PA Gaming Revenue: How Resorts World, Inflation, and Digital Play Shaped June

We have seen a rare year-over-year decline for Pennsylvania online casinos this June, with total revenue down 1.7% to $535 million (including Daily Fantasy Sports sites and apps).

However, that small overall decline masks the seismic shifts occurring across specific gaming verticals. Pennsylvanians are currently navigating $4.00-a-gallon gas and increasing grocery prices. Perhaps most impactful of all, a new gambling behemoth has risen just minutes away from midtown Manhattan - historically one of eastern Pennsylvania’s largest feeder markets.

iGaming’s Unstoppable Momentum

With its convenience, lower wagering limits, and no need to spend $20 on gas to reach a slot machine, iGaming seems custom-made for the current economic environment.

While total online spend still came in under brick-and-mortar totals, the growth is undeniable:

• Total Online Revenue: $242 million (up 14% from $212 million last June).

• Fiscal Year Online Growth: Just over 18%.

• Adjusted Gaming Revenue (FY): $2.93 billion.

Sports Betting: High Handle, Low Tax Revenue

Sports betting in Pennsylvania - primarily mobile - is where the numbers start to look a bit anomalous.

Handle (the total amount wagered for the month) reached an impressive $570 million, a gain of nearly 18% over last June. This surge was primarily driven by the nearby New York Knicks making a deep playoff run and the beginning of soccer's Copa America/World Cup-qualifying events hosted across the USA.

However, the state did not reap the rewards of that high handle:

• Taxable Revenue: Came in at just $31 million, down nearly 40% from last year's $51 million (which was won on a much smaller total amount of bets).

• The Takeaway: It appears Pennsylvanians bet heavily on the Knicks and guessed correctly on soccer goals, beating the sportsbooks.

The Resorts World Effect: Table Games Take a Major Hit

The long-discussed boogeyman of New York City table games finally transitioned from nightmare to reality. Resorts World in Queens opened hundreds of table games in late May after securing a full casino license. By early June, reports of carnage at PA casinos - which heavily rely on that New York play - began to surface, and official numbers from the PGCB confirm it.

Across the state, overall table games revenue declined by 21%. The drop was steep, regardless of region or proximity to New York:

While Resorts World is pulling players from eastern Pennsylvania, it cannot be the sole catalyst for table game issues - the decline was felt from Philly to Pittsburgh and up to Erie. With iGaming table play only picking up 3%, the most likely culprit remains weak economic conditions and worried consumers tightening their belts.

Brick-and-Mortar Slots Hold Steady (for Now)

Even though Resorts World added thousands of new Class III slot machines alongside their new table games, it didn’t seem to faze the Pennsylvania slot market.

Total brick-and-mortar slot play was down just 1.3% across the whole state to $196 million. Most of the state barely registered changes, with Wind Creek Bethlehem actually seeing a 2% increase. Live! Philadelphia was the only major property to notch a double-digit move, falling 14.74%.

Growing Pains in Queens Retail slot departments are not out of the woods yet, but they may be benefiting from early operational hiccups in New York. Early reviews of Resorts World highlight customer disdain for their newly rolled-out loyalty program, particularly the refusal to status-match nearby competitors. Players have also complained about paying New York City prices for drinks (which are comped in NJ and PA), crowded floors, and long wait times for hand-pays and machine repairs.

However, with billions on the line, Resorts World is addressing these issues rapidly:

• Adding another 1,400 slots in mid-July (bringing the total to 3,900+).

• Hiring and training attendants and repairmen at breakneck speed.

• Preparing to revamp lackluster promotional offers.

As these problems are smoothed out, they will likely continue to chip away at slot revenue from Atlantic City and Eastern Pennsylvania.

The Digital Threat and the Omnichannel Imperative

While Resorts World will likely act as an anchor on retail slot growth moving forward, the real threat is digital. The 17.6% bump in online slot play represents an increase of almost $18 million in just 12 months.

The casino in everyone's pocket continues to be the biggest threat to brick-and-mortar play. To survive, retail casinos must renovate, innovate, and embrace omnichannel experiences that can successfully funnel online players into their physical hotel rooms, restaurants, and showrooms.