s Q2 earnings call. At the time, he said, “We’ve seen growth in GGR quarter-to-quarter and year-over-year. And our teams are focused on driving continued expansion of our market position.”

Capex is expected to reach $400 million for 2024, with $70 million-$75 million for CoD Sri Lanka.

According to NASDAQ.com, Melco stock currently has a “buy” rating from Zacks Rank, “indicating that it could outperform the broader market in the near term”.

Winners of the first casino licence in the UAE, Billings said that as of this week, 24 floors of the Al Marjan hotel tower have been completed. He projects the country will be a “$3 billion-$5 billion gaming market“. And Wynn, also so far the only casino company to be awarded a licence, will be at the forefront. To date, Billings said, 3.6 million square feet of concrete and steel are in place.

UAE is “certainly the most exciting new market for our industry in decades,” Billings said. “I remain incredibly bullish about the future of our company. We have the best assets in the world’s premier gaming markets and our team is the most dedicated team in the business.

“We are investing for long-term growth with an exciting high ROI development in well under way, which is unique in our industry.”

During the third quarter, Wynn put $18.2 million of equity to the Marjan Island project. It has now increased its total contribution to $532.6 million in total equity.

“Luxury positioning” a key driver

Overall, the company’s third-quarter revenue of $1.69 billion and $32.1 million net loss missed Wall Street projections. Billings pointed to a downturn in the Las Vegas casino business, while Deutsche Bank noted Macau revenue fell $27 million below its estimates. Wynn stock dropped 2.8% in after-hours trading.

But Billings pointed to strong third-quarter growth across the world, despite US properties showing the least amount of year-over-year improvement. While he said that “demand remained strong” in Nevada, revenue there was up about 1% and EBITDA was flat “year over year on very tough comps”.

The company did see hotel revenue rise by 5% and slot handle grow by 4%. Despite potential general economic headwinds in the US, Billings pointed to Wynn’s client base as a strength.

“Our luxury positioning and unique programming continue to appeal to the market’s most affluent and therefore most resilient customers,” he said.

The numbers were essentially the same for Wynn’s Boston Encore property where EBITDAR was up 4% to $63 million against the third quarter of 2023. Slot handle grew by 3%, non-gaming revenue was up 2% and slot handle rose 1%.

While much of Wynn’s worldwide focus is on the UAE, it is also diversifying and growing its Macau business.

Wynn eyes non-gaming improvements in Macau

From a financial perspective, that market was the strongest for the third quarter – EBITDA was up 3% while revenue grew 6% and combined mass table and slot win was up 10%. However with operating revenue from Wynn Palace falling 1% to $519.8m and Wynn Macau’s contribution up 19.3% to $352m, revenue from the Special Administrative Region came in $20m below Wall Street’s consensus.

Headwinds stemmed from hotel and retail, Deutsche Bank’s Carlo Santarelli noted, with aggregate non-casino revenue down 8% year-over-year.

In the broader picture, Wynn is expanding its non-gaming offerings in Macau. Billings said the company has upgraded four dining venues at the property and is in the process of “revitalising and expanding the Chairman’s Club, our most exclusive gaming area at Wynn Macau.”

Santarelli said amid stiff competition in Macau, Wynn Macau’s market share would only improve once these new amenities launch during 2025.

“Given sluggish non-gaming trends and annual cost increases, our Macau revisions are somewhat material, but we think capture a largely static environment and, as such, could be conservative,” he wrote in an analyst note.

Debt reduction = $70m in savings

Billings also shared that Golden Week, which ran from 1-7 October, was a boon for the company. Mass table drop was up 30% against Golden Week in 2023. The company is also continuing work on an event centre and production show.

In the bigger financial picture, Wynn has significantly reduced its debt and in turn will save $70 million annually in interest payments, according to CFO Julie Cameron-Doe.

The company had $3.5 billion available in cash and revolver availability as of 30 September. Of that, $1.7 billion in liquidity is available in the US and $1.8 billion in Macau. The company reduced gross debt by $1.2 billion during early October. The board approved a $0.25 cash dividend for those holding stock as of 15 November.

Both Billings and Cameron-Doe reiterated a positive outlook for 2025 as the company continues to invest in upgrades across its properties.

That’s 6% more than the previous post-pandemic high of MOP$20.2 billion, recorded in May. It also beat September GGR by 20%, according to the city’s Gaming Inspection and Coordination Bureau (DICJ).

Golden Week saw robust tourism

The month started with a bang as tourists flooded the city for the national Golden Week holiday, running 1-7 October.

From 2-5 October, arrivals from mainland China were up almost 55% year-on-year. And tourism peaked on 3 October, breaking the all-time single-day record with more than 174,000 visitors. The weekly tally exceeded 993,000, up 1.9% over 2019, before Covid shutdowns began. The city did not fully reopen its borders until 6 January 2023.

According to the Macau Government Tourism Office (MGTO), hotels in the city posted record occupancy, peaking at 98.5% on 3-4 October. The Macau Daily Times reported that daily room rates were 4% higher on average than during the same period in 2019.

Monthly haul points to full-year bonanza

Gaming spend exceeded expectations: an average MOP1.08 billion per day, versus the more modest estimate of MOP900 million, as reported by Macao News.

JP Morgan analysts said the results implied “mass GGR [recovery of] 130% to 140% of pre-Covid levels”. VIP play was up, too, by 35% and per capita spend rose 25% over pre-Covid levels. 

The rising tide anticipates stronger full-year performance. The local government had projected annual GGR of MOP216 billion. Now it’s looking to a total of almost MOP240 billion.

Year to date through October, GGR came to MOP$190.1 billion, up 28.1% over the same period in 2023.

Net revenue in Macau reached an all-time high, which in turn allowed MGM to announce a special dividend for the region. On top of this, revenue also grew across MGM’s Las Vegas and Regionals businesses, while the BetMGM digital venture with Entain saw profitability again.

While MGM remains on a largely upward trajectory, Hornbuckle (pictured) said the group is seeking to build on this success. He notes progress with expansion plans in several markets around the world, with ongoing initiatives set to drive long-term growth.

Where is MGM looking to grow?

During Q3, MGM entered a strategic venture with the Grupo Globo, Latin America’s largest media group based in Brazil. Hornbuckle told analysts during the 30 October Q3 earnings call that BetMGM would launch in Brazil in January, pending licence approval.

“This venture is meaningful as it allows us to leverage MGM’s LeoVegas technology and gain access to 70 million people providing invaluable insights into Brazil’s consumer market,” Hornbuckle said. “This aligns with a broader strategy to expand our digital footprint globally and tap into emerging markets.”

On the interactive arm, which falls under its LeoVegas business, Hornbuckle said he did not anticipate any more capital to be put into the business, or acquisitions to be made, in the short-term. The company closed a deal to acquire Tipico’s US betting platform on 24 June to drive its LatAm ambitions and in-source its betting technology.

“We don’t anticipate any more acquisitions as it relates to MGM Interactive in-house, we call it, which is a LeoVegas arm. Look, we have three markets under launch right now, UK, Netherlands and soon to be Brazil. I think by the late part of next year, all of that will manifest itself,” Hornbuckle told analysts.

As for digital performance, MGM did not state specific figures for this area of its business. CFO Halkyard did, however, offer some insight during the group’s earnings call, setting out how he was “encouraged” by its Q3 performance.

“During Q3, we achieved profitability again, record igaming results and a 70% increase in first-time depositors while stabilising market share,” he said.

New York and UAE developments moving, but slowly

Looking at its expanding retail estate, MGM continues to advance its zoning requirements for the planned venue in New York. Hornbuckle said the group plans to submit its request for applications towards the middle or late next year.

