On May 12, the resort operator reported that revenue for the first quarter was down 3% y-o-y to $608 million. Gaming revenue, which traditionally accounts for the bigger proportion of the business, was down 8% y-o-y to $403.4 million. Non-gaming revenue, which is made up of the rest of the resort business, including retail, attractions and F&B, was up 8% y-o-y to $204.1 million.
According to Chee, citing company management, the softer gaming volume was partly due to lower VIP visits, which, in turn, were due to tighter credit extended by the casino.
To maintain the growth momentum from non-gaming revenue, Genting Singapore says it will continue to invest in new concepts, hotel and asset enhancements, new amenities and technological applications.
However, Genting Singapore had to bear higher costs. “The ongoing conflict in the Middle East and current geopolitical developments have increased cost pressures across supply chains, including higher energy, freight and logistics expenses, while elevated airfares are weighing on travel demand and dampening consumer sentiments,” says Genting Singapore in its earnings commentary.
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“The group is proactively addressing these challenges while also seeking to capture opportunities through targeted programming and market-focused initiatives.”
As a result, Genting Singapore’s earnings for 1QFY2026 plunged 55% y-o-y to $65.2 million, in what was a typically strong season that included the Chinese New Year holidays.
“We believe the activations and renovations at RWS have yet to resonate sufficiently with its customer base to offset its locational disadvantage,” says Chee in his May 13 note, referring to the better-sited rival Marina Bay Sands.
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“In our view, a comprehensive rethink of its operational strategy and asset enhancement initiatives may be required to restore the company to its historical profitability levels,” he adds.
In contrast, Marina Bay Sands, part of the listed Las Vegas Sands (LVS), reported revenue of US$1.5 billion ($1.9 billion) in the same 1QFY2026, up 27.9% y-o-y, led by a surge in gaming revenue.
Adjusted property ebitda was up 30.2% to a new first-quarter high of US$788 million from “high quality” visitors, according to LVS.
Chee expects the remainder of this year to be “challenging” for Genting Singapore amid headwinds from softer tourist inflows due to rapidly rising airfares. “With VIP volumes likely to remain weak and operating costs elevated, we expect a meaningful loss of operating leverage, and estimate that FY2026 adjusted ebitda margin could compress to around 30% from 33% in FY2025,” he adds.
Chee has cut his FY2026 and FY2027 ebitda forecast by 23% and 24% respectively to reflect the challenging operating environment and loss of operational leverage.
His lower target price of 67 cents is based on 7.3 times forward EV/Ebitda for FY2026 was in line with the company’s five-year average. “Given the limited visibility on an operational turnaround and the reduced likelihood of a major capital return plan, we believe it is more appropriate to apply our valuation multiple to the lower revised FY2026 ebidta, rather than using a blended ebitda approach,” says Chee.
Separately, Tay Wee Kuang of CGS International has turned more cautious on this counter as well, as he lowered his target price from 76 cents to 67 cents, while keeping his “hold” call.
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“Despite the introduction of new attractions, such as Minion Land in Universal Studios Singapore, The Weave, The Singapore Oceanarium and The Laurus Hotel, Genting Singapore’s non-gaming revenue grow by only 8.3% y-o-y in 1QFY2026, which was insufficient to mitigate the decline in gaming revenue,” he notes.
Tay suggests that rival Marina Bay Sands has gained a stronger upper hand over Genting Singapore in what he calls a “winner takes most” situation, thanks to the former’s location in the city centre, amid other attractions, which positions it as a better captive location for tourists.
To reflect Genting Singapore’s loss of gaming market share and ongoing margin pressure, he has cut his FY2026 adjusted edbitda estimates by 15.4%, and FY2027 and FY2028’s by 12.3%.
As such, Tay has derived the lower target price of 67 cents based on 7.5 times
EV/Ebitda for FY2027, which is 0.5 times below four-year post-Covid-19 mean. On the plus side, he sees support from the guidance of a dividend of 4 cents per share, which implies a yield of 5.8%.
Chu Peng of OCBC Group Research has maintained her “buy” call but has lowered her FY2026 adjusted ebitda estimate by 14% to account for the headwinds, leading to a lower fair value of 77 cents, down from 87 cents. “Patience is required as earnings recovery may take longer amid persistent cost pressures and external uncertainties,” she warns.
