The U.S. commercial gaming industry brought in $16.6 billion in total gross gaming revenue (GGR) during the first quarter of 2023. That number was up by 15.5% over the first quarter of 2022, according to the American Gaming Association.

With 70.1% growth year-over-year, sports betting grew faster than the entire industry. But it was not alone in gaining popularity over the last year: Every other sub-category of the U.S. gambling industry grew by at least 5% year-over-year.

Even with that explosive growth over the past year, sports betting made up just about a fifth of the industry's gross revenue in Q1 2023. Or, to put it another way: The combined earnings of slot machines, table games, and iGaming was more than four times as much money as sports betting pulled in.

For this reason, casinos still place a lot of value on their "land-based" gaming and continue to focus on innovation in that area, especially regarding using apps to streamline the guest experience between accommodations, gambling, and other entertainment. Of course, some of the priority placed on slots and table games is a carryover from how the gambling industry has traditionally operated.

Before the legalization of sports betting throughout the U.S., casinos considered it an extra revenue source but not a core part of the business. For an example as to why, let's look back to a decade ago using data from UNLV's Center For Gaming Research: Of a total win amount of $11.14 billion for nonrestricted locations in the state of Nevada, the sportsbook only added $202.8 million (or 1.8%) in 2013.

It was such a small part of the business—even in a state where it was legal—because it didn't make the margins of other games. The "hold" percentage, or share of money gambled kept by the casino, on sports bets was 5.6%, which was far lower than the rates for table games (13.0%), blackjack (12.0%), baccarat (13.5%) and craps (13.6%).

While slots (6.4%) were more comparable, the high volume made it a huge revenue source for casinos despite the lower margin—something that can't be said about sports bets.

The classic "one-armed bandit" is a highly popular form of gambling at casinos—and the most addictive. They require no skill or preparation, unlike horse racing and sports betting, and they encourage players to always take that next chance at winning. They offer some of the best odds in a casino, as evidenced by that low hold percentage for the house, which can give the illusion that you'll find a "hot" machine and win more than you lose, which is not true in the long run.

Counterintuitively, casinos have learned that reducing the number of slot machines can lead to more revenue, both on a per-machine basis and overall. Nevada casinos carried 50,000 fewer slot machines in 2021 than in 2010, partly due to the reduced capacities of the pandemic. But their average win per machine rose from $108.88 to $212.72 over that span. There's a sweet spot that balances between total volume and per-machine winnings to maximize revenues for the casino.

Table games like poker, craps, blackjack, roulette, and baccarat made up 15% of the total U.S. gaming revenue during Q1 of 2023. Some of these require more genuine skill than others, but they all deliver a comparatively large percentage of the handle to the casino.

Then there's iGaming, which can run the gamut from online casino gaming, including online poker, blackjack, and bridge. It's the second-fastest growing sector of the gambling industry, behind only sports betting, and made up 8.9% of total GGR in the first quarter of 2023.

With $1.48 billion in revenue (up 22.7% versus Q1 2022), online gaming activity has accelerated during the COVID-19 pandemic. While most online casino gaming has ties to brick-and-mortar casinos or racetracks, it's becoming the case less often. Since the pandemic, some states (such as Tennessee and Virginia) have set up online or mobile gaming markets without any land-based casinos, and others (such as New York and Maryland) have removed the need for online sports betting operators to team up with a retail gaming partner.

It's projected the sports betting industry will continue to experience sustained growth. There may be a day when the plurality—if not an outright majority—of all gambling-related revenue comes from sports betting.

But for now, sports betting is merely one of many revenue sources for gaming operators, mixed in alongside table games and iGaming, and firmly in the backseat behind slots. Casinos may even prefer it that way, with the idea that the rise of sports betting offers a complementary experience to their other offerings rather than a substitute. If that's the case, expect significant gains for the total amount spent wagering—in its many forms.

Story editing by Carren Jao. Copy editing by Kristen Wegrzyn. Photo selection by Elizabeth Ciano.