Online gambling continues to drive overall gaming growth, while a decline in sports betting raises questions about the potential impact of prediction markets.
ATLANTIC CITY, N.J. — Atlantic City's casino industry is showing signs of renewed weakness after a strong summer, with September's gambling results revealing a decline in revenue at the city's nine physical casinos even as internet gaming continued to grow.
Brian Tyrrell, faculty director of Stockton University's Lloyd D. Levenson Institute of Gaming, Hospitality and Tourism (LIGHT), said the September 2026 figures released Monday by the New Jersey Division of Gaming Enforcement point to a concerning change in the industry's performance.
The results follow several months of relatively strong casino-floor revenue, raising questions about whether Atlantic City's traditional gambling business can maintain its momentum heading into the fall and winter.
"Internet gaming again led Atlantic City to another year-over-year increase in total gross gaming revenue for the month of September 2026," Tyrrell said in an October 19 statement.
But the positive overall numbers masked weaker results inside Atlantic City's casinos.
Casino Floors Struggle After Strong Summer
Tyrrell said slot-machine gross gaming revenue increased 4.6% compared with September 2025.
That improvement represented a turnaround from August, when slot revenue declined 5.1% year over year.
It also contrasted with September 2025, when slot revenue fell 1.8% compared with September 2024.
Tyrrell suggested that warmer weather extending into September may have contributed to the stronger slot-machine performance.
However, the increase in slot revenue was not enough to offset weakness elsewhere in the casino-floor business.
Atlantic City's total brick-and-mortar casino gaming revenue declined compared with September 2025.
That distinction is significant because the physical casino business supports a wide range of jobs and economic activity in Atlantic City, including dealers, hospitality workers, food and beverage employees, entertainment venues and other businesses serving casino visitors.
While internet gambling generates substantial revenue for licensed operators and their online partners, it does not necessarily create the same level of activity inside casino hotels.
One of the Weakest Septembers in Recent Years
The latest results mark a sharp reversal from earlier in the year.
Tyrrell said Atlantic City's physical casinos enjoyed particularly strong revenue from May through July 2026.
Those months included some of the best brick-and-mortar gaming returns since 2011.
But the momentum weakened in August and continued into September.
"After a positive run from May through July 2026 – some of the best brick-and-mortar returns since 2011 – Atlantic City's brick-and-mortar operations have seen a concerning shift in fortunes to one of the worst Septembers in recent history," Tyrrell said.
The September results do not necessarily establish a long-term downturn. Monthly casino revenue can fluctuate because of visitor activity, seasonal patterns and gambling outcomes.
Nevertheless, two consecutive months of weaker casino-floor performance warrant attention as the industry approaches its traditionally slower winter season.
Internet Gambling Continues to Drive Growth
The September figures highlight the increasingly important role of online gambling in New Jersey's gaming industry.
Internet casino gaming allows customers to play authorized games remotely through platforms operated by licensed casinos and their partners.
Those revenues contribute to statewide gaming totals even when customers never visit Atlantic City.
The distinction between online gaming and physical casino revenue is especially important when evaluating Atlantic City's local economy.
Strong internet gaming results can improve the financial performance of licensed operators without necessarily indicating that more people are visiting the Boardwalk, staying in hotel rooms or spending money at local restaurants.
For that reason, analysts closely watch brick-and-mortar casino revenue as a separate measure of the city's gambling business.
Sports Betting Declines Raise New Questions
Tyrrell also pointed to significant year-over-year declines in statewide sports wagering revenue and betting handle during September.
Handle refers to the total amount wagered by customers, while sports wagering revenue generally represents the amount retained by operators after paying winning bets, subject to applicable reporting adjustments.
The distinction matters because betting activity and operator revenue do not always move in the same direction.
Tyrrell said football accounted for the largest share of sportsbook activity and suggested that the calendar played an important role in September's decline.
September 2026 included three weekends of football games, compared with four during September 2025.
That difference reduced the number of major betting opportunities within the reporting month.
But Tyrrell also raised another possibility: competition from prediction markets.
Could Prediction Markets Be Taking Business From Sportsbooks?
Prediction platforms such as Kalshi and Polymarket have attracted attention by allowing users to trade contracts tied to the outcomes of various events.
Some event contracts involve sporting events and can resemble traditional sports wagers in their economic effect, although they operate under different regulatory frameworks.
Tyrrell suggested that activity on those platforms may be affecting New Jersey's regulated sportsbook business.
He did not claim that the September figures establish a direct connection.
The distinction is important because the later football calendar offers another explanation for the monthly decline.
Determining whether prediction markets are diverting significant business from New Jersey sportsbooks would require additional information about customer activity, trading volume and changes in betting behavior.
Still, the possibility raises questions for the state's gaming industry and regulators.
Potential Implications for State Tax Revenue
Tyrrell warned that a sustained shift away from state-regulated sports wagering could have consequences beyond the gaming operators themselves.
"If prediction markets are taking revenue off the board for regulated gaming operators in the state, we can expect to soon see (among other things) an impact on the state's tax revenues and contributions to the Casino Revenue Fund," Tyrrell said.
The Casino Revenue Fund helps support programs and services benefiting eligible senior citizens and people with disabilities in New Jersey.
A decline in taxable gaming revenue could affect the money available through the state's established gaming-tax structure.
However, the September results alone do not establish that prediction markets have reduced those contributions.
Any long-term financial effect would depend on how much wagering activity shifts, how the activity is taxed and whether other gaming revenue offsets the decline.
Why the Numbers Matter to Atlantic City
For Atlantic City, the latest figures illustrate the difference between a growing statewide gambling industry and the financial health of the city's physical casino market.
The nine casino hotels remain major employers and tourism destinations.
Their operations support workers, local vendors and surrounding businesses that depend on visitors coming to the resort.
Internet gaming growth benefits the broader gaming industry, but it is not a direct substitute for hotel occupancy, restaurant spending, entertainment attendance and other economic activity generated by casino visitors.
September's weaker brick-and-mortar results therefore deserve attention even though total gaming revenue increased.
The next several monthly reports will help determine whether the decline reflects a temporary seasonal shift or a more persistent challenge.
For now, Tyrrell's assessment underscores an increasingly important reality for Atlantic City: Online gambling may continue to set the pace for revenue growth, while the city's traditional casino business faces a different set of economic pressures.
South Jersey NewsBeat will continue following the monthly gaming figures, the performance of Atlantic City's nine casino hotels and the developing debate over prediction markets and regulated sports wagering.
