Okada Manila’s mass-market growth has been insufficient to offset a structural decline in its VIP business, according to Fitch Ratings, which expects competition and migration to online gaming to continue constraining the Philippine integrated resort’s recovery.
In its October 2nd APAC gaming peer review, Fitch noted that VIP table games accounted for 20 percent of the property’s gross gaming revenue in 2025, down from 35 percent in 2023.
‘Fitch considers the declining VIP mix to be structural,’ the report stated, adding that growth in the lower-spending mass segment had not been sufficient to offset the decline.
Weak gaming demand, higher promotional spending and a softer Philippine economy continued to weigh on Okada Manila’s earnings. A recovery in parent company Universal Entertainment Corporation’s Japanese amusement equipment business was insufficient to compensate for that weakness.
‘Competition, online migration and macroeconomic headwinds are likely to continue limiting integrated resort revenue and EBITDA recovery,’ Fitch wrote.
The agency also pointed to intensifying competition in Manila’s Entertainment City, with declining gaming revenue and constrained reinvestment capacity limiting Universal Entertainment’s competitive strength.
Cash-flow pressure persists
Fitch expects Universal Entertainment to generate negative free cash flow in 2026 and 2027, with subdued earnings reducing its liquidity headroom despite the absence of significant debt maturities before August 2029.
Its forecasts put the group’s free cash flow margin at negative 3.1 percent in 2026, improving to negative 0.1 percent in 2027.
Okada Manila accounts for around 53 percent of Universal Entertainment’s revenue, leaving the group heavily exposed to the property’s performance.
Although the Japanese amusement equipment business provides some diversification and near-term recovery potential, Fitch said its longer-term prospects remain constrained by structural market decline. The agency identified stabilizing Okada Manila’s operations and increasing EBITDA generation as key factors to monitor.
