The Philippine online gambling market reached a total revenue of $2 billion in the first half of 2025, surpassing the physical casinos' $1.62 billion for the first time, marking an acceleration in digital transformation. The Philippines has become the largest jurisdiction globally that legally hosts both domestic online gambling and integrated resorts, with total gambling revenue nearing $6.5 billion last year, ranking second in Asia. Despite the advantages of integrated resorts in licenses, branding, and data, and a lower online gambling tax rate (25%), their online operations still face challenges. Experts point out that the lack of a digital DNA and a technical team among physical casino operators is the main reason, and successful transformation requires an independent digital team, third-party cooperation, and policy support. The Philippine regulatory body Pagcor views physical and online gambling as complementary channels, committed to maintaining a "healthy balance."
Market Structure and Revenue Shift
In the first half of 2025, the total revenue from online gambling in the Philippines reached $2 billion, surpassing the physical casinos' $1.62 billion. This shift occurred earlier than predicted by Lyon Securities analyst Amos Ong, who had forecasted that online revenue ($3.9 billion) would surpass physical ($3.7 billion) by 2026.
The second quarter online gambling revenue accounted for 57% of the total revenue, reaching $1.1 billion, a 78% increase year-over-year, contributing over $275 million in revenue to the government.
Global Status of the Philippine Market
With a population exceeding 116 million, the Philippines is the only jurisdiction globally that legally hosts both domestic online gambling and large integrated resorts. In 2024, its total gambling revenue approached $6.5 billion, making it the second-largest gambling market in Asia, only behind Macau and Singapore.
This unique position makes the Philippines a "living laboratory" for observing the impact of online gambling on physical businesses and society.
The Digital Dilemma of Physical Casinos
Despite having advantages in licenses, brand influence, and customer data, the development of online operations in Philippine integrated resorts remains challenging. A similar situation is also seen in New Jersey, USA, where Atlantic City casino brands lag far behind online giants like FanDuel and DraftKings.
An anonymous executive from a Philippine integrated resort admitted, "If we had known the potential scale of the online market earlier, we would have positioned ourselves sooner."
Fundamental Challenges and Perception Gaps
Experts point out that the fundamental problem for physical casino operators is not a lack of opportunities, but a lack of digital understanding at the top level. Shaun McCamley, managing partner at EuroPacificAsia Consulting, stated, "In many cases, senior leaders are either deliberately ignorant or know very little about the conditions for online gambling success."
Joe Pisano, CEO of Jade Gaming, emphasized, "Online competition means becoming a tech company, not just a casino brand, requiring different talents, mindsets, and willingness to take risks."
Success Stories and Transformation Paths
Hotel Stotsenberg has successfully expanded its online business through its CasinoPlus platform, hiring digital gaming expert Evan Spytma as CEO. Besides its own brand, it also provides B2B services to help competitors with digital transformation.
Spytma stated, "CasinoPlus is proving that integrated resorts can lead the online gambling revolution, setting a benchmark for how physical operators can expand their business."
Cooperation Models and Third-Party Value
Experts suggest that physical operators collaborate with online service providers to share databases and revenue. Andrew Klebanow, head of Klebanow Consulting, pointed out, "Casinos need excellent online gaming products, and if not developed internally, they need to cooperate with providers."
Joji Kokuryo, managing director of Bay City Ventures, added, "The advantage of third parties is clear, allowing for improvements by learning from others, such as the successful cooperation between Bet MGM and Entain."
Regulatory Environment and Social Responsibility
The Philippine regulatory body Pagcor views physical and online gambling as complementary channels, not competitive ones. The agency stated, "Each channel has unique functions, and combining them can offer more choices to players, and we are committed to maintaining a healthy balance."
Frederic Gushin, CEO of Spectrum Gaming, emphasized, "As reliance on the local market increases, responsible gambling becomes more important in the Philippines than ever before."
Policy Risks and Market Uncertainties
The growth of online gambling has sparked calls for bans. The Philippines has precedents for shutting down profitable online gambling forms, such as the 2022 ban on cockfighting gambling (eSabong) and the 2023 crackdown on offshore gambling operators (POGO).
Experts warn that banning legal gambling is a "blunt political tool" that can disrupt governance, harm compliant businesses, and strengthen criminal networks.
Transformation Recommendations and Future Directions
Experts suggest that regulatory bodies guide physical operators through flexible frameworks and education for transformation. McCamley noted, "A team led by people with real online experience is needed, otherwise most online products will still perform poorly."
Jack Wheeler, head of Optimove Asia-Pacific, emphasized, "The biggest challenge is not just technology but change management, requiring a shift in mindset from reception to digital interaction."
Investment Commitments and Development Prospects
In June 2025, Philippine market leader Bloomberry launched the MegaFUNalo platform, offering traditional iGaming as well as casino games, carnival games, and movies. The company confirmed a monthly investment of at least 1 billion Philippine pesos ($17.5 million) to promote the platform.
Greg Hawkins, COO of Bloomberry, stated, "Online is an opportunity, and developing a business into an influential one requires serious commitment."
