Casinos in Atlantic City Face Tough Times: Q3 Earnings Drop Significantly by 14%
Rewritten Article:
Struggling Atlantic City Casinos Seek a Digital Lifeline
Atlantic City's casino industry is battling a grueling 14% drop in third-quarter profits this year, sparking concerns about the industry's resilience and future outlook.
According to the New Jersey Division of Gaming Enforcement, Atlantic City's nine casinos collectively earned $281.2 million in gross operating profit during Q3 2023. This figure takes a dive from the $322.2 million earned during the same period last year.
The decline in profits reflects the industry's struggle to keep afloat in a world where digital gambling's allure is on the rise.
Borgata Hotel Casino & Spa, a traditional powerhouse in Atlantic City, underwent the steepest decline, witnessing a 52% drop in its gross operating profit, plunging from $73.5 million to $35.3 million.
However, some establishments defied the trend. Resorts Casino Hotel and Golden Nugget Atlantic City managed to keep their heads above water, while the Hard Rock Hotel & Casino Atlantic City retained its title as the city's leading earner, despite a 4.8% decrease in profits to $44.3 million.
As traditional casino operations falter, the report underscores unrelenting growth within the online gambling and sports betting arenas. These digital sectors play an increasingly significant role as essential revenue streams for the city's casinos, especially in the post-COVID era which further hastened the shift towards online gaming.
While the Q3 2023 industry-wide performance appears dismal, looking at the first nine months of 2023 paints a somewhat less daunting picture, with profits dipping by a more manageable 4.2% compared to the previous year.
The average hotel occupancy rate for the quarter stood at 86.5%, a slight dip from 87.7% in Q3 2022. The Ocean Casino Resort maintained the highest average room rate at $270.75, while Resorts posted the lowest at $148.90.
As Atlantic City's casinos face these tumultuous times, industry analysts keenly observe how operators will refashion their strategies to reverse the downward spiral and capitalize on the expanding digital gambling market. The coming months will be critical for the industry's quest to regain its foothold and ensure its longevity within today's high-tech and digitally-driven gaming landscape.
Strategies for Adaptation:
- Embrace the Digital Revolution: Atlantic City casinos must adapt to the digital age by streamlining their online presence and integrating technology across their operations. This may involve creating user-friendly mobile apps, boosting their online gaming platforms, and offering a blend of digital services alongside their physical offerings.
- Intensify Marketing Efforts: Upping marketing expenditures to lure both online and offline customers is paramount. This includes offering engaging promotions, strengthening loyalty programs, and crafting captivating experiences for visitors.
- Innovation through Experiences: Focusing on forging unique experiences that cannot be replicated digitally is key. This may involve immersive entertainment, exclusive events, and personalized services that tickle customers' fancy for a memorable experience.
- Strategic Collaborations: Forming strategic partnerships with online operators or other businesses can help Atlantic City casinos tap into the digital market with greater precision. This might entail integrating their brands with online platforms to broaden their reach.
- Engage with Regulatory Bodies: Engaging with regulatory bodies to ensure advantageous conditions for both online and offline gaming can help even the playing field. This involves advocating for policies that support both sectors equally.
In the face of growing competition from New Jersey's burgeoning online gambling sector, Atlantic City casinos must embrace digital innovation, experimental entertainment, and strategic collaborations to keep their edge in an industry dominated by digital gambling.
Enrichment Data (Selected Insights):
- Digital Transformation: Atlantic City casinos must stay attuned to the digital era by augmenting their online presence and incorporating technology into their day-to-day operations. This includes efforts like enhancing mobile apps, upgrading online gaming platforms, and offering diverse digital services to complement their traditional offerings.
- Recent Moves: Borgata reported a slight uptick in revenue for April 2025, exhibiting resilience in the market. Meanwhile, online operators like FanDuel and DraftKings have taken the digital stage by storm, with FanDuel hitting a record $52.9 million in revenue for April 2025.
- Promotional Spend: Online operators' heavy promotional spending suggests a fiercely competitive market where Atlantic City casinos must innovate to survive.
Casino establishments in Las Vegas, known for their casino-culture, are closely watching Atlantic City's casinos as they seek a digital lifeline. The online gambling and sports betting sectors, showing unrelenting growth in Atlantic City, could provide insights for Las Vegas casinos to adapt their casino-and-gambling offerings. Embracing digital technology, intensifying marketing efforts, forging unique experiences, forming strategic partnerships, and engaging with regulatory bodies are all strategies that Las Vegas casinos might consider to keep pace with the digital gambling revolution, similar to what Atlantic City casinos are doing.
