Moody’s Advises Pennsylvania Operators To Invest In Table Games Over Slot Machines
Moody carried out a review into PA’s casino industry over the last 12 months and analysts have noticed that there has been a steady increase in revenue for table games.
This is mostly due to the increase in the number tables being in service and the amount of revenue each table can produce.
Table Games More Reliable Than Slots
Moody’s thinks that this increase in revenue is mostly because of the change in consumer preferences. This is reflected by the performance of table games in Maryland and other neighboring states, where they have also registered an uptick. Slot machines have not been as lucky though. There has been a noticeable drop in the number of slots in service, while daily revenue received from them has also lowered.
Slot machines generated around $2.34 billion in 2017 when compared to the $2.36 billion revenue generated in 2016. The highest slot machine revenue for Pennsylvania was back in 2012 when slot machines reached their peak and brought in $2.47 billion in revenue.
In a statement, Keith Foley, a senior vice president with Moody’s, said “That’s really the takeaway from this report. People talk about market saturation — it’s the slots, which are a large portion of the market, that are saturated.”
Market Saturation Reason For Slot Revenue Decline
The result of slot revenue flattening out is that table games have picked up. In 2017, table games brought in around $890.7 in revenue which is an increase from $853.2 million from 2016. Moody’s report showed that 27.6 percent of Pennsylvania’s total gambling revenue is now from table games, which is a 3 percent increase from 2013. Moody’s believes that this trend will continue and it makes sense for casino operators to focus more on table games than slot machines.
This is an interesting time for Pennsylvania’s casino industry as the state is in the middle of expanding its gambling operations. As part of the expansion, 10 mini-casinos are being set-up. Each of these casinos is expected to have around 750 slot machines and 30 table games for starters. So far, four new mini casino licenses have been awarded and six more are up for grabs. Moody investors believe that adding more slots to the market will not help in generating more revenue as the market has reached saturation point.