Into the Middle East and the United Arab Emirates, Hornbuckle said MGM also continues to monitor the situation. The group last month applied for a licence in the region, while it also has a property under development. However, Hornbuckle said there is scope for more work.

“There’s obviously a couple other opportunities that will probably come forward,” he said. “We love our position in Porto Island. That has started in earnest and construction is now starting to come out of the ground, so we’ll see ultimately once the decrees come out by Emirate, who wants to do what. But we’re keenly focused on it and I would particularly love it, obviously, if it had gaming.”

Building on Macau success with greater Asia presence

As for Asia, Hornbuckle highlighted progress with the Osaka casino project in Japan. Last month, MGM reportedly forfeited its right to withdraw from the initiative, suggesting it is fully committed to moving ahead.

“We’re making significant progress in Osaka, aiming to complete ground preparation starting main construction in the middle of next year,” Hornbuckle said.

There is also potential for expansion into Thailand, with this having proved a hot topic during recent earnings calls. Hornbuckle said during the Q3 call that he had recently made his third trip to the country to scope out opportunities for MGM.

“We’ll continue to monitor it,” Hornbuckle said. “We’ve said we’re going to do it in concert with MGM China. It’s working its way through the legislation; ultimately hopefully through their parliament. We hope by early next year something will be announced.

“We like what we hear to date in terms of tax and investment ratios that we hear. Obviously, it’s a great place to build relatively cheaply as compared to other markets. The cost of doing business there is extremely low. So, from an operating margin perspective, we love the opportunity it could bring. But I think we’re still a long way away from getting to the finish line.”

Speaking broadly on the initiatives, Hornbuckle said this will fuel future growth, diversifying MGM’s geographic reach and earning sources.

“With a strong pipeline of initiatives spanning short, medium and long-term, we’re well-positioned to sustain growth and drive future success all while returning cash to shareholders,” he said.

China the highlight during quarter of growth at MGM

As for current operations, MGM’s continuing success in China is clear to see. For the third quarter, revenue from the MGM China segment increased 14.4% to $929.5 million, mainly due to the removal of all remaining Covid-19 measures in Q1 of last year.

Revenue was higher across all areas within the MGM China business, with casino the main money-maker at $800.2 million, up 12.1%. In addition to this, adjusted property EBITDAR hit an all-time high, while MGM’s market share in Macau was 15%.

While growth in China is impressive, MGM’s Las Vegas Strip Resorts business remains by far its primary revenue source. For Q3, revenue topped $2.13 billion, up 1.3% year-on-year, despite a 12.8% drop in casino gaming revenue.

MGM noted that during Q3, the Las Vegas properties segment benefited from $37.0 million in business interruption proceeds, related to the cybersecurity incident a year ago.

“We grew month-to-month during the quarter with many of our key metrics demonstrating strength, including a 3% increase in ADR, an occupancy increase of 250 basis points and 4% growth in slot handle,” chief financial officer Jonathan Halkyard said.

Also in the US, the Regionals business generated $692.6 million in revenue, a rise of 2.1%. In contrast to the Las Vegas segment, casino drove this growth, with gaming revenue up 2.1%.

Across the MGM group, total casino revenue increased 3.4% to $2.12 billion, rooms revenue was up 6.8% to $883.6 million, food and beverage revenue grew 8.1% to $755.3 million and entertainment, retail and other revenue also grew 6.7% to $411.6 million. An additional $11.9 million was noted in reimbursed costs.

Net profit climbs to $184.6 million

On the subject of expenses, total operating costs were 6.9% higher at $3.88 billion in Q3. After including $8.0 million in income from unconsolidated affiliates, this left an operating profit of $314.9 million, down 14.9% year-on-year.

However, after including non-operating costs and income, pre-tax profit was $296.7 million, some 32.1% more than last year.

After paying $52.6 million in income tax and taking off $59.6 million in profit attributable to noncontrolling interest, this resulted in a net profit of $184.6 million. This is 14.6% ahead of last year.

In addition, adjusted EBITDAR for the quarter hit $1.14 billion, with no comparable figure for last year.

“Overall, we’re exceptionally well diversified and we’re very optimistic about both our near, long, near, mid and long-term,” Hornbuckle concluded.

It will take the stage on 15 December at MGM Cotai, sister property of MGM Macau. The show is part of the company’s commitment to introduce more non-gaming and culturally relevant attractions in the city.

Tickets go on sale on 2 November.

Celebrating anniversary of Macau handover

Now a Chinese special administrative region (SAR), Macau will rejoin the PRC in 2049.

In comments to US entertainment weekly Variety, an MGM spokesperson said the spectacular is “a grand tribute to the 75th anniversary of the founding of the PRC and the 25th anniversary of Macau’s return to the motherland”. It is also “a catalyst to propel the city’s cultural and entertainment sectors towards new heights”.

The show was designed to “further foster the development of Macau as a ‘City of Performing Arts’… and promote Chinese culture to the world”.

The show at the 2,000-seat, high-tech MGM Theatre will “re-interpret traditional Chinese culture from a contemporary perspective”.

Pansy Ho: “A milestone in cultural tourism”

The show is directed by noted filmmaker Zhang Yimou, known for movies like Raise the Red Lantern and Full River Red. Zhang also directed the opening and closing ceremonies of two Beijing Olympics, in summer 2008 and winter 2022.

Zhang said Macau 2049 will “harness technology and innovation to bolster Chinese cultural confidence and captivate global audiences with China’s cultural prowess”.

Pansy Ho, chairwoman and executive director of MGM China, called the production a “milestone in cultural tourism… as the city enters a new era of ‘1+4’ diversified development.”

Her comment was a reference to Macau’s Plan for Economic Diversification. The five-year market-led strategy was created to develop Macau as a Centre of World Tourism and Leisure by 2028.

The plan also includes the development of four new industries. They include big health, finance and technology. The fourth category includes culture, sports and MICE (meetings, incentives, conferences and exhibitions).

New chief executive calls for more residencies

According to the South China Morning Post, Macau’s incoming chief executive, Sam Hou Fai, has asked casino concessionaires to invest in more entertainment residencies to help boost tourism.  

“A renowned UK artist was offered around $200 million for a half-year residency but declined,” said Sam, in an apparent reference to singer Adele. “We must continue to pursue opportunities like this for sustained operations.”

The former judge, elected on 13 October, will succeed current CE Ho Iat Seng in December.

Meanwhile, Melco Resorts and Entertainment’s splashy House of Dancing Water, a water-based stage production, will return to City of Dreams Macau later this year.

The world’s largest water extravaganza ran from September 2010 to June 2020, then closed due to the Covid-19 pandemic. As reported by the Macao News, more than six million people saw the production during its initial run.

The amended Law on Combating Gambling Crimes passed on 16 October, according to Macau Business. It includes prison terms of up to five years for offenders. Individuals convicted of the crime could be banned from entering city casinos for up to a decade.

The new law also increases the penalties for illegal gambling. Side bets and parallel bets are punishable by as much as eight years in prison. In addition, the law gives police more power to enter and search suspected illegal gambling dens.

Enabling capital flight, contributing to crime

In June, Beijing launched a crackdown on illicit money-changers, who help gamblers skirt government controls on capital flight.

According to the ministry of public security, the exchanges contribute to a more lawless atmosphere. In addition to money laundering, they lead to “fights, fraud, thefts, illegal immigration and other crimes” including kidnapping and murder.

Between 2019 and 2022, several women involved in the exchanges were murdered in Macau. They were known to carry large amounts of cash.

Official data indicates that gaming-related crime in Macau rose 62% year-on-year in the first half of 2024, compared to an 18% spike in total crime. Through June, police arrested more than 2,200 people involved in currency gangs.

In comments before the city judiciary on 17 October, chief prosecutor General Ip Son Sang said “common crimes, such as fraud and theft, saw significant increases, directly contributing to the overall rise in cases.”

