United States casinos post $66.5 billion in revenue for 2023, a 10% increase over 2022

February 20, 2024 4:17 PM
Photo: Shutterstock
  • Rege Behe, CDC Gaming Reports
February 20, 2024 4:17 PM
  • Rege Behe, CDC Gaming Reports

By any measure, 2023 was a banner year for the gaming industry.

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According to the American Gaming Association, commercial-gaming revenue reached $66.5 billion for the year, a 10% increase over the previous record of $60.5 billion generated in 2022.

The past year also saw record revenue for a quarter ($17.4 billion in Q3) and for a single month ($6.2 billion in December). Expansion looms, with Rhode Island set to legalize igaming in March and North Carolina ready to launch mobile sports betting March 11.

“Our reputation and popularity continue to accelerate growth and performance,” said AGA President and CEO Bill Miller Tuesday during the webinar “State of the Industry: Gaming’s Year Ahead.”

The stellar results are in part due to the growth of sports betting, which experienced a record handle ($119.8 billion, a year-over-year increase of 27.8%) and sportsbook revenue ($10.9 billion, a 44.5% increase). Revenue from igaming also increased to $6.2 billion, a year-over-year increase of 22.9%.

“This growth translated into robust economic and community impact,” Miller said, noting that the gaming industry contributed $14.4 billion in taxes to state and local governments, another record.

The record revenues do beg the question, where does future growth come from? There are a little over 1,000 casinos in the U.S., and 30 of the 50 states, and the District of Columbia, have legalized sports betting.

Miller, citing the “massive uptick” in sports betting since the repeal of the Professional and Amateur Sports Protection Act (PASPA) in 2018, said individual stakeholders in states have fueled growth in sports betting and igaming. And despite three-fifths of states now permitting sports betting, the growth in that vertical hasn’t been solely due to adding new markets.

“We’ve seen states that have been online for several years with sports betting continue to have strong growth,” said AGA Vice President, Research Dave Forman. “Illinois has been online for several years now and last year posted another really strong year of growth. A lot of people saw New Jersey’s numbers that just came out for January and the second-most mature market in the country (behind Las Vegas) posted really strong growth.

“So part of it will be new markets coming online, but a lot of it is just continuing to migrate either new customers to the legal books from offshore books or bringing new customers into the sports-betting fold.”

Illegal offshore sportsbooks and skill machines continue to remain an area of concern for the AGA. Miller noted that illegal offshore markets are “not going anywhere and we need to figure out how to better understand where they are and how to stop them.”

Of equal if not more concern than illegal sportsbooks is the proliferation of skill games in markets such as Pennsylvania (an estimated 100,000 machines) and Virginia, which Miller said has “tens of thousands” skill games. “These are a group of individuals who have brazenly entered a market without any regulatory interests at all. They’re just brazenly deciding that they’re going to open up gaming operations in the states without regard to regulatory structure. My view is you shouldn’t reward bad actors with regulatory rewards.”

But perhaps the most encouraging sign for the industry – not that record revenue is discouraging – is that the public seems to support, or at least tolerate, legal gambling. According to AGA research, 9 of 10 Americans believe that casino gaming is acceptable for themselves or others and 75% believe the industry has a positive effect on the economy.

Miller says public- and private-sector acceptance of gambling was realized with the recent Super Bowl in Las Vegas.

“Had you asked me 10 years ago or even five years ago, it would be hard to imagine one of the world’s premier sporting events in Las Vegas, Nevada,” Miller said. “It was really a full-circle moment for the city and yet another example of how much we’ve transformed as an industry. It shows that today, we’re broadly embraced by the public and key stakeholders, including professional sports leagues and teams. And it all happened in just five short years since the fall of PASPA. It is truly remarkable.”