Nevada Gaming Revenues Hit New Low in 2020
The COVID-19 pandemic has led to casinos in Nevada hitting a new low, with revenues resembling earnings from the 1990s.
The year 2020 was not a good one for casinos in Nevada. The COVID-19 pandemic hit early, with casinos shutting down across the state in March. A few months would go by before the venues would open back up in June. Even after opening though, the capacity levels were low and players do not seem as willing to travel. Recent reports have shown that casinos in the state all saw year over year revenue declines with the Strip taking the largest hit at 43%.
COVID Creeps In
Nevada casinos were shut down for a total of 78 days in 2020, from March 18 to June 4. The goal of the shutdown was to slow the spread of the virus. In March, a large portion of the nation shut down to try and stop the virus from getting out of hand. However, people did not adhere to the guidelines and here almost one year later, we are still dealing with the ongoing threat of the virus.
Once casinos opened back up in Nevada, they had to rely on traffic from neighboring states like California and Arizona. However, this was not enough to bring in a steady flow of income. The 2020 overall revenue totals for the state came in at $7.87 billion. This was a decrease from 2019 by just over 34%. Taking a look back, the last time that Nevada saw such low revenue numbers was in 1997 when the state earned the same $7.8 billion.
The Strip saw $3.73 billion in earnings, which was a super low total. Again, records have to go back to the late 1990s to be able to find a comparison to the 2020 totals. Downtown saw a drop of 32.2% with $464.2 million in earnings. For the entire Clark County region, $6.5 billion was earned, which is a decrease of almost 37%.
Looking outside Las Vegas, the numbers were still low. Casinos located in Washoe County saw a decrease of over 21% with $676 million in revenues. This area includes the city of Reno. For the northern region of Nevada, you have to go to the late 1980s to find reports of earnings this low.
South Lake Tahoe also had issues, with revenues dropping by just over 19%. Gaming resulted in $182.1 million. The major region all the sections of the state saw such a huge decrease is due to the venue closures. With zero operations, revenues were nonexistent. You have some properties that earn hundreds of thousands a day, which create millions quickly.
Operators are hopeful that 2021 will be a much better year. However, restrictions are still in place due to the COVID-19 restrictions. Casinos can only operate at 25% capacity which has resulted in less amenities including dining and beverage service. Overall, tourism is super low, and casinos are feeling the effects.
Some casinos have even closed portions of their properties during the week because business is so slow. This has led to employees being laid off or furloughed and operators are earning much less still. The city of Las Vegas also relies heavily on convention traffic. Because of the virus, restrictions have shut down meetings and conventions completely.
With zero conventions or meetings taking place, casinos are losing out on hotel revenues, food and dining, plus casino play and other entertainment spending. The hope is that at some point this year, people will either start to travel more or that casinos can start offering more service options on a daily basis so the revenues can start coming in once again at a normal rate. Only time will tell if this will happen.