Las Vegas Sands Corp. (LVS) Q3 2025 Earnings Report, Transcript and Summary

Good day, ladies and gentlemen, and welcome to the Sands Third Quarter 2025 Earnings Call. [Operator Instructions] It is now my pleasure to turn the floor over to Mr. Daniel Briggs, Senior Vice President of Investor Relations at Sands. Sir, the floor is yours.

Thank you, Paul. Joining the call today are Rob Goldstein, Chairman and CEO; Patrick Dumont, our President and Chief Operating Officer; Dr. Wilfred Wong, Executive Vice Chairman of Sands China; and Grant Chum, CEO and President of Sands China and EVP of our Asia operations. Today's conference call will contain forward-looking statements. We will be making those statements under the safe harbor provision of federal securities laws. The language on forward-looking statements included in our press release also applies to our comments made on the call today. The company's actual results may differ materially from the results reflected in those forward-looking statements. In addition, we will discuss non-GAAP measures. Reconciliations to the most comparable GAAP financial measures are included in our press release. We have posted an earnings presentation on our website. We will refer to that presentation during the call. [Operator Instructions] This presentation is being recorded. I'll now turn the call over to Rob.

Thank you, Dan. Good afternoon and thanks for joining us. Marina Bay Sands delivered EBITDA of $743 million. We had forecasted MBS could do $2.5 billion annually. It turns out we were too conservative we should easily exceed that figure in 2025. MBS is currently over $2.1 billion of EBITDA this year with a quarter still to go. Mass gaming and slot was a record $905 million, reflecting 122% growth from Q3 of 2019 and 35% higher than last year. We are in the right place at the right time with the right product. Singapore is a highly desirable destination and our product is superb. It's difficult to find superlatives described in magnitude of this result, operating performance and MBS is unprecedented in the history of our industry. Macau delivered $601 million EBITDA for the quarter, which reflects an improvement in our financial results with Typhoon negatively impacted our reported EBITDA by about $20 million. We have underperformed in the Macau market for the past few years. We believe that our buildings will be enough to compete favorably, we were wrong. We've adapted to the market and changed our approach in the second quarter of 2025 to enable us to be more competitive. Our mass market revenue jumped to 25.4% this quarter, up from 23.6% in the first quarter of 2025. We expect additional share gains and EBITDA growth in the fourth quarter. Our assets remain the strongest in the Macao market. But Londoner is moving towards $1-plus billion of EBITDA. We have meaningful opportunities for growth improvement throughout our Macao property portfolio. Importantly, the Macao market's GGR is growing, when you couple this back with our assets and our recent marketing changes, we believe will continue to improve in the fourth quarter and beyond. Let's hear it from Patrick.

Thanks, Rob. Macao EBITDA was $601 million. If we had held as expected in our rolling program, our EBITDA would have been lower by $2 million. When adjusted for higher-than-expected hold in the rolling segment, our EBITDA margin in the Macao portfolio of properties would have been 31.5%, down 160 basis points compared to the third quarter of 2024. We are focused on delivering revenue and cash flow growth at the Londoner and across the portfolio. Margin at the Venetian was 35%, while margin at the Londoner was 31.9%. We expect growth in EBITDA as revenues grow and as we use our scale and product advantages together with targeted incentives to better address every market segment. We see opportunity in every segment. Now turning to Singapore. MBS' EBITDA for the quarter was $743 million at a margin of 51.7%. We had held as expected in our rolling program, our EBITDA would have been lower by $43 million. With this quarter's results, we are putting in place a new methodology for the theoretical hold percentage of rolling baccarat play for the quarter. This new approach has been enabled by the introduction of smart tables on our baccarat games in Singapore. This technology has now been in place at our rolling baccarat roundtables in Marina Bay Sands for over one year. Please see Slide 7 in the earnings materials for more detail. We have provided theoretical hold rates for rolling baccarat plays for the last 5 quarters at Marina Bay Sands. There will naturally be fluctuations in theoretical hold rate in any specific quarter driven by player betting preferences. The record financial results of Marina Bay Sands reflect the high -- the impact of high-quality investment and market-leading product and the growth in high-value tourism. We believe we are still in the initial stages of realizing the benefits of our investments in Marina Bay Sands. Turning to our program to return capital to shareholders. We repurchased $500 million of LVS stock during the quarter. We also paid our recurring quarterly dividend of $0.25 per share. Our Board of Directors has approved an increase in our quarterly dividend of 20% for the 2026 calendar year or $1.20 per share per year or $0.30 per share per quarter. In addition, during the third quarter and in July, we purchased $337 million of SCL stock, increasing the company's ownership percentage of SCL to 74.76% as of today. We believe repurchases of LVS' equity through our share repurchase program will be meaningfully accretive to the company and its shareholders over the long term. We look forward to continuing to utilize the company's share repurchase program to increase returns to shareholders. Thanks again for joining the call today. And let's take some questions.

