MGM China is forecast to report an adjusted EBITDA of approximately HK$2 billion (US$250 million) for the fourth quarter of 2024, marking a 5% increase compared to the previous quarter. This growth is in line with the company’s continued momentum following the post-pandemic recovery. According to analysts at investment bank Jefferies, the company’s gross gaming revenue (GGR) is predicted to grow by 7% quarter-on-quarter, reaching HK$8.5 billion (US$1.1 billion), outperforming the overall Macau gaming industry, which is expected to see a more modest 3% growth. MGM China’s market share is also expected to rise, reaching 15.8%, up from 14.8% in Q3, although still below its peak of 17.1% in Q1 2024.

Strong VIP segment drives outperformance:

Jefferies analysts, Anne Ling and Jingjue Pei, highlighted that MGM China’s robust performance in the VIP segment will be a significant factor in its market share gains. The analysts estimate that the company will continue to outperform the broader market due to its strategic focus on attracting high-value customers. While the anticipated GGR growth is encouraging, the analysts also project a slower increase in adjusted EBITDA, as higher operating expenses are expected to dampen margin growth. These expenses include the recent launch of the Poly MGM Museum at MGM Macau and the Macau 2049 residency show at MGM Cotai, both of which are seen as part of the company’s ongoing investment in its Macau properties.

Despite the increase in operating costs, which will likely limit the margin to 27%, the growth in GGR is expected to keep the company’s earnings on track, with a forecasted property EBITDA for MGM Macau and MGM Cotai combined of HK$2.1 billion (US$269.6 million) — a 5% quarter-over-quarter growth. This represents a solid performance in the context of rising competition in the Macau gaming market, with rivals ramping up their premium offerings and smart table technology.

MGM China’s continued focus on premium mass customers and its investment in property upgrades at MGM Macau and MGM Cotai are part of a long-term strategy to sustain its market share within the mid-teens percentage range. Jefferies suggests that these efforts will be crucial in maintaining the company’s competitive edge as more high-end offerings and technology are introduced by other casino operators in Macau. According to Inside Asian Gaming, the company’s president and executive director, Kenneth Feng, has previously credited MGM’s strong performance to its “deep understanding” of premium mass gamblers, which has been central to the company’s record-breaking revenue and EBITDA results in 2023.

In addition to its investments in the VIP segment, MGM China is also prioritizing non-gaming attractions, such as the Poly MGM Museum and the Macau 2049 show. The Poly MGM Museum, which opened in late November 2024, is expected to draw in a diverse range of visitors, while the Macau 2049 show, which debuted in December 2024, aims to enhance the entertainment offerings at MGM Cotai. These investments are seen as a way to diversify revenue streams beyond traditional gaming and cater to a wider range of customers.

Looking ahead: a more competitive market in 2025:

Despite its strong performance in 2024, MGM China is bracing for a more competitive landscape in 2025, as fellow casino operators in Macau ramp up their offerings. Jefferies analysts have noted that the market for high-end suites and smart table technology is expected to become more saturated, which could pose challenges for MGM China as it looks to maintain its market share. Nonetheless, MGM China’s focus on the premium mass segment and ongoing investments in its properties will likely help the company stay competitive in the evolving market.

At the same time, the broader Macau gaming industry is expected to see slower growth, with a forecasted 3% quarter-on-quarter increase in GGR for Q4 2024, as reported by Asia Gaming Brief. According to brokerage firm CLSA Ltd., the sector as a whole is projected to report an EBITDA of US$2.02 billion (HK$15.7 billion), driven by seasonally higher non-gaming revenue and modest GGR growth. However, MGM’s results are expected to continue exceeding industry averages due to its strong positioning in the VIP market and its ongoing investments in Macau’s non-gaming infrastructure.