Sportsbooks near record-high $1B monthly wagers as casinos take 10% hit

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Despite New Jersey’s sportsbooks nearing a record-high $1 billion in wagers for a single month, the state’s nine casinos on Monday reported they took a 9.6% hit over the past year and a 34.6% hit at their brick and mortar establishments.

That spells choppy waters for the casinos as they navigate the second wave of COVID-19 outbreaks, while at extremely limited in-person capacity and with the costs of sanitization and social distancing protocols eating into profits.

New Jersey’s casinos reported $260.9 million in gaming revenue in November this year, compared to $288.6 million in November 2019, according to the New Jersey Division of Gaming Enforcement, which regulates the state’s casinos, racetracks and sports betting.

Floor winnings were $146.6 million last month, compared to nearly $224 million in November 2019, according to the NJDGE.

Casinos had to stay closed for nearly four months at the height of the first wave of COVID-19 cases, starting on March 16, and were only allowed to reopen just before the July 4 weekend at 25% capacity.

“The resurging public health crisis drove down business in Atlantic City during November,” James Plousis, who chairs the state’s Casino Control Commission, said in a statement Monday afternoon. “Continued growth in internet gaming provided an important source of revenue for the operators and also sustained gaming taxes.”

The city’s entertainment, gaming, restaurant and hospitality industries have all suffered during the pandemic as a result, and the city’s unemployment rate during the pandemic has been the highest across the state.

The closure of indoor dining between 10 p.m. and 5 a.m. has only worsened the situation for casinos, according to Jane Bokunewicz, coordinator of the Lloyd D. Levenson Institute of Gaming, Hospitality and Tourism at Stockton University.

“A much-needed holiday bump from Thanksgiving weekend, usually a busy time for casinos, was limited this year by travel restrictions between states and stern warnings about family gatherings,” she added.

Gambling and sports wagering online products thrived during the pandemic, which kept many New Jerseyans homebound.

Between January and November 2019, the casinos won $433.4 million through online gambling and $3.3 billion through online and mobile sports betting.

Those numbers soared in those same 11 months of 2020, with casinos winning $870.9 million through online gambling and $4.6 billion through remote sports betting.

All told, patrons bet $931.6 million at the state’s sportsbooks for the month of November, a sizable chunk of the $1.2 billion they bet in all of 2018 and the $4.6 billion they bet in 2019.

“Even if New Jersey can’t quite reach $1 billion in a month before the end of the NFL season, the mere possibility so soon after the industry launched in 2018 would have been close to inconceivable until just a few months ago,” reads a statement from Dustin Gouker, an analyst for PlayNJ.com

But with casinos and sportsbooks using online gambling as a financial lifeboat, Gouker acknowledged that “[t]he state’s growth overall over the last few months is almost entirely the product of online sportsbooks.”

The worst-hit casino was Caesars Atlantic City, which suffered a 54.8% loss between November 2019 and last month. Borgata Hotel Casino and Spa, which reopened in late July and laid off more than 3,000 staff during the pandemic, posted a 10.3% loss overall – but a 38% loss at its Atlantic City establishment.

Harrah’s Resort Atlantic City posted a 50.5% loss between November 2019 and last month.

Only two casinos fared better last year, both of which were the most recent to open their doors: Hard Rock Hotel and Casino Atlantic City, and Ocean Resort Casino.

Ocean posted a 5.3% gain year-over-year, while Hard Rock saw a 32.2% gain in profits, including a 19% gain from its brick and mortar establishments.