US gaming executives entered 2026 with a notably strong view of near-term industry conditions, but the same outlook shows rising concern over prediction markets and regulatory uncertainty.
The American Gaming Association’s (AGA) Spring 2026 Gaming Industry Outlook, prepared by Oxford Economics, found that real economic activity in the casino gaming sector continued to expand in the first quarter.
The survey was conducted from 23 March to 8 April of this year, with responses from 26 senior-level AGA member executives.
AGA President and CEO Bill Miller said: “Operators are focused on investing in innovation and delivering world-class entertainment, while also navigating an evolving competitive and regulatory landscape.”
The positive side of the survey was broad. More than 60% of AGA member executives expect capital investment, revenue and balance sheet health to improve over the next six to 12 months.
The Gaming Conditions Index, which tracks real activity through gaming revenue, employment, wages and salaries, executive sentiment and casino hotel event demand, rose 1.5% year-on-year in the first quarter of 2026.
That marked a continuation of growth from the previous two quarters and showed that the sector was still expanding after inflation adjustments.
Executive sentiment moved to 21.4% net positive, the highest reading since the third quarter of 2022.
The current business situation was 12% net positive, with 24% of executives describing conditions as good, 64% as neutral and 12% as bad. That was slightly better than the 11% net positive reading recorded in the third quarter of 2025.
Future expectations remained positive, although less forceful than last autumn’s reading. The survey found 29% of executives expected the business situation to improve.
That was down from 26% net positive in the third quarter of last year, but still kept the industry in favourable territory.
Capital investment activity to pick up
The more salient figures came from specific operating categories.
Revenue growth and overall balance sheet health were each 56% net positive, while customer activity was 32% net positive.
Investment plans were also strong. Among all respondents, 62% expected capital investment to increase over the next six to 12 months.
Among casino operators and owners, capital investment was 56% net positive, local customer activity was 31% net positive, overall customer activity was 28% net positive and overnight customer activity was 25% net positive.
Promotional activity moved the other way, with operators expecting a decline for the second straight quarter.
That category was 31% net negative, suggesting operators are still watching margins closely instead of chasing volume through more costly offers.
Gaming equipment suppliers gave one of the most optimistic readings in the report. Supplier expectations around the pace of capital investment reached 80% net positive.
Sales of gaming units for replacement use were 60% net positive, while sales of units for new or expanded use were 20% net positive. The AGA said expectations for capital investment among suppliers had never been stronger since the survey began.
The stronger investment and revenue outlook did not remove pressure from the cost side of the business. Hiring expectations remained negative for the seventh consecutive survey.
New employees hired was 12% net negative among all executives, and employee wages remained the most commonly cited expense pressure, selected by 54% of respondents.
Taxes or regulatory policy changes, insurance and technology privacy or data protection were each cited by 42% of executives. Employee benefits were cited by 35%.
Prediction markets cast shadow on bright gaming future
Despite the positive overall view of the sector, prediction markets stood out as a separate concern. The report found that 81% of executives viewed prediction markets as a very significant threat to the gaming industry.
Industry executives also pointed to prediction market regulation as an area requiring greater-than-normal management attention.
Their written responses identified concerns over untaxed and unregulated competition, possible expansion into gaming markets, and the potential effect on industry credibility.
Miller said: “Illegal sports betting through sports event contracts is increasingly encroaching on legal, state-and tribal-regulated operators. It’s clear the legal, regulated industry views this is a threat, and will continue to fight back and protect the integrity of our industry.”
The report did not frame those concerns as theoretical. It said prediction markets had already begun to affect business.
Regulatory pressure around the issue is rising alongside broader uncertainty. Federal regulatory concerns were cited by 46% of executives as a factor limiting operations, up from 29% in the third quarter of 2025.
Competition from new forms of gaming was cited by 42%, up from 25% last autumn. State regulatory concerns were also cited by 42%.
Those figures place prediction markets within a wider competitive conundrum for licensed gaming companies, which are planning new investments while also facing new products that do not operate under the same state-by-state regulatory structure.
Economic and political uncertainty remained the top operating constraint. Geopolitical risk and uncertainty in the economic environment were each cited by 62% of respondents.
The report linked those concerns to tariffs, inflation and supply chain pressure. It noted that rising prices for fuel and violence in the Middle East had been eating away at the profitability of firms and reducing consumer spending.
The March forecast by Oxford Economics predicted an ongoing robust performance of the US economy, however, boosted by investment in AI and other industries.
