Macau Shows Signs of Recovery as Drop in Gaming Revenue Narrows

(Bloomberg) -- Macau’s declines in gaming revenue narrowed in October, after plunging at least 90% for six straight months, in a sign that China’s relaxation of travel and visa curbs is starting to attract mainland visitors.

• Gross gaming revenue fell 72.5% to 7.27 billion patacas ($910 million) in October from a year earlier, according to data from the Gaming Inspection & Coordination Bureau. That was better than the median analyst estimate for a 74% drop.
• Revenue in the 10 months through October has fallen 81.4% to 45.9 billion patacas, according to the data.

Key Insights

• Macau’s recovery from Covid-19 curbs has been slow after China gradually lifted travel restrictions. Mainland Chinese visitor arrivals during Golden Week in early October were down 84% from a year earlier. However, gamblers are starting to return in volume as a visa backlog clears.
• “Toward the end of October, the number of visitors increased, but it’s still far away from our normal level,” said Joe Liu, director of the city’s largest e-payment company Macau Pass S.A., which is accepted in more than 18,000 locations including restaurants and retail outlets. But he said the visitors returning first are the high-spending customers who don’t hold back. “They shop and eat crazily.”
• Analysts say the key to a continued recovery will be a streamlining of the visa-issuance process and virus-testing requirements, which currently hinder mainland tourists from visiting Macau.

Market Performance

• The Bloomberg Intelligence index of Macau casino operators dropped 5.6% in October amid the slow pace of recovery. The benchmark Hang Seng Index gained 2.8% in the same period.

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• Las Vegas Sands Corp. is betting on Macau’s future. The world’s largest casino company is exploring a sale of its Las Vegas casinos to focus on Asia.
• Click here for analysts’ survey on Macau gaming
• Sept. 30, Macau’s Global Gambling Crown Slips With Chinese Staying Home

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