Vegas of the East: Macau's Commercial Casinos
Insight: Macau's gaming revenue has seen a mixed performance with less than 1% growth through the first four months of 2025. Analysts have reduced growth forecasts for 2025, with Seaport Global Securities predicting a 3% increase due to a weaker-than-expected start to the year. However, there's optimism for acceleration in growth during the second half of 2025.
Analyst's View: According to Jefferies Equity Research analyst Anne Ling, the promising tourism numbers and gaming revenue during the Golden Week holiday are giving a modestly positive outlook for the sector. Despite the macroeconomic worries and the ongoing trade war between the US and China, Ling's projections of 5% or less gambling-revenue growth in Macau are seen as favorable compared to the economic and diplomatic landscape.
Macau's Golden Week exceeds expectations, according to Jeffries analyst's remarks.
Golden Week saw a significant 12% spike in gambling grosses, averaging $130 million per day. Mass-market play increased between 60% and 65%, while VIP action, though weaker, grew 55% to 58% sequentially. Post-Golden Week, Ling estimates daily revenue to range between $75.2 million and $81.5 million, translating to potential monthly revenue of between $2.6 billion and $2.8 billion – a 9% increase from 2024.
Enclave's Boom: During the Golden Week of 2024, Macau surpassed 2019's numbers by 7% and outperformed governmental projections by 24% to 34%. The influx of tourists, which reached 850,000 compared to the estimated 634,000-700,000, averaged 170,000 tourists per day. Notably, hotel occupancy stood at 90% for the first three days of the holiday, with 40% of visitors planning to stay for one to two nights, while the other 60% were day trippers.
Financial Performance: Despite concerns over volume levels from the current Golden Week and potential trade war implications, key players such as MGM China, SJM Holdings, and Sands China have maintained or even surpassed Wall Street's expectations. MGM China's cost-containment measures contributed to beating cash flow expectations for the first quarter.
Future Projections: Ling expects Sands to grow gambling revenue by 6%, MGM China by 7%, and Wynn by 2%. However, specific growth projections for upcoming months from Jefferies Equity Research might not be available without direct reports or updates. As the focus remains on Macau's persistent growth, analysts hold hopes for an acceleration in growth during the second half of 2025.
- The financial performance in Macau's commercial casinos in 2025 has shown a mixed performance, with a minimal growth of less than 1% in the first four months, but with optimism for a growth acceleration during the second half.
- Despite the ongoing trade war between the US and China and macroeconomic concerns, Jefferies Equity Research analyst Anne Ling projects a gambling revenue growth of 5% or less in Macau in 2025, which is considered favorable compared to the current economic and diplomatic landscape.
- During Golden Week in 2025, Macau's gambling grosses saw a significant 12% spike, averaging $130 million per day, with mass-market play increasing by 60% to 65% and VIP action growing by 55% to 58%.
- During the Golden Week of 2024, Macau surpassed its 2019 numbers by 7%, outperforming governmental projections by 24% to 34%. The influx of tourists during this period reached 850,000, a significant increase compared to the estimated 634,000-700,000.
- Key players in Macau's casino industry, such as MGM China, SJM Holdings, and Sands China, have maintained or even surpassed Wall Street's expectations, with MGM China's cost-containment measures contributing to beating cash flow expectations for the first quarter.
