Investment banks described Galaxy Entertainment Group’s higher-than-expected interim dividend as a ‘positive surprise’, while pointing to improving gaming demand following disruption from the FIFA World Cup.
Seaport Research Partners said Galaxy’s HK$0.90 ($0.12) per-share dividend was well above expectations and represented a payout of more than 70 percent of earnings.
Jefferies calculated the payout ratio at 75 percent, compared with 58 percent in the first half of 2025 and 64 percent in the second half. The dividend increased 29 percent year-on-year, with payment brought forward to September from October.
Both banks considered Galaxy’s second-quarter results broadly in line with expectations.
The Macau gaming operator reported adjusted EBITDA of HK$3.38 billion ($433 million), down about 5 percent year-on-year. Normalized adjusted EBITDA, which removes the effects of win-rate fluctuations, increased 8 percent to HK$3.40 billion ($436 million).
Net revenue fell 2 percent to HK$11.84 billion ($1.52 billion).
However, analysts focused on improving operating momentum after the World Cup, which temporarily diverted customer attention from Macau’s gaming market.
Jefferies said management had highlighted a ‘meaningful recovery’ beginning in late July, with momentum continuing into August. The strongest rebound was recorded in the VIP and premium-mass segments.
August operating indicators were tracking in line with or slightly ahead of expectations, according to the brokerage. Management characterized the weakness during the World Cup as ‘temporary rather than structural’.
Seaport estimated Galaxy’s second-quarter gross gaming revenue market share at 20.3 percent, up about 40 basis points sequentially. The brokerage said the company entered the third quarter with further share gains, although its estimated 23 percent share at the beginning of the period was partly supported by favorable hold.
On a hold-adjusted basis, Seaport expects Galaxy to maintain its share in the low-20-percent range during the second half.
The brokerage also pointed to stabilizing operating expenses and player reinvestment. It estimated that costs at Galaxy’s Macau operations rose 2.5 percent year-on-year but fell approximately 2 percent from the previous quarter.
Jefferies said industry reinvestment levels appeared to have stabilized, with Galaxy continuing to prioritize returns and profitability over pure volume growth.
Outside gaming, mall rental income increased 16 percent year-on-year, supported by demand for gold jewelry and luxury watches.
Galaxy’s Phase 4 expansion remains scheduled for completion by the end of 2027. The project is expected to add approximately 1,350 rooms and suites, primarily targeting premium customers.
