Tribal gaming CFOs say they ’ re optimistic about 2023
By Grant Eve
In January , Wipfli surveyed chief financial officers ( CFOs ) from more than 20 prominent tribal casinos to gauge their outlook for 2023 . Here ’ s the good news :
Tribal casinos are financially stable
Over 70 percent of tribal casino CFOs say their financial stability is much higher today than it was five years ago . None reported deterioration .
With record revenues of over $ 39 billion reported by the National Indian Gaming Commission in fiscal year 2021 , and revenue expected to be even higher for 2022 , it ’ s likely that financial stability is stronger than prepandemic . This means that tribes are investing in their facilities and not transferring all the profits back to the tribal governments . Investments that have led to stronger financial stability include investments in technology , paying down debt and keeping larger cash reserves on hand .
Concerns are relatively minor
CFOs are trying to fund bold futures in a wild macroeconomic environment — yet they reported few major concerns . The ongoing talent war and rising labor expenses are their biggest worries . Cybersecurity may have ranked as a moderate concern in the survey , but once a breach occurs , it becomes a high concern , so ensuring proactive actions to address cybersecurity are critical . Otherwise , for the most part , CFOs feel prepared for the challenges ahead .
Most CFOs are optimistic
More than half of tribal gaming CFOs are at least somewhat optimistic about 2023 . About a third are neutral about their business outlook .
What ’ s in their favor ? Record-high revenue from the past two years that can help them overcome pricing hikes and labor shortages . The right incentives and marketing offers continue to draw guests in . And casinos still have efficiencies to gain through supplier agreements and technology .
Revenue is expected to rise
Despite inflation and rising costs , the majority of CFOs expect revenue to increase in 2023 . By how much ? Two-thirds of those polled think revenue could rise between 1 percent and 10 percent .
With a lot of unknowns going into 2023 , it ’ s great news that CFOs expect a continued increase of revenue in 2023 . This will help offset inflation from 2022 , as casinos cannot simply raise prices like many other businesses have done to combat inflation .
While there is no doubt about the fact that some uncertainty is coming for the remainder of 2023 , there is also no doubt that CFOs of large tribal gaming operations are dialed in on the trends for 2023 and plan to act appropriately as we face new challenges .
Grant Eve is a partner for Wipfli specializing in gaming and hospitality . He has several years of experience working with tribal gaming organizations and commercial casinos throughout multiple jurisdictions . A recognized leader in the gaming industry , Eve has authored numerous articles and interviewed in many industry publications .
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