[Operator Instructions] And the first question today is coming from Dan Politzer from JPMorgan.

So for Singapore, I want to go back to the hold rate. And obviously, you guys raised it to the 4.2% for VIP. Is there any impetus or desire or potential to raise the mass hold because that one has been going up, too. So I guess, one, is that directionally similar in terms of the benefit that you're seeing from the smart tables? And two, is that something you would ever give a hold range for?

Yes. I think right now, what you're seeing is a rollout on to the floor where we can get accurate rolling table data. So we're not there yet to give you data on the mass floor because if you remember, it's a mix of games. So it's not just baccarat. So I think that's an important point to note. And the other thing is we don't really normalize mass hold because of the volume of play at that size and getting to the -- let's call it, the theoretical. So for us, it's much more meaningful to deal with the rolling program because of the volatility of the hold in that segment.

Got it. That makes sense. And then just turning to Macao, this is more of a high level one. Londoner does seem like it's turned the corner. You guys have been marketing broadly across the portfolio there. Can you kind of talk about that path back to $2.7 billion, $2.8 billion of EBITDA that you kind of laid out is maybe a soft target last quarter, how are you pacing in terms of getting back there? Would you say that you need the market to kind of pick up from here to get there? Or can you kind of do this independent of the market to help?

I would say, Dan, you can't do independent market, you need market growth, which you're experiencing thankfully in Macao. The overall markets could be next year of $33 billion, $34 billion. We need -- everyone needs market growth to make Macao numbers work better. But we also had the main changes, and we've been making those changes in the last, I don't know, 4, 5 months and adapt to the market, which is we did not participate and we are now participating. Probably we're halfway there, another half to go. But I think when you marry the market growth to our assets to our new marketing programs, yes, we can get to our target. But critical to the market grows. That's essential for all of us. Otherwise, we're just the same customers are circulating. But you're seeing -- we've come off the bottom here, we're growing, we're getting better. Probably 620 is the right number. If you take out the Typhoon. It's a respectable quarter. It's not our goal. Our goal, as you know, is to get to [ 2,728 ]. We're not there yet. I think we're making progress, and we keep putting down -- the team has to stay in sync with the market to deliver those results. Grant?

Yes. I think this quarter, what we saw was, I think, some of our reinvestment programs coming to fruition in terms of productivity across Londoner, yes, because this is the first quarter we've had the full deployment of the Londoner Grand rooms and suites. And on the product side, that definitely helped us. And then to Rob's point, in terms of our marketing strategies, responding to the market dynamics, we've obviously adjusted our reinvestment rates across the portfolio, not uniformly. Obviously, some of our smaller properties have had a bigger boost in our reinvestment ratios, as you can see. And we're seeing the results of that. You can see that both year-on-year and sequentially, we are outgrowing the market for the first time in a long time when you look at the mass GGR.

I think the weak links in our portfolio in Parisian, in Sands especially Parisians come way off the highs and about 50% of its -- used to be in terms of EBITDA performance, I think we have a lot of value in that property. Londoner, as you referenced, is fine. Venetian is okay. And I just think we've got to come off the bottom in Sands to get that back to being competitive. But it's underway. It's progressing. It just takes a lot of work and a lot of focus.

The next question is coming from Shaun Kelley from Bank of America.

To whoever wants to take it, I want to go back to Singapore because the smart table initiative is super interesting. Can we just unpack a little bit, though, about like -- what's the underlying betting behavior or change that would sort of be driving such a material increase? I mean, obviously, on your numerator, this type of change in hold would suggest some sort of underlying behavioral change or mix change. So is it mix of betters and we're maybe getting more casual better? Or is it a mix in, again, what games or in what bets they're making? Because I mean, historically, we think of baccarat, in particular, as being extremely simple player banker. So how is the smart table piece evolving in a way that we're seeing an actual underlying change in behavior?

Shaun I just to be clear, the smart table is just the score keeper it's the umpire, the referee. It doesn't make this stuff happen. What makes it happen is, as you alluded to, historically, baccarat's been 285 when I began in this industry, baccarat was a boring game, its a [ sub-3 ]whole percentage game, there was not a lot of juice in it. And it stayed that way for decades. What's changed in baccarat is not the smart tables, that's the score keep, what's changed is the game itself offers a lot more opportunities to gamble different ways, it's analogous to sports bet. And your side bets and sports bets, the prop bets and the side bets the honestly, the low percentage bets for the customer play in your favor. And this is simply mathematics. This isn't casual betters, this isn't sophisticated better, this is everybody gravitating towards side bets that are house advantaged. And that's what's happening here. I don't think -- we tell you it's 4.1% or 4.2% that's what the smart tables tell us. The score keeper said, "Hey, these guys are making these bets and that results in this result". It has the game, as you alluded to, it's changed dramatically from the old days was kind of a steady game. It's a very interesting game have lots of opportunities that lose your money in different ways and people -- and especially in Singapore, we're seeing all levels, not just casual, but seasoned pros seem to want to bet these side bets. And it's become very powerful. And in a company like ours, which is baccarat-dependent, it's a powerful driver of revenue and EBITDA flow through. So what you're seeing in Singapore is simply not the smart table helping us, but the game deviations helped us and the customers win to bet those deviations has driven this thing to 4-plus percent, which is astounding when you think back to what used to be a very boring [ 2.85 ] game for years. But that's a simple factor. This isn't an anomaly, it's just the way the market is proceeding. I think you'll see it happen in Macao as well. And for this company, it's a massive, massive change in the opportunity to make more money.

