Executive Summary
- Investment analysts at Morgan Stanley project Macau’s casino gross gaming revenue will climb 6% in 2026, while Singapore and Las Vegas are expected to see only 1% gains
- The Special Administrative Region recorded MOP247.40 billion (US$30.63 billion) in GGR for 2025, representing a 9.1% year-over-year increase
- Profitability gains are forecast to lag behind revenue expansion, with EBITDA projected to increase just 2% amid escalating operational expenses
- The investment bank has revised its Macau gaming sector rating downward from “attractive” to “in-line”
- While Singapore’s gaming volumes are anticipated to increase, EBITDA is forecast to contract 1% in 2026
The gaming hub of Macau is positioned to deliver stronger revenue performance than its primary competitors in Singapore and Las Vegas throughout 2026 based on gross gaming revenue metrics. However, bottom-line profitability may fail to mirror that topline momentum.
In a research note issued Wednesday, Morgan Stanley analysts projected that Macau’s casino industry GGR will expand approximately 6% on a year-over-year basis in 2026. This forecast stands in stark contrast to the roughly 1% growth trajectory anticipated for both Singapore and Las Vegas markets.
These projections come on the heels of an impressive performance year for Macau in 2025. Government data indicates that GGR climbed 9.1% year over year to reach MOP247.40 billion, equivalent to approximately US$30.63 billion.
Yet topline revenue expansion doesn’t necessarily translate to improved profitability. Morgan Stanley anticipates Macau’s EBITDA will advance by a modest 2% during the current year. This projection falls short of market consensus expectations.
The investment bank attributed the subdued profit forecast to a downgrade from 2025 results. Escalating cost pressures continue to constrain earnings performance throughout the market.
Permanent Cost Inflation Challenges Macau’s Bottom Line
Morgan Stanley’s research team characterized the cost pressure facing Macau as structural rather than cyclical. The market’s strategic emphasis on premium mass segment players is driving up expenditures on incentives and promotional programs targeting mid-tier customer segments.
The bank identified three principal factors underlying its conservative EBITDA projection. Initially, GGR expansion is anticipated to decelerate during the latter half of 2026 due to challenging year-ago comparisons and persistent softness in the base mass gaming segment.
Additionally, promotional allowances remain elevated. These expenditures are associated with customer acquisition and retention efforts in an increasingly competitive operating environment.
Finally, non-gaming operational expenses continue their upward trajectory. These costs are partially attributable to obligations Macau’s six licensed casino operators accepted as conditions of their current decade-long gaming concessions, which commenced in January 2023.
Considering these dynamics, Morgan Stanley reduced its assessment of Macau’s gaming sector from “attractive” to “in-line.” The bank now forecasts diminished year-over-year GGR growth beginning in May.
The firm also projects negative EBITDA growth during both the second and third quarters of 2026. This would represent a significant departure from the positive momentum witnessed throughout 2025.
Singapore Seeing Volume Gains While Hold Percentages Return to Historical Norms
Morgan Stanley also provided analysis on Singapore’s duopoly casino market. This market encompasses Resorts World Sentosa, managed by Genting Singapore, and Marina Bay Sands, operated by Las Vegas Sands.
The investment bank anticipates gaming volumes in Singapore will advance by a mid-single-digit percentage during 2026. This expansion is being fueled by sustained performance at Marina Bay Sands and newly introduced amenities at Resorts World Sentosa.
Nevertheless, Morgan Stanley doesn’t anticipate Genting Singapore will capture market share from Marina Bay Sands. The bank observed that Genting Singapore has been unsuccessful in achieving this objective in recent years.
Marina Bay Sands reported exceptionally elevated hold rates throughout 2025. Morgan Stanley projects those percentages will normalize to historical levels during the current year.
Consequently, the bank forecasts that declining hold rates will neutralize the volume increases. This dynamic leaves overall Singapore industry GGR essentially unchanged for 2026.
Morgan Stanley estimates Singapore’s industry-wide EBITDA will contract by approximately 1% year over year in 2026.
