Content Writer: Janice Chew • Saturday, 26/01/2026 - 01:07:21 - AM
Analysts at Citigroup concluded that Macau’s major casino concessionaires saw less improvement in operating leverage during the December 2025 quarter than expected largely because of higher incremental operating expenses tied to external events and structural changes, despite underlying revenue growth trends.
According to Citi’s research note, industry EBITDA was forecast to rise about 13 % year-on-year, supported by gross gaming revenue (GGR) growth of roughly 15 %, but additional cost pressures eroded operating leverage gains that might otherwise have been achieved.
A key source of these extra costs was event-linked spending, most notably from major hosted events such as the NBA China Games at The Venetian Arena and the 15th National Games, which saw multiple concessionaires providing support, venues and sponsorships. These events, while boosting Macau’s global profile, required elevated staffing, logistics and venue costs.
Another significant drag came from the closure of satellite casinos, particularly those tied to SJM Resorts; this not only reduced distributed earnings but also forced cost absorption from shutting down operations and integrating affected employees back into parent company structures, which put upward pressure on OPEX.
Despite these headwinds, Citi still expects an increase in the overall EBITDA margin to around 27.5 % for the quarter, slightly higher than the prior year, and forecasts market share gains for operators such as Galaxy Entertainment, MGM China and Sands China due to favorable VIP hold rates and strong concert programming that helped drive premium-mass play.
External market commentary from other financial analysts like JP Morgan echoed the view that operating costs, particularly for live events, present downside risks to Q4 forecasts, suggesting broad recognition of the same structural cost pressures within the sector.
Broader industry context indicates Macau’s GGR growth has remained resilient, with continued year-on-year gains in gaming revenue reported into late 2025, though some data suggests growth may be moderating relative to expectations, underlining the mixed environment operators face balancing revenue expansion with rising expenses.