Key Takeaways
- Investment analysts project Macau’s casino gross gaming revenue will climb 6% during 2026, while Singapore and Las Vegas see minimal 1% expansion
- The territory’s 2025 gaming revenue reached MOP247.40 billion (US$30.63 billion), representing a 9.1% annual increase
- Earnings before interest, taxes, depreciation and amortization in Macau expected to grow merely 2% amid escalating operational expenses
- Investment bank downgraded Macau gaming sector rating from “attractive” to “in-line” with broader market
- Singapore’s casino market volumes projected to increase while EBITDA faces anticipated 1% contraction in 2026
Macau’s gaming establishments are positioned to surpass rival markets in Singapore and Las Vegas during 2026 when measuring gross gaming revenue performance. However, bottom-line profitability may struggle to match revenue expansion.
Investment banking firm Morgan Stanley published research Wednesday indicating the Macau casino industry’s GGR should increase approximately 6% on an annual basis throughout 2026. This projection stands in stark contrast to the mere 1% growth anticipated for both Singapore’s and Las Vegas’s gaming markets.
These forecasts arrive following an impressive 2025 performance for Macau. Government statistics reveal last year’s GGR climbed 9.1% compared to the previous year, reaching MOP247.40 billion, equivalent to roughly US$30.63 billion.
Nevertheless, top-line revenue expansion doesn’t automatically translate to improved profitability. Morgan Stanley anticipates Macau’s EBITDA will advance by only 2% throughout the current year. This forecast falls short of market expectations.
The financial institution attributed the underwhelming profit projection to a downward revision from 2025’s results. Mounting cost pressures continue to suppress earnings throughout the gaming jurisdiction.
Operational Expenses Create Ongoing Margin Pressure
Morgan Stanley’s research team characterized Macau’s cost challenges as fundamentally structural in nature. The jurisdiction’s strategic emphasis on premium mass gaming segments is inflating expenditures related to player incentives and promotional activities targeting middle-tier customers.
The investment bank identified three primary factors contributing to the conservative EBITDA outlook. Initially, GGR expansion is anticipated to decelerate during 2026’s latter half due to unfavorable year-over-year comparisons and persistent softness in the base mass customer segment.
Additionally, promotional allowances remain elevated. These expenditures reflect costs associated with customer acquisition and retention within an intensely competitive marketplace.
Furthermore, non-gaming operational costs continue their upward trajectory. These expenses stem partially from obligations Macau’s six licensed casino operators accepted with the government as conditions of their current decade-long gaming concessions, which commenced in January 2023.
Considering these combined factors, Morgan Stanley revised its assessment of Macau’s gaming sector downward from “attractive” to “in-line.” The bank currently forecasts diminished year-over-year GGR growth beginning in May.
Analysts also project negative EBITDA growth throughout the second and third quarters of 2026. This would represent a significant departure from the positive momentum observed throughout 2025.
Singapore Market Faces Volume Growth Offset by Normalization
Morgan Stanley additionally analyzed Singapore’s duopoly casino market. This jurisdiction encompasses Resorts World Sentosa, managed by Genting Singapore, and Marina Bay Sands, operated by Las Vegas Sands.
The investment bank anticipates Singapore gaming volumes will expand by a mid-single-digit percentage throughout 2026. This growth trajectory is supported by sustained performance at Marina Bay Sands and recently introduced facilities at Resorts World Sentosa.
Nevertheless, Morgan Stanley doesn’t foresee Genting Singapore capturing increased market share from Marina Bay Sands. The bank observed that Genting Singapore has failed to accomplish this objective in recent periods.
Marina Bay Sands documented exceptionally elevated hold rates during 2025. Morgan Stanley projects these rates will revert to historical norms this year.
Consequently, the bank forecasts that normalizing hold rates will neutralize volume increases. This dynamic positions overall Singapore industry GGR as essentially flat for 2026.
Morgan Stanley estimates the Singapore gaming industry’s EBITDA will contract approximately 1% year-over-year throughout 2026.
