No Miracle Happened: Las Vegas Casinos Profit Fell Short Of Hopes After A Restart

Article by : Eva Reed Aug 17, 2020

• 
• 

For most players worldwide, Las Vegas-based casinos are synonymous with the most luxurious and exclusive gaming establishments. This place managed to gather an incredible number of casino operators, and, over the years, became a global center for the gambling business. Today Las Vegas is a 24/7 entertainment place and is one of the most famous cities in the United States.

Nevertheless, the Covid-19 pandemic did not bypass the city; on the contrary, it hit Las Vegas with redoubled force. Local authorities and the governor of Nevada himself are struggling to get the gambling market back on its feet. However, it seems that their efforts did not lead to the expected result.

The Nevada authorities have already lifted almost all restrictions and allowed the casinos to restart their business. Despite this, gambling halls and hotels are half-full of their usual capacity. According to data provided by the Las Vegas Convention and Visitors Authority, the number of visitors in June was lower than last year: 70.5% of 2019 numbers.

The first half of 2020 showed an overall drop of 54%. This means that the number of guests who have visited Las Vegas has dropped to 9.7 million. These numbers look shocking, as, in the first half of 2019, the number of guests who attended Las Vegas reached 11.4 million more people.

Casinos that have restarted their business cannot attract the required number of players since they are obliged to comply with the rules for admitting only 50% of visitors. As a result, total revenues remain well below last year’s figures.

However, it looks like the Covid-19 situation seems quite different for some states. For example, Maryland was able to show significant growth in gambling income over last year’s performance for the same month.

The Las Vegas gambling operators are not sitting still either. For example, MGM Resorts and Wynn Resorts offer their visitors promotions of unparalleled generosity. Wynn has already announced that casino guests can reserve a night at the hotel and receive a free second one. However, such a proposal should be treated very carefully: you have to take taxes, resort fees, and other nothings into account.

It looks like the Las Vegas strategy of putting all its eggs in one basket has not been successful. Moreover, gambling houses now have to pay for such a choice of development vector. While the state authorities successfully delivered alternative plans to diversify budget revenues, casinos continued to focus solely on their income.

Perhaps the only project that was actively supported by large casinos was the construction of a completely unnecessary Allegiant stadium. This investment project has demanded over several billion dollars and remains closed. Moreover, even if the upcoming NFL season was held at this stadium, fans’ admission would still be prohibited.

The current situation has demonstrated that the survival of the states depends mainly on non-residents. Therefore, the drop in the number of visitors instantly affected the profitability of absolutely all casinos located in the state.

As a reminder, more than 42 million people visited Las Vegas in 2018. At the same time, almost 6 million guests were international travelers. According to statistics, between 2014 and 2019, more than 40 million people visited Las Vegas every year. However, it seems that the situation with the coronavirus interrupted the victorious march of gambling giants. The thing is that no one can say when the case will resume its natural course.