Addressing the same body, judge Song Man Lei agreed that casino-related crimes have surged since mid-2023, as the city recovers from the Covid-19 pandemic. However, she said, the volume is “still short of the sustained high levels before the pandemic.”

Broad-based campaign includes more border checks

Legal expert António Lobo Vilela has described the exchanges as sophisticated engines that move funds across jurisdictions “without crossing any borders”. He called them “the primary unofficial channel for providing funds to gamblers in Macau”.

The government campaign looks to “strike hard and take multiple measures” against illegal exchanges. In addition to stiffer penalties, those measures includes stronger border checks.

News reports have emphasised Sam’s harsh early criticism of Macau’s gaming industry. In August, after announcing his candidacy, he used the word “barbaric” to describe the sector.

Gaming has “developed in a disorderly manner… expanded wildly” and must be reined in, he said. Relying on a single industry “is not beneficial for Macau’s long-term development,” he added.

Sam echoed the central government’s position that Macau must diversify its economy beyond gaming. He called the directive “mandatory… not a question of choice.”

Macau’s top industry will not “be shut down”

The candidate later acknowledged the importance of gaming to the city. Casinos shut down for three years during the Covid-19 pandemic, but bounced back when borders reopened in early 2023. Last year, the industry reaped gross revenues of MOP183.1bn (£17.45bn/€20.95bn/$22.85bn).

“Gaming “is Macau’s primary industry”, Sam conceded, and must “develop healthily”.

In a 28 September policy address, he said his government would “protect and supervise the healthy and orderly development of the six concessionaires”. He later assured gaming operators that the sector “will not shrink or be shut down”.

“1+4” equals resilience

In a weekend press conference, the CE-elect said he will follow Ho’s “1+4” policy to develop Macau as a World Centre of Tourism and Leisure while fostering the growth of four new industries. Big health, finance and technology top the list. A final category includes culture, sports and MICE (meetings, incentives, conferences and exhibitions).

The government agrees Macau is uniquely positioned as a convention city. In 2023, the Forbes Travel Guide named Macau the “hotel capital of the world”, displacing London with 22 five-star hotels. But gaming is an inextricable part of that designation, as many of the hotels are located in casino resorts. They include the Galaxy Hotel, Grand Lisboa Palace Macau, the Karl Lagerfeld, the Londoner Court and the Londoner Hotel.

Ieong Meng U, University of Macau assistant professor of government, says Sam is unlikely to disrupt the casino industry, because it’s simply “too important for Macau.”

Is Sam equipped to do the job?

Sam ran unopposed. He is seen by some as hand-picked by Beijing to lead the city in its next phase of development.

Observers have expressed concern about his lack of political experience, but political commentator Sonny Lo Shiu-Hing told the Macao News that a strong cabinet will help. “He will have to rely on the executive council members who may have more experience in economic and financial development,” he said. “Sam will be able to govern Macau successfully with a batch of experienced economic advisors.”

Lau Siu-kai, consultant to the Chinese Association of Hong Kong and Macao Studies, told The Standard in August: “Sam might have relatively few connections. [But he] should not have too much trouble solving problems with Beijing providing tremendous support.”

Macau casinos will have “less wiggle room”

Ben Lee, managing partner with consultancy iGamiX, told iGB that Sam “is first and foremost a judge. His conditioning over the last decades is black and white, which means he will likely interpret everything in the literal sense.”

That means casino concessionaires “are likely to have less wriggle room than they have gotten away with the past two decades in terms of non-gaming investments and efforts,” according to Lee.

Sam’s lack of experience outside the judiciary could also handicap him in his goal to diversify the economy as Beijing demands, Lee observes. “He is not a politician nor an administrator. Turning around the Macau bureaucracy to redirect attention towards diversification will be his major challenge.”

The new law would increase penalties for illegal gambling and give law enforcement the right to search suspected gambling dens. It would also make it a crime to operate an illegal money exchange.

In June, Macau’s ministry of public security launched a “high-pressure crackdown” on the underground banks. The ministry pledged to “destroy criminal gangs” that help Chinese gamblers sidestep government controls on capital flight.

Tackling corruption

In a July interview, Peng Peng, executive chairman of the Guangdong Society of Reform, told the South China Morning Post the crackdown was necessary “to protect China’s financial security, tackle the problem of corruption and prevent the illegal outflow of money”.

“While the illegal money exchange business in Macau might have stemmed from the gambling industry, it has [become] a very common channel for corruption,” he said.

The tougher law, first proposed in August, includes prison terms of up to five years for unlicensed money changers. In addition, it would ban offenders from entering city casinos for between two and 10 years.

Not a victimless crime

In a 2023 commentary in the China Daily, attorneys Lei Wun-Kong and Kacee Ting Wong wrote that illegal exchanges “are good at finding innovative ways to navigate the wild criminal seas”.

The illegal exchanges offer better rates than licensed money-changers and banks and do not limit the amount to be exchanged. For years, the team wrote, such transactions were considered “victimless minor offences”. The Financial System Act responded with a slap on the wrist. Violators were fined and the offence was published in local media.

But tougher sanctions seemed inevitable. The exchanges are increasingly linked to fraud, money laundering, loan sharking and violent crimes including kidnapping and murder. Officials add that they have led to more overall crime in Macau and have “seriously affected social stability”.

Moreover, the money-changers are known to prey on unlucky gamblers chasing their losses.

This is something that enables “desperate gamblers to stage a comeback” and “constitutes a violation of responsible gambling policies propagated by the Macau SAR government”, the attorneys wrote.

He pointed to Golden Week tourism as a sign that the Chinese are actively pursuing leisure and entertainment.

Golden Week stronger than expected

The annual holiday commemorates the 1 October 1949 founding of the People’s Republic of China. Golden Week is peak travel season among mainlanders and this year’s volumes didn’t disappoint.

According to the Macau Government Tourism Office (MGTO), nearly a million people visited the city between 1 October and 7 October. That’s a 2% increase over the same period in 2019.

An average of 152,600 tourists arrived each day, far exceeding the government target of 130,000 per day. Mainland visitors made up 83.2% of the total visitor base. The rest came from Hong Kong.

“We’ve all had an amazing week,” Hornbuckle told CNBC’s Contessa Brewer at G2E. “It speaks to the general economy and the activity case in Macau. And we remain pretty excited by it all.”

According to government data, year-to-date gross gaming revenue (GGR) in the world’s top casino market has grown 31.3% year-on-year. Through September, casinos generated MOP169.36bn (£16.165bn/€19.3bn/US$21.14bn), which is 76.9% of pre-Covid levels.

MGM Resorts is the parent of MGM China, which operates MGM Macau and MGM Cotai in the Chinese special administrative region (SAR).

US company expanding in Asia

MGM will open Japan’s first integrated casino resort in Osaka in 2030. It is looking to further grow its presence across Asia.

The US-based company has also expressed interest in Thailand, when and if that market opens to legal gaming. In addition, Hornbuckle said it has applied for a gaming licence in the United Arab Emirates.

Golden Week commemorates the 1949 founding of the People’s Republic of China. It’s one of China’s busiest travel seasons. And revellers came out this year despite prolonged economic uncertainty and rock-bottom consumer confidence.

From 2 October to 5 October, arrivals from mainland China – Macau’s main feeder market – were up almost 55% year-on-year. Tourism peaked on 3 October, breaking the all-time single-day record with more than 174,000 visitors.

However, visitation from Hong Kong dropped more than 25%, to fewer than 80,000 tourists.

CE candidate pumps big-name residencies

At a town hall meeting Saturday, the sole candidate for Macau chief executive said SAR casinos should step up their entertainment calendar to boost patronage.

