According to Lawrence Ho, Chairman and CEO of Melco Resorts, the upcoming end of the three-year transition period for satellite casinos will have minimal impact on the industry.
In a recent interview with local media, Ho stated that Melco is only involved with 15 gaming tables at one casino, and the disposal of these tables “fully respects the government’s opinion.” He believes this change will have “limited impact on the overall industry,” emphasizing alignment with government and national long-term development goals.
When asked about potential impacts from US-China trade tensions, Ho observed that while trade conflicts may cause “certain impacts” on the international economy in the short term, they could present opportunities in the long run.
Drawing parallels to historical conflicts like the Cold War and World War II, he noted how countries emerged stronger through such challenges. Ho urged Macau and mainland Chinese enterprises to “unite with the party” and support national development, expressing confidence that the nation would reciprocate by supporting business growth.
Meanwhile, Bank of America analysts recently reiterated their Neutral rating on Melco while lowering their price objective to $5.7.
The analysts, including Karl Choi, Ronald Leung, Eric Du, and Candice Zhang, reduced their forecast for the overall sector’s gross gaming revenue (GGR) in 2025 from 2.5 percent growth to flat, and trimmed 2026 expectations from 4 percent to 3 percent growth.
The bank lowered Melco’s FY26 GGR forecast by 2 percent and its FY25-26 EBITDA projections by 1-3 percent. They anticipate “slower deleveraging progress” due to weaker profitability and higher capital expenditure needs in 2025.
While Melco gained market share in 1Q25, rising from 15.3 percent in 4Q24 to nearly 16 percent, analysts expect only minimal growth in market share for the full year.
They forecast Melco’s 2025 GGR to grow by approximately 1 percent compared to flat performance for the sector overall, while EBITDA is expected to decline 3 percent year-on-year, with cash earnings dropping by about 14 percent due to higher-than-expected interest expenses.
