Borgata Online Gambling Expected to Turn Profit By End of Year

The Borgata Hotel Casino and Spa was one of the Atlantic City casinos that launched an online gambling site last November. The market has grown more slowly than Chris Christie and other lawmakers initially anticipated, but is still picking up. Kevin Smith, the CEO of Boyd Gaming (the holding company of the Borgata) recently announced that the company should make a profit by the end of the year.

The Borgata's recent income statement shows that the company faced a $3.2 million loss in the first quarter. On the surface, the initial report was discouraging.

However, Smith said that the reported losses didn't reflect the Borgata's long-term profitability. He said that the majority of those losses were attributed to the initial costs of launching the online gambling platform. The company's analysts are confident that investment will pay off in the near future.

"We invested heavily in marketing and advertising," said Smith. "Of the $3.2 million operating loss reported by our online business during the quarter, about $2 million was due to onetime nonrecurring expenses."

Smith believes their losses will shrink in the coming months as revenues from both online and land-based gaming begin to increase. The Borgata is the most successful online gambling operator in the state. It currently holds a third of the market share, but faces fierce competition from Caesars Entertainment.

New Jersey online gambling providers generated nearly $12 million in March, a 15% increase over the previous month. The Division of Gaming Enforcement shows that the market has grown every month since the industry was launched. However, growth rates have fluctuated during that timeframe, which makes it difficult to predict the future revenues that Atlantic City casinos can generate.

The DGE has issued some new changes to its online gambling regulations. They allowed the casinos to relax the settings on their geolocation software, which has helped them cater to players near the state borders. Neteller also launched a new ewallet service in New Jersey, which should help many people that faced payment processing problems. These changes are expected to benefit the Borgata and other casinos in the near future.