The American Gaming Association (AGA) has released its State of the States 2021: The AGA Survey of the Commercial Casino Industry, citing the COVID-19 pandemic’s dramatic effect on the gaming industry in 2020, which resulted in a 31 percent decrease in commercial gaming revenue and a major shakeup in the top 20 casino markets.
While the pandemic wreaked havoc on traditional gaming markets, emerging verticals such as sports betting and igaming saw massive development, according to the study.
It was discovered that the industry’s overall annual revenue in 2020 was the lowest since 2003, with customer spending on commercial gaming dropping to $29.98 billion, down 31 percent from 2019. Furthermore, all 25 states with commercial casino gaming posted lower revenue in 2019 than in the previous year.
On a more promising note, Americans legally wagered $21.5 billion on sports in 2018, up from $13 billion in 2019, and income from legal sports betting operations rose by 69 percent to $1.5 billion.
According to the survey, the Baltimore-Washington, DC gaming market has surpassed Chicagoland and is now only second to the Las Vegas Strip and Atlantic City. The Gulf Coast, St. Louis, and Shreveport/Bossier City markets all improved their rankings in the top twenty.
Bill Miller, President and CEO of the AGA, reflected on the results, saying: “The gaming industry faced enormous challenges in 2020 – and we also saw significant changes, as player demographics shifted and emerging verticals saw strong growth.
“From sharp revenue declines, to booming legal sports betting activity and overwhelming voter enthusiasm behind gaming, this year’s report reflects both the highs and lows of the past year.”
Commercial gaming income in the United States increased 11.4 percent in the first two months of 2020 compared to the same period in 2019. However, revenue dropped sharply for the remaining 10 months of the year due to mandatory casino closures and capacity limits, which began in March when all US casinos closed due to the COVID-19 pandemic.
Last year, America’s commercial casinos lost more than 45,600 business days due to pandemic-related closures, averaging around 27 percent of the year.
At the end of the year, there were active legal sports betting markets in 19 states and the District of Columbia. Despite the closing of land-based casinos and the cancellation of major sporting events in the spring, sports betting grew significantly, with Americans legally betting more than $21.5 billion on sports last year.
AGA member business executives, including industrial and tribal operator and supplier CEOs and CFOs, estimated a sales decline of slightly more than 40% in 2020 and a recovery timetable of up to two years in a survey conducted in April 2020.
However, commercial gaming revenue in Q1 2021 tied for the highest quarterly total ever, indicating a faster recovery than anticipated.
“The first quarter of 2021 clearly shows that consumer interest in gaming never waned, despite the challenges of 2020,” added Miller. “This momentum is a direct result of our industry’s ability to provide safe environments for our employees and guests to return to and is a strong indicator that our recovery is on the horizon.”