Buddy Frank, CDC Gaming Reports
CDC Gaming Report May 2022:
Last year about this time, I reported on the “State of the States 2021” from the American Gaming Association. These bellwether annual reports reflect the trends from the previous year, so the 2021 report was particularly interesting to see exactly how disastrous the 2020 pandemic year was. Certainly, it was no surprise that the numbers were down, but it was still somewhat shocking to see the gory details:
Total commercial gaming revenues were down 31.3% in 2020.
The declines ranged from 78.8% in New Mexico to 4.5% in South Dakota
Las Vegas visits declined 74%
Tax revenues generated for states were down 34.2%
Wonderfully surprising, our 2021 recovery was even stronger than many would have predicted. In a preamble message of this latest report, AGA President and CEO Bill Miller says, “Despite continuing pandemic-related uncertainties, including labor shortages and supply chain issues, our incredible rate of recovery set us apart from others in the hospitality sector and the broader economy.”
Here’s the report graph that gives dramatic visual proof of his statement:
You can see that not only did we recover to pre-COVID levels; we set new records. “Annual commercial gaming reached a new record of $53.03 billion—a 21.5 percent increase from the previous high in 2019.”
Thankfully, the good news doesn’t seem to be a one-time (or a one-year) blip. The most recent press release from Miller stated, “Nationwide commercial gaming revenue totaled $14.31 billion in Q1 2022, according to the American Gaming Association’s (AGA) Commercial Gaming Revenue Tracker. This sets a new Q1 record and nearly matches the all-time quarterly record, which was just set in Q4 2021 ($14.35B).”
If you’re not familiar with AGA’s State of the State report, it comes out annually around this time of the year, and according to them it “provides a comprehensive overview of the commercial casino gaming industry in each of the 34 jurisdictions with legal commercial casino gaming or sports betting as of December 31, 2021.” The AGA first began these reports in 1998 and has recently worked with VIXIO Gaming Compliance to compile the data.
What’s not included this year is a comparison to revenue results from Native America operations. The report does show Annual U.S. tribal gaming revenue gathered from the National Indian Gaming Commission from 2016 to 2020, but the 2021 figures were not available when this report was issued.
Historically, Indian gaming represented about 45% of all gaming in the country. From my off-the-record conversations with tribal leaders and operators, their results have been as strong, or stronger, than the commercial casinos profiled in this report.
In AGA’s ranking of the Top 20 Commercial Casino Markets, the Las Vegas Strip is number one ($7.05B) followed by Atlantic City ($2.57B). I would confidently estimate that Southern California would easily take the second spot away from the Boardwalk.
Two other specifics from this report are worth noting as they represent significant hints that things are changing: Online activity continues to grow, and our demographics are getting younger. Both are encouraging signs.
The report states, “The average visitor to a land-based commercial casino in 2021 remained notably younger than prior to the pandemic. In 2021, the mean age of a casino patron was 43.6 years old, versus 49.6 in 2019 and 48.6 in 2018, according to AGA survey data.”
Together, online gaming and sports betting totaled $8.04B or $15.2% of all commercial gaming revenues. That is the highest percentage the segment has ever achieved. Of course, sports betting has been leading the way as noted in the report: “The regulated U.S. sports betting market generated total revenue of $4.33 billion in 2021, not including sportsbook operations in tribal casinos. That total marked an increase of 179.7 percent on the prior year, as Americans legally bet some $57.71 billion compared to a handle of $21.60 billion in 2020.
The report goes on the say, “2021 saw a significant expansion of the legal sports wagering industry to new markets across the country. Seven states—Arizona, Connecticut, Florida, Nebraska, Ohio, Wisconsin, and Wyoming—enacted legislation to authorize sports betting during 2021 … a further three states—Louisiana, Maryland, and South Dakota—passed enabling legislation after sports betting was authorized through statewide referendums in 2020. Finally, New York passed a new state law permitting online sports betting, expanding a market that was previously limited to physical sportsbooks. By the end of 2021, legal sports betting was available in 30 states plus the District of Columbia, up from 19 states at the start of the year.”
Likewise, internet gaming had a banner year according to the report, “Despite the full reopening of land-based casinos, total internet gaming revenue across the seven states with legal internet casinos or online poker platforms continued to grow and reached $3.71 billion, an increase of 138.9 percent from 2020. Annual revenue surpassed $1 billion in each of New Jersey, Pennsylvania, and newcomer Michigan, establishing all three states as major internet casino gaming markets on a global scale.”
Again, if you’re unfamiliar with the report, the bulk of the content after the Executive Summary (the source of most of the quotes above), details a state-by-state breakdown of revenues from those jurisdictions with at least some form of commercial gaming from Arizona to Wyoming.
Like most of us, 2021 was a welcome and wonderful relief. Miller echoed the hope that all of us share: “Although 2021 was a tumultuous year, I’m confident it set a new baseline for gaming in the long-term as we provide consumers with cutting-edge entertainment and anticipate the full recovery of travel, events, and entertainment.”
“Over the past year, innovation accelerated as suppliers and operators found new ways to strengthen customer engagement. This includes the expansion of omnichannel gaming, giving more consumers access to a truly integrated gaming experience—one that enables players to interact with us how, where, and when they want.”
As I’ve often said about other great predictions, “From his lips to God’s ears.”