March 2023
In LIGHT of the data.
First-quarter gross gaming revenue returns for 2023 offer a ray of sunshine following a disappointing year-end 2022 report.
Brick-and-mortar gross gaming revenue for Atlantic City’s casino operators in the three months ended March 2023 ($655.3 million) exceeded the same period in 2022 ($612.7 million) by 7.0% and 2019 ($597.1 million) by 9.7%.
When revenues from internet and sports wagering are included, Atlantic City operators’ collective performance in the first quarter of 2023 ($1.2 billion) exceeded 2022 ($1.08 billion) by 11.5% and pre-pandemic 2019 ($726.7 million) by 65.7%. The rise of internet gaming especially during the pandemic has clearly accelerated total gross gaming revenue for Atlantic City’s casino operators to new heights masking more modest gains in brick-and-mortar revenue in the same period. Sports betting, perhaps fueled by March Madness, recorded an impressive 49.3% increase year-over-year revenue in the three months ended March 2023 compared to the same period in 2022. The increase is even more impressive when compared to first quarter 2019, as the market was just beginning to take off. The first quarter of 2023 saw $87.5 million in revenue compared to $25 million in the same period of 2019.
Regarding year-end 2022:
Although total net revenue exceeded 2021 totals and surpassed pre-pandemic 2019 total net revenue ($3.16 billion) for the first time, it was not enough to exceed gross operating profit (GOP) year over year. Despite realizing higher GOP in 2022 than 2019 ($613.5 million), the year ended with a disappointing decline of nearly 5% GOP compared to 2021.
Increased local competition and lost earning potential in 2020 combined to make 2022 a uniquely challenging year for several of Atlantic City’s casino operators. Anecdotally, operators have increased spending on marketing and promotional efforts to draw in consumers and remain competitive in the market. Increases in wages for the industry workforce also likely contributed to higher operating costs leading to lower GOP at year end.
Notably, with the industry-wide gains in revenue — especially revenue generated by internet gaming, which is taxed at a higher rate — the industry has generated record-high total gaming tax revenue in the last two years. Combined tax revenue generated from an 8% tax on casino gross revenue, a 15% tax on internet gaming gross revenue, an 8.5% tax on casino retail sports wagering gross revenue, and a 13% tax on casino Internet sports wagering gross revenue resulted in $467 million in 2022. That is a nearly 12% increase over the industry’s last peak at $417.5 million in 2006 — before the launch of online and sports wagering.
Atlantic City Gaming Win & Total Casino Revenue
Source: N.J. Division of Gaming Enforcement
| Monthly Revenue (Casino Licensees, $ In Thousands |
March 2023 |
% Change from Prior Year | March 2022 | YTD
March 2023 |
% Change from Prior Year | YTD March 2022 |
|---|---|---|---|---|---|---|
| Total Gaming Win (includes Internet & Sports Wagering) | $441,021 | 15.2% | $382,893 | $1,203,926 | 11.5% | $1,079,732 |
| Sports Wagering Revenue | $46,662 | 82.1% | $25,627 | $87,463 | 49.3% | $58,580 |
| Internet Gaming Win | $165,712 | 17.8% | $140,655 | $461,172 | 12.9% | $408,481 |
| Casino Gaming Win | $228,648 | 5.6% | $216,611 | $655,291 | 7.0% | 612,672 |
| Quarterly Revenue (Industry, $ In Thousands)** | Q4 2022 | % Change from Prior Year | Q4 2021 | YTD December 31, 2022 | % Change from Prior Year | YTD December 31, 2021 |
|---|---|---|---|---|---|---|
| Casino |
$412,822 |
-8.9% | $452,937 | $1,781,497 | 0.0% | $1,781,740 |
| Rooms | $144,016 | 6.5% | $135,229 | $698,226 | 13.0% | $617,785 |
| Food & Beverage | $132,062 | 18.3% | $111,653 | $528,128 | 29.3% | $408,335 |
| Entertainment & Other | $82,991 | 29.1% | $64,262 | $296,144 | 37.3% | $215,671 |
| Casino Licensees Total Revenue | $359,069 | 1.0% | $764,081 | $3,303,995 | 9.3% | $3,023,530 |
| Gross Operating Profit (GOP) | $119,301 | -31.6% | $174,485 | $731,276 | -4.6% | $766,877 |
** Data agregated from New Jersey Division of Gaming Enforcement Quarterly Financial Reports for individual properties, includes amended totals as of April 13, 2023. May not match totals from Quarterly Press Releases and Statistical Summaries, which represent a 'snapshot' of data at the time of publication and are not retroactively updated.
