Many consumers in the U.S. are spending less because of high interest rates and high prices. The Consumer Confidence Index gives an indication of this. In July and August of last year, consumers were a little less pessimistic but in September they were more negative. Attitudes fluctuated over the rest of the year.
The Index dropped again in December after the election. Most consumers are spending less on items such as travel and entertainment. A decline in consumer spending on gambling could affect casinos in Las Vegas.
Las Vegas casino gambling revenue
Inflation and an unpredictable economy definitely had an impact on consumer spending in 2024. This probably had a knock-on effect on the revenue of Las Vegas casinos. For six consecutive months, gaming was lower than in the corresponding months of the previous year. This was the first time this happened since before the pandemic.
While some brick-and-mortar casinos may be struggling, online gambling in Michigan and other states is flourishing. In states such as Pennsylvania and New Jersey, it is going strong. One of the main reasons for the success of online gambling is the convenience of being able to gamble from anywhere and at any time using mobile devices.
November gaming revenue
The Strip generated just over $788 million in November gaming revenue. This was down 3.9% from what it generated in November 2023. The Strip’s total win was down 0.8% for 2024.
The results in November were impacted by various factors other than the economy. This included a drop in baccarat winnings and fewer weekends in the accounting period. Experts believe that without challenges like these, the figures would have been more in line with November 2023, one of the strongest months on record in the state.
Gaming trends
When looking at gaming trends, slot revenue grew in 2024 while baccarat winnings declined. Slot segments appear to be set to perform well in 2025. Figures may show a moderate contraction mainly due to the challenging comp stack the segment will face with the Super Bowl and in the second half of 2025. Baccarat is always volatile and difficult to forecast. Non-baccarat table gaming revenue may decline slightly but it won’t be a significant drop.
Slots are one of the main attractions of online casinos. Online casino operators are discovering that the way you use technology can offer clients more personalized, immersive experiences when playing slots. For example, they can receive recommendations for slot games based on past behavior.
Investors are preparing for weaker revenue growth
Deutsche Bank analyst, Carlo Santorelli, said comparisons to when Las Vegas hosted the Super Bowl last year are on the minds of gaming investors. However, he doesn’t see the trend in gaming revenue growth as problematic over the long term.
Santorelli forecasts that 2025 gross gaming revenue (GGR) in the casino center will fall by 0.1%. However, net revenue will decrease by 2.4% due to attrition in non-gaming sales.
Large operators on the Strip include MGM Resorts International and Caesars Entertainment. While investors expect weaker growth for them in 2025, they could also see an upside surprise.
Operators are confident
Las Vegas casino operators are positive about growth returning and expect trends to be more consistent in 2025.
There is a strong group event calendar for the year. Caesars management is anticipating year-over-year growth in cash room revenue. The emphasis for these operators is on long-term performance rather than fluctuations that happen in the short term, such as when the Super Bowl takes place.
Gaming revenue has been consistently strong over the past four years, despite economic downturns at certain times. High-profile events like Formula 1 and the Super Bowl can create challenging benchmarks. This can make year-over-year comparisons difficult.
Las Vegas – a tourist mecca
Las Vegas has managed to withstand various economic pressures over the years. For tourists, the city offers a wealth of entertainment options beyond gaming. Visitors can enjoy luxurious accommodations and a variety of immersive experiences. They can watch spectacular shows, admire incredible sculptures, and savor gourmet cuisine.
Being able to combine gaming and other great activities such as experiencing its vibrant nightlife continues to make it one of the favorite destinations in the U.S. for tourists.
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