Macau’s gaming industry experienced a notable decline in January 2025, with gross gaming revenue (GGR) at MOP 18.25 billion (US$2.27 billion). This represents a 5.6% drop compared to the same period last year, when GGR stood at MOP 19.34 billion (US$2.39 billion). Although slightly higher than December’s performance, the overall figure still fell short of expectations, especially considering that January typically enjoys a surge in visitors due to the Chinese New Year celebrations and associated holiday activities.

Challenges and forecasts for 2025:

The modest improvement in GGR from December 2024 (which saw MOP 18.2 billion, a 1.3% drop month-on-month) came as a surprise to many. December’s performance had been impacted by several factors, including the visit of Chinese President Xi Jinping to Macau during the handover celebrations. As reported by Macao News, analysts had predicted a more optimistic start to the year for January, especially as Macau’s government had rolled out new visa policies on January 1st for residents of Zhuhai and Hengqin, which were expected to boost tourist arrivals. Despite these efforts, the overall gaming performance did not meet the anticipated recovery.

While the January results were slightly better than the preceding month, they were still underwhelming when viewed against analysts’ expectations for early 2025. Citigroup analysts had forecasted a 6% year-on-year rise for January and February combined, but actual performance did not live up to these predictions. The slower-than-expected start to the year was, however, in line with expectations that the first quarter of 2025 would face challenges due to tough comparisons with 2024. The January results were also affected by high VIP volumes and strong hold rates in the same period of 2024, making it difficult for this year’s numbers to keep pace.

Looking ahead, some analysts are projecting a more optimistic year for Macau’s casinos. Despite the slow January, consensus estimates suggest GGR for 2025 could grow by around 8%, surpassing the government’s more conservative forecast of MOP 240 billion (US$29.9 billion). Analysts from Seaport Research Partners believe that the gaming sector will benefit from a more favorable China sentiment towards Macau, as well as a growing economy and more relaxed visa policies. Additionally, the return to traditional money transfer methods, such as UnionPay pawn shops, is expected to support the local market amid ongoing regulatory crackdowns on illicit money exchange operations.

The outlook for Macau’s gaming industry is increasingly positive, though analysts remain divided on whether the industry can return to pre-pandemic levels. According to The Macao Post Daily, in 2024, Macau’s GGR grew by 23.9% to MOP 226.8 billion (US$28.39 billion), recovering nearly 77.5% of the revenue generated in 2019, just before the onset of the COVID-19 pandemic. The GGR for 2024 was also a significant improvement on the government’s initial forecasts. However, the industry is still far from the peak revenue recorded in 2013, when it reached a high of MOP 360.7 billion (US$45.2 billion).

Traditional baccarat tables remain the dominant force in Macau’s gaming sector, contributing 85% of the total GGR during the first three quarters of 2024. Meanwhile, slot machines and other games of chance accounted for a much smaller portion of the total revenue.

A glimpse at the Chinese New Year period:

January’s performance did include some of the gaming revenue generated by the Chinese New Year (CNY) Golden Week, which began on January 28th and runs until February 4th, with expected border crossings of up to 5 million. However, visitation typically peaks in the later days of the holiday period, and analysts remain cautious about how the influx of visitors will influence overall gaming performance for the month. The combination of seasonal factors, including the timing of the CNY holiday, made it challenging for analysts to provide an accurate prediction for the full January results.

Despite the slower start, many industry experts continue to anticipate strong growth for Macau in the long term, with some projecting a GGR increase of 4% to 9% for 2025. However, much will depend on how the gaming industry performs in the coming months and whether it can recover from the early-year slowdown.

The Macao government’s forecast for 2025 is based on the assumption that casino operators will generate a total GGR of MOP 240 billion (US$29.7 billion). While this would represent a nearly 6% increase from 2024’s GGR of MOP 226.8 billion, not all analysts are convinced by the government’s projections. CreditSights analysts, for instance, have predicted a higher figure of MOP 245 billion, which would outpace the official estimate. This difference in expectations underscores the ongoing uncertainty surrounding Macau’s recovery and the challenges the region faces in achieving consistent growth.