Korean casino operators Lotte Tour Development and GKL reported June and Q2 2026 revenue growth, outperforming Macau's casino market. Lotte Tour Development's June casino revenue reached 487억원, up 36% year-over-year, while GKL's June revenue rose 7% to 372억원, driven by a 19% increase in foreign tourists to South Korea in May (195万명). The growth was fueled by won depreciation, China-Japan diplomatic tensions redirecting Chinese tourists, and Japan's July departure tax hike from 1000 yen to 3000 yen. In contrast, Macau's June casino revenue fell 12% year-over-year, with Q2 revenue down 0.1%, as tourist growth slowed and World Cup betting demand diverted casino spending. Samsung Securities analyst Lee Hye-yeon stated that Korean casino operators' relative performance advantage over Macau should persist in the second half, warranting higher valuation multiples for domestic stocks.
Foreign Tourist Inflow to South Korea Reaches 195万명 in May
Foreign tourist arrivals to South Korea totaled 195万명 in May, a 19% increase from the prior year. Cumulative arrivals from January to May reached 872万명, up 21% year-over-year. Japanese tourist arrivals rose 21%, and Chinese tourist arrivals increased 25%, driving overall growth. Won depreciation improved South Korea's price competitiveness for foreign travelers. Deteriorating China-Japan relations led some Chinese tourists to choose South Korea over Japan as an alternative destination. China extended visa-free entry for group tourists, and Japan raised its departure tax from 1000 yen to 3000 yen starting in July, while tightening single-entry visa requirements to curb overtourism.
Lotte Tour Development and GKL Report June and Q2 Revenue Growth
Lotte Tour Development's June casino drop amount reached 2662억원, up 10% year-over-year. June revenue totaled 487억원, a 36% increase, with a hold rate of 18.3%, up 3.5 percentage points from the prior year. For Q2, Lotte Tour Development's casino drop amount was 7606억원, up 14% year-over-year, and revenue reached 1471억원, a 34% increase, exceeding market consensus and setting a quarterly revenue record. GKL's June drop amount was 3278억원, up 9% year-over-year, with revenue of 372억원, a 7% increase. GKL's Q2 drop amount totaled 1조원, up 15% year-over-year, and revenue reached 1205억원, a 19% increase, accelerating from flat Q1 growth.
Macau Casino Revenue Declines 12% in June as Korean Operators Gain Market Share
Macau's total casino revenue fell 12% year-over-year in June, following growth of 6% in April and 7% in May. Q2 revenue declined 0.1% year-over-year. Macau tourist arrival growth slowed from 11% in April to 3% in May, and World Cup betting demand reduced casino spending. Korean casino operators maintained stronger revenue growth, supported by sustained foreign tourist inflows. Samsung Securities projects that Korean operators' performance advantage over Macau will continue in the second half, driven by structural inbound tourism growth. Korean casino operators' 2026 estimated price-to-earnings ratio averages 13 times, with 2027 at 10 times, compared to Macau operators' 2026 average of 12 times and 2027 average of 9 times. Lee Hye-yeon of Samsung Securities stated, "Given the structural growth trend in domestic inbound tourists, Korean operators' relative performance advantage over Macau should persist in the second half, and their valuation premium should expand."
FAQ
What was the foreign tourist arrival figure for South Korea in May?
Foreign tourist arrivals to South Korea in May totaled 195万명, a 19% increase from the prior year. Cumulative arrivals from January to May reached 872万명, up 21% year-over-year, with Japanese tourist arrivals rising 21% and Chinese tourist arrivals increasing 25%.
How did Lotte Tour Development's June casino revenue perform?
Lotte Tour Development's June casino revenue reached 487억원, up 36% year-over-year, with a drop amount of 2662억원 (up 10% year-over-year) and a hold rate of 18.3%, up 3.5 percentage points from the prior year. Q2 revenue totaled 1471억원, a 34% increase, setting a quarterly record.
Why did Macau's casino revenue decline in June while Korean operators grew?
Macau's June casino revenue fell 12% year-over-year as tourist arrival growth slowed from 11% in April to 3% in May, and World Cup betting demand diverted casino spending. Korean operators benefited from sustained foreign tourist inflows, won depreciation, and Japan's policy shifts, including a July departure tax increase from 1000 yen to 3000 yen.
