Macau casinos won more money in October than any other month since January 2020.
On Friday, Macau’s Gaming Inspection and Coordination Bureau published the October gross gaming revenue (GGR) tally showing that the six casino concessionaires won MOP20.78 (US$2.59 billion) last month. October marked a 6.6% year-over-year increase and 20% surge from September.
October benefited from a strong National Day, China’s seven-day holiday that begins on October 1 each year to celebrate Mao Zedong’s establishment of the People’s Republic of China on Oct. 1, 1949. Visitation during the weeklong festival rebounded, with daily border crossings averaging almost 142K. The traffic exceeded pre-pandemic visitation.
Casinos benefited from more people in town leading to October topping the May GGR haul of $2.52 billion, previously the best gaming month for the resorts in 2024. October 2024 was also the best month since January 2020.
Through October, casino revenue totaled $23.74 billion, up over 28%, оr $5.21 billion, from the same 10 months last year. But despite the gaming rebound іn 2024, the January through October haul remained 23% below the same period іn 2019.
Shareholders Growing Weary
Shareholder sentiment regarding the six publicly traded casino companies operating in Macau remains subdued nearly five years after the coronavirus emerged.
China’s maintaining of Xi Jinping’s “zero-COVID” through the end of 2022 kept a post-pandemic rally on hold in Macau. Beijing’s direction to Macau to crack down on money laundering and capital outflow — both of which targeted Macau’s junket industry — has further hampered a gaming rebound since zero-COVID was ditched in December 2022.
Adding fiscal stress to the six operators is that they were forced to invest tens of billions of dollars into their resorts in exchange for new 10-year gaming licenses that run through 2032. Sands, Galaxy, Wynn, MGM, Melco, and SJM agreed to allocate almost $16.2 billion in nongaming projects during the life of the concessions.
The nongaming directive is designed to lessen Macau’s economic reliance on casino gambling and transform the Chinese enclave into a premier destination for leisure travelers, families, and nongaming businesses.
Investors, however, remain weary about the casinos’ outlook. Macau casino stocks were down 11.4% in October, while the benchmark Hang Seng Index was down less than 4%.
Market Headwinds
October was a needed performance for Macau casinos and the companies’ shareholders. Friday trading saw Macau casino stocks make gains.
Looking ahead, concerns remain for the six casino giants. Of utmost worry is China’s latest order that Macau police target unlicensed money exchanges that have commonly operated around the resort corridors for decades.
Such exchanges enabled high rollers from the mainland to transfer money to the exchanges and withdraw cash once inside the casino area. Unlike banks and other legitimate financial institutions, these unlicensed exchanges allowed mainland high rollers to bypass Beijing’s stringent regulations on capital flight.
Now that unlicensed money exchanges have been criminalized, VIPs and premium mass players will find it more challenging to move large sums of cash into the tax haven of Macau.
Travelers entering Macau are restricted to carrying no more than $15,000 in cash. Anyone with an amount exceeding this limit must go through the “Red Channel” at the entry port.
The Red Channel requires significantly more time for travelers to complete customs compared to the Green Channel, which is for those with nothing to declare. Passengers going through the Red Channel risk having their money or belongings confiscated unless they can provide a valid explanation for bringing in those assets or CBNIs — Currency and Bearer Negotiable Instruments.