I think you have to give credit to our gaming innovation team for their willingness to really look at the customer experience and had the opportunity to enhance that experience through some higher volatility bets, which the customers are actually using. And it's their preference, right, they could choose not to use them, but they seem to be very popular, they create a better gaming experience and better enjoyment in the game. And so we're very fortunate that our team continues to innovate and try these things. And the market has received them quite well. And so I think the smart table system has helped us measure these bets better, but it's a practical matter, it's just as Rob said, it's about having the bets on the table and having the customers enjoy using them.

Very clear. And Rob, you kind of went where I was going to take it, which I think this is the next logical place, which is the ability to expand these types of bets or these types -- this type of table to other markets, obviously, Macao being a big opportunity. So can you just talk a little bit about either where you're at and rolling that out? What segments, I mean, I would assume, given that sort of the junket based VIP business, is no longer a thing there, but perhaps in-house VIP or premium mass would have some real opportunities. So where are you at? What inning are you in? And then just maybe super high level, is this technology or these bets, are these proprietary to you all? I mean, I know there's kind of open secrets in gaming. But I mean you are developing these in-house, there's not like a third party that's kind of brought these to you from a sort of just pure optionality perspective?

Yes. We probably were the initiators as much a decade ago, we started this process with someone. We grew that team. The team has now expanded. So we were an issue. We're not -- it's not proprietary. We can't -- we don't have control and people can copy these bets. They are copying these bets, which, by the way, doesn't assume to be a problem. It's good for the industry to grow. Yes, we're moving towards this in Macao. Yes, the Smart table system will be there as well as a score keeper. And so as the Macao market has more opportunity, you're seeing it happening already. I think you'll see the [indiscernible] go up there as well. It's the more advantageous thus far in Singapore, but we are moving into Macao as is the Macao market. You go look at the layouts now, they're fraught with side bets all over the place. In fact, some of the times, you can't find the flat bed, the table is so busy with alternatives. But yes, moving in that direction to Macao. No, it's not proprietary. Yes, we did develop it. I think we've initiated it. But -- and again, the confusion is sometimes people think it's a smart table, which is not true at all. The smart tables gives you a better measurement stick to know how many bets they're making in the side what that means the mathematics. And I think what Patrick alluding to the 4.1% or 4.2% is we have good evidence that these are -- this is not a guess anymore, it should be this. For years [indiscernible] correct whole percentage. There is no correct whole percentage. It depends on that quarter, what those people bet. We can have a quarter that comes in at 5.1% or come at 3.8%. It depends on what the players at the table bet at that time, and every bet is calculated. So yes, it's going to move towards Macao. And I think it's very helpful for not just this company but others to make the gaming more interesting more diversified. And I don't think it's tied to the high end, by the way. Mass customers love it, too, small betters, large betters. When you bet the sports book, the biggest prop better is the small guys. The guys who are betting 100 hours a game, they love betting props. I think baccarat is similar to sports betting in that regard.

The next question is coming from Stephen Grambling from Morgan Stanley.

So you've upped the dividend for next year and you keep the pedal down on buyback. At the same time, you had the disclosure around CapEx is coming down as well over the next few years. So one thing you didn't touch on, I guess, that you talked about in the past is just maybe a willingness to buyback some of the shares in Hong Kong as well. So I wonder if you any thoughts that you have there or other capital allocation opportunities.

So I think the best thing is we are a capital allocation story and a return to capital story. You look at the company's history, we've been very shareholder-friendly. We allocate capital with growth in mind. So we invest for high returns. But when those high-return investment opportunities are available. We return the capital and we try to do it through dividends in a prudent manner and through share repurchases. And so I think that's where you're seeing us today. We did buy back SCL for the last little while. If you kind of see where we're at, we're basically at getting close to the limit we're at 74.76% I think the number is. And we can't really go past 75%. So I think for us right now, we're kind of where we are in SCL. But our goal is to continue to return capital both at SCL and the parent code a friendly way for shareholders. And so you'll see us continue to do that.

Makes sense. And maybe changing gears a little bit. Just going back to Macao. Would love any further color you could provide on kind of characterizing the strength that we've seen in VIP. I mean, it's been quite a while since we've seen this level of growth. Is that really just more semantics around where customers are referring to bet? Or is that a new customer who's coming in?

