Record-Breaking $668 Million Sports Betting Month Helps Keep Atlantic City Casinos Afloat

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The Atlantic City casino industry’s revenues were down year-over-year in August — no surprise at all, given the ongoing pandemic.

But the deficit compared to August 2019, a much simpler time, was a manageable 7.5%, according to the state Division of Gaming Enforcement.

The industry accomplished this in three ways.

First, all of the casinos were reopened for the entire month — a first since February. Even with capacity limited to 25% and with no formal indoor dining, alcohol, or smoking, the casinos still posted a win of $199.1 million. That’s down 30.5% from August 2019, but the properties made up most of that loss elsewhere.

They did so in part with sports betting revenue — nearly all of it online — which rose almost $10 million from July to August. Traditionally, August is a dull month without the NFL, NBA, or NHL. But the latter two leagues this year offered playoff series in the month due to the long suspension of play amid the pandemic.

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And more importantly, online casino gaming continued its seemingly endless hot streak. August brought in $87.8 million, more than doubling August 2019 revenue and edging out July 2020’s previous record of $87.5 million.

What does all this mean for taxpayers? The Treasury got a boost of $32.4 million in August, and $171.5 million so far in 2020.

Sports betting handle record, for any state

Back to that sports betting boost from unusual August NBA and NHL action: New Jersey saw a record $668 million in handle, with a shade over $600 million of that bet online. That’s the biggest betting handle month any state, including Nevada, has ever produced.

New Jersey bettors collectively lost 5.9% of what they wagered, which is fairly typical.

The exotic lure of multi-team parlays of sometimes a dozen or more games — all of which must be winners to collect what would be massive jackpots — continue to be a lure for gamblers who find that quixotic dream far more enticing that a lottery scratch-off ticket. But in reality, the sportsbooks have a lucrative 15.2% profit margin in 2020 on the $74 million in parlay selections. Compare that to NBA single wagers, where the “house” in New Jersey shows only a 4.1% profit this year.

Massive operator losses in April, May, and June — when there were no traditional casino revenues and few sporting events — mean the state gaming industry has no chance to match 2019. Total gaming revenue for the first eight months is $1.6 billion, down 29% from that time span last year.

Online poker was up nearly 78% year-over-year to $3 million in August.

The Meadowlands Racetrack, whose main online partner is FanDuel, took in more than half of the month’s sports betting revenue.

One AC casino was on the rise in August

All of the casinos were down last month compared to August 2019, except one. Ocean Casino Resort, which opened three years ago as successor to the star-crossed Revel casino, was up from $24 million to $24.4 million.

That propelled Ocean to third place in the city’s rankings behind Borgata and fellow three-year-old property Hard Rock (successor to Trump Taj Mahal).

Neighboring New York State’s four commercial casinos once again were left holding the bag in August, as state officials had not yet reopened the doors and there is no legal mobile sports betting or online casino gaming — which means some New Yorkers are still crossing state lines and padding New Jersey’s online gaming totals.

Photo courtesy of Shutterstock.com

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John Brennan

John Brennan has covered NJ and NY sports business and gaming since 2002 and was a Pulitzer Prize Finalist in 2008, while reporting for The Bergen County Record.

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