Atlantic City casinos post 1st revenue increase in 10 years
Internet gambling helped Atlantic City’s casinos post their first revenue increase in a decade.
Figures released Thursday by New Jersey gambling regulators show the casinos won $2.6 billion from gamblers in 2016, an increase of 1.5 percent from a year earlier.
The last time Atlantic City casino revenue increased was in 2006, just as a wave of Pennsylvania casinos began opening and drawing away Atlantic City’s customers. The city had 12 casinos that year; now it has seven.
Only two casinos posted revenue declines during the year, in which less competition and a continuing boost from New Jersey’s nation-leading online gambling industry helped Atlantic City casinos start to find a new equilibrium. It follows a brutal three year-period that saw five casinos close and 11,000 jobs lost.
The Trump Taj Mahal, which was opened by President-elect Donald Trump in 1990, shut down on Oct. 10. But Matt Levinson, chairman of the New Jersey Casino Control Commission, thinks better days are arriving for Atlantic City’s casino industry.
“These are some strong numbers, especially with all the bad news about Atlantic City’s ‘demise,’” he said. “There’s a lot of good news here. We have some stronger casinos now, and internet gambling continues to increase. The hope is we’re entering a stable environment now.”
Tom Polhman, general manager of the Golden Nugget, said the Atlantic City market has “right-sized itself to the point where we’re not over-saturated anymore. I’d like to think things had hit rock bottom and we’ll all get better from here.”
Internet gambling revenue in New Jersey rose by more than 32 percent last
year to nearly $197 million. New Jersey is one of three states in the U.S. where internet gambling is legal, along with Nevada and Delaware, but New Jersey is by far the largest online market.
It is divided among five competitors: Borgata ($47 million); Golden Nugget ($42.2 million); Caesars Interactive-NJ ($38.6 million); Tropicana ($36.9 million) and Resorts Digital ($31.7 million).
The seven surviving casinos also saw their on-premises winnings from gamblers increase by 2.1 percent last year to $2.28 billion. When the Taj Mahal is included in the comparison, the eight casinos saw a collective revenue decrease of 0.3 percent.
When revenue from slot machines, table games and internet operations is included, only two of the seven currently operating casinos saw their revenue decline last year. Harrah’s was down 4.3 percent to $358 million, and Caesars was down 2.7 percent to $302 million.
The Borgata remains Atlantic
City’s top casino; the $769 million it took in last year was more than twice the total of its nearest competitor, Harrah’s. The Golden Nugget ($251.9 million) and Tropicana ($341.1 million) each posted 9 percent revenue increases for the year.
For the month of December 2016, the seven surviving casinos won $208 million, an 8.6 percent revenue increase over the December 2015 figure.
David Schwartz, director of the Center for Gaming Research at the University of Nevada-Las Vegas, said Atlantic City still needs to focus on its recent efforts to diversify its offerings beyond casinos.
“At this point, it should be clear that relying on gaming revenues is not the way ahead,” he said. “There needs to be a focus on broader tourism and diversification into non-hospitality areas.”
Pennsylvania’s Gaming Control Board estimates its 2016 casino revenue will be about $3.2 billion once final figures are reported, an increase of about 1 percent.