The U.S. commercial gaming sector set a new high in 2025, generating $78.72 billion in gross gaming revenue and $18.09 billion in state and local gaming taxes, according to the American Gaming Association (AGA). Sports betting revenue grew much faster than handle, signaling a higher national hold, while iGaming kept expanding. Altogether, the figures point to a shift toward online products, with implications for pricing, taxation, and regulatory boundaries.
Key 2025 results
The AGA’s Commercial Gaming Revenue Tracker shows industry GGR up 9.2 percent year over year and gaming tax revenue up 15.1 percent. All 38 commercial gaming jurisdictions it tracks posted annual gains. By vertical:
- Traditional gaming: $50.94 billion in revenue (+2.3 percent); $11.33 billion in taxes (+7.2 percent)
- Sports betting: $16.96 billion in revenue (+22.8 percent) on $166.94 billion in handle (+11.0 percent); $3.71 billion in taxes (+32.4 percent)
- iGaming: $10.74 billion in revenue (+27.6 percent); $2.59 billion in taxes (+36.9 percent)
Sports betting: revenue growth outpaces handle
In 2025, sportsbook revenue grew more than twice as fast as handle. Based on the reported figures, the implied national hold—the share of handle kept as revenue—was about 10.2 percent. That amounts to a higher effective price for bettors and usually reflects a product mix that leans into higher-margin wagers such as parlays and certain in-play markets.
For regulators and market analysts, that gap matters because most states tax GGR, not turnover. Taxes rose 32.4 percent year over year against a 22.8 percent revenue increase, pointing to a higher effective tax take across regulated sportsbooks in 2025. The pattern can stem from a mix of higher hold and wagering shifting toward jurisdictions with relatively higher rates or tighter limits on deductions.
iGaming’s expanding share
iGaming grew the fastest among tracked verticals, with revenue up 27.6 percent and tax receipts up 36.9 percent. While the report does not break out state-level contributions, the expansion of iGaming—where legal—continues to reshape the industry’s revenue mix, lifting the share of online, always-on markets relative to venue-based gambling. For bettors, the online shift concentrates activity in channels where pricing is dynamic and often personalized, and where tax regimes vary widely by state.
Traditional gaming slows in a record year
Casino and other traditional gaming revenue grew 2.3 percent, well below the online segments. Even so, taxes from traditional formats rose 7.2 percent, contributing the majority of gaming tax receipts. The slower growth versus online fits a longer-run rebalancing: as more wagering moves to digital channels, operators’ product design and risk management increasingly focus on bet types that can be priced and settled more frequently—shaping both hold and the bettor experience.
Regulatory perimeter: AGA targets prediction markets
AGA and allied stakeholders reiterated their opposition to “prediction markets” offering sports event contracts outside state and tribal sports betting regimes. The association says these platforms operate without state-level oversight, do not meet the responsible gaming standards applied to sportsbooks, and do not contribute state tax revenue. AGA estimates such activity has diverted more than $500 million in potential sports betting tax revenue to date. The estimate underscores an ongoing jurisdictional boundary issue: state-regulated sports wagering versus federally overseen derivatives platforms that, in some instances, have sought to list contracts referencing sporting outcomes. Policymakers’ decisions on where to draw that line will determine which rules, protections and tax structures apply to sports-related event trading.
What the numbers signal for market mechanics
Two structural points stand out. First, the higher implied national hold suggests the industry is still leaning into higher-margin bet types, which can raise the all-in cost of wagering for customers and lift tax yields where rates are assessed on GGR. Second, growth is concentrated in online formats—sports betting and iGaming—where pricing, latency, and data access are central to competitive dynamics and where regulatory differences across states create uneven effective tax and compliance burdens.
Conclusion
AGA’s 2025 data shows record GGR and gaming tax receipts, led by faster-growing online segments. Sports betting revenue outpacing handle points to a higher national hold, amplifying tax collections in GGR-based systems. iGaming’s expansion further tilts the market toward digital channels. With the association pushing back on sports-related prediction markets, the regulatory perimeter around event wagering remains a live policy issue with direct consequences for pricing, protections, and tax flows.