Macau Casinos Post Revenue Gains, Margins Limited in Q4

Macau’s casino operators recorded stronger revenues in the fourth quarter of 2025, yet margin expansion was constrained by increased operating expenses tied to major events and regulatory shifts. Analysts George Choi and Timothy Chau from Citigroup noted that the NBA China Games, the 15th National Games, and SJM Holdings’ satellite casino closures generated additional costs that offset potential gains in operating leverage. Without these factors, industry margins would have seen more pronounced growth alongside revenue increases.

Citigroup Maintains Positive Outlook
Citigroup projects Macau’s gaming EBITDA rose 13 percent year-on-year to around $2.25 billion in 4Q25, fueled by a 15 percent increase in GGR and 12 percent net revenue growth. However, extra costs from hosting the NBA and National Games, combined with SJM’s satellite casino transition, curtailed margin improvement. As a result, industry EBITDA margins increased only slightly, from 27 percent a year earlier to 27.5 percent in 4Q25.

Looking to 2026, Citigroup remains optimistic. The bank forecasts a 7 percent year-on-year rise in GGR and a 9 percent increase in EBITDA, suggesting that the temporary event-related expenses and regulatory adjustments are behind the market. Investors are encouraged to consider leading operators, with Galaxy Entertainment, Wynn Macau and Sands China highlighted as preferred names.

Shifts in Market Share
The quarter saw notable shifts in market share among Macau’s top operators. Sands China is estimated to hold 24.5 percent of the market, up 0.5 points quarter-on-quarter. Galaxy Entertainment gained 1 percentage point to 21.7 percent, helped by concerts at Galaxy Macau and favorable VIP hold rates. MGM China also expanded its share to 16.4 percent, supported by strong VIP performance at MGM Cotai.

Wynn Macau remained steady at 13.2 percent. SJM Holdings declined to 10.5 percent, impacted by satellite casino closures, while Melco’s share fell 0.9 points to 13.8 percent. These trends show how regulatory consolidation, particularly the shuttering of satellite casinos, redistributes revenue toward operators with stronger core properties.

Varied EBITDA Performance
EBITDA growth varied significantly across the operator group. Galaxy Entertainment led with projected year-on-year growth of 31 percent to HKD$4.24 billion (around $544 million), reflecting both market share gains and operational efficiencies.

Sands China followed with an 8 percent increase in EBITDA to $616 million. However, higher costs from hosting the NBA and National Games events limited margin expansion, as the operator carried a significant portion of the additional expenses affecting the industry.

2026 Outlook Clearer Without Event Pressures
Citigroup anticipates that these temporary cost pressures will ease in 2026. Without major event and regulatory expenses, operating leverage should more directly support EBITDA growth. This underpins Citigroup’s positive stance and the recommendation for investors to accumulate shares in leading Macau operators ahead of a more normalized earnings environment.