By Dominic Andreasson
The world was rocked by the coronavirus (COVID-19) pandemic during the first quarter of 2020 and nobody was prepared for the impact. Governments across the world ended up enforcing a lockdown to control the spread of COVID-19 and as a result multiple industries were devastated. The land-based casino industry was one of the industries that suffered the most.
Our guest writer Dominic Andreasson gives us details as to how the casino industry has been affected by the COVID-19 pandemic and what the future could look like. To find out more about Dominic Andreasson, click here.
Land Based Casinos Take Big Hit
The top land-based casinos in places like Macau, Las Vegas and Singapore tend to offer both gaming and non-gaming services that attract thousands of patrons on a daily basis. When COVID-19 hit big time in March 2020, all of these locations went into lockdown mode and casino operators had to close their business for over 3 months.
Sweden was one of the many countries that took a hit and reports show that gambling revenue in the second quarter dipped by 4.1% but at the same time casino online revenue increased by 3.1%.
Macau, which is the biggest gambling hub in the world and home to some of the most luxurious casinos. Reports show that the six casino operators in Macau witnessed a combined decline of 81.6%(compared year on year) in gross gaming revenues during the first 8 months of 2020.
The United States saw more than 1,000 land-based casinos spread across 43 states close their doors due to the pandemic. They recorded a 36.5 decline in gross gaming revenues (GGR) during the first 9 months of 2020 (compared year on year).
Casino Operators Struggling To Survive
When we go deeper and look at how individual casino operators performed during the pandemic, we see that MGM China Holdings lost 80% of their GGR during the second quarter of 2020 and suffered a HKD$2.8 billion loss, Sands China suffered a HKD$5.5 billion loss and Wynn Macau lost HKD$3.9 billion.
These operators suffered even bigger losses in the US casino market as MGM Resorts International reported a 97% decline in revenues during the third quarter of 2020, Las Vegas Sands Corp had a 91% decline and Wynn Resorts ended up losing $523 million.
While these big casino operators took a massive hit, they were still able to survive the pandemic. A number of smaller gaming operators were not so lucky as they were unable to absorb the financial hit and are looking to either sell their business or shut down for good.
Casino Employees Out of Work
The complete closure of the land-based casino industry in Macau, United Kingdom, United States forced casino operators to lay off thousands of employees. This was a very difficult time for casino employees as they suddenly found themselves with no income in the midst of the pandemic.
Thousands of these casino employees will have to find new jobs once things improve as a lot of casinos are no longer in a position to absorb them back due to declining revenues. Casino operators and organizations like the American Gaming Association (AGA) are pushing for a casino relief package to be approved so that land-based casino operators can get a financial boost and be better prepared for the future.
iGaming Booms Amidst Pandemic
With land-based casinos shutting their doors to the public, online casinos were only too happy to welcome these players who were not stuck at home due to the lockdown. iGaming operators across the world experienced a surge in player traffic especially during the second quarter when most of the world was in lockdown mode.
Land-based casino players who would have never tried out an online casino were forced to go online and try out online casino games. A lot of new players signed up at online casino sites and boost iGaming revenues worldwide.
The COVID-19 caused a huge loss for land-based casino operators but ended up boosting iGaming revenues worldwide. While the brick and mortar casino industry slowly recovers from COVID-19, a new wave of cases has once again threatened the land-based casino industry.