Pennsylvania Fiscal Year-End Shows Power of iGaming
When Pennsylvania launched its first internet gaming sites last summer, the state could not have known the ultimate benefits of that move. Pennsylvania knew that the additional gaming revenue would help, but there was no predicting a pandemic that would shut down all live gambling establishments for months in 2020. It was then that lawmakers and state officials breathed a sigh of relief that the internet gaming industry launched when it did.
A Year for the Record Books
The fiscal year for the Pennsylvania Gaming Control Board runs from July 1 through June 30. This put every form of gambling in the state – from brick-and-mortar casino games to video gaming terminals and fantasy sports contests – in the spotlight.
Combined revenue for all gambling for the 2019/2020 year was $2,724,785,117.
That seems like a nice sum of money, but it was down 18% from the previous year.
However, much of that decrease was a direct result of the coronavirus pandemic. To slow the spread of Covid-19 in March 2020, Governor Tom Wolf closed down all nonessential businesses. And those state-ordered closures stayed in place until June, at which point all gaming resumed at some level. Most casinos did not open to their full capacity, however, and they may not be able to do so for some time.
PGCB Reports Total Pennsylvania Gaming And Fantasy Contest Revenue For 2019/20 State Fiscal Year https://t.co/fWRKV3RjZB
— PGCB (@PAGamingControl) July 16, 2020
First Year for Internet Gaming
Despite Pennsylvania lawmakers approving internet gaming in 2017, the first online casino sites didn’t launch until mid-July 2019. Three opened their virtual casino doors that month, and there are now 10 online casinos in operation.
The first poker site didn’t launch until November 2019, and there remains only one. Two more have indicated that they are at various stages of the approval processes to launch, but there is no indication as to when it might actually happen.
These are the 10 online casinos available to players in Pennsylvania, along with each one’s land-based casino partner and launch month, as well as the revenue for each in the 2019/2020 fiscal year:
–Hollywood Casino via Hollywood: June 2019 ($38,445,607)
–Parx Casino via Parx: June 2019 ($30,156,746)
–SugarHouse Casino via Rivers Philadelphia: July 2019 ($73,157,709)
–Unibet Casino via Mohegan Sun Pocono: November 2019 ($9,615,090)
–PokerStars Casino via Mount Airy: November 2019 ($24,120,154 but $48,770,064 with online poker)
–FanDuel Casino via Valley Forge: January 2020 ($37,474,322)
–BetRivers Casino via Rivers Pittsburgh: January 2020 (no casino game revenue listed)
–BetAmerica Casino via Presque Isle Downs: January 2020 ($1,351,982)
–Caesars Casino via Harrah’s Philadelphia: April 2020 ($1,923,332)
–DraftKings Casino via Meadows: May 2020 (no casino game revenue listed)
As for the only online poker site in Pennsylvania, the revenue was solid:
–PokerStars for online poker via Mount Airy: November 2019 ($24,649,910)
While there were only eight casino operators offering i-gaming per the Pennsylvania Gaming Control Board report, and the discrepancy unexplained, the total for 2019/2020 online gaming revenue was still impressive at $240,894,852.
Sports Betting and Other Gaming
There are 13 casinos or racinos offering sports betting to customers, with only nine of them offering online sports wagering services. Those with online action weathered the pandemic months better than the others, but none went unscathed due to the lack of sports action upon which to place bets.
Even so, the sports wagering segment of the Pennsylvania gaming industry contributed significantly to its overall revenue:
–2019/2020 sports wagering revenue: $113,724,759
–2018/2019 sports wagering revenue: $21,730,113 (up 423% year-on-year)
The year-on-year comparison may be a bit unfair, as only eight casinos had launched their sports betting operations in the 2018/2019 fiscal year, and they were just getting their footing during that time.
Fantasy contests didn’t experience any growth:
–2019/2020 fantasy contests: $20,868,176
–2018/2019 fantasy contests: $23,588,490 (down 11.53% year-on-year)
Video gaming terminals (VGTs) only set up operations in July 2019, and the first year brought in $72,089,525. After payouts, VGTs took in a gross revenue amount of $6,798,123.
Rough Year for Gaming Totals
As mentioned, internet gaming and VGT revenue was new in the most recent fiscal year. Sports wagering only got started in the 2018/2019 year, and fantasy sports contests only began the year before.
Therefore, let’s just take a look at the last few years of brick-and-mortar casino slot machine and table game revenue to get a bigger picture of how Covid-19 affected this year’s numbers.
–2015/2016 total casino game revenue: $3,227,835,635
–2016/2017 total casino game revenue: $3,202,671,328 (down 0.79%)
–2017/2018 total casino game revenue: $3,247,599,742 (up 1.38%)
–2018/2019 total casino game revenue: $3,264,447,572 (up 0.52%)
–2019/2020 total casino game revenue: $2,342,499,209 (down 39.36%)
When adding in the additional gaming revenue for the past few years, everything improves, even the past year with its pandemic troubles.
–2016/2017 total gaming revenue: $3,202,671,328
–2017/2018 total gaming revenue: $3,249,949,311 (up 1.45%)
–2018/2019 total gaming revenue: $3,309,766,175 (up 1.8%)
–2019/2020 total gaming revenue: $2,724,785,117 (down 21.47%)
Clearly, the significant online gaming and sports wagering revenue in the most recent fiscal year lessened the blow of Covid-19 quite significantly. And as the years progress and operators find their groove – and more poker sites join the fray – the revenue from internet gaming will increase significantly.
