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USA’s Commercial Gaming Sector Scores $11.3b in Q1 2021
By Jeff Osienya May 13, 2021 IndustryA new report by the American Gaming Association indicates that the US gaming sector generated over $11 billion in revenue between January and March 2021. Join us as we crunch the numbers further, measuring the historic win against previous quarters.The US gaming industry in 2021 is off to a blazing start after racking up an impressive Gross Gaming Revenue (GGR) of $11.13 billion for the first three months of the year. The American Gaming Association (AGA), the USA’s gaming industry trade body, disclosed the shining performance on Tuesday in its latest Q1 2021 report.
Compared to the same January to March period in 2020 when the US gaming sector won $9.46 billion, the Q1 2021 haul has recorded a 17.7% surge. However, this year-over-year climb isn’t much of a surprise. Halfway through March 2020, the gaming world was crippled by the casino shutdowns and sports cancellations implemented due to the novel coronavirus pandemic.
What makes this performance particularly impressive is the fact that it bested the gaming industry win recorded for the first three months of 2019 when the industry was at peak capacity. The 11.13 billion GGR generated between January and March 2021 is 4% higher than the $10.7 billion that the USA’s gaming sector racked up For Q1 2019. This terrific comeback from the Coronavirus shortfall is even more impressive as it matches the industry’s best quarter in history recorded in Q3 2019.
Bill Miller, the AGA president, praised the industry’s stellar performance in a statement saying:
Quote“Today’s report shows gaming’s comeback is ahead of schedule. Throughout the COVID-19 pandemic, our industry has faced numerous challenges head-on while still reopening responsibly and providing a safe, exciting environment for customers. The gaming industry is generating these impressive results with one hand tied behind our back as capacity and amenity restrictions remain across the country. This is a testament to gaming’s hard work to help ensure our team members’ safety and well-being, which enabled us to reopen safely. We applied those same standards to our customers, whose clear pent-up demand was met by our responsible industry.”
Bottled-Up Demand Drove the Gaming Industry to Historic Highs in Q1
Part of this blistering recovery can be attributed to consumers coming back in large numbers to soothe their pent-up demand. It has been more than 12 months of total lockdowns, shutdowns, and restrictions for consumers due to the COVID-19 pandemic. As a result, travel and entertainment were non-existent for many gaming enthusiasts for the better part of last year.
Looking at the data on a quarterly basis, the gaming industry generated 21.6% more revenue in Q1 2021 than the $9.33 billion garnered over the last three months of 2020. It is an expected trajectory given the gradual lift of restrictions over the first three months of 2021. Despite the remarkable movement in GGR, however, the gaming sector is barely half its full strength. Up until March 31st, casinos in 14 out of the 25 gambling legal states in the country are still under heavy restrictions. The 14 states host over 75% of commercial gaming properties in the country, but the said states have limited casino occupancy to less than 50%.
But then, now that vaccination rates are growing by the day, with restrictions for non-essential businesses increasingly eased across the country, the hospitality industry at large is opening up. In Sin City, for instance, three casinos have already received the okay to start taking in patrons at 100% capacity after at least 80% of their employees received their first dose of the vaccine. Furthermore, in many other states, the occupancy limits continue to be relaxed each week.
Sports Betting and iGaming Picked Up the Slack for Traditional Casino Gaming
Sports betting and online gaming have been lifelines of the US gaming sector since the Coronavirus pandemic started rocking the industry. Better yet, thanks to expanded state gaming regulations, the two gaming verticals have also been growing exponentially over the past year.
Per AGA’s latest report, from January to March 2021, sports betting generated a total of $961.1 million in revenue, marking a monstrous triple-digit surge of 270.2% compared to the same period last year. The figure sets a new record high for any other quarter of legal sports betting country, shadowing all other quarterly performances that have ever been recorded in the US. To put the $961.1 million win into perspective, the quarter haul is 5.75% higher than the nationwide GGR generated for all four quarters of 2019!
Shining a spotlight on the total handle for the period, American sports fans parted with over $12.97 billion in wagers at legal sports betting platforms across the country. This is three times more than the money spent on wagers for the first quarter of last year. Furthermore, in March 2021 alone, sports bettors placed a total of $4.6 billion in bets, effectively setting a record for the largest monthly countrywide handle.
Meanwhile, iGaming, brought in a $784.5 million revenue in Q1 2021, marking a year-over-year improvement of more than 300%. For context, the Q1 2021 haul for iGaming is 50% of the $1.55 billion recorded for all four quarters of 2020.
Overall, sports betting and iGaming accounted for 15.7% of the entire gaming revenue generated for the first three months of the year. Compared to the first quarter of 2020, the two verticals combined accounted for only 5.2% of the total gaming industry GGR. The 15.7% contribution to the gaming industry GGR is the second-best performance, only surpassed by Q2 2020 when sports betting and iGaming accounted for 20.3% of all the gaming sector’s GGR. Mind you, Q2 2020 was the time when the majority of land-based casinos in the USA had been shut down.
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