Nevada is the unprecedented gaming capital of the United States. No question. The city of Las Vegas has been hosting gambling and excess for more than 80 years. The city’s motto, “What Happens in Vegas Stays in Vegas,” is an example of the fun and extravagance Vegas offers. Vegas, along with other gambling towns in Nevada, placed billions of dollars in the state during the last six decades. Some years, there has been more money flowing in than others. Nevada suffered greatly during the economic crisis 10 years ago, and the state has been gradually rebounding. However, the numbers coming in from the first quarter demonstrate a flatness with gambling revenue in 2019.
Nevada’s Casino Gambling
The U.S. government owns much of the state of Nevada. For decades, Nevada was the least populated state in the United States. However, thanks to quickie divorces and legalized gambling, the population has grown. The state is still not as populated as the other states. Nevada earns a lot of revenue through gambling and tourism. In fact, gambling accounted for $852 million in revenue for the state in 2017. There are more than 334 casinos in the state. They range from very small casinos and poker halls to the huge resorts in Las Vegas.
In 2018, the casinos in Nevada had a nice year revenue-wise. The casinos took in $11.9 billion in revenue in 2018. This total represents the third-largest one in state history. Casinos were up 3 percent in 2018 from the revenue year in 2017. However, it is important to note the state has yet to breach the $12 billion mark. That was the highest total ever for the state, which it last attained in 2007 before the financial crisis. Casinos in Nevada crossed the $1 billion mark in monthly revenue five times during the last year. The majority of the casino winnings were from slot machines. They accounted for 65 percent of casino winnings. Las Vegas Strip casino revenue increased 2 percent from 2017 to 2018. Downtown Vegas casinos had a revenue increase of 3 percent. However, they could not come close to revenue generated by The Strip casinos.
Revenue in the First Quarter of 2019
The Overall Picture
Last year seemed to spell continued good times for Nevada casinos. Unfortunately, the gambling revenue so far this year has been a bit flat. In January 2019, revenue was up a bit from the January 2018 revenue, at 4 percent. However, there are places statewide that had revenue fall in the month of January. The Strip showed a slight decline of nearly 1 percent from the prior year. In addition, both the Reno and Sparks areas showed decreases in January. South Lake Tahoe had the biggest decline of all the casinos in the state (9 percent).
There were areas that showed hefty increases in January. Both Downtown and North Las Vegas had double-digit revenue increases in January of more than 20 percent.
Analysts have said the reason South Lake Tahoe saw a decline in January was the extreme winter in the area. The sheer amount of snowfall alone kept tourists away. However, in Downtown Las Vegas, analysts say revenue is increasing because of the construction of new casinos. In addition, downtown casinos have been focusing on luxury, experiences, and attracting Millennials. In contrast, North Las Vegas is home to smaller casinos and poker rooms, which have attracted a niche following. People who go to the casinos in North Las Vegas want to gamble without the glitz and glitter.
Comparisons with February and March
The February numbers weren’t as promising as the January numbers, which was disappointing given the promising beginning of the year. February saw the entire state’s gambling revenue decrease by 3 percent from the year before. The casinos took in $994 million in February. Many of the areas in the state that typically do well for monthly revenue missed the mark in February. Both the Las Vegas Strip casinos and the Downtown casinos saw their revenue fall in February. North Las Vegas saw its revenue up slightly more than 1.5 percent during February.
Of all the regions for gambling, Sparks saw one of the healthiest months. Its revenue rose by 5.5 percent. Other areas in Nevada that did well were the Wendover and Carson Valley areas. Both had increases of more than 5 percent for February.
Analysts point out the months of January and February are some of the slowest months in revenue for casinos. One of the few bright spots in the gambling scene in Vegas is Super Bowl week. This leads to tons of sports gambling. However, this year, there are other states taking a bite out of sportsbooks. Currently, seven other states besides Nevada allow sportsbooks.
The March indicators continue to show a fairly flat picture overall for casinos in Nevada. The revenue did go over the $1 billion mark for the month. The revenue still fell short of the revenue from the previous year. The revenue declined by about .62 percent for March. The Las Vegas Strip casinos continued to show a trend downward. Their revenue was down about 2 percent in March. However, the Downtown casinos fared much better. They reported an increase of 9 percent from the previous year. Both North Lake Tahoe and South Lake Tahoe casinos had an extremely poor month. The steep decline was largely because of storm after storm dumping heavy snowfall in the area. Reno’s revenue also declined by about 7 percent. In addition, Sparks casinos had an extremely modest increase of .41 percent for the month.
Slot machine revenue was up a lackluster .5 percent. The revenue for table games was also poor. Table game revenue decreased by 2.2 percent in March. Table games had a rotten month largely because of baccarat. Baccarat usually gets a bump in the first quarter because of the gambling taking place during the Chinese New Year. However, the high rollers who love baccarat did far better than they normally do. Because of the large payouts to high rollers, baccarat revenue fell more than 25 percent in March. The large decline in baccarat revenue obscured a nearly 10 percent rise in blackjack revenue. Craps revenue was also up 20 percent. Even the poker revenue was not as good as expected (3.8 percent).
What About the Sportsbooks?
In contrast to the rather flat picture of Nevada gambling in the first quarter, sportsbooks had a nice quarter. Sportsbooks set a record for the quarter. Revenue for the quarter was up over 200 percent from last year’s totals. In fact, revenue on sportsbooks doubled from February to March. The betting revenue in March hit $458 million, which was a state record for the month. College and pro basketball were the big winners in the sportsbooks’ revenue. Betting during the Super Bowl gave February betting a further boost. People also placed bets on Major League Soccer in the United States, the NHL, and the Premier League football clubs.
It remains unclear what the April numbers will bring. However, if the casino revenue doesn’t begin to pick up, experts will talk. They will continue to say that Nevada has still not recovered from the economic crisis a decade ago.
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