Macau’s Gaming Revenue will Rebound

May was a slow month for Macau. It might have seemed like the revenue was even back sliding to points it hit after the initial crackdown on Junkets. But, it really has not. While it did not jump hugely in May, there were some bright spots for certain casinos.

Morgan Stanley analysts say Macau’s gross gaming revenue will increase for June. If it will not increase, then there should be steady numbers for the income. Morgan Stanley firmly believes that the gross gaming revenue, overall, will see a rebound to before May and that the numbers will not be steady based on the 2017 income.

The gross gaming revenue for may was down 12.1 percent overall or $3.15 billion. For a month to month comparison in 2018, May was 27.6% lower than April of 2018. The reason for the lower numbers was thrown at the mass market. The mass market attendee’s numbers were down for May, due to some mainland police busts. Several currency exchange locations near the Gongbei border were raided. The market may also have needed a bit of a slowdown, since there has been 22 months of consecutive growth.

The weakness in May is not going to continue according to the analysts. It is likely that the gross gaming revenue by the end of June will show a 20 percent growth due to an improved mass market attendance.

Macau’s Statistics and Census Service shows that the total visitor arrivals for June were up 5.2 percent, which means about 2.7 million people visited the island already. The tourists are mainly from China, which also showed an 8.3 percent increase.

Attribution to Melco Resorts

Melco Resorts and Entertainment opened the Morpheus Hotel and Dragon Boat Festival. It is thought that many people came to Macau to see the opening. Morgan Stanley also stated that tourists are coming from lower-tiered Chinese cities. Beijing and Shanghai are considered tier-1 to give you an idea of the difference in visitors to the island.

Macau saw a 12.5 percent jump in lower tier cities, with a lower contrast between tier-1. In other words, only 5.5 percent of a jump in tier-1 visitors occurred as opposed to more visitors from smaller cities around China. It is believed that the mass market gambling will continue to hold strong through August. Morgan Stanley believes it will continue with an estimated $105.16 million earned per day on the island.

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