May casino revenue numbers bear out what I saw during a week in Macau: a comprehensive recovery is in full swing. Cotai and the peninsula are both enjoying resurgent gaming volumes, and there are more guests staying longer and coming from further away, thanks to the growth of hotel room supply.

The numbers say Macau’s casino revenue grew 23.7% year on year in May, the highest percentage rise this year, to 22.7 billion Macau patacas (MOP; US$2.8 billion), beating the consensus growth forecast of 17%. For the first five months of 2017, gaming revenue is up 15.8%.

Union Gaming Group analyst Grant Govertsen estimates May mass market revenue grew in “the high teens or better” while JP Morgan’s DS Kim suggests VIP revenue rose by up to 35%. Sanford Bernstein’s Vitaly Umansky reports average daily revenue (ADR) of MOP805 million for the last week of May that included the Dragon Boat Festival holiday, just the sixth week in the past year with ADR exceeding MOP800, though Umansky continues to “voice caution” about the accuracy of the weekly channel checks.

JP Morgan cites three reason for the strong VIP gains in May. According to analysts Kim and Sean Zhuang, one of Macau’s big three junkets – Suncity, Neptune/Guangdong and Tak Chun – had particularly good luck for the month, boosting sector revenue an additional 4-5%. The calendar was favorable, with the Dragon Boat holiday shifted from June to May, also benefiting mass revenue. Finally, they note the “resurgence” of mid-sized junkets such as David, MegaStar and Heng Sheng that have found fresh capital to open rooms in recent months.

A VIP industry contact noted the same phenomenon with a fair bit of surprise, underscoring JP Morgan’s warning about the sustainability of the trend. Remember that VIP revenue divides into a share for the casino operator, a share for the government and, in most cases, a debt for junket promoter to collect. Smaller junkets carry higher collection risks, JP Morgan says.

Those cautions aside, Macau appears to be doing extremely well. Interviewed on Macau broadcaster TDM, LINK IGamiX Managing Partner Ben Lee suggested Steve Wynn’s Cotai debut with Wynn Palace last August has been the key catalyst in the VIP recovery, along with increased liquidity for junkets. At the other end of the spectrum, “Macau has been on sale for two years,” Union Gaming’s Govertsen says, citing moderation of hotel room rates and gaming table minimum bets.

There were big crowds checking into Galaxy Macau on a Monday afternoon last month at the start of a non-holiday week. On the peninsula and especially in Cotai, gaming floors were populated from mid-morning to the wee hours. Unlike three years ago in the waning days of the boom, there was no problem finding tables with minimum bets under HK$1,000 (US$130), even as low as HK$300 for baccarat, even at Wynn Palace on a weekend night. The one exception was City of Dreams, where table minimums in the four-digits predominated, targeting the premium mass market.

Sands China’s Parisian Macao, opened the month after Wynn Palace as a mass market property, is reconfiguring its room supply, creating more suites for premium players, Las Vegas Sands President and COO Rob Goldstein, LVS Chairman Sheldon Adelson’s top lieutenant, told a Sanford Bernstein conference last week. Parisian is also adding more “affordable” food offerings to take more advantage of the “curbside appeal” of its half-scale Eiffel Tower. Next year, Goldstein expects market growth will be less junket driven, and LVS continues to believe in Macau’s mass market.

But right now, VIP is driving the big headline numbers of the recovery. The challenge for Macau is not to lose sight of longer term opportunities and issues ahead in the blinding light of VIP revenue.