Analysts at CLSA have significantly improved their estimates for Macau’s casino industry this year due to a mix of positive currency dynamics and the launch of various premium properties within the casino region of the territory. The updated projection marks a dramatic shift from previous expectations and reflects the nuanced dynamics driving the recovery of the gaming industry.
The brokerage now anticipates Macau casino gross gaming revenue to rise by 7.6% year-on-year in 2025 to HKD234.8 billion, or about US$30 billion. This is a major improvement over CLSA’s May estimate, which had forecast just a marginal 1.8% increase for the year. The upgrade is a 5.8 percentage point lift in their growth estimate.
Currency Dynamics Playing Key Role
One of the main reasons for this new perspective is currency movements that have been in favor of Chinese tourists to Macau. The renminbi strengthened against the U.S. dollar by 1.4% between the second quarter of 2025, making the conditions more appealing for mainland Chinese tourists who make up the majority of Macau’s clientele.
This currency appreciation is important because the majority of Macau casino bets are placed in Hong Kong dollars, which are pegged to the U.S. dollar. When the renminbi is stronger than the dollar, Chinese tourists actually have more purchasing power to spend on their gaming. CLSA analyst Jeffrey Kiang saw this currency shift as probably “the biggest factor” behind enhanced Macau gaming performance.
Macau recorded a 19.0% year-on-year growth in gaming revenue in June, and this is solid proof that the market recovery is picking up pace beyond what the analysts had earlier projected.
Premium Properties Adding Market Strength
Aside from currency effects, the launch of a number of new luxury resorts has helped improve the forecast. The new developments are mainly concentrated in Macau’s Cotai area, now the territory’s top integrated resort destination. Kiang said, “The opening of certain new premium properties on Cotai also underpins the strength” of the gaming industry.
The specific properties mentioned include Sands China’s Londoner Macao Phase 2, which made its full room inventory available by early May, timing perfectly with the mainland China Labor Day holiday period. The Capella at Galaxy Macau represents another significant addition, featuring 95 penthouses and suites along with a gaming floor containing about 30 gaming tables. MGM Macau also contributed to the upgraded accommodation landscape with 10 new suites that opened in late April and early May.
Steady Premium Gaming Segment
The premium mass gambling segment has shown particular resilience over the past year, according to CLSA’s analysis. Kiang emphasized that this segment has been “pretty solid and steady for the past 12 months,” with the new ultra-premium offerings providing “an additional boost to it.“
Proof of this resilience was seen in June’s casino revenue figures, especially in the first two weeks of the month prior to entertainment activities such as Jacky Cheung’s concert series at Galaxy Arena. Hong Kong singer Jacky Cheung’s nine concerts from mid-June to early July at Galaxy Macau received much attention, with some analysts attributing the boost in market-wide June gaming revenue to these concerts.
Financial Margins and Future Expectations
Looking ahead, CLSA expects the gaming industry’s earnings margins to remain relatively stable. The brokerage projects that industry-wide EBITDA margins will “remain flat at 27.2% in second-quarter 2025” before dipping slightly to 26.9% in the third quarter.
Kiang noted that there is “minimal scope for margin expansion” under current conditions. However, he noted that margins may increase if Macau’s gaming growth accelerates through operating leverage effects. The analyst anticipates the second-quarter EBITDA of Macau’s gaming sector to grow 6.9% year-on-year to around HKD 16 billion.
For the rest of 2025, CLSA expects relatively stable daily levels of gaming revenue, projecting a flattish GGR per day in the second quarter of 2025 at MOP672 million (US$83.1 million). This steady performance would support the overall 7.6% annual growth target that forms the basis of their revised forecast.
Source: GGR Asia
