Earnings Call Transcript - LVS Q3 2025

Operator, Operator

Good day, ladies and gentlemen, and welcome to the Sands Third Quarter 2025 Earnings Call. 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.

Daniel Briggs, Senior Vice President of Investor Relations

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.

Robert Goldstein, Chairman and CEO

Thank you, Dan. Good afternoon and thanks for joining us. Marina Bay Sands delivered EBITDA of $743 million. We had forecasted that 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 to describe the magnitude of this result; operating performance at 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, even though 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 facilities will be enough to compete favorably, but 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 Macau market, but Londoner is moving towards $1-plus billion of EBITDA. We have meaningful opportunities for growth improvement throughout our Macau property portfolio. Importantly, the Macau market's GGR is growing, and when you couple this with our assets and our recent marketing changes, we believe we will continue to improve in the fourth quarter and beyond.

Patrick Dumont, President and Chief Operating Officer

Thanks, Rob. Macau 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 Macau 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 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%. If 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 round tables in Marina Bay Sands for over one year. 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 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, Operator

And the first question today is coming from Dan Politzer from JPMorgan.

Daniel Politzer, Analyst

So for Singapore, I want to go back to the hold rate. And obviously, you guys raised it to 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?

Patrick Dumont, President and Chief Operating Officer

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 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.

Daniel Politzer, Analyst

Got it. That makes sense. And then just turning to Macau, 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 as 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?

Robert Goldstein, Chairman and CEO

Dan, market growth is essential for improvement, and I'm glad to see that happening in Macau. Next year, the overall market could reach around $33 billion to $34 billion. Everyone requires market growth to enhance Macau's performance. We've also implemented significant changes over the past few months to adapt to a market we weren't engaging with previously, and we're now involved. We are likely halfway to where we need to be. Combining market growth with our assets and new marketing strategies will help us reach our targets, but market growth is critical for everyone. Without it, we're just reshuffling the same customers. However, we are starting to see improvement, and we are on the rise. The right number is probably around 620. Excluding the impact of the Typhoon, it was a decent quarter. While it's not our ultimate goal, which is around $2.728 billion, we're making progress. The team must remain aligned with the market to achieve these results.

Grant Chum, CEO and President of Sands China

Yes. I think this quarter, what we saw was 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.

Robert Goldstein, Chairman and CEO

I think the weak links in our portfolio in Parisian, in Sands especially — Parisian has 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.

Operator, Operator

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

Shaun Kelley, Analyst

I want to return to Singapore because the smart table initiative is quite intriguing. Can we delve a bit deeper into the underlying betting behavior or changes that might be responsible for this significant increase? This type of change in hold indicates some sort of underlying behavioral or mix change. Is it due to a different mix of bettors, perhaps more casual bettors, or is it related to the games or types of bets they are placing? Historically, baccarat has been viewed as very straightforward: player versus banker. How is the smart table initiative evolving to reflect an actual change in behavior?

Robert Goldstein, Chairman and CEO

Shaun, just to clarify, the smart table acts as a scorekeeper; it doesn’t influence the outcomes. What drives these changes is that historically, baccarat started at a 2.85% hold when I entered this industry; it was a rather dull game, operating at a 3% house edge, yielding minimal excitement. This remained consistent for decades. The transformation in baccarat isn’t due to the smart tables; those just keep track of scores. Instead, the game itself has evolved to provide numerous betting opportunities similar to sports betting. The side bets and prop bets, even the lower percentage bets, tend to favor the house, attracting all types of bettors toward them. This trend is simply a matter of mathematics. It’s not just casual players or experienced ones; everyone is gravitating towards these house-favored side bets. The data shows that the smart tables indicate a 4.1% or 4.2% hold because they track these betting patterns. The game has dramatically evolved from its former steady pace; it has become intriguing with many ways to lose money, especially in Singapore, where we observe participation from all player levels, not just novices but also seasoned pros, eager to place these side bets. This has become a strong revenue driver for our baccarat-dependent company. What’s happening in Singapore is not a result of the smart tables but rather the changes in the game and the customers' desire to engage with those changes, leading to a hold of over 4%, which is remarkable compared to the previous mundane 2.85% hold maintained for years. This is not a temporary situation; it reflects a genuine market trend. I expect to see a similar phenomenon in Macau as well, representing a significant opportunity for our company to enhance profitability.

Patrick Dumont, President and Chief Operating Officer

I think you have to give credit to our gaming innovation team for their willingness to really look at the customer experience and have 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.

Shaun Kelley, Analyst

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 this type of table to other markets; obviously, Macau 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?

