6 Jun 2026
PAGCOR Chair Highlights Risks to Gaming Revenue from Escalating Regional Costs
Alejandro Tengco, chair of the Philippine Amusement and Gaming Corporation, issued a direct warning that gross gaming revenue could fall by as much as 19 percent in 2026 because of rising operational costs tied to the Middle East conflict, and this projection matches earlier estimates that already accounted for sustained pressure on the sector even as regulators maintain oversight.
The statement from Tengco centers on how external supply chain disruptions and energy price spikes feed directly into higher expenses for casino operators across the Philippines, and those added burdens stand to erode margins at a time when the industry continues to operate under close regulatory scrutiny.
Breakdown of the Projected Decline
Figures released alongside the warning show the 19 percent drop applies to the national GGR total, which encompasses contributions from both land-based venues and integrated resorts, while analysts tracking these numbers note that the same percentage appeared in prior internal assessments circulated within PAGCOR earlier in the year.
Cost increases linked to the conflict involve fuel surcharges on imported equipment, elevated insurance premiums for maritime shipments, and upward adjustments in utility rates that hit 24-hour gaming floors particularly hard, and these factors combine to create a measurable drag on profitability forecasts through the end of 2026.
Connection to the Middle East Situation
Tengco pointed out that ongoing tensions in the Middle East have driven up benchmark crude prices and complicated logistics routes that Philippine gaming companies rely on for everything from slot machine components to hospitality supplies, and the resulting expense growth appears in multiple line items within operator budgets rather than in any single category.
Because the conflict shows no immediate signs of resolution, PAGCOR has incorporated these variables into its multi-year modeling, and the 19 percent reduction now serves as a baseline scenario that operators can reference when adjusting expansion plans or renegotiating vendor contracts.
Consistency with Earlier Industry Assessments
The current forecast aligns precisely with projections PAGCOR circulated months ago, and Tengco emphasized that the repetition of the 19 percent figure reflects updated data rather than any shift in underlying assumptions about conflict-related costs.
Observers who follow the agency’s quarterly reports note that the same percentage has remained stable across successive updates, which indicates that the Middle East-driven cost pressures have proven more persistent than initially anticipated in some models.
Regulatory Oversight Remains in Place
Despite the revenue outlook, PAGCOR continues to enforce licensing requirements, responsible gaming measures, and compliance checks that apply uniformly to all operators, and Tengco stated that these regulatory functions will proceed without alteration even as the agency monitors financial performance closely.
Data shared by the corporation shows that oversight activities have not slowed, and the same standards that governed operations in prior years will continue to shape how new licenses are evaluated and existing properties are audited through 2026.
Implications for Sector Planning
Operators now have a clear numerical benchmark they can factor into capital expenditure decisions, and Tengco indicated that PAGCOR stands ready to review any adjustment requests that arise from the revised revenue expectations while still upholding all existing rules.
The warning also provides a reference point for local government units that receive shares of gaming revenue, allowing them to incorporate the 19 percent scenario into their own budgeting processes for the coming fiscal periods.
Conclusion
The statement from PAGCOR’s chair supplies a single, consistent figure that captures the combined effect of conflict-related cost increases on the Philippine gaming sector’s top-line revenue, and the alignment with prior projections underscores that these pressures have been tracked systematically rather than treated as sudden developments.
With regulatory oversight continuing unchanged, the industry possesses both the forecast and the compliance framework needed to navigate the period ahead, and the 19 percent decline now functions as a documented planning parameter for all stakeholders involved. according to reports from cdcgaming.com