Atlantic City Hotel Lodging
Source: N.J. Division of Gaming Enforcement
| Casino Hotel Lodging Statistics For the Period Ended September 30, 2022 & 2021 |
Q4 2022 | Q4 2021 | YTD 2022 | YTD 2021 |
|---|---|---|---|---|
| Occupancy percentage | 65.8% | 66.4% | 73.4% | 67.6% |
| Average Daily Room Rate (ADR) | $155.75 | $156.60 | $177.89 | $172.88 |
| Revenue Per Available Room (RevPAR)* | $102.48 | $103.98 | $130.57 | $116.87 |
* RevPAR= ADR X Occupancy Percentage
Atlantic City Statistical Transportation Data
Source: South Jersey Transportation Authority
| Travel Mode | February 2023 |
Change from Prior Year |
February 2022 |
YTD February 2023 |
Change from Prior Year |
YTD February 2022 |
|---|---|---|---|---|---|---|
| AC Expressway | ||||||
| Total Toll-Paying Traffic Pleasantville Toll Plaza |
1,210,622 | 1.9% | 1,188,421 | 2,426,775 | 7.9% | 2,249,628 |
| AC Airport | ||||||
| Scheduled Service Passengers | 59,633 | -6.7% | 63,925 | 115,602 | -3.1% | 119,324 |
| Charter Passengers | 9,081 | 26.3% | 7,192 | 13,620 | -1.1% | 13,777 |
| Total Air Passengers | 68,714 | -3.4% | 71,117 | 129,222 | -2.9% | 133,101 |
Atlantic City Meetings and Conventions Data
Source: VistAC
| March '23 | March '22 | % Change from Prior Year |
TOTAL 2023 YTD |
TOTAL 2022 YTD |
% Change from Prior Year |
|
|---|---|---|---|---|---|---|
| Conventions/Tradeshows/Meetings* | ||||||
| # of Shows | 13 | 9 | 44% | 25 | 18 | 39% |
| # of Room Nights | 7,645 | 8,393 | -9% | 38,680 | 30,522 | 27% |
| # of Delegates | 110,005 | 93,029 | 18% | 234,597 | 174,366 | 35% |
| Delegate Spending | $18,430,615 | $13,329,123 | 38% | $49,883,048 | $32,560,553 | 53% |
| Boardwalk Hall Bookings | ||||||
| # of Shows | 2 | 1 | 100% | 10 | 7 | 43% |
| # of Attendees | 23,454 | 12,996 | 80% | 56,844 | 44,881 | 27% |
| Hotel Bookings | ||||||
| # of Shows | 7 | 12 | -42% | 24 | 24 | 0% |
| # of Room Nights | 8,003 | 12,202 | -34% | 20,063 | 25,843 | -22% |
| # of Attendees** | 9,113 | 11,863 | -23% | 20,769 | 37,103 | -44% |
| Delegate Spending | $5,172,646 | $8,319,847 | -38% | $12,682,092 | $17,699,491 | -28% |
| Monthly Totals | ||||||
| # Convs_Trade_Mtgs / Boardwalk Hall / Hotel | 22 | 22 | 0% | 59 | 49 | 20% |
| # of Room Nights | 15,648 | 20,595 | -24% | 58,743 | 56,365 | 4% |
| # of Attendees | 142,572 | 117,888 | 21% | 312,210 | 256,350 | 22% |
| Delegate Spending | $23,603,261 | $21,648,970 | 9% | $62,565,140 | $50,260,044 | 24% |
Notes:
*Includes Visit Atlantic City events booked at Boardwalk Hall
**January 2023 vs January 2022 Hotel Attendee variance is due to an event moved from hotel venue in 2022 to Boardwalk Hall* in 2023
LIGHT Snapshots is a publication of the Lloyd D. Levenson Institute of Gaming, Hospitality
& Tourism, Stockton University School of Business
Jane Bokunewicz, Ph. D., Faculty Director and Associate Professor of Hospitality
Atlantic City Information
Atlantic City City Council approves construction of "unicoaster"- As reported by The Press of Atlantic City, members of the Atlantic City Council approved a resolution to award redevelopment of land under the city-owned Boardwalk Rotunda building to ACPB LLC to build a “unicoaster” thrill ride on the Boardwalk.
