Despite Atlantic City’s casinos reporting strong revenue through the third quarter of 2025, operating profits are under pressure, with most properties seeing profitability decline compared to last year.
According to reports from the casino licensees submitted to the New Jersey Division of Gaming Enforcement, the casinos recorded third-quarter revenue of about $942 million, virtually unchanged from the previous year. Although gross operating profits during the same period dropped by almost 3%.
For the first nine months of 2025, revenue was around $2.5 billion, down 1% from last year, and operating profits slid by roughly 3%.
But between June and August, the casinos brought in a little more than $855 million, which is almost 6% more than they did during the same months in 2024.
New Jersey Hotel Occupancy is a Bright Spot
On a brighter note, hotel occupancy in casino hotels slightly increased to 84% in the third quarter of 2025, showing a marginal improvement from last year’s figures. Overall occupancy for the year, however, has decreased slightly by around 1%.
Even though demand for Atlantic City’s casinos remains steady or is gradually increasing, operating profits tell a different story. Of the nine casinos, five reported a drop in in-person gaming revenue, leading to narrower profit margins.
Why Are Atlantic City Casino Profits Being Squeezed?
Increasing costs in areas such as labor, utilities, marketing, and maintenance are outpacing the slight revenue growth, leaving operating profits behind gross gaming revenue (GGR). This is particularly true for casinos investing heavily in marketing to maintain or increase their market share, which hasn't necessarily translated into higher profits.
The only four casinos that are showing growth in on-site revenue in 2025 include:
- Borgata Hotel Casino & Spa
- Hard Rock Hotel & Casino Atlantic City
- Ocean Casino Resort
- Harrah’s Resort Atlantic City
The remaining five have seen flat or negative growth, which aligns with the reported profitability decline. It's important to note that Harrah's welcomed back the WSOP Circuit, which may have contributed to its slight increase in revenue.
Borgata Hotel Casino & Spa is attempting to change the entertainment landscape in Atlantic City by reinventing the former Premier Nightclub.
Ocean Casino Resort recently held a star-studded event that brought a lot of big names in, and it was for a good cause.
The Role of Online Gaming and Sports Betting
While traditional brick-and-mortar gaming faces challenges, online gaming has surged nearly 23% year over year, surpassing $2 billion faster than in previous years. This online success partly offsets weaker physical casino performance.
However, sports betting is down compared to 2024.
Despite this, the combined revenue from online and retail sports betting still allows the state's total gaming revenue to grow by around 1%, even though this doesn't translate to equal profit across all casinos.
Overall, Atlantic City's gaming market seems healthy yet maturing, with small revenue gains and growing online revenue. But there's a growing gap in profitability between top-performing resorts and others.
Operators should see this as a sign to re-evaluate strategies for 2026, especially those with weaker profitability in Q3.
Simply relying on volume growth may not be enough to maintain profit margins in this challenging cost environment. Cost management and strategic segmentation may be necessary to navigate the future successfully.
