How to know an online casino is profitable: GGR and NGR explained

US casinos reported $41.2 billion in gross gaming revenue during 2017. How much money does online gaming bring in yearly? GGR, or gross gaming revenue, is a metric for profit in the online casino and gaming industry. A casino makes money when the amount of money wagered by players differs from the amount of money won.

What is GGR?

Suppose you have a better understanding of GGR or Gross Gaming Revenue. In that case, you’ll see that gaming sales include all bets made by players over a specified period, including checks and the monetary value of other committed instruments. Thus, some people in the gaming business refer to gross gaming revenue as “gross game win” or “game yield.”

The gaming industry’s profit is measured by gross gaming revenue (GGR). Gross Gaming Revenue estimates how much the gaming sector contributes to the overall economy from a purely monetary perspective. As a result, you’ll find a lot of reviews/evaluations praising the gaming industry for its positive impact on a region’s economy.

Increased tourist visits and tax money bring several advantages, including more jobs for local residents and businesses. However, it’s also been observed that many people view the profits made by gaming operators as immoral.

The explanation of NGR or Net Gaming Revenue: 

A casino’s Net Gaming Revenue (NGR) is the amount of money it makes from its operations after deducting costs like transaction fees, player bonuses, and other levies. The Net Gaming Revenue (NGR) measures a casino’s profit margin tallied after each calendar month. For these reasons, we need to track the business’s progress, set long-term objectives for the casino, and take remedial action as necessary.

This is something that every company in every industry undertakes to stay afloat in the market. However, giving new player’s bonuses and paying personnel impacts the bottom line; therefore, figuring that out exposes those costs.

Gaming operators use Net Gain Revenue (NGR) to track their profit and loss, which is commonly calculated at the end of a financial month. It’s the best way to tell how well a casino is doing.

What’s the Difference Between GGR and NGR?

While gross gaming revenue and net gaming revenue have some parallels, they are two entirely different KPIs (KPIs).

• GGR is a financial metric that measures how much money a gaming facility has made from player activity after subtracting player payments but before bonus payments and taxes.

• A gambling establishment’s net revenue, fewer payments to players, bonuses, tax deductions, but not running expenses, is known as its NGR. 

In contrast to GGR, there isn’t a standard way to figure out a company’s NGR. In addition, there is no connection between the principal function of this indicator and mandated payments; instead, it is used to analyze business profitability. That’s why it’s critical to create an NGR formula for your organization and stay with it throughout the planning process.

In conclusion:

To manage a long-term successful Gaming business, it’s critical to know what GGR stands for, what NRG stands for, and how the two compare when applied to online gaming.