With gaming revenues at an all-time high, it’s no surprise that the majority of CEOs surveyed by the American Gaming Association have favorable opinions about the industry.
According to the Gaming Industry Outlook Index, a survey of 32 gaming industry executives prepared by Oxford Economics for the AGA, 44% characterized the current environment as good, and 50% termed it satisfactory.
The executives also were optimistic about future conditions, with 32% expecting business conditions to improve over the next six months, up from 20% in Q3 2023.
“Gaming’s record-setting growth over the last three years has set a new standard for industry success,” said AGA President and CEO Bill Miller in a statement. “However, as we enter a period of market normalization, continued investment and innovation in offering world-class, responsible entertainment experiences will be required to maintain industry momentum.”
The survey indicates gaming executives are optimistic about the industry’s “overall balance health sheet” for the next six months; 42% of respondents were net positive, while 13% expect a net negative in revenue growth and 22% expect a net negative in hiring.
Other highlights from the Outlook Index include:
- In contrast to past surveys, gaming equipment suppliers are slightly pessimistic about the sale of gaming units for replacement use and new or expansion use (both 13% net negative). However, they remain optimistic about the pace of capital investment (38% net positive).
- Half of operator CEOs expect capital investments in hotels over the next year to be higher than normal compared to the fall 2023, and more expect higher than normal levels of capital investment in meetings, conventions and table games (28%). Also, 44% expect increases in food and beverage investment, down from 67% in Q323.
- Executives said inflationary or interest rate concerns continue to be a major factor limiting operations (28%). However, this concern has been overtaken by geopolitical risks (34%) and uncertainty of the economic environment (34%) as the biggest limiting factors.
- The Current Conditions Index of 102.8 for Q124 indicates solid annualized real economic growth of 2.8%. This includes gaming revenue, employment, and employee wages and salaries.
- The Future Conditions Index stands at 102.2, indicating that annualized industry economic activity, after controlling for underlying inflation, is expected to increase moderately over the next six months. This outlook reflects Oxford Economics’ forecast that the U.S. economy will slow during 2024 but avoid recession.
The survey was conducted between March 28 and April 10, 2024. It included executives from international and domestic gaming companies, tribal gaming operators, single-unit casino operators, major gaming equipment suppliers, and major igaming and/or sports betting operators.
