Macau gaming revenue falls short of June forecast
Macau gaming revenue growth is cooling down just as temperatures are heating up.
Gaming revenue on the Chinese enclave rose 12.5 percent to $2.78 billion in June, missing the 18 percent growth forecast by Wall Street analysts.
Macau gaming revenue has now missed analyst forecasts two months in a row, prompting Union Gaming to cut its 2018 growth forecast to 17 percent.
‘’Keep in mind that Macau has bad weeks all the time and one bad week doesn’t make a trend,’’ Union Gaming analyst Grant Govertsen said in a note.
Gaming revenue has risen 19 percent over the first half of the year to $18.7 billion.
The June results may have been affected by lower hold as well as the World Cup, which started in the middle of the month, Govertsen said.
Stock impact
MGM Resorts International opened its second casino in Macau in February. Analysts hoped the $3.4 billion resort would generate enough excitement to pull in larger crowds. That hasn’t happened, Govertsen said.
‘’We’re not seeing the market-growing benefit from the most recent supply as it needs to be finished before it can begin ramping properly,’’ he said.
The weak June numbers could send shares of Las Vegas casino operators lower on Monday. Wynn Resorts Ltd. and Las Vegas Sands Corp. generate more than 50 percent of their revenue from Macau. MGM Resorts receives only 21 percent of its revenue from Macau.
Jefferies gaming analyst David Katz expects Macau gaming revenue growth to pick up later this year with the opening of the Hong Kong-Zhuhai-Macau bridge.
The Review-Journal is owned by the family of Las Vegas Sands Corp. Chairman and CEO Sheldon Adelson.
Contact Todd Prince at 702-383-0386 or tprince@reviewjournal.com. Follow @toddprincetv on Twitter.
