Atlantic City’s nine casinos saw a hearty rise in their net revenue over the last year, however their increase in income couldn’t combat rising overheads. This consequential push and pull tipped the scales, leading to a considerable decline in profits as the year progressed.
Seated majestically on the iconic Boardwalk, six of the city’s casinos thrust upwards into the Atlantic City skyline, accompanied by three others nestled in the scenic Marina District. Yet, despite their undeniable presence, the profits of these Atlantic City titans took a dip in 2023 from the previous year, according to figures freshly published by the New Jersey Division of Gaming Enforcement.
This comprehensive report critically breaks down the performance of the casino resorts. It takes into account the entirety of their operations, from the jingling slot machines and green felt tables, to their hotel rooms, culinary offerings, and entertainment spectacles.
The financial intrigue of the report lies in its details, where it reveals that the nine casinos ratcheted their net revenue up by almost 3% to an impressive $3.23 billion. Yet due to inflated labor and supply costs, their overall financial health stumbled, resulting in an uneasy gross operating profit of $744.7 million. This marked a 1.6% slide down from their 2022 profits.
A silver lining, however, is spotted in three of nine establishments. MGM Resorts’ Borgata, Ocean Casino Resort, and Bally’s all painted success across their ledgers. Borgata witnessed a respectable 1.3% ascent to $226.1 million, Ocean’s profit leapt 22% to $117.3 million, and Bally’s earnings skyrocketed an awe-inspiring 689%, overturning a $1.9 million loss from 2022 to a cushioned $11.1 million profit in 2023. This remarkable U-turn came in the wake of a much-needed, comprehensive makeover at the Boardwalk property.
Yet, the inverse picture was painted at the remaining six casinos, all of which saw year-over-year declines. The Hard Rock took the most modest blow with a 2% dip, while at the other end of the spectrum Resorts experienced a harsh 55% hit. On the bright side, every establishment managed to stay in the black.
An added windfall for Caesars Entertainment’s trio of properties—Caesars, Harrah’s, Tropicana—as well as Resorts, was provided by their online gaming sectors, which brought in robust separate revenue streams.
Despite acknowledging a drop in profits, James Plousis, chair of the New Jersey Casino Control Commission, commended the $744.7 million collective profit made in 2023. He marked the scale of this achievement: it’s the second-highest collective profit in six years and the third year in a row that net revenue has soared past the $3 billion threshold.
“Every casino hotel reported positive gross operating profits in 2023,” Plousis reported, expressing admiration for their competitive spirit. The casinos, he stressed, were diligently reinvesting in their establishments, honing attractive new features and polishing their properties’ allure.
Counterbalancing this optimistic overview, some disconcerting elements bubble to the surface. Jane Bokunewicz, director of the Lloyd D. Levenson Institute of Gaming, Hospitality, and Tourism at Stockton University, expresses a sobering insight into the fiscal challenges of Atlantic City’s casinos. She cites that only four of the nine— Borgata, Hard Rock, Ocean, and Tropicana—attained higher profits in 2023 than they did in 2019. And she leans into the concerning fact that escalating costs of running a casino in Atlantic City are not being met by a corresponding consumer spend, even though guest costs increased 3% to $3.2 billion.
Further, adding to the icy climate, legislative discussions are underway to eliminate smoke-filled casinos, a move which casino operators fear will cause yet another dent in earnings and possibly lead to layoffs. With room sales in 2019 still outperforming current rates by a significant margin, this could be another gloomy cloud on the horizon for Atlantc City’s casino industry.
