The American gaming sector is currently riding the waves of an impressive winning streak, with the industry’s revenue scaling new heights in 2023. The year witnessed a remarkable 10% surge in total gaming revenue, amounting to a staggering $66.5 billion—a sizable jump from the $60.4 billion generated in 2022, itself a significant increase from $53 billion in 2021.
The robust performance is partly thanks to a record-breaking Q4, which saw an unprecedented quarterly revenue of $17.4 billion, contributing to the annual high. Moreover, the industry celebrated a record $6.2 billion in revenue within the same quarter.
Brick-and-mortar casinos are far from losing their luster, proven by their record Gross Gaming Revenue (GGR) which reached $49.4 billion in 2023. This figure represents a 3.3% boost from the previous year, with 19 out of 27 traditional gaming markets witnessing all-time highs in their annual revenue.
Moreover, sports betting has been a significant contributor to this growth, with an impressive $119.8 billion in total bets placed and $10.9 billion in revenue, breaking previous records. These numbers are an upswing of 27.8% and 44.5% year-on-year, respectively.
Anticipation is high for the total GGR in 2023 to near the $110 billion mark, following the inclusion of tribal gaming revenue data from the National Indian Gaming Commission later this year.
AGA President and CEO Bill Miller reflected on these figures, emphasizing the soaring demand for gaming among American adults, spanning the spectrum from traditional casino experiences to online formats. Miller also stressed the importance of industry-wide endeavors to counteract illegal gaming operations and enhance responsible gambling initiatives, tasks the AGA pledges to spearhead throughout 2024.
Currently, igaming is restricted to just six states, yet despite these limitations, it showed a remarkable rise of 22.9% year-on-year, with revenues touching $6.2 billion. Igaming’s GGR came in a close second to sports betting, even though it’s legal in considerably fewer states.
Online gaming also accounted for 24.7% of the nationwide GGR in 2023, marking an all-time high from the previous year’s 19.5%.
Looking ahead to 2024, multiple states are considering the introduction of igaming. One notable exception is New York, as Governor Kathy Hochul did not include igaming in her executive budget for 2025. This was in contrast with efforts by State Senator Joseph Addabbo, who proposed a revised igaming bill aimed at legalizing online gaming in the Empire State.
The relationship between online and land-based casinos has been a topic of debate, with concerns that igaming could siphon revenue from traditional establishments. However, a new report commissioned by the iDevelopment and Economic Association (iDEA) dispels these fears, indicating that igaming may, in fact, benefit land-based casinos.
The report revealed a positive shift in the compound quarterly growth rates (CQGR) of land-based casino GGR post the introduction of online casinos in six studied states. A survey conducted by EKG, which included both land-based and online casino operators, echoed a consensus that cannibalization is a non-issue. When queried about the impact of online casinos, 20% reported a “moderate increase” in land-based revenue, while 80% noted that revenues remained approximately the same.
In response to inquiries about the effects of online casinos on traditional venues, a unanimous 100% of those surveyed dismissed cannibalization fears as invalid. This positive sentiment suggests a synergistic relationship, wherein the growth of online gaming may potentially complement and encourage the prosperity of land-based casinos.
