Macau Casino Revenue Improves in August Thanks to Favorable Calendar
The revenue from Macau casinos in August reached MOP19.8 billion (US$2.47 billion). The August draw increased by 14.8% compared to last year and 6.2% from July.
The gaming revenue figures (GGR) reported by the city’s Gaming and Inspection Coordination Bureau represent roughly 81.5% of the pre-pandemic levels of August 2019, when the six commercial casino operators collectively earned just over $3 billion.
August marked Macau's second-best month since Chinese President Xi Jinping ended "zero-COVID" in late 2022, facilitating a return to normality in the world's second-most populated nation and second-largest economy. Macau is governed by China under the principle of "one country, two systems," which is implemented in the People’s Republic's two Special Administrative Regions (SAR) — Macau and Hong Kong.
August Fulfills Expectations
Macau's GGR for August matched analysts' predictions. Citigroup estimated August revenue at MOP20 billion, whereas JPMorgan projected an August win of approximately MOP19 billion to MOP19.5 billion.
In theory, August appeared to indicate a recovery in gaming, with casinos shifting their focus from the VIP segment to the broader market. The operators did not desire a refocus, but they had no choice after Xi's Beijing mandated the Macau SAR Government to expel junket groups that served mainland high rollers.
Yet, the revenue narrative for August 2024 is more complex. August enjoyed 14 Fridays, Saturdays, and Sundays, unlike the 12 in August 2023. July 2024 included 12 weekend days as well.
However, thanks to a robust August, the GGR for the first eight months of 2024 reached MOP152.1 billion (US$18.92 billion). That’s a 33% increase compared to the same timeframe in 2023 and accounts for nearly 78% of the pre-pandemic total from January to August 2019.
Market Challenges
Macau's gaming sector experienced significant transformation throughout the pandemic. In late 2022, the six concessionaires consented to invest $16.2 billion into nongaming projects at their resorts in return for new 10-year gaming licenses.
Only a month later, the conditions turned less favorable for the licensees after Suncity's leader Alvin Chau was convicted of operating a criminal organization and enabling unlawful gambling. Known as the "Junket King" for overseeing approximately 25% of the junket industry in Macau, Chau's 18-year prison sentence in China caused many VIP groups to escape to more advantageous markets such as Vietnam, the Philippines, and South Korea.
Macau’s upcoming chief executive might add more pressure to the city’s casino sector. As Chief Executive Ho Iat Seng is not pursuing reelection due to health issues, former Court of Final Appeal President Sam Hou Fai is the frontrunner to become Macau’s leading government figure.
Sam recently conveyed his belief that Macau should diversify beyond gaming. Casinos still represent over 80% of the area's tax revenue.
"During a media briefing last week, Sam said that the casino industry “developed in a disorderly manner” and has “expanded wildly.” He opined that “having one dominant industry is not beneficial” for the city’s long-term development.
Sam thinks the casino's control has led to a narrow perspective among Macau's youth, who view gaming as their sole career option.
