The gaming industry in Macau has undergone significant changes over the past five years. A public tender, stricter regulations, and a pandemic-induced crisis were followed by a better-than-expected recovery, which, however, remains below 80 per cent of pre-pandemic levels. Despite this, with junkets nearly absent, concessionaires are enjoying unprecedented earnings margins.
Macau Business | January 2025 | Special Report | Pandemic: Five years on, still falling short
Has gaming in Macau effectively recovered?
This is a challenging question, not only because various factors need to be considered, and they do not all point in the same direction, but because gaming in Macau in 2025 is fundamentally different from 2019. Over this period, the industry endured a pandemic lasting three years and saw the completion of a new public tender. While the six operators remain the same, the conditions under which they operate have changed significantly.
One indicator of recovery is the return to dividend payments after three years during which most operators incurred debt to address the lack of gamblers and meet obligatory expenses. Galaxy Entertainment Group (GEG) resumed paying dividends to shareholders in 2023, but GEG stands in a league of its own in this respect.
In 2024, two more operators, MGM China and Wynn Macau, brought good news to their shareholders by resuming dividends. It is anticipated that the remaining three operators will follow suit: Sands China and Melco in mid-2025, and SJM Holdings in 2026, according to Morgan Stanley.
On another front, with junket operators now playing a marginal role, gaming concessionaires have seen significant margin improvements, buoyed by a boom in the mass and premium markets. By May 2024, mass market gross gaming revenue (GGR) reached an all-time high. Analysts estimated that by October, it accounted for 113 per cent of pre-pandemic levels. MGM China was the first to benefit from this momentum, closing 2023 with a record-high EBITDA of 117 per cent of 2019 levels.
With fewer high rollers frequenting the now less numerous VIP rooms, gambling in 2025 is markedly different. The mass market dominates gross gaming revenue, consistently breaking records month after month.
However, Ben Lee, Managing Partner at IGamiX Management & Consulting, highlights the evolving VIP landscape: “The junket operators are mostly gone, but the junket agents are still around. Firstly as ‘Program Players’ but more recently as ‘Referrers’ under the various ‘Friends and Relatives Referral Programs’.”
“VIP players are now called Premium Mass in Macau, although no gaming regulator anywhere recognises that nomenclature. The DICJ most certainly does not,” Mr Lee explains to Macau Business. “The evergreen distinction between VIP and mass is the size of their wagers. So, if you have someone betting tens or hundreds of thousands per hand, they are VIP, not mass.”
“VIP players are now called Premium Mass in Macau although no gaming regulator anywhere recognizes that nomenclature. The DICJ most certainly does not (…) The evergreen distinction between VIP and mass is the size of their wagers. So, if you have someone betting tens or hundreds of thousands per hand, they are VIP, not mass” – Ben Lee, gaming consultant
“Right now, the VIP business, as recognised by the DICJ based on the location of the gaming, constitutes approximately 25 per cent of overall GGR, down from approximately 44 per cent in 2019. Yet, as some operators will tell you, the premium mass can form as much as 60 to 70 per cent of their mass,” Mr Lee states.
Supporting Mr Lee’s analysis, it was recently announced that November 2024 recorded the largest “whale” since Citigroup began tracking such data in 2017.
Professor Jenny Lao-Phillips, Dean of the Faculty of Business and Law at the University of Saint Joseph, also shared her perspective with our readers: “With the new gaming law, casinos will be moving away from their dependence on VIP rooms and satellite casinos, supported by junkets, to focus on their own mass market.”
“In fact, the premium mass market was a major income source even before the new gaming law. Now, with more focus on it, we can see GGR gradually recovering. It may take some time to return to pre-2019 levels, but with a new market and strategies targeting this group, the future remains optimistic,” Prof Phillips told Macau Business.
For 2025, the government anticipates revenue based on a global GGR forecast of MOP240 billion, compared to MOP292 billion in 2019. Morgan Stanley’s latest projection is MOP238.35 billion.
Market share is another key aspect to monitor, as operators face fierce competition. By the end of 2024, MGM emerged as the big winner, increasing its share from 10 per cent in November 2019 to 14.1 per cent five years later (peaking at 16.5 per cent in November 2023). Meanwhile, Sands China and Galaxy Entertainment continue to account for half of the total revenue.
So, has gaming in Macau truly recovered?
“Gaming operators have effectively navigated these turbulent times, with gaming revenues remaining relatively stable. However, this growth has not extended to other sectors. While countries explore new economic strategies and companies seek new markets, uncertainty stemming from political issues, conflicts, tariffs, and trade barriers continues to dampen consumer confidence and spending across all regions,” José Alves, Dean of the Faculty of Business at the City University of Macau, told Macau Business.
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