Jefferies raises casino revenue forecast for 2025

Investment bank Jefferies has increased its 2025 gross gaming revenue (GGR) forecast for Macau’s casinos to MOP237 billion (USD29.3 billion).

While this revised figure remains above the government’s June projection of MOP228 billion, it closely matches broader market expectations, according to Jefferies.

Analysts Anne Ling and Jingjue Pei highlighted the city’s robust gaming revenue growth in the first half of 2025, particularly in May and June, where revenues rose by 4.4% compared to the same period last year.

This strong performance led them to revise their revenue forecast upward.

In a memo released earlier this week, Jefferies forecasts that GGR will grow by 4.5% over the full year.

The investment bank also raised its forecast for the next two years, with GGR expected to increase by 3.5% in 2026 and 3.4% in 2027, reaching MOP254 billion by 2027.

Galaxy Entertainment Group and MGM China are forecast to expand their market shares in 2025 and 2026, while Sands China is anticipated to regain ground following renovations at The Londoner Macao property.

Jefferies added that these shifts could come at the cost of competitors such as SJM and Wynn, who may lose market share as a result.

“We expect Galaxy to experience margin expansion in 2Q25, with the scale at its Galaxy property reaching an inflection point,” Jefferies wrote.

“On the other hand, Sands China is likely to focus on driving absolute adjusted EBITDA. Among the niche operators, MGM continues to outperform, in our view.”

In May, Robert Goldstein, chairman and CEO of Las Vegas Sands (LVS), discussed the mounting challenges facing Macau’s gaming market in a CNBC interview.

While reaffirming the region’s ongoing importance to his company, Goldstein acknowledged that Sands China has struggled amid intensifying regional competition.

Despite a rebound in visitor numbers, he highlighted a significant decline in spending per visitor, which has caused annual gross gaming revenue to plateau at around USD28 billion (MOP225.82 billion).

Goldstein explained that Macau’s market has shifted away from relying solely on product quality toward a landscape where aggressive customer incentives are crucial to attracting and retaining key players.

He emphasized the need for a more proactive strategy focused on direct incentives, even if it means accepting slimmer profit margins, to enhance competitiveness and drive future growth in the market.

Looking ahead, Jefferies projects 5.7% year-on-year GGR growth in the third quarter of 2025, though this represents a 3.5% decline compared to the previous quarter.

The first two weeks of July saw a 9% increase in GGR year-on-year but a 10% drop from the final two weeks of June, reflecting typical seasonal softness and mixed market sentiment about sustained momentum in the latter half of 2025.

Entertainment events such as Jacky Cheung’s concerts at Galaxy Arena and the return of the acclaimed House of Dancing Water show at City of Dreams are expected to help maintain visitor numbers and boost revenue for Macau’s major casino operators during the summer, following typical seasonal patterns.

However, analysts noted that while early July figures are lower than those recorded at the end of June, the start to the second half of the year is still “a good start,” especially since the third quarter is usually a slower period for the gaming industry.

They added that market sentiment remains mixed, with some experts questioning whether the strong performances in May and June can be sustained or if they were a temporary spike driven by VIP gamblers frontloading their visits earlier in 2025 to coincide with the opening of new casino properties.