The American Gaming Association released its State of the States 2026 report this week, and the headline numbers are extraordinary: US commercial gaming revenue grew 9.1% year-over-year in 2025 to a new all-time record, with online casino up 27.6%, online sports betting up 20.4%, and land-based casino revenue effectively flat. iGaming and mobile sports betting are now the two largest growth drivers in regulated US gambling, and prediction markets — operating outside state regulatory frameworks — are increasingly part of the conversation.
Here's a complete summary of the 2026 AGA report, the trends that matter most for operators and players, and how the regulatory landscape is shifting heading into the second half of the year. For the broader industry view, see our gambling guides library.
Headline Numbers From The 2026 AGA Report
- Total US commercial gaming revenue 2025: $79.7 billion (record high)
- Year-over-year growth: +9.1%
- iGaming revenue: $10 billion (+27.6%)
- Online sports betting revenue: $14.2 billion (+20.4%)
- Land-based casino revenue: $49.5 billion (essentially flat)
- Tribal gaming revenue (estimated): $43 billion
For the third consecutive year, the US commercial gaming industry set an annual revenue record. The growth is no longer being driven by retail casinos — it's driven by online product, and within online product, by iGaming more than sports betting.
iGaming Is The Fastest-Growing Segment
iGaming revenue grew 27.6% in 2025 to clear $10 billion for the first time. Pennsylvania, New Jersey, and Michigan account for nearly 90% of that figure. The three top states' combined performance:
- Pennsylvania: $3.46B (+27.6%)
- Michigan: $2.43B (+22.1%)
- New Jersey: $2.18B (+19.8%)
For the first time, online casino revenue in both Pennsylvania and New Jersey exceeded land-based casino revenue. That's a structural shift the industry has been forecasting for years — and 2025 was the year it actually happened.
Sports Betting Is Still Growing, But More Slowly
Online sports betting revenue grew 20.4% to $14.2 billion. That's a strong number in absolute terms, but it's a deceleration from 2024's 25%+ growth rate. Three factors are driving the slowdown:
- Most legal-state markets are now mature (NJ, PA, NY, IL, OH all in their post-launch phase)
- No major new state launched in 2025
- Prediction markets are absorbing a portion of incremental demand
The big winners by state: New York ($2.9B GGR), Pennsylvania ($1.7B), Illinois ($1.4B), and Massachusetts ($1.0B). For state-by-state coverage, see our US sports betting guide.
Land-Based Casinos: Flat But Profitable
Land-based casino revenue was essentially flat in 2025 — $49.5B vs. $49.2B in 2024. The flat number masks meaningful regional variation: Las Vegas had a strong year, regional Midwest properties struggled, and Atlantic City continued its slow decline.
The interpretation: the retail casino business has stabilized at a high level after the post-pandemic recovery, but secular growth has clearly shifted online. Operators are increasingly viewing retail properties as marketing assets for their digital products rather than primary revenue centers.
Prediction Markets: The Wild Card
The AGA report notes that prediction markets — Kalshi, Polymarket, and several smaller CFTC-regulated venues — are increasingly absorbing demand that would otherwise flow to state-regulated sports betting. Kalshi was valued at $22 billion after a $1 billion Series F in May 2026, and the platform's sports event contracts are available to residents of all 50 states.
Several states have moved to restrict prediction markets at the state level — Minnesota's recent bill being the most notable — but federal preemption arguments under CFTC regulation have so far held up in court. This is the single largest unresolved policy question for the US gaming industry heading into the second half of 2026.
What The Numbers Mean For Operators
Three implications for the operator landscape:
- Investment in iGaming product is now the highest-return capex in regulated gambling. Expect more aggressive product launches in 2026
- Pure-play sports betting margins are compressing as the market matures. Operators are leaning harder on iGaming cross-sell
- Prediction market competition will eventually be addressed at the state or federal level. Operators are lobbying both directions, with most pushing for state-level enforcement
FanDuel, DraftKings, BetMGM, and Caesars remain the four largest operators by combined sports betting and iGaming GGR. See our reviews of DraftKings, FanDuel, and BetMGM for current operator analysis.
What's Next: 2026 Legalization Outlook
The AGA report includes a sober outlook for 2026 state legalization activity. The Casino.org analyst consensus is that no new state will approve iGaming or sports betting in 2026. The remaining holdouts — Texas, California, Georgia, Minnesota — all face structural obstacles that are unlikely to break in a single legislative cycle.
The most plausible 2026 legalization candidate is online poker liquidity expansion. Pennsylvania has flagged the multi-state online poker compact for possible review, and a 2026 vote could materially expand the small US online poker market.
Frequently Asked Questions
How big is the US gambling industry in 2026?
US commercial gaming revenue hit $79.7 billion in 2025, a record high. Including tribal gaming, total US regulated gambling revenue is approximately $123 billion.
What's the fastest-growing segment?
Online casino (iGaming) is the fastest-growing segment, up 27.6% year-over-year to $10 billion in 2025.
Is land-based casino revenue declining?
Not declining — but essentially flat. Land-based casino revenue was $49.5B in 2025 vs. $49.2B in 2024, a 0.6% increase.
Will any new states legalize sports betting in 2026?
The industry consensus is no. The remaining holdouts (Texas, California, Georgia, Minnesota, others) face structural political and legal obstacles unlikely to break in 2026.
What's the deal with prediction markets and the AGA report?
The AGA flagged prediction markets — Kalshi, Polymarket — as a growing regulatory concern. CFTC oversight provides federal preemption against state restriction, but several states are pushing back.
Conclusion
The 2026 AGA State of the States report confirms what the industry has been signaling for two years: US gambling is increasingly an online business, with iGaming the fastest-growing segment and sports betting maturing into a steady-growth category. Prediction markets are the wild card, and the regulatory fight over their status is the single most important policy question for the back half of 2026.
For a deeper look at US gambling state by state, see our latest articles and the full gambling guides library on about DeucesCracked.
Join the Conversation
Be respectful. No spam. Strategy discussion welcome.