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Nevada tourism is likely to decline over the next two years, and Las Vegas gaming revenue along with it. So says a recent report out of the Center for Business and Economic Research (CBER) at the University of Nevada Las Vegas (UNLV).
One of the report’s authors, Dr. Stephen Miller, says the report considers several factors that, taken together, should produce a downturn compared to the period from 2022 to 2024.
However, he does not believe that the expansion of legal gambling in other parts of the United States is one of those factors. Although new retail casinos are popping up in numerous other states, it isn’t the availability of local gaming options keeping visitors away from Sin City.
Report prognosticates significant declines in NV tourism for 2025 and 2026
The UNLV CBER report released on Nov. 13, 2024, shows that the researchers expect a 5.8% decrease in visits to Nevada in 2025 and a further 6.9% drop in 2026.
Appropriately, the report shares that hotel occupancy rates will fall by 3.8% in 2025 and 4.4% in 2026. Among considerations accounting for those projections, the report cites economic factors affecting the entire United States, such as inflation.
Miller says that the expected declines are also part of Nevada tourism regressing to a mean after an unusual rise.
“The recovery from the [COVID-19] pandemic recession was quick, but in spurts and pauses,” Miller told PlayUSA. Miller continued: “Once we recovered to near pre-pandemic peaks, the spurts and pauses became less dramatic with much smaller movements.
It is still a pattern of moving back to a more normal situation. The fact that the trend has been slowly in a downward direction overall since March 2022 does provide a caution going forward. Note that March 2022 was the start of the Fed’s policy attack on inflation, which is continuing.
The new player in Las Vegas is sports entertainment, with Formula 1 taking off on its second year this week.
Dr. Stephen Miller, UNLV
The downward direction that Miller mentioned has been visible in gaming revenue numbers. The report expects that trend to build.
Nevada gaming revenue set for a tumble
The CBER report sets its expectations for diminished gaming revenue in Nevada at 5.4% in 2025 and 4.6% in 2026. That would represent an expansion of recent statistics.
Nevada gaming revenue in July 2024 and August 2024 represented marginal year-over-year declines in terms of total gaming revenue from all Nevada casinos. September’s returns for Nevada gaming counteracted that with a YOY gain, however, as an example of the spurts and pauses Miller alluded to.
Overall, even a 5.4% decrease would not be sufficient to end Nevada’s current 43-month streak of collecting over a billion dollars in win from players. Similarly, Miller believes that Nevada casinos have nothing to fear in gambling expansion outside of the state.
Miller believes gaming expansion is good for Las Vegas
Access to regulated gambling has never been greater for more people all over the US. In recent years, states like Nebraska and Virginia have gone from zero physical casinos to multiple gaming facilities.
However, Miller doesn’t feel that will keep people at home, telling PlayUSA that he thinks it “actually may enhance visitors to Las Vegas.” Miller stated: “By getting a taste of ‘brick-and-mortar’ casino activity, they may get excited about visiting the international capital of leisure, hospitality, and resort casino action.
That is, local casinos around the United States may tap into a latent demand for the complete experience, which they cannot get at a local casino in their home state. Gaming expansion around the country is viewed as only a glimpse of part of what Las Vegas offers and at a lower quality level.
Dr. Stephen Miller, UNLV
Declines in land-based casino revenue around Nevada over the next two years could further entrench the status quo regarding potential gaming expansion within the state, however.
Don’t expect online casinos in Nevada any time soon
Currently, Nevada has a limited landscape for regulated online gambling. Online sports betting is available, but markets and promotions are comparatively minuscule next to those common in other US states.
Additionally, bettors must register their accounts with the few online sportsbooks in person at connected physical casinos. Most other US jurisdictions allow online bettors to sign up remotely.
People in Nevada can also take part in interstate online poker pools. Otherwise, there is no regulated channel for playing online slots or table games for real money in Nevada.
Declines in tourism could hinder appetites to change that scenario.
“The downtrend in local southern Nevada variables in the leisure and hospitality sector are not huge, but rather a signal about possible bumps in the road going forward,” Miller commented. “Vegas promotes the complete experience, which you cannot even come close to in the online gaming world.”
Those bumps in the road will likely make gaming licensees more reticent to support any expansion of online gambling. Without their support, considering the extent to which Nevada’s economy relies on that casino resort experience, any attempts to expand gaming in Nevada are dead on arrival.
If the CBER report is accurate, the next two years in Nevada will not be as robust as 2024 and 2023 have been. Miller’s comments suggest that those gains were unsustainable anyway.