“In various sectors, we are lagging behind,” said former appeals court judge Sam Hou Fai. He suggested Macau play to its strength as an emerging centre of tourism and leisure. City leaders set that goal in 2011. It was followed in 2018 by the Guangdong-Hong Kong-Macau Greater Bay Area (GBA) Development Plan.

“Our competitiveness in several aspects is not as good as others,” said Sam. “We are falling behind Shenzhen’s technology, Guangzhou’s comprehensive capabilities and Hong Kong’s financial centre.”

“Our unique advantages have not yet been fully utilised. In the future, we have to make up for our shortcomings in these aspects in a targeted manner,” he said.

Sam said casino operators should promote superstar residencies like those in Las Vegas.

“A famous UK singer, who once performed in a residency show in Las Vegas, was offered around $200m (£152.76m/€182.1m)” for a similar contract in Macau, he said. “While she turned down the offer to take care of her family and children, could we not continue to promote something like this to make it a long-term operation?”

Some publications have identified British songbird Adele as the singer in question.

The election for chief executive will take place on 13 October. Current Macau chief executive Ho Iat Seng announced in August that he would not seek reelection due to health reasons.

But at a 28 September press conference, Sam Hou Fai adopted a softer tone. Acknowledging gaming as Macau’s primary industry, he said it must “develop healthily” for the city’s long-term viability.

However, Sam said Macau must not forget the lessons of the Covid-19 pandemic – chiefly, that no government can rely on a single industry for its survival. “How could we handle it if (future) big disasters arise?” he asked.

Promoting “diversified development” in Macau

At Saturday’s three-hour session, Sam said his administration “will protect and supervise the healthy and orderly development of the six (gaming) concessionaires.” And the Big Six – MGM Resorts, Wynn Resorts, the Las Vegas Sands Corporation, SJM, Galaxy Entertainment and Melco Resorts – have agreed to do their part.

As part of their licence agreements, the operators must invest a collective MOP130bn (£12bn/€14.6bn/US$16.2bn) in non-gaming amenities, such as urban renewal and cultural attractions.

“We will periodically review the overall situation regarding the fulfilment of the concession contracts,” said Sam.

The local government will also support the development of four additional pillar industries: finance, technology, health and meetings and conventions.

The market-led “1+4” approach will “promote the diversified development of the Macau economy”, said Sam, and position the city as an international tourism and leisure destination.

The pivot away from gaming has already begun. In May, current CEO Ho Iat-seng said the industry contributed less than 40% to gross domestic product in 2023, down from about 60%.

Is Sam qualified to lead the charge?

In August, Sam became the sole candidate for CE, earning nods from 386 of 400 election committee members. Those members will elect the new leader on 13 October; most of the SAR’s 687,000 residents don’t have the right to vote. Sam seems a shoo-in to succeed Ho, who is leaving for health reasons.

If elected, he would be the city’s first leader from mainland China and would assume office in December.

Some analysts have questioned Sam’s credentials and his ability to lead Macau into a new era of development.

“It seems ridiculous to think that a chief justice might be qualified to be chief executive,” Anthony Lawrance, founder of consultancy Intelligence Macau, told Reuters.

Ieong Meng-u, assistant professor of social sciences at the University of Macau, shares that skepticism. He said Sam’s “track record in the judiciary system” doesn’t make him capable of “handling economic restructuring, regional collaboration or even bridging Macau with the world”.

Political commentator Sonny Lo Shiu-Hing said Sam’s “economic experience has been relatively weak.”  He added, “I’m confident that Mr Sam will be able to govern Macau successfully with a batch of experienced economic advisors.” 

In the end, who becomes CE “is not important”, Ieong said. “The rule of the game is, you take (Beijing’s) order as your priority.” The incoming CE wouldn’t dare to disrupt the gaming industry, because it’s “too important for Macau”.

“Casino capitalism will continue in Macau,” Lo agreed. But it will be “diluted by more social welfarism and… more economic diversification.” 

Year to date, so-called whales – those who place average bets of HKD100K or more – have wagered a collective HK$43.3m, more than the HK$39.7m wagered in all of 2023.

The body count is also up. Citi tallied more than 600 premium-mass players at casino tables in September, up 42% year on year.

Exchange crackdown in Macau a non-issue

In an August note, Citi analysts George Choi and Ryan Cheung wrote that “demand by mainland Chinese players remains robust.” That’s in spite of a recent crackdown on illicit money touts, designed to quell exchange gangs and loan sharks around Macau casinos.

The segment clearly has no trouble transporting funds from the mainland into the special administration region (SAR). And they’re not hampered by ongoing deflation in the world’s second largest economy.

Despite those headwinds, observed the Citi team, “Macau is still getting players who are still very much willing and able to spend.” At Galaxy StarWorld, for example, Choi and Cheung witnessed one gambler placing a HK$640K bet.

During stops at Galaxy Macau and Wynn Palace, they saw high rollers betting HK$130K-HK$330K.

“The fact that this happens after the Macao government’s decision to criminalise illegal money exchanges within casino premises means that most players, via legitimate channels, are still able to get their funds to the Macao casinos,” wrote Choi and Cheung.

Despite the virtual collapse of Macau’s junket trade, whales and premium players remain an essential part of the patron demographic at the city’s casinos.

The PBOC should be ready to present a prototype with “basic functions” by the end of 2024, said Ho.

Catching up with the global economy

Officials first laid out a plan to create and issue the virtual pataca, or e-MOP, in 2022. In a memo to the Legislative Assembly, they said the move would make Macau part of the global digital economy and put it on par with “neighbouring jurisdictions, namely mainland China and the Hong Kong SAR”.

It’s also in keeping with the government’s “1+4” programme, launched in 2023. The five-year plan was designed to wean the city from its reliance on gaming by developing four nascent sectors: finance, technology, health and meetings and conventions.

In a 2023 policy address, Ho said the strategy “will essentially reverse the trend of one industry overshadowing other sectors”. It also affirms Macau’s commitment to becoming a “smart city”, where data amassed through technology informs municipal management.

HKD dominant in Macau casinos

Patacas are the official currency of Macau, although Hong Kong dollars are most often used in casino transactions.

China’s plan for a digital renminbi, or yuan, is seen as a way to curb money laundering, tax evasion and terrorism financing. According to industry commentator Muhammad Cohen, gaming experts believe “Beijing would welcome renminbi play in Macau”.

“Digital RMB would mitigate what Beijing sees as the most harmful financial side effect of Macau casinos: capital flight through illegal funds transfers from the mainland,” Cohen wrote.

VIP volumes have dwindled due to crackdowns on cross-border gambling and illicit money exchanges. But big spenders are still spending big, as indicated by a recent Citigroup study.

The table survey showed a marked increase in average wagers by VIP gamblers. Through September, 228 so-called “whales” wagered a total of HK$43.3m (£4.8m/€5.8m/$6.5m), up 43% over the same period in 2023.

Meanwhile, the Chinese-Portuguese pataca remains Macau’s coin of the realm. The digital-currency legislation includes a mandate that businesses must continue to accept physical cash as payment.

Senna Fernandes was a guest of Melco Resorts’ ‘Glow Your Way to Macao’ campaign, at the new City of Dream Mediterranean. Melco’s first European resort opened in Limassol 2023, joining three satellite casinos in the republic.

Attendees included representatives of travel agencies and trade associations from Europe and the Gulf Cooperation Council (GCC) of Arab states.

Travel group picks Macau as “preferred destination”

The MTGO’s global roadshow is already bearing fruit. In April, the European Travel Agents’ and Tour Operators’ Association (ECTAA) announced that Macau is its “preferred destination” for 2025.

