Casino visitation dipped in December, with foot traffic down 4.8% compared to the same month last year, according to a report from Jefferies Equities Research. The decline reflects lingering challenges from competition, economic factors, and uneven recovery across markets. December’s performance also underscores a 10.5% drop in foot traffic compared to pre-pandemic levels in 2019, although some regions bucked the trend.
Regional Trends Show Uneven Impact
David Katz, an analyst at Jefferies, highlighted that foot traffic in key markets like Ohio and Pennsylvania saw significant year-over-year declines of 6.9% and 6.8%, respectively. Atlantic City experienced an even steeper drop, with visitation levels down 13.6% compared to December 2023 and 19.2% compared to December 2019.
Illinois data mirrored this decline, with traffic running 17.4% lower than pre-pandemic levels. However, Katz noted that these figures excluded the impact of Wind Creek’s new property in the Chicago area, which opened in November and is expected to drive increased visitation.
Detroit showed mixed signals. While foot traffic was up 5.8% year-over-year, it remained 21.6% below 2019 levels, reflecting a still-fragile recovery.
Black Hawk in Colorado offered a rare bright spot, with visitation up 3.7% year-over-year. However, Katz pointed out that this growth was influenced by Monarch Casino Resort’s new market entry, making broader comparisons tricky.
Macro Trends and Rising Costs
Higher operating costs—spanning insurance, utilities, and labour—are adding pressure to casino operators. These costs vary widely across markets, further complicating recovery efforts. Despite December’s declines, Katz believes that trends could stabilise and potentially improve in 2025, as year-over-year comparisons ease.
For regional operators, exposure to competition remains a concern. Penn Entertainment, which operates seven casinos in Illinois and Ohio, is particularly vulnerable. Meanwhile, Boyd Gaming and Caesars generate the majority of their earnings before interest, taxes, depreciation, and amortisation (EBITDA) from regional markets, leaving them broadly exposed to fluctuations.
Competition and New Openings Shape Local Performance
New openings in markets like Kentucky and Virginia are influencing results. For example, the Rose Gaming Resort in Dumfries, Virginia, opened in late October and is expected to boost Churchill Downs’ performance in the coming months. Similarly, Kentucky’s figures showed seasonal fluctuations rather than fundamental changes in demand, with a 4.1% year-over-year decline.
Bullet points for December’s foot traffic snapshot:
- Ohio and Pennsylvania: 6.9% and 6.8% year-over-year declines, respectively.
- Atlantic City: Down 19.2% versus 2019, 13.6% year-over-year.
- Detroit: Up 5.8% year-over-year, down 21.6% compared to 2019.
- Black Hawk, Colorado: Up 3.7% year-over-year.
What Lies Ahead
The December report suggests ongoing volatility as casinos continue to adapt post-COVID. While some markets show signs of recovery, others are hampered by competition, rising costs, and slow foot traffic. Regional operators are particularly exposed, with many relying heavily on footfall in markets facing fierce competition.
The outlook for 2025 offers cautious optimism. As year-over-year comparisons ease and new properties become fully integrated, some stabilisation is expected. However, macroeconomic pressures and the uneven pace of recovery remain critical challenges for the industry.
