Casinos Win New Macao Licenses, but Will Shares Rise?
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China renewed the licenses of the largest casinos in Macao for another 10 years. The casinos invested billions of dollars in the gambling mecca and billions more on developing nongaming activities at the behest of Beijing. Macau's casino industry has been wrecked by the pandemic. Regulators probably needed the deep-pocketed players as much as the casinos needed licenses.
Macao casinos have generated just 38 billion patacas in the first 11 months of 2022. Gross gaming revenue is down 51% compared to last year. China's economy has plummeted. People may not want to gamble even if they can.
Las Vegas Sands sold all of its Las Vegas properties in 2021. It is focusing on the Asian gambling market. The company has operations in Singapore. In 2019, Las Las Sands generated $13.7 billion in revenue and profits of $3.3 billion. Wynn Resorts is more dependent on Macao, with 70% of revenue coming from its casinos there.
MGM Resorts is one of the biggest operators of casinos on the Las Vegas Strip with 10 casinos. It lost $3 billion in Macao three years ago, but it's made about $500 million there year to date.