The ECTAA will push Macau’s “stunning blend of Portuguese and Chinese culture, world-class resorts and vibrant nightlife”. It pointed to its status as a UNESCO World Heritage site and called it a perfect stop “for travellers seeking adventure”. Those emphases align with Beijing’s drive to wean Macau from a gaming-reliant economy by 2028.

Senna Fernandes thanked the ECTAA for “strengthening connections with overseas travel trade… to achieve Macau tourism development”. She noted “considerable interest” in the market from countries such as Romania, Hungary and Bulgaria.

Alan Ho of the Macau Association of Convention, Exhibition & Tourism Sectors added: “In meetings, we also noted investment interest from Arab countries including Saudi Arabia, the United Arab Emirates and Kuwait.”

Melco to cross-promote Macau

One of Macau’s Big Six casino concessionaires, Melco is an active part of the campaign. The Hong Kong-listed company just announced it will open a sales office in Cyprus to promote Macau to Cypriot patrons.

“This facility in Cyprus… can act as a gateway for more visitors to visit Macau,” Melco CEO Lawrence Ho told the Cyprus Mail. “Melco always thinks of itself as being in a public-private partnership with the Macau government.”

The gaming giant also operates an integrated resort (IR) in Manila. Next year, it will open a new LKR350tn (£752.8bn/€897.3bn/$1bn) IR in Sri Lanka), also under the “City of Dreams” brand. Melco currently has promotional offices in Singapore, Hong Kong and the Philippines.

Six of Galaxy Entertainment’s eight hotels have been sold out since June. MGM Macau and MGM Cotai are also booked up – a total of 2,000 rooms between them.

Investment bank UBS agrees that bookings are “[tracking] solidly”. The team observes that “new and younger” patrons are becoming more important to Macau’s visitor mix. Operators are responding with more non-gaming attractions, including entertainment.

“The concert pipeline during the holiday period should drive incremental demand to Macau, in our view,” UBS added.

IVS program boosts visitation

Gaming demand is also high, despite a slower economy, thanks in part to visitors from cities recently added to the individual visa scheme (IVS) list. The IVS programme allows mainland Chinese to visit the SAR on their own, without a tour group.

UBS analysts expect gross gaming revenue (GGR) to reach up to MOP950m (£89.8m/€106.2m/$118m) per day during the holiday, according to an analysts note.

Jeffries Equity Research says increased visitation is a sign of Macau’s continuing post-Covid recovery. So far this year, an estimated 19.7 million people have visited the city. That’s 17.1% lower than in 2019, but a “significant improvement” over last year, Jeffries noted.

Crackdown on money exchanges not make-or-break

The CLSA team shrugged off investor fears about Macau’s crackdown on illegal money exchanges at casinos, calling them “likely overdone”. They pointed to last month’s GGR – MOP19.7bn, the year’s second highest total after MOP20.1bn in May – as a sign of health for the industry.

Even so, the firm has cut GGR forecasts for Macau through 2025 due to the crackdown, which launched in June. It now predicts this year’s take will top out at MOP228.3bn, down from MOP243.57bn. Next year, it estimates total GGR of MOP238bn.

Last year at this time, almost 1 million people visited Macau for the holiday, which kicks off with National Day on 1 October.

“There have been times [the industry] developed in a disorderly way and expanded wildly,” he said. He added that its dominance “squeezes the resources of our society… [and] affects our young people’s choice of employment and career.”

At the 12 September meeting, however, he acknowledged gaming’s contributions to the city’s economy and urged industry leaders to work toward a more resilient economic model.

Present at the meeting were:

• Pansy Ho, chairwoman and executive director of MGM China and Kenneth Feng, president and executive director of MGM China
• Wilfred Wong, executive vice-chairman of Sands China and Grant Chum, president and CEO of Sands China
• Lawrence Ho Yau, chairman and CEO of Melco Resorts & Entertainment
• Francis Lui, deputy chairman of Galaxy Entertainment Group
• Linda Chen, president, vice-chairwoman and executive director of Wynn Macau
• Daisy Ho Chiu Fung, managing director of SJM Resorts
  

Toeing the party line

Ieong Meng-u, professor of political science at the University of Macau, told the South China Morning Post that, despite his criticism of the industry, Sam is unlikely to “change the status quo, at least not in the next few years”.

“He described the gaming sector as developing ‘in a disorderly way’ because that’s how Beijing perceives it,” he said.

Seaport Research Partners analyst Vitaly Umansky believes the new CEO will understand “the importance of the gaming and hospitality industry to the economic well-being and future development of Macau.”

Gaming industry, plus four

From January through July, 84% of total Macau government revenue came from gaming taxes. Government leaders have set a goal to reduce that by more than half, deriving 60% of GDP from non-gaming going forward.

Last August, in his ‘1+4’ strategy for economic diversification, the current CEO Ho Iat Seng laid out a plan to add four additional pillar industries:

• Medicine
• Financial services
• Technology
• Special events

The Big Six have pledged to invest more than MOP108.7bn (£10.276bn/€12.2bn/$13.5bn) in nongaming over pursuits the next decade, a condition of their current licences.

Sam is presumptive winner

Sam is the former president of Macau’s Court of Final Appeal. He is unopposed in his quest to succeed Ho. He has cornered 383 of 400 elector endorsements ahead of the 13 October election.

Ho announced last month that he would not seek reelection due to health reasons. If elected, Sam will take office on 20 December.

Who’s involved?

Among those banned for life are midfielder Jin Jingdao, forward Guo Tianyu and goalkeeper Gu Chao, all of China. They can no longer take part in football or football-related activities. Seventeen others received five-year bans.

In a press conference on Wednesday, South Korea’s Son Jun-Ho protested his innocence. A tearful Son said he was “dumbfounded” by the “ridiculous charges”.

“They threatened that if I didn’t admit to the charges, my wife would be arrested,” he declared. “I said I hadn’t done anything like that.”

China targets sports-related crime

The bans are the latest salvo in Beijing’s war on corruption in sports.

In March, a court sentenced former CFA chairman Chen Xuyuan to life in prison for accepting bribes worth MOP88m (£8.4m/€9.98m/$11 million).

At the same time, former CFA vice-president Wang Dengfeng got 17 years for embezzlement and bribery. In August, another former VP, Li Yuyi, got 11 years for accepting bribes.

A losing game

News reports including one on ESPN poured salt on the wound, calling Chinese soccer a “notoriously underperforming sport”, despite president Xi Jinping’s vow to make home teams more competitive. China has qualified just once for the World Cup, in 2002. It lost all three matches and scored no goals.

The men’s national team currently ranks 87th in the FIFA world rankings, just behind Curaçao (pop. 150K), and just ahead of Equatorial Guinea (1.7m). China has a population of about 1.4bn.

On 5 September, China lost 7-0 to Japan in a World Cup qualifier. Coach Branko Ivankovic called the outcome “humiliating”.

Casinos open, but playing it safe

The websites of casino resorts in Macau all include pop-up warnings about Yagi and potential changes in operations.

Sands China resorts including the Venetian, Parisian and Londoner remain open, although some restaurants, bars and other attractions are temporarily closed.

Studio City advised that part of its hotel services and facilities will be affected and apologised “for any inconvenience”. Galaxy Macau advised patrons that restaurants will resume operation two hours after the Typhoon 8 signal is lowered.

According to the Macau meteorological bureau, a Signal 8 indicates sustained wind speeds of 63kph to 117kph with possible gusts exceed 180kph.

Expect impact on GGR

Last year, the government closed all casinos for nine hours during super-typhoon Saola, which hit on 1 September.

After the storm moved out, JPMorgan analysts warned that GGR for the month “isn’t going to wow anyone, not only due to seasonality (a shoulder season between the summer holidays and October Golden Week), but also due to super Typhoon Saola.”

They were right: September GGR totalled MOP14.93 billion (£1.4bn/€1.7bn/$1.9bn), down more than 13% from August.

