Concerns of cannibalisation are “totally overstated”, says BetMGM CEO Adam Greenblatt

There has been a significant back and forth debate on the impact of igaming on the retail casino sector in the US and BetMGM CEO Adam Greenblatt is weighing in on the discussion. Studies that examine whether or not online gambling cannibalises retail casino performance have at times contradicted each other and today some of the US’ front-running igaming operators are still arguing that online casinos are impacting their retail business.

Last year in Maryland, Live! Casino owner Cordish Companies testified in front of lawmakers that online gambling would be bad for brick-and-mortar operators, particularly impacting state tax revenues and employment. John Pappas, on behalf of the iDevelopment and Economic Association (iDEA) trade body, argued that Pennsylvania’s revenue report showed no such negative effect.

Entain and MGM Resorts JV BetMGM has been at the forefront of leveraging the latter’s rich casino guest database and brand presence in Las Vegas. As a combination of Entain’s online tech stack and MGM’s longstanding casino expertise, BetMGM is in a unique position to self-examine the topic of cannibalisation.

BetMGM single wallet proving omnichannel approach is successful

BetMGM claims to have been the first operator to launch an omnichannel betting wallet in Nevada ahead of last year’s NFL season, meaning bettors can access their wallet and account seamlessly both online and in a retail sportsbook.

Speaking to analysts during MGM Resorts’ 2024 earnings call in February, CEO Bill Hornbuckle said the development had helped drive a 60% increase in Nevada-acquired first-time depositors versus the prior NFL season. Clearly, BetMGM is benefitting from extensive efforts to cross-sell.

BetMGM CEO Adam Greenblatt says there has been a level of fearmongering by some in the retail sector on the issue of cannibalisation.

“The concerns around retail to digital cannibalisation, we believe, are totally overstated by the retail incumbents,” Greenblatt told iGB in a March interview.

“Cannibalisation scaremongering” exaggerates threat

The BetMGM chief notes a level of distortion, caused by the pandemic, led to lower attendance at casino venues, but longer-term trends have been “pretty consistent”. Igaming, where introduced, has expanded the tax bases in states that also have retail facilities, Greenblatt says.

“If you look at the underlying trajectory of the retail facilities in states where igaming has been introduced, [across] the really long-term trends, it’s been pretty much business as usual.

“The point here is, I think the scaremongering around cannibalisation is greater than the actual [threat],” says Greenblatt.

He understands why retail – and even some omnichannel – operators are pointing to the impact of cannibalisation, but notes MGM Resorts’ vision for the future is a combination of retail and digital. Hornbuckle has been vocal about his desire to bridge the gap between digital and retail casino innovation.

Hornbuckle noted previously that there is an experiential evolution taking place and the gambling industry is now in that phase.

“We went through the restaurant evolution, with world-class chefs coming, and then we went through the retail evolution, building out world-class shopping experiences, and now we’re in the entertainment revolution,” Hornbuckle said.

To foster this “revolution”, MGM Resorts/BetMGM has been promoting rewards programmes that see players earn credits across both channels. These can unlock invites to concerts and sporting events or simply just extended stays at MGM on-premise sites.

Greenblatt’s relocation and building an expat community

Greenblatt kicked off his gambling career in the UK as a corporate development director at Ladbrokes Coral in London from 2011 to 2018. He joined GVC upon the group’s acquisition of Ladbrokes Coral in December 2017 in a deal valued at £4 billion.

In October 2018, at the dawn of the betting bubble in the US, Greenblatt was among the first European gaming expats to relocate to the US, as he took the helm of the newly formed BetMGM JV.

In May 2018 a landmark Supreme Court ruling overturned the Professional and Amateur Sports Protection Act of 1992, which had effectively outlawed sports betting in nearly all US states. The long-awaited ruling ushered in a new era. European incumbents flocked to the US market, sending key strategic executives to New York and New Jersey to leverage the opportunity. This created a thriving expat community between New York City and gaming hubs in New Jersey.

Reflecting on a challenging entry into the US

Reflecting on that time, Greenblatt’s longtime friend and industry peer, ex-888 Holdings head of US Yaniv Sherman, said his friendship with Greenblatt was rekindled when the two relocated to the east coast to lead their respective companies’ entrance into the US.

“We’ve stayed in contact on and off, but when PASPA was repealed and we both moved to the US, that connection was rekindled. We arrived at different locations and very different set-ups. I was setting up a new market for what was a UK-focused plc and singular brand.

“Adam was stepping into the complicated role of a JV CEO, balancing between two major shareholders with dominant execs on both sides. We both had very limited US resources and generally our organisation’s ‘nerve centres’ were stretched through Las Vegas, Gibraltar, Israel and India,” Sherman tells iGB.

“He is one of a few executives that grew on the corporate development side and was able to transition to an operational role,” he adds. “Doing it with two shareholders that are not always aligned, to put it mildly, while building and growing a US igaming powerhouse is nothing short of incredible.”

US market presents greater opportunities

Speaking on the differences between his experiences of the US and UK markets, Greenblatt says while the UK is a mature market, the opportunities in the US are much greater.

“I will say in terms of the size of the pool, the depth of the US market is just staggering,” Greenblatt says. “The US just dwarfs everything else in a way that surprised me. You know, relative to London, I was like, ‘Whoa!’ I thought I knew what to expect, but that hasn’t been the case. It’s really orders of magnitude more significant.”

