The Philippine gaming industry showed flat overall revenue in the third quarter, but significant changes are occurring within the industry. The ban on offshore gaming operators (POGOs) and a sharp decrease in Chinese and Korean tourist markets have led to a decline in traditional casino revenues, while online gaming is also facing regulatory adjustments. These factors together have brought the industry into a period of adjustment, with uncertain future prospects.
Overall Revenue Situation
According to data from the Philippine Amusement and Gaming Corporation (PAGCOR), total gaming revenue (GGR) for the third quarter of this year was 94.5 billion pesos (about 1.6 billion USD), roughly the same as the same period last year. However, land-based casino revenue fell by 10.2% year-on-year to 45.6 billion pesos (about 773 million USD), accounting for 48.2% of the industry's total revenue, reflecting a contraction in core business.
Key Factors Affecting Revenue
The POGO ban directly cut off the funding chain for high-end VIP customers, as offshore gaming previously provided cash flow for Chinese gamblers and operators, leading to the closure of a large number of companies. At the same time, the decrease in Chinese and Korean tourists weakened the casino consumer group, and although flights have resumed, visa policies and security issues have turned tourists to other regions, resulting in a significant drop in VIP room traffic.
Fluctuations and Regulation in Online Gaming
Domestic online gaming (eGames) grew in July, but after the central bank required electronic wallets to be unlinked from platforms, revenue continued to decline in August and September. PAGCOR Chairman Tengko stated that the industry is adjusting to establish a safer system, but a short-term decline is inevitable.
Future Challenges and Directions for Adjustment
The Philippine gaming industry faces three major challenges: the continuous loss of mid-to-high-end customers, stricter regulations leading to capital flight, and the uncertainty of electronic gaming transformation. PAGCOR plans to restructure its self-operated casino business by 2026 to attract international investment, but whether the transformation will be successful under the pressure of customer return and public opinion remains to be seen.
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