Banking group Jefferies expects Sands China Ltd and Galaxy Entertainment Group Ltd to be share gainers in Macau’s six-operator casino market during 2025, noting the quality and range of their hotel offer – including additional rooms – can boost gaming volumes.
“We expect mild shift in market share among the six operators in 2025/26 with Sands/Galaxy gaining share with the reopening of Londoner’s hotel capacity and opening of Galaxy’s Capella,” stated the institution in a Thursday report.
The first was a reference to Sands China’s The Londoner Macao, which has seen extensive refurbishment, including the recent relaunch of one of its two casinos and a rejig of hotel capacity at the Cotai property. The second reference was to the anticipated launch next year, of a luxury hotel called Capella at Galaxy Macau at Galaxy Entertainment’s Cotai flagship.
Jefferies stated: “With number of visitors in 2025 [likely] returning to 94 percent of 2019’s level, it should bode well for operators with large hotel capacity like Sands China and Galaxy.”
The institution’s analysts said they expected Macau gross gaming revenue (GGR) in 2025 to “normalise” and increase by 8 percent year-on-year, to circa MOP245 billion (US$30.6 billion), returning to 84 percent of 2019’s levels.
They said their estimates were backed by: an expected 5-percent year-on-year increase in visitor arrivals to Macau; hotel capacity upgrade, especially for suites that attracts premium-mass players; new attractions/events in Macau; and no further deterioration in consumer sentiment, since economic development remains “one of the key priorities for China government”.
Banking institution Citigroup had said in its own 2025 lookahead issued on Wednesday, that growth in suite accommodation at Macau casino resorts – though likely to mean fewer hotel keys market-wide – could boost the city’s 2025 GGR, in particular for the premium mass segment.
Citi flagged fresh suite supply in 2025 at Sands China’s Londoner Grand hotel (1,500 units), Galaxy Entertainment’s Capella (100 units), and MGM China Holdings Ltd’s two Macau properties (70 units).
Jefferies mentioned that in the 2023 post-pandemic recovery year, Sands China had actually had a 27 percent market share, albeit of a smaller GGR pie, so the bank’s estimate of 24.4 percent in the current year, and 25.7 percent in 2025, reflected in part a post-revamp boost from The Londoner Macao.
The institution said it expected the Sands China and Galaxy Entertainment “market share gain in the next two years,” to come from the other four players: MGM China, Melco Resorts & Entertainment Ltd, SJM Holdings Ltd, and Wynn Macau Ltd.
Jefferies expects Galaxy Entertainment to improve on its 2023 GGR share of 17.9 percent, and reach 18.8 percent this year, and 20.0 percent in 2025.
The institution stated: “While market share is important, improving adjusted EBITDA [earnings before interest, taxation, depreciation and amortisation] is a common target for most operators.”
On an earnings call of Melco Resorts earlier this year, Lawrence Ho Yau Lung, chairman and chief executive, made the same point.
Mr Ho said the issue was “not so much the top-line market share”. He outlined: “That has never really been the case that we cared about. It was really about EBITDA.”
Sands China’s management said in the group’s third-quarter earnings call that the mid-term goal on adjusted EBITDA for The Londoner Macao and The Venetian Macao was US$1 billion-plus, with the rest of the Macau portfolio contributing another US$1 billion-plus annually.
Citi had said in its Wednesday market outlook report regarding EBITDA share: “The base is low for Sands China, as it has been suffering from disruption from the Londoner Grand renovation for most of 2024. The ramp-up of Galaxy Macau Phase 3 started only at around mid-2024.”
Jefferies said: “Galaxy believes in offering quality product and service over price promotion,” adding that the operator needed “higher” average daily theoretical loss players in order to be willing to award “quality comps,” a reference to complimentary services to customers for marketing purposes.
