In October, Macau casinos generated more revenue 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 operators generated MOP20.78 (US$2.59 billion) in revenue last month. October registered a 6.6% increase compared to the previous year and a 20% rise from September.
October enjoyed 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. During the weeklong festival, visitation saw a rebound, with daily border crossings averaging nearly 142K. The traffic surpassed the visitation levels seen before the pandemic.
Casinos reaped rewards from a larger number of visitors, resulting in October surpassing May's GGR total of $2.52 billion, which had previously been the top gaming month for the resorts in 2024. October 2024 was likewise the top month since January 2020.
By October, casino earnings reached $23.74 billion, increasing by more than 28%, or $5.21 billion, compared to the same 10 months a year ago. However, even with the gaming recovery in 2024, the earnings from January to October were still 23% lower than in the same timeframe of 2019.
Investors Becoming Increasingly Fatigued
Investor sentiment towards the six publicly listed casino firms conducting business in Macau continues to be muted nearly five years following the outbreak of the coronavirus.
China's persistence with Xi Jinping's "zero-COVID" policy until the end of 2022 stalled a post-pandemic surge in Macau. Beijing's orders to Macau to tackle money laundering and capital flight—both aimed at the junket sector—have further hindered a recovery in gaming since the end of zero-COVID policies in December 2022.
Imposing financial strain on the six operators is the requirement to invest tens of billions of dollars into their resorts in return for new gaming licenses valid for 10 years, extending until 2032. Sands, Galaxy, Wynn, MGM, Melco, and SJM consented to invest nearly $16.2 billion in non-gaming initiatives throughout the duration of the concessions.
The nongaming initiative aims to reduce Macau's economic dependence on casino gambling and convert the Chinese enclave into a leading spot for leisure tourists, families, and nongaming enterprises.
Investors, nevertheless, stay cautious regarding the casinos’ prospects. Macau casino shares dropped 11.4% in October, whereas the benchmark Hang Seng Index fell by under 4%.
Market Challenges
October was an essential performance for casinos in Macau and their shareholders. Casino stocks in Macau experienced increases during Friday trading.
Looking forward, worries persist for the six casino giants. A major concern is China's recent directive for Macau police to focus on unregistered money exchanges that have frequently functioned around the resort areas for many years.
These transactions enabled mainland gamblers to transfer funds to the exchanges and retrieve their cash upon entering the casino area. The unregulated exchanges, in contrast to banks and other reputable financial entities, assisted mainland high rollers in evading Beijing’s stringent restrictions on capital outflow.
As unlicensed money exchanges have been made illegal, VIPs and high-stakes players will face greater challenges in moving substantial sums of money to the tax haven of Macau.
Visitors to Macau are restricted to bringing $15,000 in cash. Anyone exceeding that amount must use the entry port’s “Red Channel” processing system.
The Red Channel requires significantly more time for travelers to finish the customs process in contrast to the Green Channel, where travelers have no items to declare. Travelers passing through the Red Channel risk having their money and/or belongings seized unless they can provide a legitimate explanation for attempting to bring in the assets, or CBNIs — Currency and Bearer Negotiable Instruments.