Macau has fallen

July 29, 2022 Macau Earnings & Filings Industry Updates

“The king is dead. Long live the king.”

First declared in 1422 upon the death of the French King Charles VI and the instantaneous accession to the throne of his son, King Charles VII, this evocative proclamation full of history and tradition is uttered only on the exceedingly rare and momentous occasion of the passing of the crown from one monarch to the next.

And so too, it’s time to make this declaration for the global gaming industry. The harsh reality is that Macau – the undisputed king since surpassing Las Vegas in gross gaming revenue (GGR) in 2007 – is king no more. For the 30 months since the pandemic hit, GGR has ranged, on a calendar monthly basis, from as low as 3% to as high as 43% of 2019 levels, with an average of just 24% throughout the entire pandemic.

Meanwhile, in a booming post-COVID recovery many thought impossible, the state of Nevada has booked over US$1 billion in GGR every month since March 2021 – with the lion’s share from Las Vegas, of course. This is approximately 50% higher than the Macau average throughout the entire pandemic and around triple the GGR run rate of Macau’s last completed quarter, 2022 Q2. Even traditionally much smaller jurisdictions like the Philippines, Singapore and Australia are beating or in the ballpark of Macau’s last quarter.

2004 TO 2013
Macau’s arguably most historic gaming company, STDM, founded by the legendary Dr Stanley Ho, held the city’s monopoly casino gaming concession from 1960 to 2000. In the wake of the handover of Macau from Portugal to China on 20 December 1999, the concession was extended to 2002, after which the industry was liberalized with the addition of Wynn Macau and Galaxy Entertainment, creating a triumvirate of industry operators. Subsequent sub-concessions were granted to Venetian Macao (now Sands China), MGM China and Melco-PBL (now Melco Resorts), expanding the triumvirate into a sextet. It took until 18 May 2004 for Sands to open their first property – Sands Macao – on the Macau peninsula near the Hong Kong-Macau ferry terminal. Two months later Galaxy’s first casino opened across the road at the Waldo hotel and the shiny new industry was off to the races.