Nevada’s casino industry had a remarkable year in 2023, breaking its own revenue records for the third consecutive year. According to the Nevada Gaming Control Board, the state’s 300 casinos that grossed $1 million or more in gaming revenue generated a combined net income of $3.4 billion from total revenues of $27.4 billion. This represents a 4.6% increase over 2022 and a 34.6% increase over 2020, when the pandemic severely affected the casino operations.
Strip casinos lead the way
The Las Vegas Strip, the most iconic and lucrative gaming market in the world, accounted for more than half of the state’s gaming revenue in 2023. The 60 casinos on the Strip reported a record $8.9 billion in revenue, a 7.4% increase over 2022. The Strip also had the highest single-month revenue in December, with $909.6 million, surpassing the previous record of $834.9 million set in July.
The Strip’s success was driven by several factors, including the recovery of tourism and visitation, the hosting of high-profile special events, and the opening of new attractions and resorts. Some of the highlights of the year were:
- The Formula One Las Vegas Grand Prix in late November, which attracted thousands of racing fans and celebrities to the city.
- The opening of the $2.3 billion Sphere in Las Vegas on Sept. 30, a state-of-the-art entertainment venue that features a 360-degree LED screen and a 17,500-seat auditorium.
- The opening of the $3.7 billion Fontainebleau Las Vegas on Dec. 13, a luxury resort that features 3,900 rooms, a 100,000-square-foot casino, and a 60,000-square-foot spa.
Slot machines and baccarat boost revenue
The main drivers of gaming revenue in 2023 were slot machines and baccarat, which together accounted for more than 70% of the state’s total. Slot machines, which are the most popular and profitable games in Nevada, generated $10.4 billion in revenue, the third-highest total in history. Baccarat, a high-stakes card game favored by Asian gamblers, generated $1.6 billion in revenue, the second-highest total in history.
Slot machines benefited from the increased demand and spending of customers, as well as the introduction of new and innovative games and features. Baccarat benefited from the favorable hold percentage of the casinos, which was 16.9% in 2023, well above the average of 12.5%. The hold percentage is the ratio of the amount won by the casino to the amount wagered by the players.
Other markets show mixed results
While the Strip was the star performer of the year, other gaming markets in Nevada showed mixed results. Clark County, which includes the Strip and other areas in the Las Vegas Valley, had 174 casinos that grossed $1 million or more in gaming revenue, which generated a combined net income of $3 billion from total revenues of $26.9 billion. This was a 4.9% increase over 2022, but a 0.8% decrease over 2020.
Washoe County, which includes Reno and Sparks, had 31 casinos that reported a combined net income of $156.8 million from total revenues of $1.2 billion. This was a 7.3% decrease over 2022 and a 15.4% decrease over 2020. The county was affected by the competition from tribal casinos in California, as well as the wildfires that reduced visitation and air quality.
The rest of the state, which includes rural areas and smaller markets, had 95 casinos that reported a combined net income of $254 million from total revenues of $1.3 billion. This was a 2.4% increase over 2022 and a 9.2% increase over 2020. The county benefited from the growth of sports betting, which generated $329.1 million in revenue, a 13.4% increase over 2022.
Outlook for 2024
The Nevada casino industry is expected to continue its strong performance in 2024, as the economy recovers and the pandemic subsides. The state is also expected to benefit from the legalization of online gaming, which was approved by the legislature in 2023 and is expected to launch in 2024. Online gaming will allow the state to tap into a new and growing market of customers, as well as to compete with other states that have already legalized it.
However, the industry also faces some challenges and uncertainties, such as the rising costs of labor and materials, the potential impact of the Omicron variant of the coronavirus, and the possible changes in consumer behavior and preferences. The industry will have to adapt and innovate to meet the evolving needs and expectations of its customers, as well as to maintain its competitive edge in the global gaming market.
