Recent reports from the Las Vegas Convention and Visitors Authority and the Gaming Control Board point to discouraging numbers on the Strip.
Everything remains down for March 2025, from gaming revenue and hotel occupancy to overall visitors — especially international ones. Off-Strip, however, is a different story. Casinos in downtown Las Vegas, North Las Vegas, Boulder Highway, and Reno are seeing higher gaming revenue.
What’s it all mean? It's tough to say, but trouble may be afoot for the Las Vegas and Nevada, for whom gaming and tourism is the primary economic driver.
Some takeaways from David McKee, editor-in-chief of Casino Life and gaming columnist for Las Vegas Advisor:
- Industry number-crunchers and casino operators are saying very different things. "The analysts are getting uneasy. The casino executives, at least the ones on the Strip, appear to be living in a world of denialism and cluelessness. ... You have [MGM Resorts CEO and president] Bill Hornbuckle and [CEO] Tom Reig of Caesars Entertainment — and just this morning, [CEO] Edward Pitoniak, whose company VICI Properties owns most of the real estate on the Strip — coming out with these pronouncements that everything is not only fine, but better than it's ever been. A lot of [that] boils down to, when they elaborate, 'Well, I was in Las Vegas last weekend, and everything looked great.' When you look at the numbers, they should be worried ... because the one place that really got hit hard these last two months running was the Strip."
- Don't underestimate international visitors. "There's an assumption that Americans will make up whatever we lose in international tourism, that they'll pass over going to Paris, France in favor of Paris, Las Vegas. Now, that could be true. I make no claims to omniscience. But when the 12 percent [that makes up Las Vegas' overall tourism] is mainly comprised of Mexico and Canada, our two largest feeder markets in Las Vegas, and when the President of the United States, straight out of the box on Inauguration today, goes out of his way to demonize those two countries, then we shouldn't be surprised if tourism is cratering, and we ought to be concerned about it. I mean, 12 percent of Las Vegas [tourists] is not chicken feed."
- The Strip is too expensive. "What you see is customers gravitating towards submarkets — downtown, the Boulder Strip, North Las Vegas — where they're assured of a better price and a fairer gamble. Those things are no longer guaranteed on the Strip. They haven't been for quite some time, and just in my conversations with gamblers and with people who are in touch with the gambling public, I get this distinct impression that the nickel-and-diming, which has been going on since Las Vegas reopened after COVID, is finally getting the better of people. ... I think the budgets for travel are going to be pinched for some time to come, and the Strip is going to be feeling this."
- Tariffs are causing uncertainty, and gamblers may be paying for any subsequent cost increases. "The White House has this yes-no-maybe-maybe not policy on tariffs, and they keep being pushed off to some uncertain point in the future. It not only creates uncertainty, it also raises a lot of doubt as to whether you're going to be able to afford the materials you were counting on for construction. ... It's definitely becoming a concern, as are the price of components sourced from overseas for slot machines, which are expected to become incrementally more expensive. For the casinos, they don't buy them outright most of the time anymore, but they lease them, and at some point that cost is going to trickle down to the casino, which is unlikely to eat it, and it will be passed along to the player in some way, shape or form."
- The casino companies have mixed results with economic downswings. "Vegas has a peculiar genius for getting caught with its pants down whenever the economy goes bad, and the reaction is generally twofold. One is to slash the workforce as much as possible, if not more so. And the other is to jack up prices. And you saw this in stark display after COVID. ... You saw higher table minimums, higher room prices, higher everything. And for a long time, the consumer was willing to go along with that. But now we're seeing some price resistance. Yes, room rates were $183 last month, but the occupancy was 2.5 percent down. So who's really gaining from from the price gouging?"
Guest: David McKee, editor in chief, Casino Life, and gaming columnist, Las Vegas Advisor
