Nevada Gaming Slows Slightly While Visitation Increases Again

 

In March, Nevada’s gaming revenue surpassed $1 billion for the 25th month in a row. The Nevada Gaming Control Board (NGCB) monthly gaming revenue report revealed that casinos across Nevada accumulated earnings of $1.31 billion.

Although this benchmark was achieved, there was a slight decrease in gaming revenue by 3.18% in March. Nevada casinos earned $1.35 billion during the same period the previous year.

In March, the number of visitors to Las Vegas rose by 9.6% to 3.6 million. However, Clark County’s gaming revenue fell by 2.48%. The decrease in the Vegas Strip was marginally more significant at 2.9%.

Despite a minor dip in gaming revenue and consistent high visitation in March, casino operators such as Caesars and MGM Resorts reported unprecedented earnings in the first quarter of the year.

The gaming revenue in Nevada might experience a blip in March. Simultaneously, this could signify a potential slowdown in the gaming industry in the future.

The American Gaming Association (AGA) is expecting a nationwide slowdown in gambling revenue. Nevada is an entirely different gaming market than anywhere else in the US so the report might not be applicable to the Silver State.

More on Nevada’s gaming revenue in March

The NGCB report indicates that Nevada’s gaming revenue in March was slightly lower than the previous year. This marks only the third instance in the past year where Nevada casinos reported a revenue drop compared to the previous year.

Nevada casinos collectively made $1.31 billion in gaming revenue. Nonetheless, the success varied among casinos located in different parts of the state.

Revenue from gaming in Northern Nevada, particularly in Reno and Lake Tahoe, saw a significant decrease. The decline in Reno’s gaming revenue was over seven percent, while Lake Tahoe experienced a much steeper drop of nearly 18 percent, which was more than the decrease seen in the southern cities.

Casinos on the Vegas Strip performed relatively well, winning $724.6 million. This was a slight drop of 2.9% from the $746.2 million they won in 2022.

Baccarat winnings from casinos on the Vegas Strip in March were 50% lower than the previous year. However, the gaming revenue on the Vegas Strip for March, not including baccarat, was actually greater than it was in 2022.

Baccarat is predominantly a high-stakes game played at upscale casinos. Although it has fewer tables compared to games such as blackjack, the money bet on it can significantly impact the gaming revenue of the Vegas Strip in any particular month.

Revenue in downtown Las Vegas increased from the previous year, with “old Vegas” casinos earning $87.4 million. This was a 1.15% increase from the same period in 2022.

A Nevada gaming revenue slowdown seems inevitable

Regardless of the overall economy, a slowdown in gaming revenue in Nevada is anticipated. Since the height of the COVID-19 pandemic, gaming revenue in the Silver State has seen a rapid upswing.

The suppressed urge to gamble will eventually decelerate, stabilizing the revenue. This isn’t inherently negative, but the explosive growth of gaming revenue each month in the recent years may just cease to escalate.

According to the Future Conditions Index by the AGA, the gaming industry could face economic stress later this year. The report states:

“The 97.1 reading on the Future Conditions Index in Q1 indicates an environment in which real economic activity in the gaming sector is expected to decrease over the next six months (-2.9% annualized rate).”

Nevada casino revenue could be different than the rest of the country moving forward. Las Vegas is chock full of events that will bring visitors from the US and around the world. The majority of those visitors will spend time gambling.

The event calendar, which had slowed down in April, resumes with full force in May. Every weekend in May is filled with music festivals.

Memorial Day Weekend typically marks the end of the month and is often one of the busiest times in Las Vegas as it unofficially initiates the summer vacation season across the country.

Beyond summer tourism, Las Vegas is set to host eight Raiders games in the latter half of the year, along with the Las Vegas Grand Prix in November. The F1 race weekend is projected to generate over $1 billion in economic revenue for the city.

Despite the potential for a gaming slowdown, casino operators remain optimistic about Las Vegas’ prospects throughout the year.

March Nevada sports betting report

In March, Nevada’s sports betting revenue reached $43.9 million, marking an 18.8% increase from the previous year.

Despite an increase in revenue in March, the total sum wagered by Nevada bettors declined from 2022. The $829.8 million bet during the month was 3.8% less than that of the previous March.

In March, Nevada casinos retained 5.3% of the money bet.

March Madness betting boosted the revenue for the month. $655.7 million was wagered on basketball throughout the month, with roughly 70% of it being bet on college basketball.

Before the actual 68-team tournament, March Madness in Las Vegas kicks off. Betting on college basketball commences with numerous conference tournaments happening in Las Vegas, and even more across the country, all leading up to the NCAA basketball tournament.

The initial weekend of March Madness is among the most hectic for sportsbooks in Las Vegas, with 48 games unfolding across the four-day weekend.

Nevada hosted the West regional of the NCAA basketball tournament for the first time ever. In 2028, the Final Four will be held at Allegiant Stadium in Las Vegas.

The surge in tourism in Las Vegas for the month was spurred by extra March Madness games and Taylor Swift concerts. However, despite the influx of tourists, only 64% of all March wagers were accounted for by Nevada sports betting apps.

Las Vegas visitation up, and it may not slow

The slight decline in gaming revenue in March was not because of a shortage of visitors. A monthly report by the Las Vegas Convention And Visitors Authority stated that Las Vegas saw 3.65 million visitors in March.

In general, Las Vegas saw a 9.6% increase in visitors compared to last year, but experienced a 1.1% decrease when compared to 2019, prior to the Covid-19 pandemic. The rise was significantly aided by the presence of 771,000 convention attendees in Las Vegas, representing a substantial 56% boost from the previous year.

These visitors hold significance for hotel operators because they pay higher midweek prices compared to leisure travelers who seek cheaper rooms than on weekends.

In March, 88.3% of hotel rooms in Las Vegas were occupied. This represented an increase of 7.7%, which once again drove up prices.

The average cost for hotel rooms in Las Vegas increased by 30.7% to $213.25 per night in March.

Reps from Caesars, MGM Resorts, and other casino operators indicated a positive future outlook during several earnings calls. Advanced bookings remain high due to large events scheduled throughout the summer and fall.

The Raiders will host eight regular season home games when the NFL season commences in September.

U2’s eagerly awaited limited run at the MSG Sphere is set to kick off in late September and will extend into October. Following this, the inaugural Las Vegas Grand Prix is scheduled for the weekend subsequent to Thanksgiving in November.