Gaming revenue tops $1 billion for 11th straight month despite Omicron
A surge in the Omicron variant hovered over the Las Vegas gaming market much of January.
So how did Nevada see a record 11th straight $1 billion gaming revenue month?
“Las Vegas Strip demand was strong considering the impact of Omicron and (weather-related) flight cancellations,” J.P. Morgan gaming analyst Joe Greff told investors in a research note Friday morning.
The Gaming Control Board said Friday that casinos statewide reported almost $1.1 billion in gaming revenue during January, a 41.6 percent increase over January 2021, when casinos were still operating under COVID-19 operating restrictions that reduced capacity and visitation.
The Strip accounted for more than half of the state’s total, collecting $567.2 million in gaming revenue in January, up 76.4 percent from a year ago. The figure was also 6.6 percent higher than January 2019.
However, control board senior economic analyst Michael Lawton said Omicron suppressed the Strip early in the month by causing a more than 75 percent decline in attendance to the Consumer Electronics Show.
Compared to the pre-pandemic month of January 2020, Strip gaming revenue was down less than 1 percent and Lawton said the overall figure was the lowest total recorded by the Strip in the last nine months.
Still, Lawton said gaming regulators were “pleasantly surprised by these results considering the considerable headwinds that were present.”
Wells Fargo gaming analyst Daniel Politzer said in a Friday research note that “softness” was “expected” in the Strip gaming numbers for January given recent commentary from casino operators during their fourth-quarter earnings conference calls in the past few weeks.
Nevada is coming off a record 2021 that saw $13.4 billion in gaming revenue, fueled primarily by a record $7.07 billion in gaming revenue on the Strip.
Statewide, every reporting market in Nevada – except South Lake Tahoe – saw a gaming revenue increase over January 2021.
Clark County as a whole reported more than $928.7 million in gaming revenue. Last year, Clark County recorded $1 billion in gaming revenues in six of the 12 months.
Prior to 2021, the reporting area hit $1 billion in gaming revenue in just one month, going back to October 2007.
All of Clark County’s reporting markets, except for North Las Vegas, showed double-digit gaming revenue increases during January. Two Red Rock Resorts properties located in North Las Vegas – Fiesta Rancho and Texas Station – have remained closed since the 78-day statewide pandemic shutdown was ordered in March 2020.
Both Washoe County and Reno each saw gaming revenue increase 8 percent in January.
Lawton said casinos in South Lake Tahoe, where gaming revenue of $17.1 million was a 4.4 percent decline over January 2021, were hurt by a lower hold percentage on slot machine wagers. The amount wagered on slot machines increased 15.9 percent, but customers played lucky and revenue from the game declined 11.9 percent.
Omicron depresses January visitation
Las Vegas saw 2.47 million visitors during January, roughly 600,000 fewer than in December, according to the Las Vegas Convention and Visitors Authority. The figure was down 27.5 percent compared to the pre-COVID-19 visitor count for Las Vegas in January 2019, but was a 91.2 percent increase over January 2021.
LVCVA Vice President of Research Kevin Bagger said the Omicron variant played a part in depressing visitation numbers, as well as convention attendance. The LVCVA said an estimated 305,300 convention delegates attended shows in January 2022, well above January 2021’s figure of 8,600, but 55.3 percent below January 2019.
The challenges to the convention business drove overall hotel occupancy to 59.3 percent during the month, ahead of the 31.6 percent hotel occupancy a year ago, but far below 85 percent in January 2019. Midweek occupancy was 52 percent in January, while weekend occupancy was 74.6 percent.
The average daily hotel room rate was $145 in January 2022, exceeding January 2021’s rate by 60.1 percent.
Record-setting sports betting month
Prior to October, Nevada sportsbooks had never collected $1 billion in sports wagers in a single month. January marked the state’s fourth straight billion-dollar sports wagering month, with casinos collecting $1.1 billion in wagers, a 71.7 percent increase from January 2021.
January’s figure also beat the previous single-month record for sports wagers set in October.
The revenue from sports betting was just $50 million, down 4.6 percent from a year ago. The month saw heavy action in both college football bowl games and NFL playoff games.
Mobile sports wagers topped $787.7 million, representing 71 percent of all sports bets.
Las Vegas airport numbers
Passenger totals at Harry Reid International Airport during January fell slightly from December, but more than doubled the totals from January 2021, when COVID-19 was still keeping potential airline passengers home.
The airport said it welcomed more than 3.1 million passengers during the month, compared with almost 3.9 million passengers in December. Severe weather-related issues in January led to several thousand flight cancellations in and out of Las Vegas during January.
International passenger totals of 94,363 accounted for the largest year-over-year increase at Reid Airport during January – 337.4 percent. In November, international airline service, other than flights to and from Canada and Mexico, resumed after the White House lifted travel restrictions on many overseas markets.
During January, the airport saw international service expand direct flights between 13 cities in five countries, including the United Kingdom, the Netherlands and Panama. In January 2021, the airport had direct international service to and from just Calgary in Canada and three cities in Mexico.
Domestically, Southwest Airlines – Reid Airport’s leading air carrier – more than doubled its passenger counts from a year ago, with more than 1.1 million travelers in January.
Updated at 1:16 p.m. on 2-25-2022 to include Las Vegas visitor totals for January.