Retaining premium players and moving out of an acquisition phase

With no new gaming states immediately on the horizon, the group is looking to its current player base to determine how it can increase their value.

In its full-year results, BetMGM reported monthly users were up 55% year-on-year in Q4, while total monthly active users for the year hit 946,000, up 14% on the previous year. Both Greenblatt and Hornbuckle are extremely bullish on BetMGM’s turnaround and its efforts to improve product to increase player value.

During the JV’s earnings call in February, Greenblatt cautioned its player growth rate would likely slow in 2025 as it shifts from player acquisition mode to improving player retention. BetMGM is looking towards how it can best retain its premium players. Like other betting operators, it has leaned hard on live betting during the NFL and ongoing March Madness. 

BetMGM product is “twice as fast” as it was

Hornbuckle talked up the operator’s improvement efforts during a fireside chat hosted by JP Morgan in March. He insisted the firm had successfully “pulled back on marketing” and really pumped the product, including single-game parlay, omnichannel and its single wallet in Nevada. “We’re not the fastest, but we’re twice as fast as we were,” Hornbuckle added.

Greenblatt tells iGB part of this ongoing strategy is to give players a product experience that makes them feel recognised and rewarded. He noted that the approach includes premium experiences at MGM properties.

“We’re trying to [create] as close and connected an experience as possible,” he says.

These experiences include Super Bowl parties at MGM properties where BetMGM players are invited and looked after. Similar events are being hosted throughout March Madness.

Consumer confidence remains high for gaming

The US markets have recently seen some turmoil due to a nascent trade war, causing the potential for a weakened consumer base across all markets.

But Greenblatt says the gaming sector historically has not been impacted by waning consumer confidence. Despite widespread consumer dissatisfaction across the UK, the sector is not seeing any indication of consumer weakness.

“The demand side continues to be very robust. We’re seeing it both in bet count and handle, deposit patterns and deposit value. We’re not seeing any indication within bet size, like average bet size – it’s business as usual, frankly,” says Greenblatt.

For the year ended 31 December 2024, BetMGM posted group revenue of $2.1 billion (£1.69 billion/€2.03 billion), up 7% year-on-year. However, the group reported a negative EBITDA of $244 million, which marked a drop worse than its EBITDA losses of $62 million the previous year.

BetMGM committed to positive EBITDA forecast in 2025, cost-cutting under way

The BetMGM CEO stated that the group is committed to its full-year 2025 positive EBITDA target of $240 million. To achieve this target, the group has embarked on a cost-saving journey. As part of this, BetMGM decided to cut staff at its New Jersey headquarters in February by letting 83 people go.

“Yes, we did some cost cutting with a focus on efficiency,” BetMGM said in a statement sent to iGB. “After carefully reviewing our priorities for 2025, BetMGM made the difficult decision to reduce headcount across some divisions of the organisation.”

Similar cost-saving measures have been carried out at MGM Resorts. Hornbuckle noted in March various fees for hotel and resort goers had increased to plug a hole. BetMGM JV partner Entain has similarly sought to improve efficiencies and consolidate various departments to reduce expenses and return the company to growth over the last couple of years.

Looking forward, Greenblatt tells iGB that he is feeling “really good” about the BetMGM business’ underlying KPIs.

“We have a blueprint that we’re executing against and it’s working. So, unless something comes up which destabilises that, I feel pretty good about delivering against our commitments this year,” says Greenblatt.

He sees BetMGM as an educator for regulators and lawmakers in the US. It aims to help them understand the sector’s complex model and why blanket gambling tax increases are not the answer to increasing state revenues. As with many in the industry, the company says it wants to create and foster an environment that is “supportive” for regulated operators, as it believes that this is in the consumer’s and taxpayer’s best interests.

Is BetMGM expecting new igaming states in 2025?

BetMGM launched its sportsbook in two new US jurisdictions in 2024: North Carolina and Washington DC. However, with no likely new igaming licences on the horizon, the operator has been focusing on cutting costs and improving its product in the states it already operates in.

While Greenblatt tells iGB that he does not expect any new gaming states this year, he believes “winds are blowing” that indicate a change in momentum, ushering in a new era for the sector. The BetMGM leader notes that certain pressures and issues are becoming more visible, such as state level budget deficits, futures contracts, and the impact of sweepstakes.

“It feels like we’re moving towards like a big change in momentum, positively. I think what we’re going to see is the determination that gambling, sports wagering, futures contracts are illegal, except as regulated by states. This is a states’ rights item,” Greenblatt says.

He is critical of the rise of unlicensed betting-adjacent offerings like predictive markets.

Some states have already taken a hardline position. In March, the Maryland Lottery and Gaming Control Agency targeted unregulated sweepstakes casinos in the state. It sent a cease-and-desist letter to the operator Virtual Gaming Worlds, owner of sweepstakes sites Chumba Casino and LuckyLand Slots. Predictive markets providers Kalshi and Robinhood were also presented with cease-and-desist letters in Nevada and New Jersey in March.

Greenblatt says the journey ahead is one of heightened licensing and enforcement.

“There is a framework for this. Get a licence and you’re free to participate. I think that’s the only path forward. And then the question is, well, how aggressive will enforcement be, and what tools do they have, and what is their appetite?” asks Greenblatt.

 BetMGM CEO Adam Greenblatt says the concerns around cannibalisation are far greater than the actual threat. He digs into BetMGM’s product turnaround and is critical of unlicensed gaming verticals sweepstakes and prediction markets.