The Philippine regulator has cut its outlook for the year as the online segment that recently overtook land-based casinos slumps, with the chairman pointing to squeezed lower-income players and the removal of e-wallet links from gambling platforms.
The Philippine regulator has cut its outlook for the year as the online segment that recently overtook land-based casinos slumps, with the chairman pointing to squeezed lower-income players and the removal of e-wallet links from gambling platforms.
Alejandro H. Tengco, chairman and chief executive of the Philippine Amusement and Gaming Corporation (PAGCOR), has warned that gross gaming revenue could fall by as much as 19% in 2026. The regulator now forecasts full-year GGR of PHP 320 billion to PHP 350 billion (approximately $5.12 billion to $5.60 billion), down from PHP 396.14 billion (approximately $6.34 billion) recorded in 2025.
The early data underpins the caution. In the first quarter of 2026, the electronic-gaming segment, which spans e-games, e-bingo and poker, fell 22.43% year on year to PHP 39.9 billion, according to PAGCOR. Overall first-quarter GGR dropped 15.87% to PHP 87.6 billion, a broad-based decline rather than a single weak product line.
Tengco attributed the downturn primarily to external pressure on players. The Middle East crisis, he said, has squeezed lower-income customers, the cohort most sensitive to discretionary spending and the fastest to pull back when household budgets tighten. A secondary factor is regulatory: the removal of e-wallet links from online gambling platforms has added friction to the deposit process that had helped the digital segment grow so quickly.
The timing is notable because online gaming had only recently overtaken the country's land-based casinos as a revenue source, according to PAGCOR. A double-digit contraction would therefore land on the segment the Philippine market had come to rely on for growth. It also arrives as PAGCOR completes a structural change of its own, divesting its Casino Filipino venues to complete a shift from operator to pure regulator, a transition that removes the agency's direct commercial stake in the floor even as revenues soften.
A Payments Change and a Demand Shock Are Hard to Separate
The most difficult question in Tengco's forecast is how much of the fall is demand and how much is design. A 22.43% drop in electronic gaming is severe, but two forces are pushing in the same direction at once: lower-income players cutting back under external economic pressure, and the removal of e-wallet links raising the friction of depositing at all. Those causes point to different conclusions. If the decline is mostly a demand shock tied to the Middle East crisis, it should ease as conditions stabilise, and the segment's underlying trajectory remains intact. If it is mostly the payments change, the effect is more durable, because friction at the cashier tends to redirect players rather than simply reduce them. Distinguishing the two matters for policy, and the first-quarter figures alone do not settle it.
Friction in the Licensed Channel Is a Channelisation Risk, Not Just a Revenue One
Removing e-wallet links is a recognisable player-protection instrument: making it harder to fund an account is a blunt but real brake on impulsive play. The risk is where the displaced demand goes. Players accustomed to fast digital deposits do not necessarily stop; some migrate to offshore or unlicensed operators that impose no such friction and sit beyond PAGCOR's reach. Read that way, a 19% forecast decline in regulated GGR is not automatically a 19% decline in gambling, and the gap between the two is the channelisation question every regulator tightening its licensed market has to confront. The measure of success is not how far licensed revenue falls, but whether that fall reflects genuinely reduced activity or simply activity moving out of view.
A Regulator Divesting Its Casinos Has Less Reason to Flatter the Numbers
There is a credibility dividend buried in PAGCOR's own transition. As the agency divests Casino Filipino and completes its move to a pure regulator, it loses the direct commercial interest that once gave any operator-regulator a reason to present revenue in the best possible light. A body warning candidly that its market could shrink by up to 19%, while stepping back from ownership of the assets that generate it, is behaving more like a supervisor than a stakeholder. That does not guarantee the forecast is right, and a single quarter is a thin base for a full-year call. But the separation of roles should make PAGCOR's outlook easier to trust, precisely because the regulator no longer profits from the number it is forecasting.