Robert Goldstein, Chairman and CEO

Yes, we probably started this process about a decade ago and have since expanded our team. While we developed these ideas, we don't have exclusive control over them since others can replicate our strategies. This replication isn’t necessarily a drawback; it actually benefits the industry’s growth. We are indeed expanding into Macau, where we will implement the Smart table system along with a scorekeeping mechanism. As the Macau market grows, you'll begin to observe similar trends unfolding. Although our advantages have been more pronounced in Singapore, we are making our move into Macau, aligning with market developments. If you look at the layouts now, there are numerous side bets, making it difficult to even find the flat bet due to the variety of alternatives available. We are progressing in that direction in Macau. While we created this system, it's not proprietary. There is sometimes confusion about it being a smart table, but it actually serves as a better tool to measure the number of side bets being made and understand their implications mathematically. What Patrick mentioned regarding the 4.1% or 4.2% hold percentage is backed by solid evidence; this is no longer just an estimate. Historically, hold percentages varied as they depend on players' betting behaviors during a quarter. We could experience hold percentages ranging from 5.1% to 3.8%, which is dictated by player activity. So yes, we are shifting towards Macau, which should enhance not only our company but the entire gaming sector by making it more engaging and diverse. It's not limited to high-end players; mass customers, regardless of their betting sizes, are also drawn to it. Interestingly, in the sportsbook sector, many smaller bettors engage heavily in prop betting, and similarly, baccarat appeals to both small and large bettors.

Patrick Dumont, President and Chief Operating Officer

One thing to note is 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 is smaller in Singapore than they are in Macau. So I just want to highlight that, but I'll turn it over to Grant to respond to the rest of the question.

Grant Chum, CEO and President of Sands China

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 on the side wagers in Macau, 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 see, all of the people here, you're visiting all these casinos. You can see the layouts are being reinvented every few months with additional side wagers. So that's on the side wagers. In terms of the smart tables, we, in Macau, 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.

Operator, Operator

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

Stephen Grambling, Analyst

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 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 buy back some of the shares in Hong Kong as well. So I wonder if you have any thoughts on that or other capital allocation opportunities.

Patrick Dumont, President and Chief Operating Officer

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 not 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 company in a friendly way for shareholders. And so you'll see us continue to do that.

Stephen Grambling, Analyst

Makes sense. And maybe changing gears a little bit. Just going back to Macau. 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 bets? Or is that a new customer who's coming in?

Grant Chum, CEO and President of Sands China

Yes, I believe the VIP segment has surpassed the mass GGR in recent months, with some months showing significant growth rates. This surge is due to a concentration of ultra-high-end VIP players and increased market liquidity. While we haven't engaged much in that segment this quarter, we plan to become more competitive. Additionally, we've entered the Junket Market this quarter, which has also fueled the growth in the rolling market recently. However, this segment still has low margins, typically around 12% to 15% of the overall GGR. We are focused on expanding this area, but the majority of our profit growth will continue to come from the non-rolling segment.

Operator, Operator

The next question will be from Brandt Montour from Barclays.

Brandt Montour, Analyst

I just want to double-click on that comment. I mean, I think that we all see the premium mass led inflection since mid-year. 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 by $33 billion, $34 billion 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?

Robert Goldstein, Chairman and CEO

I think it's difficult to determine the origins of the trends we're seeing. It's challenging to categorize the market into segments like junket, rolling, non-rolling, or mass. What's crucial is the observable changes taking place. I expect October to show a growth of around 7% to 9% year-on-year, and it seems like there's a positive momentum building. Macau is experiencing recovery across various segments, and while we appreciate the base mass recovery, premium mass has distinctive value. I don't have specific insights into its sources, but it's clear that growth is happening. Ultimately, for all operators in Macau, profitability and growth depend on observing this increase in gross gaming revenue.

Grant Chum, CEO and President of Sands China

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.

Patrick Dumont, President and Chief Operating Officer

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 even with F1 in a different part of the calendar year, we continue to perform through that. So I think F1 is helpful; it's 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.

Robert Goldstein, Chairman and CEO

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 just keeps getting stronger and stronger. 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 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 in Asia for people who want to gamble at a certain level. And I think that's really the real driver is the unique asset we built, unique room product. And again, what we provide there is 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 at $2.5 billion; we probably this year, we get, I don't know, $2.7, $2.8, $2.9 billion; I don't know. But the numbers are there. And it just seems like it's getting more and more desirable at the high end of the market. Extraordinary results. I think no one could have seen this kind of growth. And I don't think it's that tied to special events as much as it's tied to the place itself.

Robin Farley, Analyst

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?

Grant Chum, CEO and President of Sands China

Hi, Robin, let me take that. Yes, I think when you look at the progression in market share, clearly, we come off the bottom in Q1 when we were 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. We started tweaking our programs and changing our marketing programs in the middle of the second quarter and that ramped up throughout each month in the third quarter. 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 in the Londoner Grand, which has newly opened, 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. 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.

Patrick Dumont, President and Chief Operating Officer

Look, 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 invested in the UAE to create tremendous tourism 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.

Elizabeth Dove, Analyst

So clearly, incredible results in Singapore again. And you mentioned for this year, 2027, 2028, 2029, 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? Is this sustainable? Can it, on a hold just a basis grow next year? How are you thinking about the longer tail of the sustainability of growth in Singapore?

