Casinos on the Las Vegas Strip have posted five consecutive months of year-over-year declines in gaming revenue. Gambling parlors in downtown Las Vegas and along the Boulder Strip have reported decreases in three of the past four months of available data.

Statewide, non-restricted casino win has been down in four of the past five months, resulting in an almost 2 percent dip in gambling revenue over the six-month period of June to November.

December gaming revenue numbers have not yet been released but the general consensus around Las Vegas is that it will be another “soft” month.

The industry’s recent results contrast with its post-COVID economic boom, highlighted by a years-long stretch of monthly revenue reports showing regular YoY increases and culminating in three consecutive years of record-setting gaming revenue. Despite the past few months, 2024 will almost certainly set another annual record.

But does the latest data suggest that consumer demand for Las Vegas casinos is softening?

Vegas is ‘pretty healthy’

Industry experts do not seem to think so. At least not right now.

“I think there has been some pulling back,” said Aaron Lee, a senior research analyst for Macquarie Capital. “But overall, I would say that things are still very stable if you look at the underlying demand fundamentals,” such as slot machine handle (the amount wagered), which is up nearly 2 percent year-over-year in Las Vegas.

Lee said the data “indicates that things are still pretty healthy in Vegas.”

The monthly gaming revenue declines in the second half of 2024 can largely be attributed to a few factors, experts said, including difficult year-over-year comparisons to a few exceptional months in 2023 and significant statistical swings in baccarat, a notoriously volatile table game.

Another factor was the failure of the second annual Formula One Las Vegas Grand Prix in November to match or exceed the impact of November 2023’s inaugural race, which certain Strip casino operators alluded to in the months leading up to the event.

Nonetheless, Lee offered an optimistic view for the upcoming year.

“People have actually spent a lot of money over the past couple of years, and so there’s going to be some natural pulling back (in leisure demand),” Lee said. “But in terms of our outlook, we think on the gaming side, revenues will probably be flat to slightly up in 2025.”

Inflation, national economy impacting Vegas

Brendan Bussmann, a gaming industry analyst with Las Vegas-based B Global, noted that in addition to the tough YoY comparisons from one-time events, such as the F1 race, larger economic forces are impacting consumers. Bussmann said the public has been through two “technical recessions” in the last four years and endured inflation rates not seen in nearly four decades.

“A slight downturn in numbers does not necessarily indicate softness in the market but other factors that have contributed to the overall current environment,” he said.

Casino executives on the Strip tend to agree.

In multiple earnings calls last year, some the Strip’s biggest operators touted upticks in convention and meeting bookings for 2025 and 2026, as well as growth projections for non-gaming segments of their businesses, such as food and beverage, entertainment and hotel rooms.

The increase in non-gaming customer spend has fueled Las Vegas’ growth for the better part of the last three decades. With gaming revenue being only one metric by which the industry gauges its health and performance, there does not appear to be much concern about a downward trend.

Reasons for ‘caution’ evident in Southern Nevada economic stats

Stephen Miller, an economics professor at UNLV and research director of the university’s Center for Business and Economic Research, concurred that the overall fiscal picture was “pretty good” but noted there are some negative signs for Southern Nevada’s economy, which could impact the region’s largest industry in other ways. Miller pointed out that the leading index for Southern Nevada’s economy has been drifting downward since March 2022 and the unemployment rate is rising.

Uncertainty about how the wildfires in Southern California could affect the housing market in nearby metro areas, such as Las Vegas, is also worth noting, he said.

“It’s not signaling that we’re in any trouble, but the leading index is providing some caution. So, we’re cautious,” Miller said. “We don’t see a recession around the corner, but who knows?”

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