Las Vegas Faces New Economic Test as Gaming Revenue Slips

After months of relying on strong casino performance to offset steep tourism losses, Las Vegas is again showing signs of strain. September brought the first gaming revenue decline of Nevada’s 2026 fiscal year, deepening concerns about the city’s broader economic slowdown.

According to the Nevada Gaming Control Board, the state’s gross gaming revenue (GGR) fell 2.2% year-over-year to $1.28 billion in September. The Las Vegas Strip, which accounts for more than half of that total, posted $687.8 million — a 5% decline following a 5% gain in August. The figures end a short-lived rebound that had offered hope after a difficult summer. Nevada had set gaming revenue records in three consecutive fiscal years from 2022 to 2024, but that streak broke in FY2025. Though the current fiscal year began with modest growth, September marked its first “red month,” prompting analysts to watch the fourth quarter closely — traditionally Las Vegas’s busiest period.

Baccarat, a key driver of high-end gaming revenue, plunged 42% year-over-year on the Strip to $50.6 million. Despite short-term volatility — up 22% over the last three months but down 2% over the past year — the broader table game segment fell 17.5% in September. That decline, coupled with weakening visitation numbers, underscores a broader instability in Las Vegas’s recovery trajectory.

Nevada GGR (Sep 2025)	Strip GGR (Sep 2025)	Visitors (Sep 2025)	Baccarat (Strip, Sep 2025)
$1.28B -2.2% YoY	$687.8M -5% YoY	3.09M -9% YoY	$50.6M -42% YoY

 

Tourism Still in Decline

Visitor numbers continued their downward slide, showing few signs of stabilization. The Las Vegas Convention and Visitors Authority (LVCVA) reported 3.09 million visitors in September — a 9% year-over-year decline. It has now been 12 consecutive months since the city posted a meaningful visitor gain.

Convention attendance dropped 18%, while hotel occupancy, average daily rates and revenue per available room all fell. The only bright spots were modest increases in highway traffic, up 2.5% overall and 3.4% on Interstate 15 near the California border. Air traffic, however, fell sharply. Passenger volume at Harry Reid International Airport declined 6% to 4.4 million in September, bringing the year-to-date total down 5%. The most significant drop came from international markets, which fell 13.5%.

Travel from Canada and Mexico — Las Vegas’s two largest foreign visitor bases — has been hit particularly hard. Air Canada traffic dropped 18%, WestJet 44%, Volaris 9% and Aeromexico 11%. Analysts have pointed to trade tensions and tariffs under President Donald Trump’s administration as contributing factors. Major operators are feeling the effects. Third-quarter earnings reports show Caesars Entertainment and MGM Resorts posting weaker Las Vegas results for a second straight quarter. Both companies had previously downplayed the impact of declining tourism but struck a more cautious tone this time.

MGM CEO Bill Hornbuckle called the industry’s pricing practices “shameful” and said the company is taking steps to “create initiatives and draw incremental visitation.” Caesars CEO Tom Reeg acknowledged a “step-down in leisure demand” that has persisted for four months.

Wynn Resorts, which outperformed peers in Q2, has yet to report its latest results.

 

Local Markets Defy the Trend

While the Strip struggles, regional and local casinos are performing better. Red Rock Resorts reported a 1.5% rise in revenue and a 38% surge in profit for the quarter. Boyd Gaming also posted record results, with its Las Vegas locals segment achieving its strongest growth in more than two years and margins approaching 50%. Macquarie gaming analyst Chad Beynon noted that “softness from the leisure and international customer” in Las Vegas is likely to persist through year-end. “Conversely, trends in U.S. Regionals remain strong, and we expect this segment to continue outperforming Vegas for the remainder of the year,” he wrote.

The upcoming Formula One Las Vegas Grand Prix (Nov. 20–22) is viewed as a potential lifeline. The event’s first edition in 2023 generated a record $1.5 billion in economic impact, but revenue fell to $934 million in 2024 — coinciding with the start of the city’s downturn. LVCVA CEO Steve Hill said organizers have improved logistics and communication for this year’s race in response to resident and visitor feedback. “We’ve refined access and mobility plans, strengthened communication, and expanded transportation options,” Hill told iGB.

 

Las Vegas tourism and gaming revenues both declined in September 2025, signaling deeper economic challenges for the city’s hospitality and entertainment sectors.

 

Structural Questions Ahead

Analysts say the city’s immediate fortunes may hinge on Q4 performance — typically boosted by holiday travel, conventions, and major sporting events — but longer-term concerns remain. Josh Swissman of GMA Consulting said investors will be watching whether current trends reflect cyclical shifts or deeper structural problems. “If weaker performance is due to calendar quirks or event timing, that’s one thing,” he said. “But if it’s driven by sustained declines in air traffic or vehicle crossings, that suggests a more systemic issue.”

For now, Las Vegas finds itself in a rare bind: a cooling tourism engine, a volatile gaming sector, and uncertainty about whether the city that reinvented entertainment can once again reinvent its recovery.