US commercial gaming rises 4.6% as sports betting falls
Table of contents
- US commercial gaming revenue rose 4.6% year-over-year in February 2026, according to the American Gaming Association.
- Sports betting revenue fell 6.4% to $1.17bn, with handle declining for a fourth consecutive month.
- iGaming surged 25% to $976.3m, as the AGA argued prediction markets have cost states around $800m in lost tax revenue since the start of 2025.
The American Gaming Association’s (AGA) Commercial Gaming Revenue Tracker, released on April 16, recorded a 4.6% year-over-year increase in US commercial gaming revenue for February 2026, but the headline growth masked a growing gap between online casino gaming and sports betting.
iGaming and land-based casinos both advanced, generating enough combined revenue to offset a sharp drop in sports betting, suggesting a shift in how Americans are allocating their legal gaming spend.
Casino gains
Traditional casino revenues rose 3.9% in February 2026, aided by 5% growth in table game revenues, the first such increase since October 2025, offering cautious encouragement to operators after a difficult stretch for brick-and-mortar properties.
iGaming revenues jumped 25%, with online casinos generating $976.3 million, nearly a quarter of the $4 billion produced by traditional casinos. The figure points to continued growth in digital casino spending, particularly across the seven states with legal online casino markets.
The overall 4.6% commercial gaming gain was driven by those two segments absorbing the shortfall from sportsbooks.
Sports betting falls
Sports betting revenue came in at $1.17 billion, down 6.4% year-over-year. A handle of $12.66 billion edged up just 0.9%, but the hold percentage fell 73 basis points to 9.24%, the primary driver of the revenue decline.
Notably, nationwide handle declined sequentially for the fourth consecutive month, according to the AGA tracker, continuing a run of handle softness not seen since the pandemic era.
The AGA argues that platforms offering sports-related event contracts via prediction markets are contributing to the slowdown. The association estimates these platforms have cost state governments over $800 million in lost gaming taxes since the start of 2025, including funding it says would otherwise support pension plans and responsible gaming programs. The claim has not been independently verified. These platforms operate under federal Commodity Futures Trading Commission oversight rather than state gaming regulation and have not been uniformly classified as gambling by regulators.
Bill Miller, President and CEO of the American Gaming Association, said:
“Sports betting belongs under state and tribal regulation. That’s how consumers are protected and how communities share in the benefits.”
What comes next
The February results arrive as the industry awaits data from March, which included the NCAA Tournament, historically one of the most lucrative periods of the year for sportsbooks. Prediction markets ramped up their advertising presence during March Madness, and if they have genuinely encroached on state-licensed operators, the impact could be visible in the AGA’s next report.
The February data highlights a tension that has been building throughout the year. iGaming continues to outperform expectations and land-based casinos are showing early signs of stabilization.
Sports betting, the vertical that attracted the most legislative attention and capital over the past decade, is losing ground on both handle and hold. How states and the federal government choose to respond to the prediction market question may define the near-term trajectory of the entire US online wagering sector.
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