Atlantic City casinos slow the slide in October but steeper declines await

Atlantic City Casino

Atlantic City CasinoAtlantic City casino gambling revenue suffered only a modest year-on-year dip in October, although the prospect of a return to double-digit declines looms large.

Figures released Friday by the New Jersey Division of Gaming Enforcement (DGE) show AC’s nine casinos generated brick-and-mortar slots and table game revenue of $186.1m in October, an 8% decline from the same month last year and $3.9m below September 2020’s result.

October’s decline was largely due to decreased slots activity, which slid nearly 10% to $132.85m, while table games fell only 2.8% to $53.25m. For the year-to-date, slots revenue is down 45% to $887.9m, while tables are off 48.2% to $331m, for an overall 46% decline to $1.21b.

October’s picture was far less grim after you add the $118m generated by the casinos’ online gambling and sports betting operations. Thanks to those contributions, October’s result was up 14.2% to $304.1m, although the year-to-date figure remains down 22.7% at $2.11b.

AC’s casino decline could accelerate in the coming months after New Jersey Gov. Phil Murphy issued an order last Monday that prohibited indoor dining at all bars and restaurants after 10pm. The order took effect on Thursday.

Murphy said this ‘surgical step’ was required to avoid a second widespread lockdown that the state undertook this spring. Like many other U.S. states, New Jersey has suffered a recent surge in COVID-19 cases.

The new time-based restriction affects not only the food & beverage venues in AC casinos but will also restrict alcohol service on the gaming floors during the period spanning 10pm to 5am. This is intended to protect not only casino guests but also casino wait staff.

Over 80 casino staffers tested positive for COVID-19 in October, nearly one-third of the total number of staff-related cases reported since July 2. The Casino Association of New Jersey issued a statement supporting Murphy’s announcement but the new rules are already negatively impacting casino staff’s pocketbooks.

On Friday, MGM Resorts’ Borgata casino informed 73 staff that their jobs were being permanently eliminated, while an another 349 staff were told they would face reduced work hours for an undetermined period. The Borgata previously laid off nearly 2,400 jobs as a result of the pandemic, equal to about one-quarter of its workforce.

The Borgata has long been AC’s brick-and-mortar gaming market leader, a status it retained in October with revenue of just under $41.2m, a 20% year-on-year decline. Only the Golden Nugget ($10.5m, -28.7%) and Harrah’s ($19.25m, -20.1%) posted larger declines.

Earlier this month, AC’s casinos had lobbied Murphy to double the existing 25% capacity restriction on their indoor dining venues. The casinos also sought the lifting of the outright ban on large indoor gatherings, which have decimated the casinos’ conventions and trade show business. Suffice it to say, those ambitions will remain unrealized for the foreseeable future.