3 of Atlantic City's 9 casinos increased profits in 2023 compared to prior year
ATLANTIC CITY, N.J. (CBS/AP) — Six of Atlantic City's nine casinos saw a decrease in profits in 2023 compared to the prior year - while three saw their profits increase, according to new data from the New Jersey Division of Gaming Enforcement.
The nine casinos collectively were less profitable than the year before despite the help from the Garden State's booming online gambling market.
Figures released Monday show the nine casinos collectively reported a gross operating profit of $744.7 million in 2023, a decline of 1.6% from 2022. When two internet-only entities affiliated with several of the casinos were included, the decline in profitability was 4.1% on earnings of $780 million.
How profitable were Atlantic City, NJ casinos in 2023? Here's the data.
All nine casinos were profitable in 2023, but only three saw an increase in profitability. Here are the casinos in the order of the most profitable to the least, and the difference from last year:
- The Borgata: $226.1 million, up 1.3%;
- Hard Rock: $125.5 million, down 2%;
- Ocean: $117.2 million, up nearly 22%;
- Tropicana: $93 million, down 15.1%;
- Harrah's: $80 million, down 9.7%;
- Caesars: $51.7 million, down 14.4%;
- Golden Nugget: $29.8 million, down 2.9%;
- Bally's: $11.1 million, compared to a loss of $1.8 million a year earlier;
- Resorts: $9.5 million, down 54.8%;
Gross operating profit represents earnings before interest, taxes, depreciation, and other expenses, and is a widely accepted measure of profitability in the Atlantic City casino industry.
The figures "suggest it is getting more expensive for New Jersey's casinos to operate, and patron spending may not be keeping pace," said Jane Bokunewicz, director of the Lloyd Levenson Institute at Stockton University, which studies the Atlantic City gambling market.
"The same forces that might be tightening visitors' purse strings — inflation, increased consumer prices — are also forcing operators to dig deeper into their pockets," she said.
Bokunewicz said higher operational costs including increased wages and more costly goods, combined with increased spending on customer acquisition and retention including and free play, rooms, meals and drinks for customers have not been offset by as significant an increase in consumer spending as the industry hoped for.
Casinos' profitability data comes amid fight to end smoking
The statistics are certain to be used in the ongoing battle over whether smoking should continue to be allowed in Atlantic City's casinos.
After unsuccessfully agitating for more than three years to get lawmakers to ban smoking in Atlantic City casinos, CEASE and the United Auto Workers filed a lawsuit on Friday in state Superior Court challenging a gap in New Jersey's indoor clean air law.
The casinos say that ending smoking will place them at a competitive disadvantage to casinos in neighboring states, costing revenue and jobs.
Workers have cited data published in June 2022 by Las Vegas-based C3 Gaming that found casinos in several states that ban smoking are outperforming competitors that allow it.
Other casinos have non-smoking sections.
Among internet-only entities, Caesars Interactive Entertainment NJ earned $23.6 million, down nearly 28%, and Resorts Digital earned $12.2 million, down 20.5%.
And only four of the nine casinos — Borgata, Hard Rock, Ocean and Tropicana — had higher profits in 2023 than they did in 2019, before the COVID-19 pandemic broke out.
The casinos are also operating under a contract reached in 2022 that gave workers substantial pay raises.
The nine casino hotels had an occupancy rate of 73% in 2023, down 0.4% from a year earlier. Hard Rock had the highest average occupancy at 88.8%, while Golden Nugget had the lowest at 53.8%.
The average room in an Atlantic City casino hotel cost $180.67 last year. Golden Nugget had the lowest average rate at $123.31, while Ocean had the highest at $270.31.
