Macau's casino revenues surged in January following the lifting of COVID-19 restrictions

Macau reported an 82.5% year-on-year increase in gaming revenue, reaching 11.6 billion patacas (approximately $1.4 billion) in January, following nearly half a million visitors during the Chinese New Year celebrations.
According to data released by the Macau government on Wednesday, the number of guests was the highest in three years. However, January's revenue still amounted to less than half of what was generated during the Lunar New Year in 2019, prior to the COVID-19 outbreak.
Despite this, investors reacted positively, driving shares of Macau casinos up by 3-5%. Executives and analysts noted that this is a promising sign of a sustainable recovery on the horizon.
Macau is the only place in China where casino gambling is legally permitted. Since 2019, the region has closely followed China's COVID-19 containment strategy and reopened alongside the mainland.
January's revenue marked the first for Sands China, Wynn Macau, MGM China, Galaxy Entertainment, and SJM Holdings under new 10-year contracts. Casinos in Macau were initially launched under 20-year agreements in 2002, generating billions of dollars. The new contracts come amid increased government oversight and control, following a period when COVID-19 restrictions severely impacted Macau's gaming revenues and led to a sharp rise in net debt. The industry recorded its lowest profit levels in history in 2022.
The casinos have committed to investing a total of $15 billion over the next decade, with 90% earmarked for non-gaming developments. These include an indoor water park, wellness centers, art exhibitions, and a large garden attraction at Sands.
Rob Goldstein, Chairman and CEO of Las Vegas Sands, the majority owner of Sands China, stated, "Since the lifting of COVID-related restrictions, we have seen a strong recovery in Macau. We are just happy to be open, making money, and witnessing demand. However, a labor shortage is becoming evident. Resorts and retail outlets are rushing to hire staff to keep up with demand, resulting in some hotels not operating at full capacity."
Earlier, we reported that Macau's casino gaming revenues had plummeted by nearly 70% in May.