The closure of the nation’s casino industry this past spring due to COVID-19 caused a nearly 79% decline in total gaming revenues during the second quarter, according to figures compiled by the American Gaming Association.
In a study released Thursday, the Washington D.C. trade organization said gaming revenues from 18 of 27 commercial casino states where gaming had reopened totaled $2.3 billion in the three months that ended June 30. All gaming verticals but one showed double-digit declines.
Online gaming – active in various forms in just five states – saw revenues of $402.7 million, an increase of almost 254%.
“The gaming industry is looking for innovative ways and customers are seeking new experiences in wake of COVID-19,” AGA CEO Bill Miller said during a conference call when asked about a potential expansion of online gaming opportunities.
The online revenues included figures from Delaware, Pennsylvania, Nevada (poker only), New Jersey, and West Virginia. Michigan has legalized online gaming but has not gone live with the activity.
The AGA unveiled its new Commercial Casino Revenue Tracker, which compiles revenue from the nation’s commercial gaming states. Tribal gaming figures are not included. The organization said it will release numbers on a quarterly basis, but also provide monthly totals on its website.
Most of the overall revenues came in June. The AGA said 388 of the nation’s 465 commercial casinos reopened by the end of the quarter following state and regulatory-ordered closures, which began in mid-March in an effort to slow the spread of coronavirus.
During the quarter, slot machine revenues fell 81.9% to $1.3 billion. Table game revenues were down 86% to $286.9 million. Sports betting revenues declined 46.3% to $64.2 million.
AGA CEO Bill Miller testifies in front of the Senate Judiciary Committee in July 2020.
Miller noted the quarter marked the first three-month period where online gaming recorded higher revenues than sports betting since the activity was legalized in May 2018.
“COVID-19 has undoubtedly posed the most difficult economic challenge the gaming industry has ever faced,” Miller said. “Yet, gaming’s record popularity prior to COVID-19, as well our resilience in the midst of such adversity, is evidence of the industry’s foundation for continued success as we emerge from the pandemic.”
The AGA also provided a year-to-year comparison covering the first six months of 2020, showing the overall commercial gaming revenue was $11.7 billion, a decline of 45.6%. However, sports betting was up 10.4% to $324.9 million due to “a record start” during the first two months of 2020 and the expansion of the activity, which is now legal in 18 states,
Miller noted sports betting operators “offered some innovative betting opportunities” to make up for the shutdown of professional and college sports in March. He noted the return of the NBA, NHL, and Major League Baseball has given sports betting a new lift.
Still, with casinos still closed and many markets, declines in tourism and travel, and reduced operations due to COVID-19 health, safety, and cleaning guidelines, that has also led to reduced capacity and fewer non-gaming attraction, the gaming industry is headed toward a long period of recovery.
The AGA said cited recently released July numbers for several states showing increased gaming revenue from a year ago, despite casinos operating under COVID-19 restrictions. South Dakota was up 42.5%, Ohio was up 19.3%, and Indiana was up 7.4%.
Miller remarked that gaming customers are more comfortable driving to a location rather than traveling by air, which bodes well for regional casino states but is slowing the recovery in destination markets, such as Las Vegas.
“It won’t happen overnight,” Miller said. “Sports betting operators may have to rethink their strategies in the fall with the cancelation of some of the college football season. We’ve never experienced a situation where all commercial gaming revenue disappeared overnight.”
The AGA said April and May each accounted for more than 90% percent gaming revenue declines. During June, where much of the commercial casino reopenings took place, revenue was four times greater than the previous two months.
Miller noted unique marketing opportunities, such as MGM Resorts International’s “Work from Vegas” promotion as a way to draw in business during an ongoing pandemic.
He also cited the gaming industry’s leadership in “implementing rigorous, innovative protocols that have allowed the vast majority of our properties to reopen and stay open.” He said casino operators are “steadily charting a responsible path to recovery that prioritizes health and safety, and supports the communities where we operate.”
Howard Stutz is the executive editor of CDC Gaming Reports. He can be reached at hstutz@cdcgaming.com. Follow @howardstutz on Twitter.
