Nevada once had an iron grip on sports gambling – Not anymore. The Supreme Court struck down a 1992 law that prohibited sports betting in the other 49 United States. State governments across the country are now in a position to pass their own laws regarding what, if any, sports gambling activity can take place going forward.
How will the ruling and spread of legal sports betting affect Las Vegas casinos? Could casinos in Las Vegas be negatively affected by the Supreme Court ruling? I took a look at the actual gaming win generated by Las Vegas Strip sportsbooks in 2017 and compared it to other gaming revenue centers (pit games and slots) to help gauge the impact.
In 2017, Non-Restricted Las Vegas Strip casinos made a combined $114 million dollars as a result of sports betting according to Nevada Gambling Control Board reporting. Split that total win between the 37 locations and you’re looking at about $3 million per location on average. The book is not a huge profit center after covering basic overhead expenses.
Compare that to the strip’s 2017 table game win of over $3.24 billion or the slot win of $3.21 billion and its safe to say that sportsbook performance isn’t what is keeping Vegas executives awake at night.
To put the revenue picture in perspective, the gray sliver below is the portion of gaming revenue that sports betting made up in 2017 on the Las Vegas Strip:
Let’s not forget that Las Vegas casino operators like MGM Resorts, Caesars Entertainment, Penn National Gaming, Boyd and Wynn all have a national presence. While the legalization of sports betting nationwide MAY cannibalize their Vegas business, they are still gaining a revenue center in their non-Vegas properties. While the public was screaming on social media that the Supreme Court screwed Vegas over, investors were buying the news. MGM Resorts stock rose 1.64% on Monday and Caesars Entertainment popped 5.46%. The decision is far from a doomsday scenario for investors.
Arguing that the SCOTUS decision will dramatically affect revenues and visitor counts to Las Vegas is also short sighted in that degenerate gamblers (like me) that want to bet have been able to for some time via offshore online sportsbooks like Bovada or Sportsbook.ag. Nation wide sports betting has already been available, this move will only take the activity of placing a bet out of the shadows and allow states to regulate and harvest a new source of revenue.
To summarize, will Vegas casinos be hurt by the nationwide legalization of sports betting? Absolutely not. The sportsbook doesn’t generate enough revenue for it to matter. While a few big bettors may stay home to enjoy their new found gambling rights, most of us will continue to make our pilgrimage to Las Vegas for major events like March Madness and the Superbowl.
I know that I am excited to do March Madness in Las Vegas in 2019!