When the global COVID-19 pandemic began to unfold in early 2020, many industry experts predicted that the gambling industry’s revenue would take a massive blow and not recover to pre-pandemic levels until 2023.
However, the path to recovery was much shorter than anticipated by the majority of people.
And in 2021, Nevada experienced its greatest year ever, generating slightly more than $13.4 billion in revenues. According to the Nevada Gaming Control Board, February 2022 marked the twelfth consecutive month in which the state’s revenues topped $1 billion. The $1.1 billion it earned in 28 days surpassed the record established by Nevada in January.
The February Marking Month
Nevada’s February 2022 revenue of $1.1 billion represents a year-over-year increase of 44%. In the same month of the previous year, the state’s output was $772 million. That was a 7 percent increase compared to what February 2020 was responsible for, when the pandemic began.
The high number of concerts in Sin City, coupled with a sports wagering frenzy surrounding the Super Bowl and the city hosting the NHL All-Star Game, were cited by many as the primary reasons for the February record.
According to a number of analysts, including Michael Lawton of the Nevada Gaming Control Board, Nevada’s successful streak will end shortly, primarily due to inflation and rising gas prices resulting from the Russia-Ukraine conflict. Lawton recently expressed optimism that the present level of gaming victories will continue over the next few months.
Nonetheless – “We are dealing with a number of geopolitical and macroeconomic events that have the potential to affect trends observed over the past year.”
Nonetheless, casino directors are optimistic that March Madness, the NCAA College Basketball Tournament, will generate sufficient interest in the third month of 2022 to sustain February’s momentum into March. According to statistics, the majority of NCAA fans do not give attention to the league until the championship game.
Slot Machines Continue to Be Nevada’s Cash Cows
A widely held perception in the gambling industry is that slot machines account for 60 to 80 percent of all gaming revenue. They are without a doubt the most popular product in casinos and the easiest to play.
In 2021, reel-spinning activities in Nevada generated $9.2 billion in revenue. That is a record for spaces as well. In addition, it is a 16.4% increase from pre-pandemic 2019, when total gaming revenues reached $12 billion. There are 306 casinos in Nevada with slot machines, with 157 of them located in Clark County and 39 on the Strip.
In February, slot machines contributed $764 million to the monthly return of $1.1 billion. This represents a 69% increase and a 44% year-over-year increase. The win probability for these games was 6.9%, and multi-denomination machines were the most profitable, generating $377 million in revenue. Second place was reserved for penny slots with $282 million. Table and card games contributed $348.8 million to February’s total revenue.
The 2021 figure was augmented by roulette’s contribution of $428 million and the state’s sportsbooks’ collection of more than $1 billion in revenues, with 64% of these wagers originating from smartphone devices, a 7.5% increase compared to 2020.
2022 should be another year that breaks records.
Fitch Ratings, one of America’s top three credit rating agencies along with Standard & Poor’s and Moody’s, released a gaming-related report in November 2021, predicting that international tourism will recover in 2023. However, in certain regions, short-term volatility will persist due to stringent health regulations. In America’s favorite sun-drenched territory, Nevada, things are essentially returning to normal.
Global Market Advisors, an award-winning research and boutique management firm, predicts that 2022 will be a prosperous year for the industry, which has shown resilience in the wake of the devastation of 2020.
To Sum Up
Although sector numbers appear to be elevated, the industry has not yet fully recovered.
International travel and business are still not returned to their 2019 levels, and it is not anticipated that this will occur until 2024. According to the research firm Macquarie, MGM will experience the quickest growth.