Macau’s usual seasonal slump has been exacerbated this year by the crackdown on illegal money exchanges. Super-typhoon Yagi may add to the doldrums ahead of the Golden Week holiday starting 1 October. In good news for the city, many hotels say they’re booked solid for the weekend of 5-6 October.

With four months to go, the industry has already collected 70% of the projected full-year total of MOP216bn, according to the Gaming Inspection and Coordination Bureau (DICJ).

Casinos also saw a 6.2% month-on-month increase, the second best monthly performance since January 2023, when city borders reopened. The monthly hike, while positive, isn’t considered especially meaningful, as June and July are typically slower for tourism and casino traffic. August also benefitted from four extra weekend days – a total of 14, compared to 12 in July.

Near-term headwinds

According to JP Morgan, the August results suggest strong visitation by mainland Chinese patrons, the industry’s mainstay, especially mass players. Those factors compensated for lacklustre demand in the shrinking VIP segment.

Despite the uptick, the government’s recent crackdown on illicit money exchanges could inhibit returns in the short term. Seaport analyst Vitaly Umansky said increased monitoring of financial touts may deter visitation and limit money flows into Macau.

“Certain individuals have postponed their visits to Macau,” Umansky said in a recent note. “The activity will likely continue to be somewhat of a headwind to GGR over the next few months.

“However, we expect the crackdown to soften and liquidity in Macau to be not significantly impacted in the medium term.”

Macau: An industry in flux

The city’s dominant industry has undergone big shake-ups in recent years. Increased scrutiny of financial transactions, meant to curb capital flight and money laundering, has virtually flattened the VIP business. So have the 2023 prosecution and imprisonment of two high-profile junket operators, Alvin Chau and Levo Chan.

The government is also committed to diversifying the local economy away from gaming. Casino concessionaires were recruited to join this effort as part of their 2022 licence renewals. Together, the Big Six pledged to invest MOP108.7bn in non-gaming attractions over the next decade. This year, proceeds from non-gaming are expected to contribute 15% of total revenues.

The presumptive winner of the October election Macau chief executive, Sam Hou Fai, has pledged full support for these efforts.

A week earlier, Ho announced he would step down due to health concerns.

If elected, Sam, the former head of the Court of Final Appeal, will continue the drive toward a more diverse economy. He is expected to be the only candidate. That means less reliance on gaming as an economic driver.

“For a period of time, the tourism and gaming industry developed in a disorderly manner and expanded wildly,” Sam told reporters according to Bloomberg. “Having one dominant industry is not beneficial for Macau’s long-term development and has had a very negative impact.”

City needs new industry

Sam’s view is in line with the government’s commitment to industries such as healthcare, finance and technology, plus tourism-related segments like gastronomy and the arts. The need for a shift became glaringly apparent during the pandemic. Covid-19 shut down the city’s borders for almost three years and decimated its key industry.

Also on orders from Beijing, Macau continues to wage war on capital flight, money laundering and cross-border gambling. The crackdown caused the virtual collapse of the VIP junket industry, which catered to high rollers from the Chinese mainland.

At its peak, VIP patrons contributed over 70% of casinos’ gross gaming revenue (GGR). In June, lawmakers added new measures to curb illicit money-exchange gangs at casinos.

Analysts question Sam’s resume

Is Sam equipped to lead the economic transformation of the world’s premier gaming hub? Some experts are doubtful. Sam reportedly lacks business and government experience and does not have a big social network.

“It seems ridiculous to think that a chief justice might be qualified to be chief executive,” Anthony Lawrance, founder of consultancy Intelligence Macau, told Reuters.

Ieong Meng-u, assistant professor of social sciences at the University of Macau, shares that skepticism. He said Sam’s “track record in the judiciary system” doesn’t make him capable of “handling economic restructuring, regional collaboration or even bridging Macau with the world”.

The appointee is not chosen in a general election, but is selected by 400 party loyalists. Ho’s successor will be named on 13 October.

He did not confirm or deny the speculation until 21 August, when he issued this statement on the Macau government website: “Due to the fact that my health has not been fully restored, for the sake of Macau’s long-term development… I have decided not to participate in the election for the sixth-term chief executive.”

Ho expressed “profound feelings for Macau” and said he had “done my utmost for Macau’s development”.

One analyst says a change in leadership should not affect Macau’s gaming industry.

Leader in a crisis

Ho took over as Macau chief executive at a turbulent time in the city’s history. It was December 2019, just before the first coronavirus case was recorded in the Chinese gaming hub.

The decline was swift and severe. The following February, gross gaming revenue (GGR) toppled 88%. In March 2020, it was down 79.7%. April marked a new low, as GGR tumbled a record 97%, to MOP754m (£72.5m/€85.5m/$95m).

For three years, the special administrative region (SAR) struggled through intermittent shutdowns. It did not fully reopen its borders until January 2023.

But the pandemic hastened efforts to diversify the local economy and reduce its reliance on gaming. As a condition of their new 10-year concessions, the city’s casino operators agreed to invest a collective MOP125m in new development. Of that, 90% has been earmarked for non-gaming attractions, such as spas, waterparks and arts and cultural exhibits.

As Ho stated, he and the local government “planned to promote Macao’s diversified development, strove to build a new pattern of Macao’s development and reshaped Macao’s new competitive advantages under the concept of ‘unity and efforts, change and innovation’.”

Successor will likely hail from inside government

In a 21 August note, Seaport analyst Vitaly Umansky said Ho’s announcement was “not surprising” given his recent extended leave.

“At this stage, there is no clear obvious candidate for the job,” the analyst wrote. “But we expect the eventual chief executive to come from inside the government administration.”

Not surprisingly, the successful candidate “will be fully vetted and approved by the Chinese government,” he continued. That person will “have an understanding of the importance of the gaming and hospitality industry to the economic well-being and future development of Macau.”

However, Umansky wrote, “there should be no material impact on the gaming industry.”

According to Seaport’s most recent forecast, GGR is expected to grow to MOP231bn in 2024, up 26% year-on-year.

“Macau remains a long-term secular growth story,” Umansky wrote.

In a 13 August second-quarter earnings call, Ho attributed the results to vagaries in the calendar.

“This year, the Chinese school holiday started two weeks later,” he said. So… parents want to stay home and make sure that the kids are done with final exams before they travel.

“So, if anything, we’re very positive and optimistic about the future. I think what we’ve seen so far in August is a more typical summer,” Ho told analysts.

Ho also said the city’s new war on illicit money exchanges, which stepped up in June, was expected. “It’s been talked about for over a year now,” Ho said. He acknowledged that the clampdown will have “a bit of an impact in terms of liquidity to players”.

To combat capital flight and money laundering, Macau officials have proposed legislation that would criminalise unauthorised currency exchanges in casinos. Under the plan, the offence would be punishable by up to five years in prison. It may also include a ban from city casinos of two to 10 years.

Melco revenue picture

Melco operates casinos in Macau, the Philippines and the Mediterranean island of Cyprus. The Hong Kong-listed firm posted a 22% hike in Q2 sales to £902.3bn (€1.051bn/$1.159bn), just shy of the £903bn expectations. The increase was pegged to stronger mass-market performance and non-gaming spend and the ongoing return of tourism to Macau.

Operating income for the second quarter was £96.3m, versus £50m during the second quarter of 2023.

“Our strategic initiatives to expand revenue and profitability and drive growth continued to evolve in the second quarter,” Ho said. “We’re investing in people and incorporating enhancements to our properties to provide the best premium experience available in Macau.

“We’ve seen growth in GGR quarter-to-quarter and year-over-year. Our teams are focused on driving continued expansion of our market position. And so, we’re happy heading into the second half of the year. And I believe that we will continue to see growth.”

