Morgan Stanley has lowered its 2026 Macau GGR forecast, warning that casino growth in the world’s largest gambling hub is slowing as operators face rising costs and weakening demand across key gaming segments.
The investment bank now expects Macau gross gaming revenue (GGR) to reach approximately MOP260.6 billion ($32.3 billion) in 2026, compared with an estimated MOP247.40 billion ($30.67 billion) in 2025. The revised outlook implies annual growth of around 5.3 per cent, below Morgan Stanley’s previous forecast and market expectations of roughly 6 per cent.
According to a research note led by analysts Praveen Choudhary and Stephen Grambling, as reported by Asia Gaming Brief, growth across Macau’s gaming sector is expected to remain subdued through 2026. Morgan Stanley’s forecasts imply quarterly GGR growth of only 2 per cent to 3 per cent year-on-year through the fourth quarter of next year.
The downgrade comes despite Macau posting its strongest May gaming performance since the pandemic, with monthly GGR rising 6.7 per cent year-on-year to approximately $2.8 billion.
Morgan Stanley Macau GGR forecast 2026 signals slower growth
The latest Morgan Stanley Macau GGR forecast for 2026 reflects growing concerns that the market’s post-pandemic recovery is losing momentum. While Macau gaming revenue continues to expand, analysts believe growth rates will moderate significantly as the market faces tougher year-on-year comparisons and a more challenging operating environment. The bank expects revenue growth to remain well below levels seen during the initial recovery period following the reopening of Macau’s borders.
The weaker outlook has also increased pressure on earnings forecasts across the sector, with operators facing a combination of slower revenue growth and higher operating expenses.
FIFA World Cup expected to weigh on Macau gaming demand
Morgan Stanley warned that near-term volatility could intensify as the FIFA World Cup 2026 diverts consumer attention away from casino floors. The bank said June and July could experience particularly weak trading conditions, potentially pushing Macau gaming revenue growth into negative territory on a year-on-year basis.
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The assessment aligns with recent findings from Citigroup, which reported a sharp decline in Macau’s premium mass gaming segment during June. Citigroup’s latest table survey found total premium mass wagers fell 38 per cent year-on-year to HK$9.8 million ($1.25 million), marking the weakest post-pandemic reading recorded by the survey. Analysts attributed the decline to the expanded FIFA World Cup schedule, which features 104 matches and provides gaming customers.
The survey findings suggest that major sporting events continue to influence casino visitation and wagering activity, particularly among premium players who typically generate a disproportionate share of gaming revenue.
Premium mass gaming activity weakens
Citigroup’s survey highlighted broader weakness among Macau’s higher-value casino customers. The number of premium mass players declined 29 per cent year-on-year to 448 during June, while average wagers fell 13 per cent to HK$21,775 ($2,787). The number of so-called whale players also dropped from 35 to 24 compared with the same period last year.
Average minimum bets on Macau mass baccarat tables fell 8 per cent year-on-year to HK$1,905 ($244), dropping below HK$2,000 ($256) for the first time since April 2025.
The decline in both player volumes and average wagers suggests that premium customer spending softened during the World Cup period, reinforcing concerns about near-term gaming demand.
Despite weaker premium mass activity, broader market indicators remain relatively stable. Macau generated MOP22.61 billion ($2.80 billion) in gross gaming revenue during May, while cumulative GGR for the first five months of 2026 reached MOP108.38 billion ($13.44 billion), representing year-on-year growth of 10.9 per cent.
EBITDA growth forecast reduced
Morgan Stanley’s weaker 2026 Macau GGR forecast has also prompted cuts to earnings expectations across the casino sector. The bank reduced its forecast for industry earnings before interest, taxes, depreciation and amortisation (EBITDA) growth in 2026 to 1 per cent, down from its previous estimate of 2 per cent.
Analysts cited slower top-line revenue growth alongside persistent cost inflation across casino operators. Total corporate EBITDA for Macau’s six concessionaires is now forecast to come in at just under $7.93 billion during 2026.
For the second quarter, Morgan Stanley estimates total Macau property EBITDA of just under $2.08 billion, representing a sequential decline of around 4.9 per cent from approximately $2.19 billion in the first quarter. Earnings are expected to remain broadly flat compared with the same period last year.
The bank believes profitability will remain under pressure even as gaming revenue continues to recover, reflecting what it described as a structurally higher cost base across the industry.
Sands China and SJM face biggest downgrades
Morgan Stanley expects market-share shifts among Macau’s major casino operators as trading conditions become more challenging. The bank forecasts Sands China’s market share will decline by 2.6 percentage points to 23.6 per cent, while Melco Resorts is expected to lose 0.8 percentage points, reducing its share to 14.4 per cent.
In contrast, MGM China and Wynn Macau are projected to gain market share during the period. At the company level, Morgan Stanley said the largest downward revisions were applied to Sands China and SJM Holdings due to weaker anticipated second-quarter performance.
The investment bank expects further negative EBITDA revisions across the sector as analysts continue to adjust for lower Macau gaming revenue growth assumptions and elevated operating costs.
Macau gaming recovery enters slower phase
The latest Morgan Stanley 2026 Macau GGR forecast suggests the market’s post-pandemic recovery is entering a slower and more mature phase after several years of strong rebound growth.
Although visitor arrivals and gaming revenue remain above pre-recovery expectations, investors are increasingly focused on profitability, premium mass gaming trends and the impact of external events on customer spending patterns.
The FIFA World Cup has emerged as a short-term headwind for Macau casinos, while slower revenue growth and rising expenses continue to weigh on earnings forecasts.
With premium mass activity weakening, market-share shifts emerging and operating costs remaining elevated, Macau casino operators may face a more challenging environment heading into the second half of 2026. Industry observers will now be watching closely to see whether gaming demand rebounds after the World Cup and whether Macau can sustain the revenue growth needed to support operator earnings over the coming year.
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