Melco’s Cyprus resort posts record quarter as weak Macau and poor VIP luck hit group profit

Melco Resorts' Cyprus business grew in the third quarter of 2026 while poor VIP results and a softer Macau market pushed group net income close to zero. The split matters for anyone tracking land-based casino investment in Europe.

Melco Resorts & Entertainment’s Macau flagship stumbled in the three months to 30 September 2026, while its European business moved the other way. City of Dreams Mediterranean in Limassol, Europe’s largest integrated resort, and its Cyprus satellite casinos produced their highest quarterly EBITDA on record. At group level, earnings almost disappeared. The quarter’s net income equates to US$0.00009 per American depositary share, against US$0.19124 a year earlier.

VIP luck and soft Macau demand hit the flagship

Revenue fell 10% to US$1.17bn. Adjusted property EBITDA dropped to US$287.6m from US$380.4m. Operating income was US$100.2 million, down from US$184.5 million. On an adjusted basis, net income attributable to the company was about US$6.5 million, compared with about US$83.7 million a year before.

City of Dreams Macau drove much of the decline. Rolling chip volume there fell to US$4.63 billion from US$5.58 billion. The VIP win rate slipped to 2.49% from 3.68%. Management told analysts that poor VIP luck at the property took about US$14 million off property EBITDA. Favourable VIP results added about US$2 million each in Manila and Sri Lanka, giving a hold-adjusted group figure of roughly US$298 million.

The wider Macau market is also softening. Casino gross gaming revenue fell 10.0% year on year in October to MOP21.68 billion (US$2.68 billion). The ten-month total still reached MOP208.80 billion, up 1.6%. The government’s 2026 GGR forecast is MOP236 billion.

Cyprus grows as Melco puts margins before market share

In Cyprus, mass-market gross gaming revenue grew 21% to US$50 million. Slots revenue rose 5% to US$38 million. Those gains came even though VIP gaming revenue was negative for the quarter. The segment covers the Limassol resort and its satellite casinos on the island.

That gives Melco an exposure no other big Macau operator has: a large European casino. The Cyprus growth contrasts with the falls in Macau, where both the flagship property and the wider market weakened over the period.

Melco also kept working on its balance sheet. On 18 July, Studio City Finance repaid US$165.0 million of bonds carrying a 6.500% coupon and maturing in 2028. A larger repayment followed on 23 September, when Melco Resorts Finance retired ahead of schedule the whole US$600.0 million issue of 5.625% bonds that would have matured in 2027. Total debt, net of unamortised financing costs and issue premiums, stood at US$6.98 billion at the end of the quarter. That compares with US$6.75 billion at the end of 2025.

Shareholders also received cash through buybacks. Between 1 July and 3 November, Melco bought back about 33.1 million ADSs for about US$160.0 million. It had roughly US$487.0 million of buyback authority left at 3 November.

Executives said Melco wants to avoid heavy reinvestment to win players in Macau, using a player-club model with limits to protect margins, and that dividends could return around the end of 2027.

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