The state’s once-sprawling casino and gambling industry – ground to a halt since their brick and mortar establishments were ordered to close on March 16 in a bid to halt the spread of COVID-19 across the state – has virtually resorted to using internet gaming as a lifeboat.
Data released by the Division of Gaming Enforcement on June 12 shows across-the-board increases in how much patrons bet at the state’s online gambling and sports betting websites and mobile apps, as well as bumps in how much casinos took home and how much they generated in state tax revenue.
For May, the internet gaming win – how much the house took home via the online and mobile apps – was $85.9 million. That marks a 124.1 percent increase from May 2019, when gamblers took home $38.3 million.
Between January 2020 and May 2020, the casinos won a total of $337 million, as opposed to $179 million won during that same five-month period in 2019.
“The 124 percent year-over-year increase in internet gaming is a lifeline for casinos but it doesn’t address the loss of direct casino jobs and indirect jobs from supporting businesses that has resulted from the more than 90-day shutdown,” Jane Bokunewicz, a coordinator at Lloyd D. Levenson Institute for Gaming, Hospitality and Tourism at Stockton University, cautioned in a Friday analysis.
In-person gaming revenue and taxes have cratered, and many casinos have seen triple-digit drops in profits.
With the state’s nine casinos shut down indefinitely, despite hopes from Gov. Phil Murphy that they could be reopened with reduced capacity by July 4 weekend, their entire income has depended on the online market. In turn, they have seen massive turnouts for online sports betting and gambling, according to a Friday afternoon report from the DGE, the arm of the state government that oversees the state’s gambling and sports-wagering industry.
The state’s casinos generated $12.9 million in state tax revenue from internet gaming, and $1.3 million from online sports betting in May. Last year, casinos generated $5.4 million in state tax revenue from internet gaming, and $1.7 million from online sports betting in the same month.
Patrons bet $1.24 billion in the state’s online sportsbooks as of May, and only $145 million at brick and mortar sportsbooks. Patrons wagered $1.3 billion during the same five-month period in 2019.
“May’s increase is a positive sign, but until major professional sports resume and Atlantic City casinos reopen, the gaming industry will look nowhere near normal,” Dustin Gouker, lead analyst at PlayNJ.com, said in a Friday analysis.
Most professional sports will be closed at least until the middle of the summer, with many spring seasons having been cancelled or postponed. Football season, which starts around Labor Day weekend, now hangs in the balance amid fears of a large-scale rebound of COVID-19.
The online sportsbooks FanDuel and PointsBet, which also has a brick and mortar location at the Meadowlands Racetrack in East Rutherford, brought in $4.3 million in May.
Following them were the online sportsbooks for Resorts Casino Hotel in Atlantic City – Resorts Digital, DraftKings and Fox Bet, which made $3.8 million last month. The Borgata Hotel Casino and Spa’s online sportsbooks – BetMGM and Borgata – took home $701,283.
“Land-based gambling revenue almost certainly won’t return in June, and it will take some time to recover while Atlantic City casinos presumably navigate reduced capacity and relatively weak tourism demand,” PlayNJ.com analyst Eric Ramsey said on Friday.
“Because of that, online casinos will continue to be relied upon to bridge the revenue gap. Even if online revenue can’t fully replace what has been lost from the shutdown, the overall gaming industry would be in much worse shape without it,” he said.
Just how the state’s casinos reopen is still up in the air, but the expectation is that they would operate at reduced capacity, and with requirements for facemasks, social distancing and frequent sanitization.
Resorts announced on June 11 it would roll out contactless hotel check-in, a maximum elevator capacity of four people, and an array of other heightened standards for cleanliness.
“With casinos reopening, the industry will now be watching to see how much play returns to Atlantic City and how much activity stays online,” Max Bichsel, vice president of U.S. business at Gambling.com Group, said on Friday.
“With casinos under strict health guidelines and limited capacity, many players may prefer to stay home and play online.”