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AGA: USA Commercial Gaming Sets Quarterly Record With $16.17B in Q3
By Jeff Osienya Nov 20, 2023 IndustryAmerica’s commercial gaming industry continues with its growth curve for the 11th quarter running, posting a record-smashing $16.7 billion revenue in Q3 2023. Join us as we dissect the numbers according to the latest report published by the AGA.There has never been a more successful Q3 than the 2023 Q3 gaming period as far as the US Commercial casino gaming scene is concerned. According to the American Gaming Association (AGA), the Gross Gaming Revenue (GGR) for Q3 2023 hit record levels of $16.17 billion. This figure represents a year-over-year increase of 6.1%, and is also the 11th consecutive quarter of annual revenue growth. The data released by the American gambling trade body comprised performances from brick-and-mortar casino slot machines, table games, sports wagering, and iGaming.
Reflecting on the recent report, AGA President and CEO Bill Miller said in part:
Quote“With growth across land-based and online gaming, we are delivering career opportunities for millions of Americans and strong economic contributions to communities across the country through increased tax revenue…Our sustained momentum reflects gaming as a first-choice entertainment option for millions of American adults.”
Sports Wagering and iGaming Are the Fuel Behind the Rapid Growth
The numbers released by the Association attribute the rapid gaming industry growth to the sports wagering (in-person and online) boom and the expanded iGaming scene. Thus, as we speak, the total revenue for the first nine months of 2023 stands at $48.69 billion, which is already 9.9% higher compared to the same period over a year ago.
Additionally, even with Q4 notoriously known for low figures, it seems almost certain that 2023 will be another year of smashing performance for the commercial gaming industry. This will make it the third consecutive year of breaking records in an industry that has been soaring after the COVID-19 pandemic period shortfall.
All verticals registered quarterly growth according to the report by the AGA. The land-based gaming scene, encompassing casino slots, table games, and retail sports wagering, grew from last year’s 0.9 percent to 1.5 percent, breaking the $12.61 billion ceiling. Physical slot machines won the bulk of the money, registering $8.98 billion worth of revenue, a 1.7% improvement from Q3 in 2022. Meanwhile, table games and iGaming also posted gains in this area, with the former listing an income of $2.64 billion, a 3.8% improvement from the previous year.
At the same time, the annual revenue gains from online gaming, which encompasses iGaming and online sports betting, decreased to 26.9% compared to the 44.4% registered in Q2. Thus, overall, online sports wagering and iGaming brought in $3.52 billion, 21.8% of the total commercial gaming revenue registered in Q3. This is the lowest share that these two have contributed to the entire commercial gaming revenue in Q3 since 2022.
Commercial gaming operators nationwide also paid a whopping $3.43 billion in taxes, representing a 4.7% uptick year-on-year. Further, the industry, as a whole, paid out $10.68 billion in taxes during the first nine months of the year, which is also a 9.9 % rise over the same period last year. Going by these figures, it is fair to predict that the state and local governments across the country are on track to collect a record level of taxes.
On the question of taxes, the AGA offered a clarification, saying:
Quote“Note that these gaming taxes only cover specific state and local taxes directly linked to gaming revenue that are reported monthly or quarterly. Fees that are levied on an annual basis are not covered, nor are sports betting excise tax payments to the federal government. The figures also do not encompass the billions of additional tax dollars paid by the industry on income, sales, payroll, or various corporate taxes.”
Steady Industry Expansion Across Different Jurisdictions
Further, the third quarter of 2023 saw only one new market (Kentucky) join the regulated sports wagering realm by opening several retail locations. That said, we are still waiting on information from the Bluegrass State, which has yet to release any of its market stats following the debut.
On the other hand, commercial land-based gaming continued to expand in Q3, with Illinois and South Dakota opening new casinos. New betting markets have also emerged compared to the last Q3, with Maryland (online wagering), Massachusetts, Nebraska (retail only), and Ohio joining the fold over the one year since the previous Q3.
From the look of things, gaming revenue is poised to keep up with its growth trend in the coming quarters, as new casinos are opening up in states such as Virginia, Nebraska, and Illinois. This is a notable development, mainly because the mentioned states had previously not made gambling legal within their jurisdictions.
AGA’s President Miller has continuously welcomed the expansion of such initiatives as they further strengthen the regulated gaming aspect that the trade body constantly pushes. On that, he opined:
Quote“Americans continue to migrate their actions to the protections of legal, regulated sportsbooks in record numbers. This sustained demand only reinforces the need for federal and state enforcement against illegal offshore operations.”
Gaming Revenue Growths Experienced in Most States
The collective growth in gaming revenue across the country was, of course, spurred by the outstanding performances of the individual gaming states. The Silver State improved by 2.9% compared to the figures reported last year, landing at a cozy figure of $3.88 billion. These stellar numbers reported are all thanks to a record-breaking quarter for Las Vegas Strip casinos, bringing in a whopping $741.2 million. The superb performance was also accentuated by the highest Baccarat win in the state’s history, which stood at $458.4 million, an incredible 50.1% surge compared to the amount won last year.
New Jersey also recorded its highest-ever win with $1.56 billion worth of revenue, an 8.6% jump from last year’s reported figure. In the Garden State, iGaming and sports wagering registered new quarterly highs with $469.6 million from the former, while the latter scored an equally impressive revenue of $268.2 million. Moreover, Atlantic City casinos posted their second-best quarter in history for their land-based slot machines and table games at $816.8 million.
That said, it wasn’t all rosy returns regarding the individual state reports. Nonetheless, US jurisdictions that registered declines mostly had single-digit downturns. The sports betting-only markets of Montana, Hampshire, and Washington, DC, were the worst hit, with respective declines of -6.9%, -18.7%, and -33.2%. Be that as it may, in the larger context of the 2023 calendar year, it appears that most of these states will exceed their 2022 numbers. That said, a few US jurisdictions are still expected to produce negative numbers relative to what was reported in 2022.
Looking Outside the Silver State
The AGA reported that 6 out of the 20 highest-grossing commercial casinos outside Nevada reported higher combined gaming revenue from retail sports wagering, slot machines, and table games compared to the 2022 Q3 results of the same.
Unsurprisingly, Resorts World NYC came out top as the leading revenue-generating property outside of Nevada. It was followed by Borgata, which just edged the MGM National Harbor to second position. Here’s to an even brighter future for the wider regulated gambling sector in the USA.
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