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US – US commercial casino sector increases by six per cent in May

By - 26 July 2023

Commercial gaming industry revenue grew more than six per cent in May compared to the previous year, reaching $5.49bn, according to state regulatory data compiled by the AGA.

While this marked the 27th consecutive month of annual national growth, the strength of state market performances have begun to diverge in the face of annual comparisons that are no longer impacted by past COVID concerns.

Through the first five months of 2023, commercial gaming revenue is tracking 12.4 per cent ahead of last year’s record setting pace, reaching a total of $27.59bn through May.

While the annual growth rate remained healthy in May, the pace of revenue acceleration slowed for a fourth consecutive month, reflecting the end of COVID-related impacts to year-over-year growth measures.

As land-based gaming revenue growth contracted slightly in May, overall growth was primarily fueled by the ongoing expansion and acceleration of online gaming. Revenue from land-based gaming, which encompasses casino slots, table games and retail sports betting, declined slightly (-0.6 per cent) compared to the previous year. Conversely, revenue from online gaming grew 43.4 per cent year-over-year. This growth was driven largely by the introduction of online sports betting in Kansas, Maryland, Massachusetts and Ohio within the past year, as well as the continued growth of iGaming in the six states where it is legal.

At the state level, 24 out of 33 commercial gaming jurisdictions that were operational last year reported annual revenue gains in May. Nine states – Delaware, Florida, Iowa, Indiana, Louisiana, Missouri, Missouri, Nevada and Oregon – experienced declines in overall revenue, primarily due to slowdowns in the traditional casino segment, and as a result of lower sports betting revenue in Delaware, Mississippi and Oregon.

Although their growth has decelerated nationwide compared to digital offerings, traditional casino slot machines and table games remain the dominant engine of commercial gaming revenue. In May, these segments accumulated a total revenue of $4.12bn, a decrease of 0.3 per cent compared to the previous year. Slot machines generated $2.98bn in revenue, up 1.3 per cent, while table game revenue declined 4.8 per cent to $834.3m. The individual slot and table game figures do not include data from Louisiana and Michigan due to state reporting differences though their aggregates are captured by the combined nationwide figure.

Year-to-date through May, the combined revenue from casino slot machines and table games reached $20.50 billion, surpassing last year’s pace by 4.1 per cent. At the state level, 19 out of 25 commercial gaming states that offered these gaming options in 2022 posted year-to-date revenue growth in these segments through May.

Revenue from sports betting and iGaming continued to expand, with both verticals reporting the best May revenue levels ever.

Land-based and online sportsbooks collectively generated $864.1m in commercial revenue across 28 jurisdictions (excluding Arizona, which had not reported May figures at the time of publication). This marks an increase of 41.5 per cent from May 2022 when commercial sports betting markets were active in 26 jurisdictions.

Adults in 24 jurisdictions had the option to place bets online, including in four states that launched mobile sports betting offerings within the past year: Kansas, Maryland, Massachusetts and Ohio. Excluding the impact of new sports betting markets and online expansions, sports betting revenue grew 24.2 per cent compared to May 2022. Notably, Ohio and Massachusetts, two of the newest markets, solidified their positions among five highest-grossing sports betting states in May.

Through May, year-to-date commercial sports betting revenue reached $4.58bn, exceeding the same period in the previous year by 64.9 per cent.

Finally, the combined revenue from iGaming operations in Connecticut, Delaware, Michigan, New Jersey, Pennsylvania and West Virginia grew 22.4 per cent in year-over-year in May, reaching $497.4m. All six markets reported annual iGaming revenue growth. Year-to-date iGaming revenue stands at $2.48bn, reflecting an increase of 22.3 per cent compared to the same period in 2022.

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