Macau’s casino industry is likely to see earnings growth lag gross gaming revenue gains in the first quarter of 2026, weighed down by a less favourable mix between mass-market and VIP gaming, Citigroup said.
In a Monday note, the brokerage estimated industry EBITDA rose about 8 percent from a year earlier to nearly US$2.15 billion (MOP17.32 billion) in the first quarter, compared with a 14 percent increase in gross gaming revenue to MOP65.9 billion (US$8.2 billion).
“We believe the lower industry EBITDA growth vs. GGR can be attributed to the less favourable VIP/mass GGR mix,” analysts George Choi and Timothy Chau wrote, pointing to a higher share of VIP play, which typically carries lower margins for operators. “We also suspect that some casinos suffered from less favourable VIP hold, which hurt margins,” they added.
Nonetheless, Citigroup said industry EBITDA margin likely held at about 27 per cent, suggesting player reinvestment levels remained “reasonable.”
“The positive GGR and EBITDA growth during the quarter should remind investors that players’ appetite for gaming seems little bothered by the ongoing geopolitical tensions and economic uncertainties,” the note added.
Londoner Grand drives Sands China’s EBITDA
Among Macau’s six gaming operators, Citigroup expects Sands China to post the biggest year-on-year improvement in EBITDA in the first quarter, rising more than 20 per cent to about US$643 million, helped by market-share gains and an easier comparison. The brokerage noted that The Londoner Grand, the rebranded Sheraton Grand Macao at The Londoner Macao run by Sands China, was not fully opened or ramping up in the same period last year.
The Londoner Grand is aimed at high-value premium-mass players and now has more than 2,400 rooms and suites, down from more than 4,000 standard rooms before renovation.
Citigroup also said SJM Holdings is likely to be the weakest performer in the quarter, with EBITDA falling 6 per cent year-on-year to HK$903 million.
While Sands China’s market share rose to 25.5 per cent in the first quarter from 24.7 per cent in the fourth quarter of last year, the brokerage said Melco Resorts and Wynn Macau recorded the largest sequential gains. Melco’s share climbed to 15.7 per cent from 14.2 per cent, supported by concerts at its Cotai resort Studio City, while Wynn Macau’s share rose to 13.4 per cent from 12.2 per cent, it added.