Will Melco roll the dice in Thailand?

During the call, Ho fielded a question about Melco’s interest in Thailand, where lawmakers are considering a legal casino industry.

“Thailand is a generational opportunity based on our experience with Japan and some of the other jurisdictions,” he said. He added that the ball will likely not starting rolling in Thailand for “a year or so”.

“Anybody will be interested in such an amazing opportunity and we are looking at it. But I don’t think there’s going to be any meaningful amount of money spent on that in the foreseeable future.”

Executive VP and CFO Geoff Davis spoke about headwinds in the Philippines, where Melco operates City of Dreams Manila. He said “increased supply in the market” has caused “a small diversion of some of the trips from guests”.

But “overall” he said, “I still remain very optimistic about Manila…. Strong mass business, increased international capacity and commitment to tourism from the government will benefit us well into the future.”

The proposed amendment, added to the draft “Law to Combat Gambling Crimes”, includes prison terms of up to five years. It would ban offenders from entering city casinos for two to 10 years. However, it carries no penalties for casino-goers who avail themselves of the unauthorised exchanges.

Illegal money exchanges help gamblers from mainland China circumvent Beijing’s strict controls on capital flight and cross-border gambling.

Government crackdown launched in June

In June, Macau’s ministry of public security announced a crackdown on the illegal money exchanges, without criminal penalties. The ministry linked the operations to fraud, thefts, money laundering and loan sharking, as well as kidnapping and murder.

Coincidentally or otherwise, the amendment was announced on 9 August, days after the murder of a man involved in the trade. The victim was discovered on 7 August in his Cotai hotel room, dead from stab wounds to the head and neck.

Local media report he had worked as part of a money-exchange gang since the beginning of the year. Just before the crime, he won big at a local casino, raking in about HK$2.5m (£251,000/€293,500/$321,000).

Two suspects have been arrested in the case, a mainland Chinese man and a Hong Kong woman. Both also were reportedly involved in the illicit exchanges.

The financial fallout

Analysts said the government’s tougher stance on illegal money exchanges was partly responsible for lower gaming revenue in June and July.

Macau casino stocks dropped on news of the proposed amendment. According to a Bloomberg Intelligence index, Galaxy Entertainment Group Ltd was down as much as 5.7%. Sands China Ltd shares decreased by as much as 5.2%.

“This negative news could add uncertainties and hurt the already fragile investment sentiment” against Macau gaming, wrote Citigroup analysts.

Officials say the crimes have “seriously affected social stability” in Macau, the only place in China where gambling is legal. They have pledged to disrupt the “entire industry chain” with targeted intervention, including increased border checks.

Through May, some 1,900 unauthorised money changers were apprehended in police stings and denied entry to Macau. Of those, 927 were reported to the Gaming Inspection and Coordination Bureau (DICJ) and banned from the city’s 30-plus casinos.

During the same five-month period, 30 Macanese were found to have taken part in the illegal operations.

Jump to:

Wynn CEO discusses Thai opportunity

UAE update: Al Marjan progress, customers and licensing

Record EBITDAR in Q2

Strong bottom line in H1

Wynn eyes up Bangkok?

Billings previously spoke about Wynn’s interest in Thailand after its Q1 results earlier this year. However, with a legal market edging closer, Wynn is already “active” on the ground in Thailand Billings said, mentioning Bangkok as a potential location.

“Yes, we would pursue it out of Wynn Resorts out of the US-listed entity,” Billings said on the call. “It’s still early days but there has been progress and it’s encouraging to see and it seems as though the legislators in Thailand really want to get this moving, which is great.”

The operator needs more details on the regulatory and licensing structures he said, although the market remains very attractive.

“You have amazing tourism infrastructure, a really strong service culture and a favourable operating expense structure available in that market. So, we’re continuing to monitor the process very, very closely and we’re active on the ground there.”

Wynn building for exciting future in UAE

Elsewhere and Billings also spoke about the progress Wynn made on its IR project in the UAE during Q2.

Due to open in early 2027, Wynn Al Marjan Island will be located in the Emirate of Ras Al Khaimah. It is set to cost approximately $3.9bn (£3.1bn/€3.6bn) and will be the first IR in the Middle East and North Africa (MENA) region.

New images and renderings for the project were released in May, while Billings revealed he recently spent several weeks in the region, saying construction is progressing “rapidly”.

“The building now stands just over 90 metres, which is already the tallest building in the Emirate,” he said. “During Q2, we contributed $357m of equity to our UAE joint venture. This included the purchase of our 40% pro rata share of all 155 acres of Island 3, the island on which Wynn Al Marjan sits.

“As a result, our joint venture now owns not only the land under Wynn Al Marjan, but also 70-plus acres of land for potential future development on the Island.”

The UAE also offered access to an international customer base, Billings continued. Europe would be an important market for the Wynn Al Marjan Island, although he also highlighted India as key.

“India is a huge market for this part of the world,” Billings said. “There are a lot of folks there. There’s a lot of wealth in India and that’s going to be an important market. There are other parts of Asia that are big markets for the UAE as well.

“I think the catchment area is probably larger than any other project that we have done, maybe akin to Vegas if you take into account the fact that Europe’s population is pretty substantial and the international airlift is incredibly strong.”

No progress on Wynn’s UAE licence

Billings went on to reiterate that the UAE is the most exciting new market for the gambling industry in decades. This has been helped by the creation of the General Commercial Gaming Regulatory Authority (GCGRA) as the federal regulator for the market he said.

He referenced last week’s news that GCGRA selected The Game LLC to run the UAE’s first national lottery. Billings said this will hopefully offer more “comfort” in regards to more progress in the UAE.

However, there was no progress on Wynn’s licence for the Ras Al-Khaimah.

“I assume that they will be moving forward to the next step in our licensure,” Billings said. “I don’t have a specific timeline for you, but you can see all the momentum that’s happening there.”

Revenue growth in Q2

Turning now to how Wynn performed during Q2, group revenue for the three months to 30 June hit $1.73bn. This is 8.6% more than in the same period last year.

Casino revenue hit $1.01bn, with rooms revenue at $304.5m, food and beverage $281.4m and entertainment, retail and other $138.1m. The latter was the only area to see revenue fall year-on-year.

Breaking down revenue by segment, operations in Macau – spanning Wynn Palace and Wynn Macau – drew the most revenue. Wynn Palace saw revenue increase 17.0% to $548.0m, with table games win percentage at 23.6% and VIP table games 4.1%.

As for Wynn Macau, revenue climbed 11.8% to $337.3m. Here, table games win percentage in mass market operations was 17.5% and VIP table games 2.2% – both lower year-on-year.

Turning to the US and Las Vegas operations drew $628.7m in revenue, a rise of 8.8%. Table games win percentage hit 21.9%, slightly below expectations and lower than 22.9% last year.

However revenue at Encore Harbor in Boston slipped 4.2% to $212.6m. Table games win percentage met expectations at 19.6%, although this was behind the previous year.

Record EBITDAR for Wynn in Q2

In terms of costs, total operating expenses were 8.8% higher at $1.46bn. However, revenue growth still meant operating profit in Q2 climbed 7.8% to $269.7m.

Wynn also noted $115.5m in non-operating costs, leaving a pre-tax profit of $154.2m, a rise of 17.0%. It paid $7.9m and discounted $34.3m in profit from non-controlling interests. 

As such, it ended Q2 with a net profit of $111.9m, up 6.4%. In addition, adjusted property EBITDAR increased 9.0% to $571.7m, a new Q2 record for Wynn.

“Our second quarter results, including a new second quarter record for adjusted property EBITDAR, reflect continued strength throughout our business,” Billings said. “I am incredibly proud of our teams in Las Vegas, Macau and Boston.”