Stephen, let me take that. Yes, I think the VIP has outgrown the mass GGR over the last few months. In some cases, some months it's been -- it's been very high rates of growth. I think it is driven by some concentration of super high-end VIP players as well as increased liquidity in the market. This quarter, we haven't participated as much in that segment, but we are going to be getting more competitive in that segment as well. And of course, we have introduced our -- we entered the Junket Market this quarter. Of course, the growth of that segment in the past few months has also driven the rolling market. But at this point, it still remains a low margin segment, which typically is going to stay around 12% to 15% of the overall GGR. But we're also focused on growing that segment. But obviously, the bulk of the profit growth is going to come from the non-rolling.

The next question will be from Brandt Montour from Barclays.

I just want to double click on that comment. I mean I think that we all kind of see the premium mass led inflection since midyear. But it sounds like -- I mean looking at your slides, base mass per table was up nicely. And so I guess, Rob, for you, the question is that for the market to grow, what you need the market to grow '33, '34 when you think about that growth, is that -- does that require a broadening out of the depth and breadth of base mass? And are you seeing early signs of that inflection for that particular cohort?

I think it's impossible to say where it comes from, I'll be honest. I don't -- the junket the rolling, the non-rolling the mass it's very hard to define. I think what's important to see is happening. I mean, the market looks to me like it's -- we know that October comes in, I would say it comes in 7%, 8%, 9% year-on-year. But it feels like there's a stronger trend over there. Macao is recovering in different segments. Obviously, we like a base mass recovery, but there's nothing like premium mass. I don't have real insight to where it come from, right? So it comes. Because I think the key thing for all Macao for all the operators for profitability and growth is to see this GGR acceleration. Grant, maybe you see it different?

I think that's right. And it is obviously helpful, especially to us if the base mass grows faster because of our advantage in that segment, but also the margin structure in that segment is very favorable. I think if you look at this quarter, you're right. Year-on-year, our base mass actually grew 18%. But part of that reflects the fact that a prior year, we had the closure of the Pacific Casino which is now the Londoner Grand Casino. If you look at sequentially, premium mass, we still grew faster than base mass 11% versus 7%. But yes, I think the summer was positive for base mass but again, I would characterize the bulk of the growth in this market, even in a non-rolling is still dominated by the upper tiers of the value segment.

Okay. Just a quick question on Singapore. Obviously, really strong results in the third quarter in MBS, and that was without the F1 race, which usually falls in September it fell -- it fell in October this year. So you didn't have that in the third quarter. What order of magnitude or how should we think about how impactful that event is that sort of has now moved into the fourth quarter for you now this year?

First off, it's a great event, and it's a great event globally, and it's one of the most important F1 events, and it's phenomenally attended and it really helps Singapore. And we're actually really supportive of it and involved in its presentations. So we're very happy about that. As a practical matter, you can see the demand of Marina Bay Sands as a product and that even with F1 in a different part of the calendar year, we continue to perform through that. So I think F1 is helpful, something that we really enjoy having in Singapore. It's great for visitation, it increases the prestige of Singapore by having such a prominent race there. It drives a lot of high-value visitation, much of which ends up at Marina Bay Sands. So we're very happy about it. But where it falls in the calendar is okay or fine.

I got to say that for the last couple of years, we had all these people pointing to F1 or Taylor Swift or I don't know, I don't think it matters all that much. I think Singapore has taken a whole new -- we can't figure out just how high is up. This thing just keeps getting stronger and stronger. And the reason to me is very simple. It's the most favorable location, a lot of people with high net worth to come to whether F1 is there or Taylor Swift is there or whoever is there that week, I think the place -- the building is extraordinary, the place is extraordinary, and the events certainly move the customers around. In the end, Singapore is the driver. That place is well attended, well visited, very desirable. And it's become the place to go to in Asia for people who want to gamble at a certain level. And I think that's really the real driver is unique asset we built, unique room product. And again, what we provide there the option to gamble what you want, how you want. So as much as I respect F1, I respect Taylor Swift, I respect all these drivers, I think Singapore has just gone to a whole new place, and you see these numbers. I thought we were ambitious in 2.5. We probably this year, we get, I don't know, [ 2.7, 2.8, 2.9 ], I don't know , but the numbers are there. And it just seems like it's getting more and more desirable the high end of the market. So extraordinary results. I think no one could have seen this kind of growth. And I don't think it's that tied to special, not as much as tied to the place itself.

The next question is coming from Robin Farley from UBS.

Great. Just going back to your comments about kind of what you hope to achieve in market share in premium mass. I know you talked about upgrading the Londoner would kind of give you the assets to do that. You said something earlier in the call about how you're kind of only halfway there with what you hope to do or plan to do there. Can you talk a little bit about what other steps that you'll be taking and sort of what timing when you think about that?