Atlantic City City Council, Mayor, choose DEEM Enterprises' proposal for devlopment of Bader Field - As reported by The Press of Atlantic City, on March 23, Atlantic City Mayor Marty Small Sr. signed a memorandum of understanding with DEEM Enterprises to create a $3 billion automotive-focused housing and retail development. DEEM will have six months to conduct research and negotiate a redevelopment agreement. DEEM has agreed to pay $115 million to the city including $100 million for the land and the $15 milllion cost of building a recreation center for city residents. Further coverage by NJ.com.
Atlantic City commits to cleaning schedule for city parks - As reported by The Press of Atlantic City, the city has commited to a new cleaning schedule for city parks. Weather permitting, public works will routinely clean 25 parks during the work week, scheduling cleaning so that each is visited at least once per week. The effort is part of ongoing initiatives to promote clean and safe neighborhoods and encourage pride in the community.
Stockton University receives award for Community Day event - As reported by The Press of Atlantic City, Stockton University’s Community Day Clean Up and Party in the Park, held April 2022 in Atlantic City, was recognized with an award from the New Jersey Communities Council. The event returns to the city on Saturday, April 22, 2023.
New Jersey Gaming News
Bob McDevitt, leader of Local 54 of the Unite Here union, to resign, take national role - As reported by Casino.org and The Press of Atlantic City, after 26 years leading Unite Here Local 54, the union that represents nearly one-third of Atlantic City’s casino and hospitality workers, Bob McDevitt will step down on May 1 to become chairman of the Unite Here national pension fund.
Borgata's Water Club to be redesigned and rebranded - In a March 14 news release Borgata announced a $55 million redesign and rebrand of the Water Club. New offerings in the renamed MGM Tower will include more than 700 guest rooms, luxury vista suites and a 9,000 square-foot flexible event space. Further reporting by The Press of Atlantic City.
Four gaming bills focus of New Jersey State Assembly Commitee on Tourism, Gaming and the Arts meeting - According to records of the New Jersey State Legislature, the Assembly Committee on Tourism, Gaming and the Arts voted to advance four gaming bills out of committee during its March 20 session. Assembly Bill AR168condemns overproliferation of pro-gambling advertisements in N.J., Bill A420 establishes "Gambling Treatment Diversion Court Pilot Program" to be administered by Administrative Office of the Courts, Bill A5226 prohibits sports wagering partnerships at public institutions of higher education, and Bill A5308 requires school districts to provide instruction on risks of compulsive gambling as part of implementation of New Jersey Student Learning Standards in Comprehensive Health and Physical Education. Reporting from New Jersey Monitor.
National Gaming News
American Gaming Association (AGA) updates Responsible Marketing Code for Sports Wagering - According to a March 28 news release, effective immediatly the AGA has updated its Responsible Marketing Code for Sports Wagering to enhance protections for college-age audiences. The code sets the industry standard for responsibility in marketing and advertising of sports betting.
Kentucky legalizes sports betting - As reported by The Associated Press, Kentucky has passed legislation legalizing sports betting in the state. The Kentucky market is estimated to be worth $23 million in annual tax revenue. Further coverage from Legal Sports Report.
