The American Gaming Association’s (AGA) Commercial Gaming Revenue Tracker last week revealed that 2021 set a new record as the highest-grossing year ever for the U.S. commercial gaming industry, reaching $53 billion in revenue. The total breaks 2019’s previous industry record of $43.65 billion by more than 21 percent.
The industry closed the year on a high note, setting an all-time quarterly revenue record in fourth quarter of 2021 of $14.31 billion, surpassing the previous high-water mark of $13.93 billion set in third quarter of last year.
“These results are nothing short of remarkable,” said AGA President and CEO Bill Miller. “The success of 2021 reflects our commitment to health and safety and how Americans have welcomed gaming’s expansion across the country. Today’s industry is effectively meeting customers how and where they want to engage—whether at a casino or through mobile gaming.”
Of the 34 operational commercial gaming jurisdictions in 2021—including four new markets—23 set individual records for full-year commercial gaming revenue. On a national level, every commercial gaming vertical set new annual revenue records.
Traditional brick-and-mortar gaming led the industry’s recovery, with 2021 combined slot and table gaming revenue totaling $44.94 billion, a 6.6 percent increase over 2019’s previous record.
Sports betting’s growth accelerated in 2021, generating $57.22 billion in handle and $4.29 billion in revenue—jumps of 165 percent and 177 percent over 2020 respectively. The sector’s all-time high was powered by strong demand in established markets like Nevada, New Jersey and Pennsylvania and further boosted by the launch of seven new commercial sports betting markets in Arizona, Connecticut, Louisiana, Maryland, South Dakota, Virginia and Wyoming.
Two new iGaming markets, Connecticut and Michigan, also opened in 2021, helping the sector to a record $3.71 billion in revenue. Combined sports betting and iGaming revenue for the year totaled $8.00 billion, up 158.0 percent from 2020 and accounting for a record 15.1 percent of annual industry gaming revenue.
Seven states more are discussing sports betting in 2022, including California, Georgia, Hawaii, Kansas, Massachusetts, Missouri, and Oklahoma, with Texas in play in 2024. Four states are considering iGaming, including Indiana, Massachusetts, Missouri and New York.
“Despite our record-setting year, gaming’s total recovery is still reliant on the full return of travel and large events, which requires a safe health environment and open economy,” Miller continued. “I’m optimistic that we will see continued growth throughout 2022.”
Miller warned, however, that the battle to rid the U.S. of illegal offshore sports books and casinos is ongoing.
“Look at New York or Louisiana—does anybody reasonably think that millions of people just decided to try out sports betting for the first time last month? Of course not,” Miller said. “Americans have been betting on sports as long as they’ve been sports to bet on, they just haven’t had the legal opportunity to do it before. Raising awareness and attracting players to legal sportsbook is how we protect consumers, generate needed tax revenue and stamp out the illegal market.”
He also said that the imposition of high tax rates on sports betting also encourages illegal betting. New York has a 50 percent tax rate, and copying the New York legislation is Hawaii which is proposing a 55 percent tax rate.
“High tax rates will encourage players to bet offshore,” he says. “We need to responsibly create a legal market with reasonable tax rates or people are going to bet wherever they get the best deal.”
