Each new year brings fewer and fewer people into casinos, lowering profits as a result.
Although all of the casinos from Nevada have been suffering some rather major losses in the recent past, the Las Vegas casinos may be helped by the evolution of the gaming industry. But one must keep in mind that this side of the gaming industry refers to gambling machines, not PC and console games as one may originally think at first glance.
Nevada’s casino industry as a whole has been in the red for the past six years, unfortunately, with the biggest loss being recorded in 2009, reaching almost $6.8 billion. In 2015, losses were exponentially lower, being marked at $622 million, but this does not change the fact that average consumers are no longer attracted by gambling in comparison to 10 years ago.
The basis of this consumer behavior switch stems from how the general public usually goes to Las Vegas in order to enjoy shows or partake in alcohol consumption at parties, limiting their gambling behavior accordingly. Because people are not gambling as much as they once did, they aren’t losing as much money, leading to a decrease in profits from this side of the spectrum.
But this does not mean that casinos aren’t making profits constantly. Even if gambling has taken the backseat, restaurants still provide the necessary income in order for these businesses to maintain themselves afloat in the current market. At the end of 2015’s fiscal year on the 30th of June, the 271 Nevada casinos brought in $27 billion in profits. In comparison to 2010 total revenue of $21 billion, it is a rather hefty increase, but still, the fact that they are still in the red still remains.
Fortunately, market experts are somewhat confident that 2016 will continue the trend of cutting losses lower and lower, expecting this year to bring almost 42 million people to the Strip. Because the Strip racks in the highest amount of profits each year, even though gambling is left biting the dust, the annual revenue will get a hefty boost as well.
In order to further quell these losses from the gambling side, Nevada has been investing more and more in the gaming industry. By creating new and enticing gambling machines, business owners hopes to bring in millennials that are more attracted to gambling methods similar to the games they play at home. This can be clearly seen as being profitable if one would look at the Asian casino market, Japan specifically. In Japanese casinos, game-themed machines rack up millions of yen each day, especially Pachinko machines with themes like Silent Hill or Castlevania.
Nevada’s industry as a whole will get a boost as well, with companies like Tesla and Faraday Future building car manufacturing companies on its outskirts, bringing in more job opportunities with each newly built factory. This inevitable economic stimulation is hoped by gaming business experts to raise the entertainment industry alongside it.
Hopefully, Las Vegas casinos may be helped by the evolution of the gaming industry, bringing the industry out of the red and into the black. Only time will tell if this side of the industry will remain afloat in the coming years or if it will completely sink due to the current lack of appeal that gambling machines have.
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