Recent revelations from the American Gaming Association highlight a stellar performance by the US gambling sector. According to the data for the quarter ending on September 30, there was a significant 6.1% increase in year-on-year revenue. This marks the 11th consecutive quarter of revenue growth and stands as the best third quarter the industry has ever seen.
The upward trend in industry revenue spanned across all operational verticals. Land-based casinos and iGaming not only experienced growth but have also set all-time records for quarterly revenue. It’s notable, however, that although the sector continues to grow, the rate of expansion has moderated for the second quarter in a row. This deceleration is in part due to the challenging year-on-year comparisons.
The AGA’s thorough analysis covers 33 commercial gaming jurisdictions that were operational and where comprehensive data was accessible through September. Of these, 17 jurisdictions reported increased revenue in the third quarter relative to 2022. Five states, among them being Nevada and New Jersey — the top two commercial gaming markets in the country — registered new single-quarter records.
Breaking down the numbers further, traditional slot machine and table game revenue collectively touched $12.49 billion for the quarter, marking a 1.8% increase from the previous year. iGaming, impressively, generated $1.52 billion and saw a surge of 26% from last year.
The combined revenue from in-person and online sports betting also recorded a robust quarter, with a 22.8% increase year-on-year, accumulating to $2.15 billion. This growth was primarily fueled by states like Maryland (online), Massachusetts, Nebraska, and Ohio, which were not operational a year prior. The sports betting segment is even expected to shatter its existing annual records, with $79 billion wagered by Americans in the first nine months of 2023 — a staggering 32.7% increase from last year.
In the domain of land-based gaming, revenue acceleration was observed from 0.9% in the preceding quarter to 1.5% in Q3, totaling $12.61 billion. Conversely, the online sphere, encapsulating both iGaming and online sports betting, witnessed a slowdown in annual revenue gains to 26.9% in Q3 from a previous high of 44.4% in Q2. The combined revenue from these online sources amounted to $3.52 billion, accounting for 21.8% of the total commercial gaming revenue in Q3 — the lowest share since the same quarter the previous year.
AGA president and CEO Bill Miller expressed his positive outlook on the performance, underscoring its role in delivering career opportunities and making substantial economic contributions via increased tax revenue. He pointed out that gaming is emerging as a preferred entertainment choice for a vast number of American adults. Additionally, Miller emphasized the significance of the legal, regulated sportsbooks as they continue to attract American bettors away from illegal and offshore operators.
In Nevada, gaming revenue soared by 2.9% year-on-year, reaching $3.88 billion, a boost greatly attributed to a record quarter for Strip casinos and the highest Baccarat win in the state’s history. New Jersey also saw a remarkable performance with the highest-ever gaming win of $1.56 billion, an 8.6% increase, further supported by record highs in iGaming and sports betting. Atlantic City casinos likewise enjoyed an exceptionally good quarter, second only to their best in land-based slot machines and table games.
However, it wasn’t all upturns. A handful of states experienced declines in their year-on-year quarterly revenue, with single-digit percentage decreases being the trend. The sports betting-only markets of Montana, New Hampshire, and Washington, D.C. saw the sharpest downturns.
State and local governments in gaming states weren’t left out of the profitable quarter, seeing direct gaming tax inflows of about $3.43 billion, a 4.7% increase year-on-year—testament to the lucrative quarter experienced by the commercial gaming industry as a whole.
