The U.S. commercial gaming industry generated $10.7 billion in gaming revenues during the third quarter of 2019, up 2.8 percent or $290.5 million from Q3 2018.

The increase in gaming revenues marked the 19th consecutive year-over-year quarterly revenue increase. The last year-over-year quarterly decline in revenues occurred during the Q4 of 2014. 

 Massachusetts led the industry in terms of year-over-year revenue growth, with the Q3 2019 revenues increasing by $166.5 million when compared to Q3 2018.  During the quarter, the state benefited from both the June 2019 opening of Wynn Resort’s Encore Boston Casino and MGM Resort’s Springfield Casino operating for the entire quarter after opening mid-way through Q3 2018. 

While the Massachusetts revenue was notable, the state still has room to grow. During Q3 2019, the Encore Boston generated $150 million, making it the seventh largest non-Nevada casino in terms of gaming revenues.  While the casino ranked in the top 10, the performance varied between the gaming machines and table games. For the quarter, the Encore Boston ranked first in terms of table games revenue generated; however, its slot revenue was soft when looking at comparable East Coast casino resorts. In the coming quarters, it would be reasonable to see the Boston-based casino generate in excess of $200 million on a quarterly basis as the management team becomes more familiar with the surrounding customer base. 

While Massachusetts led the nation in terms of revenue growth, it also contributed to the largest revenue decline in neighboring Rhode Island. Prior to Q3 2019, Rhode Island had been one of the fastest growing markets in the previous three quarters, producing double-digit growth percentages. The growth was attributed to the state’s expansion into sports wagering and relocation of one casino license. However, the opening of the Boston Encore quickly reversed Rhode Island’s fortunes, as the state posted a 6.6 percent or $11 million decline in Q3 2019 gaming revenues when compared to Q3 2018.  The Rhode Island casino most adversely impacted was the Twin Rivers Casino, which is approximately 50 miles from the new Boston Encore. During Q3 2019, the Twin Rivers facility experienced a $10 million decline in table game revenues when compared to Q3 2018.

While individual states will see revenue declines from increased competition in neighboring states, the overall gaming industry does not appear to be slowing in the near term. The industry will continue to add organic growth through a strong U.S. consumer based economy, while also eagerly looking forward to additional gaming expansion.  With the NFL season well underway, states such as Indiana, Iowa and New York will be looking to capitalize on the boost in gaming revenues driven from newly legalized sports betting industries.