Hi Robin, let me take that. Yes. I think when you look at the progression in market share, clearly, would come off the bottom in Q1 when we were down at 23.5%, 23.6%. Now we are 2 points above that, which is great. But as Rob said, I think we're only halfway through, is that we started our tweaking our programs and changing our marketing programs in the middle of second quarter and that ramped up throughout each month in the third quarter. And you can see we were improving month-on-month within the quarter. But I think it's important that we're also considering how each segment has a different requirement. So we are marrying the tactical incentives with the product advantage that we have. So in the Londoner that you can see it very clearly what we're doing, not just Londoner Grand, which is newly open, but also leveraging the other side of Londoner on the super high end and we're seeing good results there. I think In the smaller properties, we have adjusted our marketing programs, but also reset our distribution team as well in terms of composition and the number of people. So we should be seeing better results from the distribution side over the next two to three quarters because so far, what we've benefited most from, I think, the launch of Londoner Grand, married with these customer reinvestment adjustments. But I think there's still a lot to be done, but we're confident that we're going to be progressing month by month, quarter-by-quarter.

Great. And maybe just one follow-up on a different topic. I don't know if we've heard your thoughts to recently on any potential opportunity in the UAE where there may be other licenses to give out. Is that something that LVS is interested and kind of actively engage with?

I really appreciate the question. So we're always looking at opportunities to deploy capital and grow our business. And I think you've seen us be very disciplined and be very patient. The UAE is a tremendous tourism market. There's been billions of dollars investment in the UAE to create tremendous tourism infrastructure of infrastructure. Some of the best hospitality and food and beverage products in the world are located there. And it's a lot of fun to visit. That being said, it's not a market we're looking at this time, but we're following.

The next question is coming from Lizzie Dove from Goldman Sachs.

So clearly, incredible results in Singapore again. And you mentioned for this year, '27, '28, '29, who knows. It feels like it's broad-based that you said not tied to one event, but how should we think about the long term? Like is this sustainable? Can it, on a holder, just a basis grow next year? Like how are you thinking about kind of longer tail of the sustainability of growth in Singapore?

Lizzie I'd say we've been wrong all along for starters, and we've under forecasted this thing, we thought we were very ambitious at [ 2.5 ]. And like I said, we're a [ 21-plus ] currently with a quarter ago. With a big quarter, you get to [ 2.8, 2.9 ] is it sustainable? Yes, it's very sustainable. You're alone over there and you've got one competitor, which is just -- it's a duopoly, it's a market that has tremendous support from the government. And it's -- you've been in the building, it's incredibly well done. I think the team did a great job of building out a one-of-a-kind assets. So yes, it's very sustainable. The question I can answer is -- does it get to 3 next year, is it a [ 3.2 ]down the road? Does is get to -- I don't know. We've been rolling along. Here we are in 2025, as you said two years ago, we're delivering $700 million quarters back to back I would have said that's very ambitious. Well it turns out it was done easily. These last quarters came along pretty well. And so I don't think anyone should question the longevity and sustainability of Singapore. If anything, what I can't figure out is how deep is the well, and I've been wrong and I'm pretty aggressive by nature in forecasting the demand over there. Slot wind is going to break $1 billion looks like. These table wins are extraordinary, it's coming out to all sides. I think strength in the building, having all suites versus mostly more rooms is a very good idea. So yes, I think it's very sustainable. And the question for me is not sustainability, it's how high is up? Could this thing hit $3 billion, get to [ 3.2 ]?, I don't know. But I didn't think you go from what used to be a $1.6 billion asset pre-COVID to now it looks like a $2.78 billion asset post-COVID. So -- it's hard to forecast something that feels so powerful and right now, it feels to me like it's got more growth to go.

Definitely. I guess on that subject, just one event, but making a bigger picture, I guess, on Golden week, it looked like -- there was a lot of outbound visitation from China into Singapore. It was up a lot year-on-year. And so curious what you're seeing really even just beyond Golden Week of just any changes in visitation trends and whether you are versus Macao seeing that kind of high-end -- higher-end Chinese customer visiting Singapore at the expense of Macao and what do you think that might continue?

Yes, we're not really getting into the current quarter. But just overall, Macao and Singapore are very separate markets. And typically, the catchment area for Singapore is very focused on Southeast Asia, and Macao is primarily Hong Kong and China. So different businesses, different tourism base, different assets, but we'll talk about this quarter on the next earnings call.

The next question is coming from Joe Stauff from Susquehanna.

Just wanted to follow-up, Patrick, on your comment about, a, the opportunity in Singapore in particular, is still essentially in the early innings, obviously, maybe an expansion of other questions. I wondered if you could just maybe talk about the second and third quarter, the strength of the volumes and maybe the things that you learned that surprised you? And then as we think about the opportunity set going forward, I understand it's hard to put a number to it. But maybe some of the bigger layers of opportunity, is it a strategy such that you'd expect to get a higher level of average spend? Is it geographical reach? Are there any puzzle pieces you can give us from that perspective?