H1 revenue up 19.1%

Looking at H1 as a whole, group revenue increased 19.1% to $3.60bn. Casino accounted for $2.13bn of this, with Wynn seeing growth in all areas, with the exception of entertainment, retail and other.

Operating costs jumped 14.0% to $2.96bn, with operating profit at $632.6m, up by 50.7%. Wynn also noted $281.9m in non-operating costs, leaving a pre-tax profit of $350.7m, a rise of 161.1%.

The group paid $27.9m in tax and took off $66.6m in profit from non-controlling interests. This meant it ended H1 with a $256.2m net profit, up 118.0%. In addition, adjusted property EBITDAR jumped 27.6% to $1.22bn.

Gross gaming revenue (GGR) for the month improved 12% over 2023, to MOP18.6bn (£1.795bn/€2.105bn/US$2.31bn). But analysts projected a year-on-year increase of 14%.

June, too, missed median estimates. According to Macau’s Gaming Inspection and Coordination Bureau (MGTO), GGR for the month rose 16.4% year-on-year. Analysts had called for 17.5%.

Inhibiting factors

The Macau GGR shortfall can be attributed in part to the midsummer slump. Travel from the mainland typically surges during the May Golden Week holiday, then tapers off in June and July.

In addition, there were only 12 weekend days last month, versus 15 during the same period in 2023. Weekends generally boost revenue by about 20% over weekdays.

A larger and potentially more enduring factor is the government’s hardline stance on illegal money exchanges.

In June, the ministry of public security ordered “a fierce offensive against crimes such as illicit money-exchange activities”. The operations have been linked to “fraud, thefts, illegal immigration and other crimes” including money laundering and loan sharking.

The secretary for security, Wong Sio Chak, says gaming-related crime rose 122% year-on-year in the first quarter. Fraud crimes accounted for 21.7% of the total. Loan sharking was second, at 17.9%.

Officials contend the crimes have “seriously affected social stability” in the Chinese SAR. They hope to disrupt the “entire industry chain” with targeted intervention, including increased border checks.

On the upswing

Despite a sluggish July, the trend continues positive. Through July, GGR in Macau was up 36.7% from 2023 to MOP132.4bn.

According to JP Morgan, the numbers signal “pretty decent – albeit not fantastic – demand from summer holidays, despite concerns regarding a crackdown on illegal foreign currency exchange gangs”. For the year, GGR is running at 76.1% of 2019 levels, before Covid-19 shut down the city for almost three years.

The analyst team anticipates a big boost during the next Golden Week celebration, which starts on National Day, 1 October.

In 2023, Macau welcomed more than 930,000 visitors for the seven-day autumn celebration. That was shy of the record, almost 975,000 visitors, set in 2019. But it exceeded the MGTO’s estimates by more than 16%.

Net income attributable to MGM Resorts was $187m in Q2 compared to $201m in the prior year’s quarter. Meanwhile free cash flow for the six months ended 30 June was $613m.

Diluted earnings per share at the end of the quarter were $0.60, compared to $0.55 in 2023.

All eyes on Thailand

Hot off the firm’s positive results, and with a keen eye on potential emerging markets, Hornbuckle told analysts during the 31 July earnings call he was viewing “an opportunity” in Thailand in August.

“That is a venture that we’re interested in. And if we do, do that, we’ll do it through MGM China Holdings,” he said, noting MGM China board member and business woman Pansy Ho would join him on the the trip.

A feasibility report, which will likely suggest a regulatory framework for legal casinos in Thailand is due this week. The Thai casino study was commissioned in March, after house members approved a draft Entertainment Complex Bill.

Also providing an update on MGM’s Japan project, the CEO said the firm had broken ground on the development and was confident on the middle-of-2030 target opening date.

MGM ahead of market growth in China

MGM put its 37.4% growth in Macau (to a $1.02bn revenue) down to the removal of all remaining Covid-19 measures in the region, which has allowed for increased travel and tourism in the region. Adjusted EBITDA for the quarter was $1.2bn, while growth in Macau Revenue growth in China also drove adjusted EBITDA in the region to a record $294m, up 40.7% from last year.

CEO William Hornbuckle said the “outstanding performance” in Macau was achieved “without any real capital enhancements from where we left this market in 2019”.

“We’re obviously outperforming,” he said. “And remembering the market has only returned to 80% recovery. Well, MGM is well above that. We still see opportunities not only for growth in the market, but ultimately for us to steal additional share.”

Luxury resorts push Las Vegas revenue up in Q1

Turning to Las Vegas, revenue was up 2.7% to $2.21bn for the quarter. MGM put this down to a rise in room revenue, driven by an increase in average daily room rate and an increase in catering and banquets revenue.

“We invest meaningfully in our strip luxury offerings as this is where we see the most opportunity for profitable growth,” Hornbuckle told analysts. “In fact, 75% of our 2024 domestic property capital budget will be focused on these properties. This includes room remodels, which are under way now at the MGM Grand and suite updates across our Las Vegas portfolio.”

Regionals remain stable

As for MGM’s Regional business, revenue was marginally higher at $927m in Q2. Hornbuckle said he was content with the stability of this segment, highlighting growth plans for the future, including a planned launched in New York.

“We’ll maintain our market-leading positions in the regional markets, including an expansion in New York,” he said. “With our regional properties, again, I want to reiterate they are stable and free cash flow generating and we’re excited to have the properties that we do within our portfolio.”

The remaining $177m in net revenue in Q1 came from management and other operations, up 40.5% year-on-year.

As for revenue type, $2.2bn was attributed to casino activity, up 8.8% from last year. Rooms revenue climbed 10.3% to $899m and food and beverage revenue 7.9% to $802m. However, revenue from entertainment, retail and other slipped 4.5% to $402m, with reimbursed costs level at $12m.

Net profit slips as higher costs offset revenue growth

Looking at spending, total operating costs in Q2 were 8.8% higher at $3.87bn. Non-operating also jumped 73.0% to $154m, with these rises impacting profitability.

Pre-tax profit slipped 4.2% to $271m and while MGM received $12m in tax benefits, this was more than offset by taking off $95.7m in profit from non-controlling interests.

As such, it ended Q2 with a $187m net profit down 7% year-on-year.

H1 revenue $8.71bn at MGM

As to how Q2 impacted MGM in the first half, total net revenue in H1 was 11.5% higher year-on-year at $8.71bn. 

This was again mainly down to growth in China, with revenue within the region rising 52.6% in the six month period. Las Vegas revenue was also 3.1% higher at $4.46bn, with Regional revenue flat at $1.84bn and revenue from management and other operations up 29.8% to $340m.

Casino revenue H1 climbed 16.2% to $4.45bn, room revenue increased 1.5% to $1.86bn, and food and beverage revenue was 7.2% higher at $1.57bn. Entertainment, retail and other revenue fell 2.9% to $806m while reimbursed costs hit $24m.

Operating costs reached $7.77bn, up 17.3%, and non-operating expenses jumped 54.6% to $269m. As such, pre-tax profit hit $615m, down 33.7% on the back of higher spending. 

MGM paid $32m in tax and discounted $178m in net profit from non-controlling interests. This left a bottom-line net profit of $405m, down 39.4% last year, while adjusted EBITDAR reached $2.43bn.

“We’re excited by the progress we’re making as a company against our strategic priorities and anticipate carrying our current momentum forward into the back half of the year,” Hornbuckle said.

What about BetMGM?

Separate to the MGM results, BetMGM, the joint venture with Entain, also published an H1 update this week. The headline from this was revenue reaching $1bn in the period, up 6% on the previous year.

Despite no new state launches revenue also grew 9% year-on-year in Q2, following a slower first quarter.

BetMGM posted negative EBITDA of £123m in the first half. It expects a similar figure in H2, suggesting a full-year negative EBITDA of £250m.