Galaxy Entertainment Group said third-quarter adjusted EBITDA rose 10% from a year earlier to HK$3.7 billion, but the gain rested on luck: favorable results at the gaming tables added about HK$584 million, and without them earnings fell 7%.

The Hong Kong-listed operator of Galaxy Macau reported the unaudited figures on Nov. 5 for the three months ended Sept. 30. For investors who hold Macau casino stocks as a proxy for mainland consumer spending, the normalized number matters more than the headline. It shows the core mass-market business, the segment that drives profit across Cotai, losing ground while high rollers happened to lose more than usual.

Group net revenue rose 4% to HK$12.7 billion. On a normalized basis, adjusted EBITDA came to HK$3.1 billion, down 7% from a year earlier and 9% lower than in the second quarter, according to the company's release.

Galaxy Macau's VIP win rate jumps to 4.8%

The swing came from the VIP rooms. Rolling chip volume fell to HK$60.6 billion from HK$65 billion a year earlier, yet Galaxy's win rate on that business rose to 4.8% from 3.1%. VIP gross gaming revenue climbed 41% to HK$2.9 billion.

Mass gaming, by contrast, slipped. Mass gross gaming revenue fell 3% to HK$9.2 billion as table drop declined to HK$32.3 billion from HK$35.4 billion. Electronic gaming revenue rose 8% to HK$798 million. Total gross gaming revenue for the group rose 5% to HK$12.9 billion.

The normalized adjusted property EBITDA margin for the gaming and entertainment division narrowed to 29.3%, from 29.9% a year earlier and 31.4% in the second quarter.

Galaxy Macau, the company's main Cotai resort, posted net revenue of HK$10.8 billion, up 7%, and adjusted EBITDA of HK$3.5 billion, up 15%. Good luck accounted for about HK$576 million of that, and normalized EBITDA at the property fell 3% to HK$3.0 billion. Hotel occupancy across its nine hotels was 99%.

Chairman Francis Lui credited the ramp-up of the Capella at Galaxy Macau hotel and an expansion of the Horizon Plus premium gaming area from six to ten private salons. He also said the FIFA World Cup, which ran until July 19, dented traffic early in the quarter before business recovered.

StarWorld Macau, on the peninsula, was weaker. Net revenue fell 11% to HK$1.1 billion and adjusted EBITDA dropped 24% to HK$279 million. A hotel renovation reduced room inventory and cut EBITDA by about HK$20 million, the company said, with upgraded rooms due in the first quarter of 2027. The construction materials division's EBITDA fell 27% to HK$150 million.

Macau gaming revenue keeps falling

Galaxy's results land in a weak market. Citywide gross gaming revenue was HK$58.5 billion in the third quarter, down 4% from a year earlier, even though visitor arrivals rose 8% to about 11.2 million, the company said, citing official data. Mainland visitors rose 10% to 8.6 million.

The softness carried into the fourth quarter. Macau's gaming revenue fell 10% in October to MOP21.68 billion, according to data reported by AGBrief, despite the mainland's National Day Golden Week holiday falling in the month. It was the fifth straight monthly decline, against a high base: October 2025 had been the strongest month of that year. Revenue for the first ten months was still up 1.6% at MOP208.8 billion. Capital Times reported earlier on analysts' forecasts for a VIP slump into November.

Lui said gross gaming revenue growth had moderated in the near term. He pointed to possible taxation policy changes, slower global growth and geopolitical uncertainty, while saying the company remained confident in Macau's medium- to longer-term outlook on the back of rising household wealth in China.

Vitaly Umansky of Seaport Research Partners linked the weakness in high-end play partly to heightened tax scrutiny of offshore trusts held by wealthy individuals, Casino.org reported. He expects November revenue to fall about 6.1% from a year earlier.

Cash pile and Phase 4

Galaxy's balance sheet gives it room. Cash and liquid investments stood at HK$36.4 billion at Sept. 30, and after HK$2 billion of debt its net cash position was HK$34.4 billion. It paid an interim dividend of HK$0.90 a share on Sept. 15, bringing dividends paid in the first nine months to HK$1.70 a share.

The company is fitting out Phase 4 of Galaxy Macau, a 600,000-square-meter expansion with five hotels of about 1,350 rooms and suites, a 5,000-seat theater and a casino. It remains targeted for completion in 2027. Elsewhere in the region, Las Vegas Sands' Marina Bay Sands also reported lower third-quarter EBITDA.

The next test is Macau's November gaming revenue figure, which the Gaming Inspection and Coordination Bureau is due to publish at the start of December.