There's a lot there in this question. So bear with me, I'm going to try to get through it all. I think the first thing is the way we got to Singapore today and this performance was very deliberate. And it started probably 5 years ago, we first started charting out where we wanted to go with the asset, given where we thought the direction of growth in high-value tourism would be. And we start off by building a great customer experience by focusing on the physical asset, which took time to both design and ultimately implement. We redesigned our service -- our service teams that we could better service our customers in a more complete way. And that was also a big lift. We focused a lot on how we sold, how we attracted customers by developing larger and more geographically spread out marketing teams and sales teams. And all that come together with a very strong management group over time with lots of investment produced this result. So this was not something that happened overnight. It was planned. It was a strategic decision. It was an investment over many years in both human capital and physical capital, along with the philosophy with a service focus and a customer experience focus. We focused on a lot of different amenities, how we enhance our entertainment, how we enhance our retail mall, how we enhance our food and beverage and how we bring it all together so that gaming customers can come in and get a lifestyle experience that can't be replicated in any place else. And so for us, that was really key. So the question is how do we grow the business more? Well, first off, I think people are just getting to know that we're in Marina Bay Sands. Remember, the renovation has not been done for that long. So we have a lot of customers who maybe experienced Marina Bay Sands a decade ago, and are not surprised by what's on offer today. I think the other thing is the quality of tourists that is coming to Singapore is continuing to elevate. There are also a lot of people who are engaging in commerce out of Singapore, and that's growing. So we have a lot of people on the leisure and on the business tourism side that are experiencing Marina Bay Sands and it's only growing. I think segments that we look to in the future continue to bring high-value tourism from different parts of the catchment area and we're working on that. And to be fair, at some point, we're going to run out of capacity, and that's where [ IR2 ]comes in. Someone asked us earlier about how we feel about the sustainability of Singapore as a market for us. And I think the biggest statement is that we're investing $8 billion to continue to grow our presence there. And that to me is the biggest signal that we're very serious about long-term investment for the success of Singapore. But I think for us, it's going to come from continuing to attract high-value tourists continue to bring in high-value business and leisure tourism activities, great entertainment, great retail, continuing to lead and amenities the investments that are necessary to stay at the forefront of tourism and attract high-value tourists from different markets, and we'll continue to grow. That was the strategy, and we're executing it now.

Maybe just a quick clarification. Earlier in my response to a question on smart table deployment for the mass tables and games area of Singapore, are you 6 months? Are you 9 months behind kind of the process that you went through with the rolling tables?

It's not that we're behind. It's that -- we have it on some games and not on others. Remember, our casino floor as baccarat, has [indiscernible], has a bunch of other different gaming products that are there, actually including crafts, like we've got different types of games out on the floor. And so not all those games are ready for this digital table system. So over time, we'll get there. But remember, we make most of our money from baccarat. And the area with the most volatility was the rolling programs. And so we started there.

The next question is coming from Chad Beynon from Macquarie.

Just wanted to revisit the comments around reinvestment program. You guys have been very open and honest in terms of your strategy and your competitive strategy in the market, I guess, year-to-date in your decision to change that. Have you seen any change with those competitors that maybe are now on a level playing field from a reinvestment strategy and maybe they don't have the product or the service that you guys have and they could potentially step outside of the current ZIP code of what's being provided to players? Or does it remain pretty rational?

Yes, let me take that. I think in general, the competition remains intense, and we don't foresee that to slow down. I think what you see is basically constant action and reaction we have to stay very alert to those changes, which we are and like what Rob said, we're going to be laser focused on basically responding to the market with the right office. And I think you can see the benefit of that change in our marketing strategy over this quarter, and that will continue. As to what other people are going to do and how they will respond, I think that's just an evolving picture that we have to monitor. And you would expect that the market to continue to be very competitive. But the positive aspect of the market is that we are seeing GGR growth, and I think that helps all of us, but it will stay competitive and we're very committed to staying ultracompetitive.

And then Patrick, I know the digital gaming business, I guess, the doors have been open or slightly open for the past couple of years. You haven't made many moves, but now you're officially closing that door, those windows. So why now? And then any cost saves that we should think about for our models?

Yes. I think we looked at this for a couple of years. I think we just didn't feel like there was something that we felt would be a good use of shareholder capital. So we shut it down. In terms of cost save, I think it's just things that all come out of development expense that you would have seen in the last year, but that's out now. It wasn't super material.

The next question will be from George Choi from Citigroup.

So obviously the encouraging [ hold rate ] disclosure in Singapore, very, very solid. But I'm just wondering it when will you do the same thing in Macao? Is there any significant difference in terms of the player behavior on how much they wager on the side bets that make you -- make it different between how you do it in Singapore versus Macao?

One thing to note that our rolling volumes are much larger relative to our overall gaming win in Singapore. And so there was a real focus there to begin with that. Also, the number of tables are smaller in Singapore than they are in Macao. So I just want to highlight that, but I'll turn it over to Grant to respond to the rest of the question.

