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US Gaming Industry Reaches Record High Revenues; Number of Commercial Casinos Declines

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New gaming study by RubinBrown indicates revenue growth is largely attributed to growth in iGaming and limited stakes segments
April 20, 2015
A new report on the nation’s gaming industry shows the overall gaming industry generated a record high $68.7 billion in gaming revenues, an increase of 0.5 percent over 2013.  The overall growth in the US Gaming is attributed to the expansion of the iGaming (online gaming) market and the limited stakes gaming market (slot machines offered in restaurants, truck stops, and taverns).  These two segments generated combined revenue growth of $479.5 million. 

Meanwhile, the traditional brick-and-mortar casino operations, comprising both tribal and commercial casinos, experienced an overall decline in gaming revenues.  In 2014, brick and mortar casinos generated $65.6 billion in revenues, a decline of 0.2 percent over 2013. Most notably, for the first time in the modern era of gaming, which started in 1989, the number of commercial casinos operating declined in 2014.  Atlantic City has been the market most adversely impacted by casino closures, as the state saw 4 casinos close their doors equating to more than 30,000 lost jobs across southern New Jersey.

RubinBrown’s Gaming Stats 2015 pools data from over 1,000 gaming operations in 39 states, incorporating all four segments of the U.S. gaming industry.  The data utilized within the report was obtained from the National Indian Gaming Commission (NIGC) and the various state gaming regulatory authorities. The report was compiled and written by RubinBrown’s National Gaming Services Group Leaders--Daniel Holmes, CPA, and Brandon Loeschner, CPA.

Commercial gaming could not sustain growth in 2014, as the overall market declined 0.6 percent in 2014 and generated $37.5 billion in revenue. Still, commercial gaming led all four of the gaming segments in total revenue, comprising 54.6 percent of total U.S. gaming revenue. Of the 23 states that have commercial gaming, only eight states saw an uptick in gaming revenue, with Ohio and Maryland recording the largest increases, up 35.5 percent and 24.4 percent over 2013, respectively. West Virginia and New Jersey had the biggest declines in revenue in 2014, decreasing 10.9 percent and 10.6 percent, respectively. Nevada, the largest market for commercial gaming, saw a slight decrease of 0.1 percent in generated revenue, reaching $6.32 billion and 29.4 percent of the total commercial gaming industry.

Holmes noted two primary challenges facing the commercial gaming industry contributing to decreased revenue: increased competition and aging entertainment offerings. However, although expansion remains a challenge for existing casinos, he also sees it as a significant opportunity for gaming operations as a whole, with six new gaming licenses awarded in New York and Massachusetts.

“Overall, the U.S. gaming industry will continue to see a redistribution of gaming revenue as new regional gaming markets emerge, notably the opening of Massachusetts’ first casino and other expansion in the Northeast,” said Holmes. “This will pressure existing operators to focus on cost reduction efforts and diversifying revenues away from the casino floor to other amenities.”

Tribal gaming grew by only 0.2 percent in 2014, but still set a new industry record of $28.1 billion in gaming revenues (fiscal year 2014 data is not yet available). This amount constituted 40.8 percent of the overall gaming industry’s revenue. Loeschner attributes the continued growth in revenue to overall market expansion as more tribal nations have been able to capitalize on the benefits provided by gaming. He noted that new tribal casinos are continuing to become more resort-style destinations that are effectively diversifying the entertainment options offered and thereby diversifying the revenues generated..

“Similar to commercial gaming, market saturation and increased competition are the leading challenges for existing Indian gaming operations,” said Loeschner. “Tribes are looking to counter this competition by finding new ways to capture the interest of the millions of patrons visiting tribal lands, including the development of new shopping centers, entertainment venues and cultural centers.”

The online or iGaming segment generated $134.7 million in gaming revenue in 2014.  The 2014 calendar year marked the first full year of legalized iGaming within the United States. The US iGaming market currently consists of three states Nevada, New Jersey, and Delaware.  Of these three, New Jersey led the industry by generating 91.2 percent of iGaming revenues with $122.9 million; however, this number fell short of analysts’ expectations.  The shortfall in iGaming revenues has been attributed to the technological difficulties in banks processing online gaming transactions and the geo-fencing used to verify iGaming play is originating within the states’ borders. Looking forward in 2015, future growth of this segment remains uncertain, with some industry supporters hopeful that California, with nearly double the population as the current three states combined, will be the next state to legalize iGaming.

Additionally, limited stakes gaming, video lottery terminals (aka Slot machines) offered in restaurants, truck stops and bars, saw significant growth in 2014, increasing 13.9 percent to $2.95 billion. While the segment experienced a significant growth in 2014, Loeschner noted the growth in this segment was solely attributed to expansion within the state of Illinois, where revenue was up 119.3 percent to $659.51 million.

“Overall, the United States gaming industry is growing as the number of gaming operations continues to increase; however the revenues generated by the new gaming operations are also taking away from the long-established gaming operations,” said Holmes. “The expansion beyond the traditional brick-and-mortar casinos reflects the continued integration of the gaming industry and is a trend we expect to continue to grow in 2015 and beyond.”

RubinBrown is one of the nation’s largest accounting and business consulting firms, with 500 team members working from offices in Denver, Kansas City and St. Louis, including a satellite office in St. Louis’ CORTEX Innovation District. Founded in 1952, the firm’s team members establish best practices within specific industry segments and work to serve the community both inside and outside the workplace. Our mission is to help clients build and protect value, while at all times honoring the responsibility to serve the public interest. RubinBrown is an independent member of Baker Tilly International, a high-quality, dedicated network of 154 independent firms in 133 countries. For more information, visit


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