For over a decade now, the situation in Atlantic City has been one that seems to be growing worse all the time. With neighboring states endeavoring more and more into the legalized gambling sphere, the coastal town in New Jersey has suffered consistently over the last decade or more.
Recent history, on the other hand, has been a bit kinder to AC. With the dawn of legalized, regulated online gambling—all of which are tied to preexistent brick and mortar casinos—an entire new form of gambling has surfaced. In the eyes of the casinos, what really happened was that one of the most robust revenue streams they could have ever imagined came to be.
A 2016 to Remember
To aptly highlight just how impressive Atlantic City’s recent history has been, we have to take a holistic look at 2016. During that year, the resorts dotting the Atlantic coastline saw gross operating profits rise by more than 7%. According to New Jersey’s state gaming commission, the 8 casino resorts in Atlantic City accrued more than a collective $550 million in profits throughout the whole of last year.
To make these numbers a bit more accurate (and impressive), you have to remove the now defunct Trump Taj Mahal. The casino resort was closed in October of 2016. If you then look at the same figures, Atlantic City’s 7 casinos saw gross operating profits increase by more than 9% in total.
Of these casinos, it was the Borgata that brought in the most money. Interestingly enough, the Borgata is one of the only casinos not located directly on the shoreline, but rather set back a little bit. The Borgata alone came just $5 million short of $250 million in gross operating profits. For those who may be unfamiliar with the term, gross operating profit is the profit earned before you take interest, taxes, and other charges into consideration. This may seem a bit misleading, but it is the standard across the global casino industry.
June Flat, But Not Down
The month of June was not nearly as impressive as the whole of 2016, but the fact that revenues did not decline steadily is a win in and of itself. According to the Press of Atlantic City, revenues across Atlantic City’s casinos remained flat when compared with revenues from a year ago. The reason this is a win is mostly because 2016 was such a good year. If casinos can even replicate what happened a year ago, they will be in much better shape than at most points in recent memory.
While the overall picture was more lackluster than anything else, there was a key statistic that stood out. Compared to a year ago, internet gambling revenues have increased by more than 23%. While revenues were little more than $16 million last year, this year they crossed over the $20 million threshold.
According to David Rebuck from the New Jersey Division of Gaming Enforcement, “June’s report reflects continuing overall financial stability within the industry and increasing strength for internet gaming operations. Both factors are positive indicators of the Atlantic City casino industry’s ability to successfully perform in an extremely competitive regional marketplace.”
So while Atlantic City brick and mortar casinos might be facing more competition from neighboring states, the one advantage the New Jersey town has over most other states is legal online gambling. Though the neighboring states may soon enter that market, Atlantic City can enjoy some respite, for now.