US casino operators in Macau face rising geopolitical risk, Fitch says
Despite escalating trade tensions between the US and China, Fitch Ratings doesn’t expect gaming licences to be terminated.
Macau.- Fitch Ratings has reported that US casino operators in Macau face potential challenges due to the ongoing trade tensions between the US and China. In a note released yesterday (April 24), analysts said there are no signs that China is targeting US casino companies but that the fear of retaliation was there.
“Trade tensions between the US and China have raised concerns that US gaming operators could be subject to retaliation, while the weaker economic outlook in China is likely to pressure gaming revenues and earnings in Macau,” it noted.
Analysts said that in previous diplomatic disputes, China increased scrutiny on foreign companies, but generally avoided bans. Meanwhile, consumer boycotts could occur but tend to be temporary.
They added: “Termination or non-renewal of these operators’ Macau gaming licences in 2032 would be a worst-case scenario, which Fitch views as highly unlikely. A scenario where US operators are compelled to sell their Macau operations could become more plausible if US-China relations deteriorate further in the medium term, but that is not envisaged in the forecast horizon.”
There are three US-based Macau casino operators: Las Vegas Sands (LVS), Wynn, and MGM Resorts International. Macau accounted for 63 per cent, 52 per cent and 23 per cent of their consolidated 2024 revenues, respectively.
The gaming industry brings in about 80 per cent of Macau’s tax revenue, with US operators accounting for over half of that. Under their gaming concessions, the companies are committed to investing a minimum of MOP108.7bn (US$13.48bn) in non-gaming initiatives over ten years.
Fitch recently reduced its growth forecasts due to the trade war. It lowered China’s GDP growth for 2025 to 3.9 per cent but slightly increased expectations for consumer spending to 3.3 per cent.
The International Monetary Fund (IMF) has lowered its growth forecast for Macau’s gross domestic product (GDP) for this year from 7.3 per cent to 3.6 per cent. Macau’s gross gaming revenue (GGR) has been flat so far.
