PA casinos had a record 2021, which was welcome news for an industry that got rocked by virus shutdowns the previous year. The records set in 2021 were also great for the Commonwealth in terms of much-needed revenue to keep important state programs in business.

Overall PA gaming revenue came in once again over $400 million at $406.3 million, a 141% increase over December 2020. That resulted in $165.0 million in tax dollars for the state and local entities, according to figures released by the Pennsylvania Gaming Control Board Thursday.

PA gaming records set in 2021:

  • $4.73 billion in gaming revenue (compared to $2.65 billion in 2020)
  • $1.93 billion in tax revenue (compared to $1.10 billion in 2020)

PA online casinos smash revenue records in 2021

December’s $127.6 million iGaming revenue (including slots, table games and online poker) eclipsed their previous record of $117 million set in October. It also brought the yearly total gross gaming revenue for online casinos to nearly $1.3 billion. That was up 91% from $680.2 million in 2020.

Pennsylvania’s now mature iGaming market with 17 online casinos and four online poker skins was the second to reach $1 billion in revenue in a year (just after New Jersey). It is also now the second-largest US market for iGaming behind the Garden State.

The record year for PA online casinos brings the lifetime total just over $2 billion in GGR. (The first online casinos began to launch in July 2019). iGaming verticals brought in a whopping $466.4 million in taxes for PA during 2021.

For a full breakdown of December revenue, view our monthly PlayPennsylvania press release.

December 2021 PA casino revenue figures

How did the 17 online casino brands stack up in December 2021?

LicenseeOnline Brand(s)Total RevenueSlots RevenueTable Games RevenuePoker Revenue
Hollywood Penn NationalHollywood | DraftKings | BetMGM | Barstool$50,867,842$36,191,401$14,387,588$288,853
Rivers PhiladelphiaSugarHouse | BetRivers | Borgata$34,402,010$30,287,361$4,025,104$89,545
Valley ForgeFanDuel | Stardust$19,041,300$10,567,527$8,473,773$0
Mount AiryPokerStars$7,560,932$3,997,957$1,519,261$2,043,714
Harrah's PhiladelphiaCaesars$3,586,220$2,748,852$197,535$639,833
Live PhiladelphiaPlayLive | Betway$2,407,123$2,124,160$282,963$0
Mohegan Sun PoconoUnibet$2,251,054$1,957,590$293,464$0
Wind CreekWind Creek$1,797,190$1,725,683$71,507$0
Presque IsleTwinSpires$1,165,673$920,071$245,602$0

Once again, Penn National was on top with its four popular brands, making up 40% of market share. Rivers Philadelphia was second again with 27% across three brands.

Two takeaways and one prediction from December 2021 PA casino revenue

1) Online casinos are standing the test of time and are a vital stream for PA taxes.

Not only are they clearly here to stay (and only helping land-based casino brands), but online casinos are also proving a vital source of income for the state. Many jurisdictions that rely on gambling as a major source of state income tax were hit hard by virus closings and restrictions but PA was able to withstand the storm with the help of income generated by online casinos.

With land-based casinos now mostly operating at normal capacity* iGaming continues to provide significant tax dollars for the state. One reason for that stems from the high tax rates PA imposes on gaming revenue.

*When we say mostly at normal capacity, there is a caveat. There are still virus concerns holding people back from in-person gambling. Additionally, beginning Jan. 3 the city of Philadelphia mandated proof of vaccine for entry into establishments where food and beverages are consumed, which includes Live! Casino and Rivers Philadelphia.

That said, the PA gaming market is still expanding both online and live. In 2021, three new casinos opened their doors: Live! Casino & Hotel Philadelphia and two Penn National mini-casinos – Hollywood York and Hollywood Morgantown.

2) High tax rates in PA are working out well for the state.

With an industry-leading tax rate of 54% for online slots and 16% for online table games and poker, it’s no wonder that online gambling is paying off big for Pennsylvania. PA’s sports betting tax rate of 36% also seemed high, though it pales in comparison to New York’s 51%. But let’s put this into a historical context.

There was an initial concern amid the 2017 PA gambling expansion that the proposed tax rates on new verticals were prohibitive and maybe the market wouldn’t be worth entering for many companies. That hypothesis did not bear fruit. Despite a slow start in mid-2019, gambling brands saw and seized the opportunity in PA. There are now 17 online casinos, four online poker brands and 13 online sports betting apps available to Pennsylvania players. And they’re all forking over a big chunk of revenues to the state. PA sportsbooks contributed $122.5 million in taxes in 2021, more than any other state.

Let’s also not forget the up-front licensing fees that PA casinos coughed up to be able to offer online gaming. Each land-based casino wanting to offer online slots and table games had to pony up $8 million ($4 million per vertical). Those who also opted for the opportunity to offer online poker got a discount on all three for $10 million. The license to offer retail and online sports betting was also $10 million. It all adds up to a healthy haul for the Commonwealth.

Prediction: Big winners in online casinos and sports betting will continue to dominate.

While basically all of the online gambling apps in PA are solid in terms of the number of games and offerings, popularity varies widely. The top brands, including those that have spent the most on marketing and promos, are the clear winners in the PA gaming space.

Market share for 2021:

  • Penn National (Hollywood, DraftKings, BetMGM, Barstool): 36.2%
  • Rivers Philadelphia (BetRivers, SugarHouse, Borgata): 27.4%
  • Valley Forge (FanDuel, Stardust): 15.6%
  • Mount Airy (PokerStars): 7.6%

The top three licensees (making up 9 of 17 online skins) account for nearly 75% of PA iGaming market share, leaving the remaining seven license holders to fight for a share of 25%.

With such a head start over brands with much smaller market share, it doesn’t appear that the ones at the bottom will be able to make up the ground.

What will this mean for these markets – and the brands at the bottom – long term?

We’ve already seen quite a number of mergers and acquisitions across the sports betting (and to a lesser extent, the online casino) space. With the market still expanding, more of these deals are inevitable. It stands to reason that many of the iGaming and online sports betting brands we see today, including some with a presence in PA, will merge with or sell to bigger brands.

But as long as there is no monopoly, the competition should continue to prove favorable for Pennsylvania bettors. And it’s clear that the online casino market in PA isn’t done growing quite yet.

Lead image credit: AP Photo/Michael Ainsworth