Atlantic City Casino Revenue Is Rising. So Why Are Profits Falling?

ATLANTIC CITY, N.J. — Atlantic City's casinos are generating more revenue, but increasingly less of that money is making its way to the bottom line.

New state figures show just how pronounced the disconnect has become.

Atlantic City's casino hotels reported $1.57 billion in net revenue during the first six months of 2026, a slight increase of 0.2% from the same period last year. But gross operating profit fell 15.5% to $269.6 million.

Casino analyst Anthony Marino says understanding that divergence is critical to understanding the true financial condition of Atlantic City's gaming industry.

“Why do the gross revenues keep going up and the gross operating profits keep going down?” Marino said Monday during an appearance on Off The Press with Scott Cronick on WOND. “That's a dilemma we have to explain.”

Marino points to three major factors: inflation and rising operating costs, the explosive growth of online gambling and higher state taxes on internet gaming and online sports wagering.

Revenue Doesn't Tell the Whole Story

The latest quarterly financial report from the New Jersey Division of Gaming Enforcement shows Atlantic City's nine casinos generated $844.5 million in net revenue during the second quarter, up 0.9% from a year earlier.

But second-quarter gross operating profit fell 10.1% to $164.9 million.

The six-month comparison is even more striking: revenue up 0.2%, profit down 15.5%.

Gross operating profit is a widely used measure of casino profitability before expenses such as interest, taxes, depreciation and amortization.

Marino said one reason for the squeeze is straightforward: The cost of operating a casino resort has increased significantly.

“Gross gaming revenue is just not going up fast enough or large enough to outpace the inflation,” Marino said.

That argument is supported by a new Atlantic County Economic Alliance analysis examining the future of Atlantic City's casino industry.

The report found Atlantic City's brick-and-mortar casinos generated $2.89 billion in gaming revenue in 2025. But when adjusted for inflation, physical casino-floor gaming revenue remained 63.7% below its 2006 peak.

That provides important context when current casino revenues are compared with totals from a decade or more ago.

Marino said declarations that Atlantic City has reached its highest gaming revenue since a particular year can be technically accurate while failing to account for inflation and the changing composition of the industry's revenue.

Online Gambling Changes the Equation

The second major factor is the extraordinary growth of internet gambling.

In 2025, New Jersey internet casino gaming generated $2.91 billion, surpassing the $2.89 billion won on Atlantic City's physical casino floors for the first time.

But those billions in online revenue don't necessarily flow directly to the Atlantic City casino hotels whose licenses make the internet operations possible.

Online brands frequently operate through partnerships with casino licensees, with revenue distributed according to contractual arrangements.

The Division of Gaming Enforcement notes in its financial reports that casino licensees may report distributions received from affiliated or third-party online operators rather than the operator's entire revenue and profit.

“Most casinos don't really get much of the profit of iGaming,” Marino said.

The distinction is increasingly important as internet gaming continues growing at double-digit rates while traditional casino-floor gambling grows much more slowly.

Marino said online gambling also doesn't necessarily produce the same economic benefit for Atlantic City itself.

A gambler playing blackjack on a phone from North Jersey may generate gaming revenue associated with an Atlantic City casino license, but that customer isn't necessarily staying in an Atlantic City hotel, eating in its restaurants or spending money elsewhere in the resort.

“It's great,” Marino said of the online revenue. “Somebody's making money from it.”

But, he added, much of that revenue is shared with or passed through to online gaming partners.

Fewer Casino Jobs

The changing economics of the industry can also be seen in employment.

Marino said Atlantic City's casino workforce has declined significantly as operators adjusted to higher costs and a changing business model.

“If they were keeping the numbers, say, 2017, we would have almost 6,000 more casino employees working,” Marino said. “But those 6,000 jobs were lost as the way the casinos adjusted to the rise of inflation, the rise of contracts, and the cost of goods.”

A separate Atlantic County Economic Alliance study found direct casino-hotel employment stood at 21,172 in April 2026, the lowest April employment level in its nine-year data series.

That workforce is increasingly supporting an industry in which a growing share of gambling takes place nowhere near Atlantic City.

Higher Online Gambling Taxes

Marino points to a third factor that particularly affects comparisons between 2025 and 2026: New Jersey's higher online gambling taxes.

Effective July 1, 2025, New Jersey increased the tax rate on both internet casino gaming and online sports wagering to 19.75%.

Internet gaming had previously been taxed at 15%, while online sports wagering was taxed at 13%.

That means the first six months of 2026 were conducted entirely under the higher tax structure, while the first six months of 2025 were under the old rates.

“So we're comparing this first six months in which taxes went up considerably on casinos compared to the first year,” Marino said. “So that's something we have to keep an eye on.”

A Changing Atlantic City Casino Industry

None of the numbers suggest Atlantic City's casinos have stopped attracting customers.

Marino recently spent several days at Hard Rock Hotel & Casino Atlantic City and said the casino floor appeared busy during his visit.

But he said the industry's long-term health can't be judged simply by looking at the top-line gaming revenue announced each month.

The combination of inflation, rising expenses, internet gambling and higher taxes means the amount gamblers win or lose is only part of the story.

The latest state financial report makes that clear.

Atlantic City's casinos took in slightly more net revenue during the first half of 2026.

They made substantially less profit.