The tribal gaming industry reached a record-breaking $41.9bn in revenue in 2023, according to the 26th Annual Indian Gaming Cost of Doing Business report. Released late last month, the report includes data from 132 tribal casinos across 18 states in the US.
Despite the new record, tribal gaming profit margins did shrink a bit, falling from 30% in 2022 to 26% in 2023.
Wipfli, a business and consulting firm, conducted the report.
“The data in this year’s report underscores the resilience of the tribal gaming industry,” Grant Eve, Wipfli’s leader for the tribal gaming and government industry, said in a press release. “While profit margins have narrowed, the overall financial health remains strong. It’s crucial for casino operators to use these insights to strategically navigate the economic challenges ahead and continue delivering value to their tribal communities.”
Tribal gaming key insights
Some top-level takeaways from the report include:
- Slot machines generate the most revenue for gaming tribes.
- Marketing, promotions and wages are among the biggest sources of spending.
- Sports betting, although growing, hasn’t yet become a significant revenue source at tribal casinos, especially compared to traditional casino gaming.
- This is the second consecutive year profit margins have decreased. It was 36% in 2021, 30% in 2022 and now 26% in 2023.
No surprise sports betting isn’t yet making a dent
Although the legal sports betting industry generated a record $119.84bn (£91.1bn/€108.1bn) in bets in 2023 – up 27.5% from 2022, according to the American Gaming Association – the vast majority of that came from online sportsbooks.
Based on numbers from states that break sports betting revenue down into retail revenue and online revenue, maybe up to just 10% of this action takes place at a brick-and-mortar sportsbook. And that’s being generous.
In some states, that number is closer to 1%. In July in New York, for instance, retail handle came out to just 0.3% of total sports betting handle.
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