Robert Goldstein, Chairman and CEO

Lizzie, I'd say we've been wrong all along for starters, and we've underforecasted this thing. We thought we were very ambitious at $2.5 billion, and like I said, we’re at $21 billion currently with a quarter to go. With a big quarter, you get to $2.8 billion, $2.9 billion, is it sustainable? Yes, it's very sustainable. You're alone over there and you've got one competitor; 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 building out a one-of-a-kind asset. So yes, it's very sustainable. The question I can't answer is — does it get to $3 billion next year? Is it a $3.2 billion down the road? Does it get to — I don't know. We've been rolling along. Here we are in 2025, and as you said, two years ago, we were delivering $700 million quarters back-to-back; I would have said that was very ambitious. Well, it turns out it was done easily. These last quarters came along pretty well. 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, it looks like. These table wins are extraordinary; it's coming out from all sides. I think there's strength in the building; having all suites versus mostly more rooms is a very good idea. So yes, I think it's very sustainable. The question for me is not sustainability, it's how high is up? Could this thing hit $3 billion, get to $3.2 billion? I don't know. But I didn't think you could 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.

Patrick Dumont, President and Chief Operating Officer

Yes, we're not really getting into the current quarter. But just overall, Macau and Singapore are very separate markets. And typically, the catchment area for Singapore is very focused on Southeast Asia, and Macau 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.

Joseph Stauff, Analyst

Just wanted to follow-up, Patrick, on your comment about the opportunity in Singapore in particular being 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?

Patrick Dumont, President and Chief Operating Officer

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 five 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. We started 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 teams so 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. All that came 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 enhanced our entertainment, how we enhanced our retail mall, how we enhanced 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 other place. For us, that was really key. 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 now 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. 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. 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, continuing 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.

Joseph Stauff, Analyst

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?

Patrick Dumont, President and Chief Operating Officer

It's not that we're behind. It's that we have it on some games and not on others. Remember, our casino floor has baccarat, has a bunch of other different gaming products that are there, including crafts; like we've got different types of games out on the floor. 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.

Chad Beynon, Analyst

Just wanted to revisit the comments around the 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?

Grant Chum, CEO and President of Sands China

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 offers. 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. You would expect 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 ultra-competitive.

Patrick Dumont, President and Chief Operating Officer

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 savings, 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.

George Choi, Analyst

The encouraging hold rate disclosure in Singapore is very solid. However, I am curious about when you will implement a similar approach in Macau. Are there any significant differences in player behavior regarding how much they wager on side bets that would account for the different strategies between Singapore and Macau?

Patrick Dumont, President and Chief Operating Officer

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 Macau. So I just want to highlight that, but I'll turn it over to Grant to respond to the rest of the question.

Grant Chum, CEO and President of Sands China

Operator, Operator

The next question will be from David Katz from Jefferies.

David Katz, Analyst

With respect to Macau, 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.

Patrick Dumont, President and Chief Operating Officer

So I think, first off, going back to early days of the Venetian with Rob, entertainment has always been front and center. 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 the first Arena in Macau for this very reason. 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. 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. We're building a 15,000-seat live performance venue that will be the most technologically advanced arena in Asia and provide a great customer experience for live performance. We're always very focused on it. For us, I think it's a very important benefit for a company to have that excitement that goes along with entertainment, but it also gives our patients something to experience in the environment as part of the lifestyle we provide to them. Regarding the NBA, this was something we started working on many years ago. We're fortunate that 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 showed up in force. They provided a lot of charity events in the local community. They were great with the fans; it was an unbelievable experience. Our team was excited because the reaction in Macau was very strong. Some of the goals we set out for this event were to create something unique; form of entertainment to highlight Macau and to showcase the investment we've made and how high quality Macau is as a global tourism destination. I think that goal was achieved. The media coverage, the social media in China, the social media externally around the globe has been very positive. The teams played very competitively, and it was a great format for the league. This benefits Sands China due to that collaboration; it created a lot of excitement for our patients when they actually came to the games, and there was an outstanding visitation. There was just a heightened sense of visitation around the business. Regarding the impact, again, we'll talk about it at the end of this quarter; we'll have better data. But overall, it was a very strong success. We're very happy with the results. Our fans and the NBA were very happy. I think we did a lot of things that helped the local community, which is also a benefit. We think it was very beneficial for Sands China on many levels. I think we received a lot of positive feedback from the local community.

Grant Chum, CEO and President of Sands China

I think that covers it very well. It did showcase Macau in a very, very favorable light. It was great for the city to have such a 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 and from the rest of the world. I think this event really highlighted the attraction of Macau as an international tourism destination. Like Patrick said, we're proud of delivering this first set of China games from Macau.

Operator, Operator

The next question will be from John DeCree from CBRE.

John DeCree, Analyst

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. I guess I specifically asked about Japan. You guys have 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.

Patrick Dumont, President and Chief Operating Officer

Look, I think our strategic priority is to deploy capital in high-growth projects. We're always looking at those opportunities and evaluating them to see if the returns are there with the appropriate factor of safety. For us, as I said before, we're looking at the UAE, trying to observe it and follow it. Obviously, Japan was something we were 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. 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.

Steve Wieczynski, Analyst

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

Patrick Dumont, President and Chief Operating Officer

Yes, I think it was a combination of marketing strategy and a little bit of higher cost. But 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 Macau market. If you look at the Macau 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 Macau market overall. 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. We need to leverage it; we need to get more volume.

Operator, Operator

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.