UBS Cuts 2026 EBITDA Outlook for Macau Casino Operators

UBS has slightly reduced its 2026 EBITDA forecasts for Macau’s gaming operators, citing rising operating expenses observed during the fourth quarter of 2025 that could continue into the new year. In a research note published on March 9, analysts Angus Chan, Perry Yeung, Ryan Lau, Samuel Yip and Robin Farley maintained a generally positive outlook for the sector. The brokerage still anticipates Macau’s gross gaming revenue (GGR) will grow by around 5% year-on-year in 2026, with profits expected to edge higher despite cost pressures.

Higher Costs Weigh on Profit Forecasts

The revised forecast follows Q4 2025 results that showed operating costs increasing across most operators. UBS believes these cost pressures could limit the pace of profit expansion in 2026 even if revenue continues to improve. According to the report, luck-adjusted sector-wide EBITDA is expected to rise about 6% year-on-year in 2026, compared with largely flat results recorded in 2025.

Analysts suggest that as operators move beyond heavy property investment phases, a stronger focus on cost control and targeted reinvestment should help maintain profitability. A more stable competitive environment in Macau is also expected to support margins as the market continues its recovery.

Strong Start Expected for 2026

The beginning of 2026 has already shown encouraging signs. UBS estimates that GGR for January and February grew by roughly 14% compared with the same period last year, outperforming market expectations. This early momentum suggests strong visitor demand and continued activity across the gaming sector.

Looking ahead, UBS forecasts that GGR could expand by around 8% in the first half of 2026, helped by easier comparisons with the previous year. Growth is then expected to slow to approximately 3% during the second half as those comparisons become tougher.

Premium Segments to Drive Growth

Premium gaming segments are expected to remain a major driver of growth. Analysts noted that operators are strengthening marketing efforts, introducing improved suite offerings and adding new hotel rooms across several integrated resorts. These developments are expected to attract higher-spending customers and sustain demand.

While the increase in costs seen in late 2025 prompted UBS to trim its EBITDA outlook slightly, the brokerage believes the sector remains well positioned. Operators are now focusing more on operational efficiency and strategic reinvestment rather than large-scale capital spending.

Balanced Competition Supports Margins

UBS also highlighted that the competitive landscape in Macau has become more balanced. This environment allows operators to prioritize profitability and efficiency rather than aggressively competing for market share.

With major property upgrades largely completed, casinos are expected to focus on optimizing existing assets while introducing targeted marketing initiatives and premium offerings. These strategies could help maintain margins and support steady earnings growth.

Measured Growth Ahead

Overall, UBS remains optimistic about Macau’s gaming sector despite the modest adjustment to its profit forecast. The brokerage continues to expect GGR growth of about 5% in 2026, supported by strong tourism demand and improved premium gaming activity.

Although higher costs in late 2025 prompted a more cautious profit outlook, analysts believe the sector can still deliver moderate earnings growth. With operators emphasizing efficiency and selective reinvestment, Macau’s gaming market appears set for steady expansion in the year ahead.