Yes, George, just to reiterate the distinction Rob made, that the smart technology helps us to understand what is happening at the table. Independent of that is the player propensity it's not one leading the other. So I think on the question of propensity to wager in the side wages in Macao, it is -- the mix is obviously smaller than in Singapore, but it's also rising and it has contributed to enhanced house edge over the past several years. And as you of all of the people here, you're visiting all these casinos. And you can see the layouts are being reinvented every few months with additional side wages. So that's on the side wages. In terms of the smart tables, We, in Macao have actually fully rolled out on the non-rolling baccarat tables, all of the smart table technology and we are in the process of completing the rollout in the rolling segment. So within the next few months, we should be able to gauge across the total baccarat table.

As a follow-up, now that we have a myriad of side bets in the baccarat tables in both Singapore and Macao, I was just wondering how do you strike a balance between improving the incremental excitement and experience for players from obviously, these new side bets versus any potential cannibalization amongst the various side bets?

Well, I think the great thing about it is all the original bets are there. So if you -- all the bets that people are used to, are still in the belt. So this is really just up to the player, it's just an option. It just gives them some additional volatility if they want to take it. So for us, it's really a player decision. And in some cases, they take it. In some cases, they don't, which is the reason why Rob in his remarks that in Singapore, you may see a quarter where we hold 5 where you see -- where we will [ high 3s ]. It just depends on propensity, the preference of the player to want to make that wager. But as a practical matter, the games has more options, but it doesn't foreclose the ability for them to bet a more traditional path.

If you on flatbed, you can flatbed all day long. Bank player, high payer. It's not -- it doesn't exclude those bets. It's just like it's no different for years than the Super Bowl. The year people thought there was something different about the Super Bowl. All it was they offered 2,000 side bets versus the usual [indiscernible]. All we've done here is expand the side bets. And -- but the unusual bets are still there, traditional bets people want to bet. So it's their decision whether to make that decision on what to bet. It's not ours, we don't dictate it.

I think the important thing here to remember is that we are iterative in the way that we apply new bets on the belt. So what you see today is after attempts to improve the game experience for people. We're very focused on the experience. So if players like it, that's great and we keep it out there and they use it. And if it makes their trip more enjoyable, that's fantastic. If it's not something that's preferred by the players, eventually it evolves itself out of the game. And we've had a lot of different iterations of what's on the belt. So I would just view this as an enhancement to the gaming experience mechanism. And so they enjoy the volatility, they enjoy the additional bets. And so they use them. But as to how those bets will progress over time. Player's preferences may change over time. You may see us have different side bets on the felt over time as players change what they want to do.

That's a very important point supermarket we keep putting these on the shelves that sell and don't sell. We're constantly coming up with new bets all the time. We have a very important committee called the Make More Money Committee. That job is to find all bets and deviation this thing in. The things don't sell, we take it off the table and put something else to try it out. It's evolving all the time. It's kind of a static function.

The next question will be from David Katz from Jefferies.

With respect to Macao, one of the topics of conversation and one of the things that we're tracking very carefully is events, whether they're concerts or otherwise. Can you talk to us about your strategy around those? And more specifically, the recent I know it's sort of -- maybe post the end of the quarter, but I'd love to hear any general comments, learnings, opportunities, et cetera, around the NBA games that were hosted and events in general.

So I think, first off, going back to early days of the Venetian with Rob, entertainment has always been front and center. And I think it's something that's always helped us in the gaming business and the perception of the excitement around our properties. We've always been focused on providing high quality entertainment and actually building the assets to support it. . Many years ago, our SCL built a first Arena in Macao for this very reason. And we've been very dedicated to programming it and creating entertainment that's been very successful over the years in creating opportunities for our patients to have a great experience. And I think you'll see that as well in Singapore. We broke ground in mid-July on what we're calling IR2 right now, eventually, we'll have a name. And we're building a 15,000-seat live performance venue there. That will be the most technologically advanced arena in Asia and provide a great customer experience to live performance. And we're always very focused on it. And so for us, I think it's a very important benefit for a company to have that excitement that goes along with entertainment, but also gives our patients something to experience in the environment as part of the lifestyle that we provide to them. In terms of the NBA, this was something we started working on many years ago. We're very fortunate the NBA is a great partner. They really pulled out all the stops. They were very supportive. I have to give credit to both the Brooklyn Nets and the Phoenix Suns for the support that they gave to the China games. They really showed up in force. And there are teams that did a lot of charity events in the local community. They were great with the fans, really it's an unbelievable experience. And our team was very excited because the reaction in Macao was very strong. I think just some of the goals we set out for this event was to create something that brought a unique form of entertainment to highlight Macao and to showcase the investment that we've made and how high quality Macao is as a global tourism destination. And I think that goal was achieved. I think the media coverage, the social media into China, the social media externally around the globe has been very positive. I think the teams play very competitively. And I think it was a great format for the league. So I think that benefits Sands China because of that collaboration. I think it created a lot of excitement for our patients when they actually came to the games, and there was this outstanding visitation. And there was just a heightened sense of visitation around the business. In terms of the impact, again, we'll talk about it at the end of this quarter, we'll have better data. But I think overall, it was a very strong success. We're very happy with the results. I think our fans and the NBA, we're very happy I think we did a lot of things that helped the local community, which is also a benefit. And then lastly, we think it was very beneficial for Sands China on a lot of different levels. I think the marketing value that's created for us was also very strong. So a lot of benefit to it. And I also think we accomplished some of the goals that we set out in our concessional renewal, which was to bring, let's call it, high-value sports, global sports to Macao, which I think we did very successfully. So a lot of positive things all around. I don't know, Grant, do you have any other comments or anything you'd like to add?

