Live gaming action at Caesars Palace before the start of the Las Vegas Grand Prix on Nov. 18, 2023.
Jeff Scheid/The Nevada Independent
The Formula One Las Vegas Grand Prix drove Strip casinos to their second-largest gaming revenue month of all time during November.
The Gaming Control Board said Dec. 28 that the four-day event, which began Nov. 16, helped produce almost $821 million in gaming revenue for Strip casinos during the month, a 22.6 percent increase from November 2022. In July, Strip casinos collected a single-month record $834.9 million in gaming revenue.
Statewide, gaming revenue was more than $1.37 billion, a 12.6 percent increase from a year ago. The overall Nevada figure fell short of July’s statewide single-month record of $1.4 billion but was the 33rd straight month of $1 billion in gaming revenue.
Michael Lawton, the control board’s senior economic analyst, said the event “was extremely profitable for both gaming and non-gaming activity” on the Strip. He said resort executives told regulators the event helped their properties “establish all-time record levels of revenue.”
The event attracted affluent racing fans, who stayed in high-priced rooms, dined on expensive meals and watched the race while lounging in specially created luxury hospitality suites.
Coupled with the Specialty Equipment Market Association (SEMA) trade show early in the month, F1 helped draw nearly 3.3 million visitors to Las Vegas in November while smashing records for average daily hotel room rates and revenue per available room (RevPAR), a metric used to gauge profitability.
The visitors also left money on the gaming tables.
According to the control board, Strip casinos produced $410.1 million in table game revenue, an increase of almost 62 percent from a year ago, while table game wagering was $2.7 billion, an increase of 39.5 percent.
Baccarat play, which is factored into the overall table game total, saw revenue of $178.3 million, an increase of 208.7 percent from a year earlier. Wagering on baccarat was $938.4 million, up 90 percent from November 2022, while the percentage of bets casinos held was 19 percent versus 11.7 percent from a year ago.
Lawton credited the baccarat play that is associated with high-end international Formula One fans for the Strip’s triumphant month.
“The event’s success was more evident at luxury properties where the Las Vegas Strip’s baccarat increase accounted for 78.6 percent of the state’s growth this month,” Lawton said.
Wells Fargo Financial gaming analyst Daniel Politzer agreed that Formula One benefitted “operators that cater to high-end customers.”
Gaming taxes generated in November were $85.4 million, according to the control board, an increase of 9.5 percent from a year ago. For the fiscal year, gaming tax collections are up almost 3.2 percent.
Through the first 11 months of 2023, Nevada is trending 4.1 percent ahead of 2022’s single-year revenue record of $14.8 billion, while Strip casinos are trending 7 percent ahead of last year’s $8.2 billion record mark.
F1 room rates boost hotel revenues
The 3.3 million people who came to Las Vegas in November was a less than 1 percent increase from a year ago, but they paid an average of $249.18 per night, driven by room prices during the Grand Prix. The figure was 33.7 percent higher than November 2022 while revenue per available room topped out at $204.18, an increase of 34.8 percent.
Analysts predicted the Formula One race would produce a record total for average hotel room rates on the Strip, given the four-figure nightly charges that were advertised earlier this year for rooms during the race weekend. In November, the chief financial officer for MGM Resorts International said the event produced “the highest-grossing weekend for hotel revenue” in the company’s history.
“[The race] was a significant event for the city of Las Vegas, which catered to the high-end and international customers,” Politzer said.
Las Vegas visitation is up 5.4 percent compared with the first 11 months of 2022 and convention attendance is up 21.4 percent.
Las Vegas visitation was helped by U2’s residency at the Sphere in Las Vegas between Nov. 1-4 and three Las Vegas Raiders home games at Allegiant Stadium. The Raiders, the Vegas Golden Knights and UNLV’s football team played games in other cities during the Formula One.
Harry Reid International Airport serviced more than 4.8 million passengers in November, a 6.1 percent increase from a year ago.
Race wasn’t a factor away from the Strip
The F1 race didn’t provide much of a revenue increase outside of the Strip.
Downtown gaming revenue declined 1.9 percent to $81.2 million in November while the Boulder Strip, which includes Henderson, saw gaming revenue decline 2.2 percent to $83.4 million. The balance of Clark County, which includes the local markets throughout the Las Vegas Valley, saw gaming revenue increase 3.6 percent to $150.9 million.
“Overall, higher-end properties with closer proximity to the track had a more robust weekend, while mid/lower-tier and further away properties saw less uplift,” Truist Securities gaming analyst Barry Jonas wrote in a research note. “We think today's release is a proof point for the inaugural F1 race's success.”
In Northern Nevada, Washoe County saw gaming revenue jump 2 percent to $80.9 million, which included $58 million from Reno casinos, an increase of 3.5 percent.
Nevada sportsbooks collected $41 million in revenue, an increase of 8.8 percent, while wagers totaled $921.9 million, down less than 1 percent from a year ago. Mobile sports betting accounted for 67.8 percent of all wagers.
This story was published Dec. 28 by The Nevada Independent and is republished here with permission.