Massachusetts launches online sports betting - As reported by The Associated Press, Massachusetts launched online sports wagering on March 10. The state permitted the first retail sports bets at the end of January. The Massachusetts sports betting market is estimated to be worth $60 million in annual tax revenue. Further coverage from Legal Sports Report.
NFL approves keeping in-stadium sportsbooks open while games are played at those venues - As reported by Casino.org, NFL owners have passed a resolution that would allow game-day operation of in-stadium retail sportsbooks located in venues in states where sports wagering is now legal. Roughly have of the league's teams could take advantage of the new resolution, which allows teams to keep all of the revenue generated from in-stadium sportsbooks up to $20 million before revenues become subject to the NFL's revenue sharing policies.
Parx Casino in Bensalem, Pa., to build on-site resort hotel - As reported by Casino.org, Parx Casino, 10 miles north of Philadelphia, is moving forward with plans to build a 300-room, on-site resort hotel. The property will also include two restaurants and a 14,000 square-foot event space.
Tennessee legislators consider amendment to sports betting, tax levied on handle rather than gross revenue - According to Legal Sports Report, legislators in Tennessee are considering a sports wagering taxation model that would levy a tax on handle rather than gross revenue. The current model taxes operators' gross revenue at 20% with a minimum 10% hold requirement. A proposed handle tax would be levied at 1.85%.
The Conference Board releases Consumer Confidence Survey results for March - According to a March 28 news release from The Conference Board, findings of the March Consumer Confidence Survey suggest that consumers plan to "spend less on highly discretionary categories, such as playing the lottery, visiting amusement parks, going to the movies, personal lodging and dining" over the next six months. The Conference Board also reported an increase in March over February of the Consumer Confidence Index, and the Expectations Index, based on consumers' short-term outlook, also increased in March over February, but remained, as it has for 12 of the last 13 months below "the level which often signals a recession within the next year." Finally, the Present Situation Index decreased in March compared to February. Analysis of the indexes suggests that "while consumers feel a bit more confident about what’s ahead, they are slightly less optimistic about the current landscape." Further reporting from Casino.org.
Hospitality & Tourism News
Brigantine considers adjustment to short-term rental ordinance - As reported by The Press of Atlantic City, Brigantine officials are considering adjustments to the municipality's short-term rental ordinance, which among other considerations, would ban one-night stays. Other local municipalities have either introduced or are considering banning one-night stays. Margate has a one-week stay minimum for short-term rentals. Longport and Ventnor are considering introducing a minimum two- to three-night stay requirement for short-term rentals.
Stockton University, Esports Innovation Center among groups fostering an esports ecosystem in southern New Jersey - As reported by WHYY, Stockton University, the Esports Innovation Center and Camden County College are connecting students with career opportunities in esports.
"Trophy Park," youth sports and hospitality complex project falls through in Hamilton Township, New Jersey - As reported by The Press of Atlantic City, a developer in Hamilton Township has decided to abandon plans for a youth sports, entertainment and hospitality complex. The complex, "Trophy Park," would have spanned 268 acres and included 345,000 square feet of indoor sports facilities, two dozen outdoor turf fields, two 3,000 seat stadiums, a 2,000 bed "athletes village," three hotels, and family amusement facilites. The project, estimated to cost $280 million, was expected to generate $3.5 million in tax revenue and create about 300 full-time and 1,000 part-time jobs. The project faced opposition from local conservationists and significant zoning challenges. The project would have also needed the Pinelands Commission to agree to designate the space a Pinelands Regional Growth Area to allow for the development.
United States Department of Justice (DOJ) files civil antitrust lawsuit to block JetBlue Airways Corporation’s (JetBlue) acquisition of Spirit Airlines Inc. (Spirit) - According to a March 7 news release from the DOJ, an antitrust lawsuit has been filed to block the merger of JetBlue and Spirit. The DOJ believes the $3.8 billion acquisition would allow JetBlue to eliminate its largest rival and further concentrate the airline industry, harming American travelers. According to Reuters, as of March 31, four states California, Maryland, New Jersey and North Carolina had signed on to the DOJ's lawsuit. Further reporting from Reuters and The New York Times.
