The casino industry in Macau defied weakened consumer spending in China in December as it saw a 433% increase in gaming income and a return of the yearly take to 62.6% from pre-COVID levels.
Gross gaming income came to 18.6 billion patacas, approximately $2.3 billion, in December, according to data from the Gaming Inspection and Coordination Bureau. This final result, representing 81.3% of the December 2019 total, surpassed the median analyst calculation of 402% annual growth.
For the entire year of 2023, gaming revenue reached 183.1 billion patacas. Additionally, the Bloomberg Intelligence Index of 6 casino operators in Macau gained approximately 2.2% from 11 a.m. on January 2, with Sands China Ltd. jumping by 3.7% and MGM China Holdings Ltd. rising 5.4%.
Despite China’s months-long economic slowdown, Macau has experienced a stable recovery in its gaming sector since the lifting of travel restrictions and lockdown policies. The industry has stayed strong, with a shift in spending model benefiting casinos in Macau as visitors prioritize instant gratification activities over expensive shopping.
Operators have noted that per capita spending for high-end gamblers remains above 2019 levels, and premium guests continue to visit Macau despite declining spending in China. However, it is expected to take years for gaming income to fully recover due to China’s clampdown on high-volume players and capital outflows, which led to the collapse of the VIP sector in Macau.
The Bloomberg Intelligence Index of casino operators in Macau increased 14.8% during December, but experienced a 19.1% drop for the whole of 2023. Also, the benchmark Hang Seng Index fell 13.9% for the entire year.
Overall, the casino industry in Macau has shown resilience despite challenges, and analysts predict that income could reach around 76% of pre-COVID levels in the coming year.