Changing the way we live
The COVID-19 pandemic changed the world forever. People didn’t initially realize the mass disruption the virus would cause after the World Health Organization (WHO) declared a global pandemic on March 11, 2020. Most thought it would be just a few weeks before things got back to normal.
All industries had to adapt, with some benefiting from the pandemic while others saw businesses shutter and never reopen again.
the landscape of the US gambling industry has transformed in many ways
The gambling sector had mixed fortunes, as racetracks, retail sportsbooks, and casinos shut down while the online sector boomed. Five years later, the landscape of the US gambling industry has transformed in many ways.
The sudden shutdown
After weeks of speculation about a new virus doing the rounds, the WHO officially declared a global pandemic in March 2020. Every country took its own approach to the matter. Some, like Sweden, kept operating relatively normally, while others, like the UK, plunged into strict lockdowns where people couldn’t go outside a small radius of their homes or be within a few feet of another human.
The commercial land-based US gambling sector shut down overnight, with major hubs like Las Vegas and Atlantic City closing their doors for 78 days and three months, respectively.
people began betting on the most obscure sports
This created a void for many people, so they turned to alternative methods of gambling. With professional sports halted for several months, people began betting on the most obscure events, such as drone racing and table tennis.
Online gambling operators benefited massively. This success provided lifeline income to land-based companies in states like New Jersey that mobile platforms had to tether to for a license.
The slow return to normalcy
As the pandemic’s grip on the country eased, the gaming sector began a slow but steady return to normalcy. Some states relaxed lockdowns and allowed gaming properties to reopen, albeit at reduced capacity. Las Vegas, for example, initially allowed gaming floors to open at 25% capacity once licensees observed strict sanitation and social distancing protocols.
took over a year for casinos in Nevada and New Jersey to be back up and running at 100%
It took over a year for casinos in Nevada and New Jersey to be back up and running at 100% capacity, and people still had to wear masks for some time.
Casino companies like MGM Resorts International mandated that all staff be vaccinated against COVID-19, which caused its own issues. Travel was still a problem that suppressed visitor levels, especially for regions that relied on people coming in from overseas for vacations and conventions.
The interim years
With people pent up for so long, there was a massive demand for travel, resulting in visitor numbers to major gambling hubs quickly increasing and businesses starting to return to normal.
Share prices of land-based casino companies began rebounding sharply as fears that people might stick solely to online gambling platforms were unfounded.
Commercial gaming revenue in the US has hit new highs for the past four years, with the American Gaming Association (AGA) reporting that the 2024 total almost hit $72bn:
The percentage of this total that online operations make up has been increasing, hitting 30% last year. This is only set to rise as more states expand their online gambling laws.
Biggest winners
Online gambling platforms were undoubtedly the biggest winners from the pandemic. People could play casino games or place sports bets from home when they couldn’t leave the house.
Land-based companies like MGM Resorts and Caesars Entertainment began building up their online offerings, including the latter buying William Hill in April 2021 for ￡2.9bn ($3.7bn) to help boost its internet portfolio.
The trend was a key reason for sports betting legalization in certain states. New York, for example, was skeptical for several years about allowing the activity before then-Governor Andrew Cuomo included it in his 2022 state budget.
The massive annual tax revenue it created for the Empire State helped ease pressures elsewhere, with the total surpassing $1bn in 2024. The revenue opportunity was also a key driver for the authorization of three New York City casino licenses that will cost $500m each.
Biggest losers
Regional casino operators were among those hardest hit by the pandemic as they often didn’t have online operations to fall back on. People also turned to tribal casinos during the pandemic, as many of these facilities remained open for business because sovereign nations didn’t need to adhere to state government restrictions. While they’ve still maintained solid results, regional casinos haven’t seen the same level of growth as other operators.
Even the big gambling destinations like Las Vegas and Atlantic City still haven’t gotten back to pre-pandemic visitor levels:
There has also been a hesitancy to introduce online casinos in more than seven states. Lawmakers in Maryland, for example, want to give land-based facilities a chance to fully recover and fear that online casinos could cannibalize their revenues, which in turn would lead to significant job losses.
This is despite researchers finding that iGaming actually helps land-based revenues. It does seem like only a matter of time before the dam bursts and more states go down the higher-margin online casino route.
Looking ahead
As the gaming industry continues to evolve, the pandemic undoubtedly shaped its trajectory. It accelerated the adoption of online gaming in the US, with some historically conservative states expanding gambling laws in an attempt to boost under-pressure tax coffers.
has emerged stronger on the other side
While the sector certainly faced challenges, it has emerged stronger on the other side. With growing technological advancements and a strong push for gambling expansion nationwide, the gaming industry will continue to transform in the coming years, offering both challenges and opportunities.