Solid underlying GGR trends and positive indications from operators around the recent May Golden Week holiday suggest the outlook for Macau remains relatively positive. However, the recent rise in VIP revenues and its inherent volatility – combined with the city’s elevated competitive environment – make accurate earnings forecasts challenging, according to commentary from CBRE Equity Research.
In a note, analysts John DeCree and Max Marsh said although the outlook remains opaque, they see upside and “remain encouraged by the solid underlying GGR trends, including operator commentary on 1Q26 earnings calls that point to a solid rebound in May behind the Golden Week holiday.”
Nevertheless, concerns remain because the quality of GGR in Q1 was dampened by higher commissions, lower EBITDA flow through and a greater proportion of VIP GGR, which is more volatile.
As highlighted by CBRE, the main talking point of the March 2026 quarter was the continued acceleration in VIP volumes which has raised some concerns about the volatility and sustainability of Macau’s current growth trajectory, especially after market-wide GGR growth decelerated to 5.5% year-on-year in April.
“In 1Q26, VIP volumes increased 26.2% year-on-year, accelerating from 20.7% growth in 4Q25 and 17.6% in 3Q25,” the analysts observed.
“VIP GGR increased 19.6% year-on-year in 1Q26 compared with 11.4% growth in mass market table GGR. However, VIP remains a relatively small piece of the overall market, representing just ~15% of total GGR.
“The VIP volume growth was led primarily by LVS at 68.3% year-on-year and Galaxy at 60.7% year-on-year. Collectively, these two companies control over 50% of the VIP market. Excluding these two operators, VIP volumes were up a modest 1.9% year-on-year in 1Q26.”
With Macau stocks still failing to pique the interest of investors, CBRE said it still sees upside to current valuation levels in Macau but expects an external catalyst or greater EBITDA growth is needed for the stocks to start performing.
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