No, I think covers it very well. I think it did showcase Macao in a very, very favorable light. It was great for the city to have such a, I would say, strong visitation from different countries. As you know, the government has been very keen on pushing us to have international events drawing visitors from different countries around the region, but in the rest of the world. And I think this event really highlighted the attraction of Macao as an international tourism destination like Patrick said, and I think we're proud of delivering this first set of China games from Macau. And I think we got a lot of cost positive price, not just from the people who came from different corners of the world, but also a very positive feedback from the local community.

The next question will be from John DeCree from CBRE.

Thanks for all the color and commentary so far. I wanted to ask a follow-up on kind of more of the strategic priorities outlined in your deck development. I know you gave some comments about the UAE specifically. But curious what you're seeing around the globe, if there's anything particularly interesting right now. And I guess I specifically asked about Japan. You guys obviously looked at that in the past. This new Prime Minister, I think, historically supportive of IR. So curious if it's worth another look at Japan and anything else that might be out there right now that's garnering your attention.

Look, I think our strategic priority is to deploy capital in high-growth projects. And we're always looking at those opportunities and always evaluating them to see if the returns are there with the appropriate factor of safety. And I think for us, as I said before, we're looking at the UAE, trying to observe it and follow it. Obviously, Japan was something we're very interested in the past, although that seems unlikely. There's been talk about Thailand, which is something that we've expressed interest in the past. So we're very patient and we're constantly looking, and we'll see what opportunities arise. But as of right now, there's nothing really to report.

And the next question will be from Steve Wieczynski from Stifel.

So Patrick, I apologize if I missed this in your prepared remarks. But if we think about the 150 basis point decrease in your Macao margins, wondering if most of that was tied pretty much directly to your change in marketing strategy or if that was just something else?

Yes, I think it was a combination of marketing strategy and a little bit of higher cost. But I think the key thing for us is the way we get operating leverage and increase margin over time despite growing revenue. You said it all along, I think there was a question earlier that Rob answered about the size of the Macao market. If you look at the Macao market today, it's growing, it's growing both in the mass segment and the VIP segment, which is very beneficial. I think we're very positive on the Macao market overall. And the way we're going to grow EBITDA and grow margins is through revenue growth. We have a great team there, but we have a big cost basis. So we need to leverage it. We need to get more volume.

Okay. Got you. And then, Rob, second question, if we go back to Singapore real quick, I mean you're at the point where you're pushing almost $1,000 a night per room. And yes, look, I understand there's more room capacity -- I understand there's more room capacity coming online in the next couple of years. But this is probably a little bit of a higher level question, but wondering, Rob, how you're thinking about room rates not only maybe now and your ability to still take price there, but maybe how you're thinking about room rates once your additional capacity comes online?

I think it's kind of irrelevant if you ask me. Our goal is to not sell rooms, just give away people who gamble because to be honest, that's the business we're in. You can't spend the kind of money we spend in Singapore and charge -- you charge $1,000 or $2,000 -- last time I checked, you're not building $8 billion hotels anywhere. This is a gaming casino with a hotel attached to it. So our goal in Singapore, every night, we can, is to give these rooms away people high-value gaming customers to drive $3 billion, $4 billion, $5 billion of top line revenue. That's the business run over there. I don't think -- we can squeeze the rates higher. I think we want to and the cash but it's such a small offering, we're mostly a comp house today. But the real goal is to not sell any rooms in IR 1 or 2, given where high-value gaming customers drive that site. You don't make $3 billion annualized with hotels. It's just that simple. So it's a very interesting dynamic over there. We shrunk the hotel, it's working very well, we attract the high-value casino customers. That is the focus, not the ADR to be blunt with you. I said we failed, we sell room for $2,000and it's a failure. We're not in the rooms business. We're in the casino hotel business, and those rooms simply are there to attract those patients to drive these ridiculously high EBITDAs.

Come visit, we'll give you a free room.

No free room.

Thank you. Ladies and gentlemen, this does conclude today's conference call. You may disconnect your phone lines at this time, and have a wonderful day. We thank you for your participation.