FANTINI ’ S FINANCE
2025 : Questions and Answers
The Trump presidency , Las Vegas Strip revenues , regional casinos and iGaming provide the questions to be answered in the new year
BY FRANK FANTINI
2025 : A year of questions . This is the time when prognosticators of various kinds — often consulting firms looking for soft ways to market their services — predict trends for the upcoming year . Yet there may be more questions for 2025 than identifiable trends . So , in that spirit , we ’ ll look into the new year by raising questions .
• Donald Trump , the biggest wild card of all .
No one seems certain what to expect from a Trump presidency . Will he follow through on his bold promises , or are they merely starting points for negotiations ? Or will there be a mix of hardline , negotiable and / or transactional decisions and policies ?
More important , what will be their effect on the economy , and on a stock market that seems more blitheful and blissful than realistic ?
Most specifically , what will any or all of this mean for gaming companies and gaming investors ?
We won ’ t attempt to predict how the economy and market will perform , but we ’ ll raise two points about the gaming industry : 1 ) A former casino owner himself , Trump has been friendly to the gaming industry , which is in the domain of the states , anyway ; but 2 ) he may be more apt to rein in Indian gaming , especially with a secretary of the interior who may oppose the hub-andspoke idea whereby tribes intend to offer online gaming off reservations as long as the servers are on reservations .
• Las Vegas . How high is high ? It has become universally accepted that Las Vegas Strip gaming revenues will grow ad infinitum . But will they ? And at what pace ? Enough to make up for higher operating costs ?
The past year has been one of ups and downs for Las Vegas , and while weak periods and financial comparisons have been explained away , the fact is that there have been those periods of weakness in what 12 months ago many thought would be a banner year from start to finish .
If Las Vegas is entering a slow-growth period , it will be fair to ask what impact that will have on MGM Resorts and Caesars , especially as MGM gets most of its revenues from Sin City .
• Regional casinos . All grown up and nowhere to go ? The success stories in regional gaming will be individual property expansions and new infill markets , such as Nebraska and Virginia , or converting the last riverboats to landside . But the fact is that brick-and-mortar revenues have declined materially in jurisdictions where digital gaming is now legal , and even in the infill situations there are cases of cannibalization of existing properties . So , it ’ s not pure growth .
Perhaps the most interesting sports betting and iCasino story of the year will be Penn Entertainment . After considerable skepticism , and even criticism , PENN may next year prove whether it can make a meaningful success of digital gaming .
Meanwhile , the spread of skill and sweepstakes gaming , often of gray legal status , is continuing to erode brick-and-mortar revenues , a matter that legislators should address given the jobs and taxes that land-based casinos provide .
The opportunity for needle-moving in regional gaming would be the opening of new jurisdictions . And , slim chance that it is , the legislature of long anti-gaming Texas is in biennial session in 2025 with the likes of Las Vegas Sands pushing for legalization .
• Digital . Finally profitable ?
This past year has been the time when online gaming in the U . S . began to mature with weak sisters leaving and the bigger players finally reaching the promise of EBITDA-measured profitability .
The question is whether the trend will accelerate in 2025 . Our expectation is that it will .
Actually , many of the questions about digital were answered this year as DraftKings and Flutter continued their market dominance , Caesars turned profitable and is on the way to showing that money can be made without entering a ruinous market share race , and companies like affiliate Gambling . com and data providers Sportradar and Genius Sports show there can be profitable pick-and-shovel plays in the space .
Perhaps the most interesting sports betting and iCasino story of the year will be Penn Entertainment . After considerable skepticism , and even criticism , PENN may next year prove whether it can make a meaningful success of digital gaming . It recently launched product enhancements and customer linking with ESPN on its ESPN BET that should tell us soon if the online betting platform will be a home run . If so , PENN might be the gaming operator stock of the year . If not , well , it ’ s trading below the value of its brick-andmortar business so there is some downside protection .
Meanwhile , the industry overall continues to grow .
• Will they take the punch bowl away ?
The flip side of growth is to attract government attention in the form of more restrictive regulations and legislation . That is especially true of gaming , which can be an easy target given that its benefit to society is just entertainment while opponents see it as socially destructive .
More restrictions , from bet and loss limits to advertising bans , have been implemented or proposed in a number of major international gaming markets , including Australia and the United Kingdom .
Legislators love to introduce legislation , and with models already provided , it would not be surprising to see 2025 become the year when materially crimping restrictions start to be imposed in the U . S .
Frank Fantini is principal at Fantini Advisors , investors and consultants with a focus on gaming .
12 Global Gaming Business JANUARY 2025