Macau and Vegas struggle as pandemic’s impact lingers
The coronavirus pandemic has decimated gambling revenue in Macau.
Yahoo Finance reports that in November, Macau gaming revenue is down 80.5 per cent in 2020 to $6.58 billion, according to the latest figures from Macau’s gaming bureau.
In November, Macau gaming revenue fell 70.5 per cent to $845.34 million, which was worse than the 65 per cent decline analysts expected, but better than the past six months, with each saw 90 per cent declines.
In June, Macau gaming revenue dropped 97 per cent year-on-year to $89.7 million, its lowest monthly gaming revenue ever.
The numbers have picked up since then, suggesting casinos there have seen the worst of the damage and are on their way back, though a recovery is likely to be very slow.
Located on the southern coast of China and a one-hour ferry ride from Hong Kong, Macau is the world’s largest legal casino destination by revenue, bigger than Las Vegas.
The city is home to 41casinos as of 2019, and only three US casino companies have properties there – Las Vegas Sands, MGM and Wynn.
In February, Macau’s government forced casinos to close for two weeks and they reopened with masks and social distancing on February 20.
Nevada closed casinos for far longer, 78 days, starting in mid-March and reopening on June 4.
Macau hit harder than Vegas
Despite reopening sooner, Macau has been harder hit by the pandemic than Vegas.
Nevada statewide gaming revenues were down 36.5 per cent through October and in the month of November, they declined 19.5 per cent year-on-year, the lowest monthly drop since the start of the pandemic in the United States.
Analysts predict it will take well into 2021 for casinos in the United States or China to return to pre-pandemic levels, since the biggest question mark is customer comfort.
The pandemic’s hit to physical casinos comes at a time when sports betting tech companies in the United States have surged, taking advantage of states legalising sports betting and bettors being stuck at home.
DraftKings, FanDuel and Penn Gaming have been in an arms race in 2020 to launch state-by-state sportsbook operations and sign betting partnership deals with pro sports franchises and their stock prices have surged.
DraftKings and FanDuel both said they saw record levels of user signups for betting apps.
DraftKings stock is up 190 per cent since it became public on April 24 by merging with Diamond Eagle SPAC.
DraftKings has announced sports betting partnerships with the New England Patriots, New York Giants and Philadelphia Eagles in the NFL, the Colorado Rockies and Chicago Cubs in MLB, Detroit Pistons in the NBA and PGA Tour golfer Bryson DeChambeau.
FanDuel’s Irish Parent company Flutter is up 44 per cent in 2020.
It has signed betting partnerships with the Denver Broncos, Memphis Grizzlies and Detroit Pistons.
Penn Gaming, the Philadelphia-based casino operator, bought a majority stake in media brand Barstool Sports for $450 million, then launched a Barstool-branded legal sportsbook app in the state in September, with its stock up 180 per cent in 2020.
In the US, 26 states have some form of legalised sports betting, but only 12 have legalised mobile sports betting.
The US mobile betting market is estimated to top $21 billion for 2020, though it represents less than 20 per cent of the global mobile betting market.