Macau's CEO Warns of Immediate Challenges, Backs Long-Term Optimism
Posted: May 30, 2025, 03:57hLast Updated: May 30, 2025, 03:57h
Robert Goldstein, Sands Chief, weighs in on Macau's GGR constraintsMacro-economics, online betting, and junket industry changes playing rolesForecasts long-term growth despite current hurdles
Cracking the code on gross gaming revenue (GGR) in Macau, the world's largest gaming hub, is as elusive as the legendary jackpot itself. Las Vegas Sands (NYSE: LVS) CEO Robert Goldstein disclosed a myriad of macro-economic factors constraining Macau's GGR, while remaining bullish on the long-term prospects of the Chinese territory.
At Bernstein's 41st Annual Strategic Decisions Conference, Goldstein revealed post-COVID GGR in Macau appears to have plateaued near $28 billion annually. Surprisingly, tourism figures have rebounded to pre-pandemic levels, but customers' spending patterns have undergone a change.
Goldstein pointed to a few misconceptions in the past that stated Macau would steadily climb into the 30s (billions of dollars) and beyond. He highlighted several factors corroborating this scenario - consumer sentiment influenced by global economic issues, trade disputes, the proliferation of online wagering in Asia, and the dramatic pruning of the Macau junket industry.
The US-China trade spat and its ripple effects
The ongoing tiff between the US and China represents one factor notorious for playing a part in determining visitor spending behavior in Macau during the 2022 calendar year. Similarly, stock prices for Sands, the top Macau operator, have plummeted by nearly 20% since the beginning of the year. While analysts are unwavering in their belief that tourists are unequivocally opting for Asian owners' over the three US concessionaires, there have been no clear indications of the incumbent operators experiencing increased tariff risks.
Junket wreckage and online betting stalemate
In addition to the US-China standoff, Goldstein implicated two other factors weighing down the GGR growth: a burgeoning online gambling scene across Asia, a significant portion of it illicit, and the major scaling back of the Macau junket industry.
STRUGGLING WITH A SUDOKU PUZZLE? Casino operations in Macau have allegedly stalled out since pre-COVID, and the demise of the junket sector has not helped. The concealed world of the Macau junket industry experienced a seismic shift with the clampdown on perks like first-class flights and luxury hotel accommodations, partly due to a series of anti-money laundering controversies. The Chinese government capped the number of junket licenses to 50, slashed from 235 in 2013, leading to a severe industry contraction.
Treacherous times in the world of junket gambling culminated in the arrest of Suncity Group CEO Alvin Chau in November 2021. His conviction on 18 years in prison for fraud, illegal gambling, and criminal association marked the end of Macau's old junket industry.
Ball's still in Macau's court
Reflecting on 2019, the last year before the coronavirus pandemic, Macau GGR clocked in at $36.5 billion. Despite the challenges, Goldstein maintains his long-term outlook remains constructive, predicting Macau GGR will climb back to $32 billion to $34 billion over the long haul.
Investments made by Sands and other conglomerates in the region could prove fruitful once the dust settles, particularly if US-China tensions dissipate. Looking ahead, Goldstein remarked, "The world is in an awkward place right now and there is confusion about the bilateral relationship between China and the US, there's confusion about the tariffs, there's confusion about China's trajectory. It's not an easy place to navigate."
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The financial implications of the US-China trade spat and its ripple effects have significantly affected visitor spending behavior in Macau.
Despite the contraction of the Macau junket industry and the growth of online betting across Asia, Robert Goldstein, CEO of Las Vegas Sands, remains optimistic about the long-term prospects of the Asian Pacific gaming business in Macau.
