High reinvestment levels and tougher comparisons are expected to weigh on profitability.
Macau.- Analysts at Seaport Research Partners expect casino margins in Macau to remain under pressure through the remainder of 2026. They say high levels of reinvestment and commission structures continue to weigh on profitability.
The brokerage said that while operating expense growth is likely to slow to around 6 to 7 per cent in 2026 after higher increases in 2025, this moderation is unlikely to result in meaningful margin recovery in the near to medium term. Seaport senior analyst Vitaly Umansky said “margins in Macau will remain pressured for some time” unless there is a stronger recovery in higher-margin base mass segments or a reduction in agency business and player reinvestment levels.
The report highlighted that competition among operators remains intense, with casinos continuing to rely on reinvestment to capture or defend market share, particularly in premium segments. If premium or agent-driven business grows faster than the broader market, reinvestment levels could increase further relative to gross gaming revenue (GGR).
Seaport indicated that expectations for regulatory intervention to cap commissions or reinvestment have diminished.
The brokerage noted that Macau saw stronger-than-expected performance in the first quarter of 2026, with industry-wide GGR rising 14.2 per cent year-on-year. Market-wide EBITDA increased by around 9 per cent. However, margins declined by approximately 30 basis points compared with the same period last year.
Seaport warned that this momentum is unlikely to continue, with tougher year-on-year comparisons beginning in May expected to lead to a “material growth deceleration” for the remainder of 2026. As growth moderates, operators are expected to focus more heavily on cost control, market share gains and optimising reinvestment strategies.
High reinvestment levels and tougher comparisons are expected to weigh on profitability. Macau.- Analysts at Seaport Research Partners expect casino margins in Macau to remain under pressure through the remainder of 2026. They say high levels of reinvestment and commission structures continue to weigh on profitability. The brokerage said that while operating expense growth is…
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