Macau Casinos Win $2.6B From Players in October, Best Month Since January 2020

Macau Casinos Win $2.6B From Players in October, Best Month Since January 2020

In October, Macau casinos earned more money than in any month since January 2020. 

On Friday, the Gaming Inspection and Coordination Bureau of Macau released the gross gaming revenue (GGR) figures for October, indicating that the six casino concessionaires generated MOP20.78 (US$2.59 billion) in revenue last month. October saw a 6.6% rise compared to the same month last year and a 20% jump from September. 

October profited from a robust National Day, China's week-long holiday that starts on October 1 annually to commemorate Mao Zedong's founding of the People's Republic of China on October 1, 1949. Visits throughout the weeklong festival surged, with daily border crossings averaging nearly 142K. The traffic surpassed the visitation levels seen before the pandemic. 

Casinos gained from increased visitors, causing October to surpass May's GGR total of $2.52 billion, which had been the best month for gaming at the resorts in 2024. October 2024 was likewise the top month since January 2020. 

By October, casino earnings reached $23.74 billion, an increase of more than 28%, or $5.21 billion, compared to the same period last year. However, even with the gaming recovery in 2024, the earnings from January to October stayed 23% lower than in the same timeframe of 2019. 

Investors Becoming Fatigued 

Investor sentiment towards the six publicly listed casino firms operating in Macau continues to be muted nearly five years after the coronavirus outbreak. 

China's continuation of Xi Jinping's "zero-COVID" policy until the end of 2022 stalled a post-pandemic recovery in Macau. Beijing's instruction to Macau to intensify efforts against money laundering and capital flight—both of which impacted Macau's junket sector—has further hindered a gaming recovery since the end of zero-COVID in December 2022. 

Adding financial pressure on the six operators is the requirement to invest tens of billions of dollars in their resorts in return for new 10-year gaming licenses valid until 2032. Sands, Galaxy, Wynn, MGM, Melco, and SJM reached an agreement to invest nearly $16.2 billion in non-gaming initiatives throughout the duration of the concessions. 

The nongaming initiative aims to reduce Macau’s dependence on casino gambling and turn the Chinese region into a top spot for leisure tourists, families, and nongaming enterprises. 

Investors, nonetheless, continue to be cautious regarding the casinos' prospects. In October, Macau casino stocks declined by 11.4%, whereas the Hang Seng Index fell by under 4%. 

Market Challenges 

October proved to be a crucial performance for Macau's casinos and their shareholders. On Friday, shares of Macau casinos experienced increases. 

Looking forward, worries persist for the six casino giants. A significant concern is China’s recent directive for Macau police to focus on unlicensed money exchanges that have frequently functioned in the resort areas for many years. 

These transactions enabled high rollers from the mainland to transfer funds to the exchanges and retrieve their cash once they entered the casino enclave. The unregulated exchanges, as opposed to banks and other more reputable financial entities, had assisted mainland high rollers in evading Beijing's stringent restrictions on capital outflow. 

As unlicensed money exchanges are now illegal, high rollers and premium mass players will face increased difficulty in moving large sums of cash to the tax haven of Macau. 

Visitors to Macau are restricted to bringing $15,000 in cash. Anyone possessing an amount greater than that must undergo the entry port's "Red Channel" processing procedure. 

The Red Channel requires travelers to spend significantly more time finishing the customs procedure than the Green Channel, where there are no declarations. Travelers processed via the Red Channel risk having their money and/or belongings seized unless they provide a legitimate explanation for attempting to bring these assets, or CBNIs — Currency and Bearer Negotiable Instruments.