The gaming industry in the Philippines is experiencing a notable upswing, with gross gaming revenue (GGR) hitting PHP194.74 billion (£2.56 billion/€3.05 billion/$3.33 billion) in the first half of 2024. This figure marks a 19.2% increase compared to the same period last year, reflecting substantial growth and development within the sector.
Land-Based Casinos Leading the Charge
Land-based casinos continue to dominate the revenue landscape in the Philippines. These establishments brought in PHP99.16 billion in the first six months of 2024. This performance highlights the enduring popularity of traditional casino gaming among Filipinos and tourists alike.
However, not all land-based venues fared equally well. Casino Filipino properties, which are operated by the Philippine Amusement and Gaming Corporation (Pagcor), reported an 11.6% decline in revenue, totaling PHP8.89 billion. This downturn comes as Pagcor prepares to privatize its casino operations by 2025, shifting its focus to a regulatory role. This move aims to create a more competitive market and attract new investments by leveling the playing field for all licensees.
The online gaming sector, particularly the Philippine Offshore Gaming Operators (POGOs), has seen phenomenal growth. Online GGR skyrocketed by 208.4%, reaching PHP63.01 billion in the first half of 2024, a significant leap from the PHP20.43 billion recorded in the same period last year. This surge highlights the increasing acceptance and popularity of online gaming among players.
Despite its success, the online gaming sector is not without its challenges. Senator Joel Villanueva continues to push for legislation to ban POGOs, a stance he has maintained since 2022. Previous attempts to limit or outlaw the sector have not been successful, but the debate continues.
In response to ongoing issues within the online gaming sector, Pagcor has taken steps to encourage legal operations. In March, Pagcor’s chairman and CEO Alejandro Tengco announced a reduction in operator fees, lowering rates by an average of 5%. This initiative aims to attract more businesses to apply for licenses and transition from illegal to regulated operations.
Financial Performance of Pagcor
Pagcor itself has reported strong financial performance in the first half of 2024. The organization’s total revenue, which includes income from gaming operations and various service and business incomes such as license fees, reached PHP51.76 billion. This represents a 42.9% increase compared to the first half of the previous year.
Of this total, PHP45.39 billion was generated from gaming operations across the country. Online gaming was a significant contributor, accounting for nearly half of this amount at PHP20.66 billion. This makes online gaming the largest single contributor to Pagcor’s revenue.
Integrated resorts and licensed casinos also played a crucial role, contributing PHP16.06 billion to Pagcor’s revenue, which is 35.4% of the first half's total. Pagcor-operated casinos added PHP6.93 billion, representing 15.3% of the total revenue. These figures put Pagcor on a solid path to potentially reach or exceed PHP100 billion in annual gross revenue for 2024, according to chairman and CEO Tengco.
Thanks to the strong revenue performance, Pagcor's net income after operating costs and expenses saw a substantial increase. Net income for the first half of 2024 rose by 121.5%, totaling PHP6.56 billion. This growth follows a record-breaking quarterly revenue of PHP25.0 billion in the first quarter, underscoring the robust financial health of the organization.
The first half of 2024 has been a period of remarkable growth for the Philippine gaming industry. With significant increases in both land-based and online gaming revenues, the sector is showing strong potential. Pagcor's strategic initiatives, including regulatory reforms and fee reductions, have contributed to this positive trend. Despite ongoing challenges, particularly in the online gaming sector, the future looks bright for the Philippine gaming industry. Continued expansion and investment are anticipated, paving the way for further growth and development in the years to come.
Source:
''Online stands out as Philippines gaming revenue jumps 19.2% in H1'', igamingbusiness.com, July 15, 2024.
''Philippines gaming industry revenue up 19% year-on-year to over US$3.3 billion in 1H24'', asgam.com, July 15, 2024.
