Macau’s GGR set to exceed China’s GDP growth: Galaxy Entertainment

Ansh Pandey January 14, 2025

SiGMA news

Galaxy Entertainment Group has predicted that Macau’s Gross Gaming Revenue (GGR) will outpace China’s GDP growth in 2025, anticipating an optimistic outlook echoed by the government.

The forecast follows a recent meeting between Galaxy Entertainment’s management and investment bank Goldman Sachs. According to Macau’s fiscal year 2025 budget, GGR is expected to rise by 6 percent year-on-year, reaching MOP 240 billion (€27.21 billion).

Both Galaxy and Goldman Sachs attribute its confidence to Macau’s relatively untapped potential as a travel and gaming destination, suggesting ample room for future growth.

Premium mass players to drive growth

Premium mass players, a key segment for Macau’s gaming industry, are expected to be the main drivers of growth. These players, who seek upscale gaming experiences, have shown evolving spending behaviours post-pandemic, with daily losses now averaging between €3,507 and €4,676. This represents a shift from pre-pandemic patterns, reflecting changing preferences in the market.

This estimate also aligns with Deutsche Bank’s latest report, which revised Macau’s GGR growth forecast for 2025 to 5.3 percent, down slightly from the earlier projection of 7.4 percent. Despite anticipating a modest slowdown, the bank still expects the market to demonstrate strong performance.

Goldman Sachs, however, highlighted risks that could undermine this growth. The investment bank pointed to the potential impact of a sharp devaluation of the Chinese yuan (RMB), which could significantly reduce outbound travel demand if the currency weakens by more than 10 percent.

RMB depreciation might hinder growth

The ongoing depreciation of the RMB has already resulted in increased travel costs for mainland Chinese tourists visiting Macau, with some costs rising by double digits. Without corresponding price adjustments, such higher expenses may make Macau a less attractive destination for travellers.

Despite these challenges, Galaxy Entertainment performed strongly in the fourth quarter of 2024. The group’s GGR market share rose to 19.9 percent, marking an 8 percent quarter-on-quarter growth, outpacing the industry’s overall growth of 3 percent.

This success came despite a slight dip in December, attributed to Chinese President Xi Jinping’s visit and increased competition from operators like MGM, which attracted more international high rollers.

Macau’s gaming industry remains confident in its capacity to expand both GGR and EBITDA market shares. This optimism stems from several new projects and offerings launched since fiscal year 2023, designed to enhance the sector’s appeal to a broader range of visitors.

While Macau continues to recover and adapt to evolving market conditions, the city’s gaming industry is poised for further growth. However, challenges on the horizon may require strategic adjustments to sustain momentum.