Atlantic City casinos were less profitable in 2023 despite the success of the state’s online gambling market.

The New Jersey Division of Gaming Enforcement released new figures on Monday. Collectively, the nine Atlantic City Casinos reported a gross operating profit of $744.7 million in 2023.

This is a drop of 1.6% from 2022. And if two internet-only affiliate entities are included, that drop becomes 4.1%.

Although all casinos turned a profit last year, only three saw that profit increase year-on-year from 2022.

Widely accepted as the measure of profitability, gross operating profit represents earnings before tax, interest, depreciation and other expenses.

Jane Bokunewicz is director of the Lloyd Levenson Institute at Stockton University, which studied the gambling market in Atlantic City.

She said: “[The figures] suggest it is getting more expensive for New Jersey’s casinos to operate, and patron spending may not be keeping pace.

“The same forces that might be tightening visitors’ purse strings — inflation, increased consumer prices — are also forcing operators to dig deeper into their pockets,”

Bokunewicz believes operating costs such as wage increases and good prices have played a role. Customer acquisition and retention have also become more expensive, with free play, rooms and meals no offset by increased consumer spending as much as hoped.

Smoking Ban Discussion Continues For Atlantic City Casinos

These figures are likely to be used in the continued debate about smoking in casinos. A group of workers has been lobbying for a ban for at least three years.

At present, New Jersey’s indoor smoking laws exempt casinos from the ban, something many are hoping to change.

The United Auto Workers Union represents employees at three Atlantic City Casinos, and last week filed a lawsuit to overturn the law.

Casinos argue that banning smoking will cost revenue and jobs by putting them at a disadvantage to casinos in neighboring states.

However, workers have cited a study on casino experience which shows evidence that non-smoking casinos are outperforming those which allow it.

The Borgata Posts The Biggest Income In 2023

With an operating profit of $226.1m (up 1.3%), the Borgata posted the highest income in 2023. It was followed by Hard Rock ($125.5m, down 2%), Ocean ($117.2m, up 22%), Tropicana ($93m, down 15.1%), Harrah’s ($80m, down 9.7%), Caesars ($51.7m, down 14.4%), Bally’s ($11.1m, having lost $1.8m in 2022), and Resorts ($9.5m, down 54.8%).

Of the online-only entities, Caesars Interactive Entertainment NJ was the best performer. It earned $23.6m, the highest total despite a 28% drop. Next was Resorts Digital, with $12.2m, down 20.5%.

Only four casinos – Borgata, Hard Rock, Ocean and Tropicana – had profits above pre-COVID19 levels. But casinos are now working under a 2022 contracts which gave workers a significant pay rise.

In 2023, casino occupancy was at 73% on average, down 0.4% from 2022. Hard Rock had the best average, at 88.8%, with Golden Nugget having the lowest at 53.8%.

On average, a casino hotel room in Atlantic City cost $180.76. These ranged from Golden Nugget at £123.31 to Ocean at $270.31.