The Super Bowl marked Las Vegas's official return to normal.
It was the first major event held in the city since Nevada dropped its indoor mask mandate. That removed a major barrier for people wanting to visit the city famous for excess, not for carefully managing a pandemic.
That led to a huge weekend for Caesars (CZR), MGM Resorts (MGM), Penn National Gaming (PENN), and other Las Vegas sportsbooks. A record 31.4 million American adults planned to bet on Super Bowl LVI, a 35% increase from 2021, according to new American Gaming Association research.
It's a massive comeback after last year's pandemic-hit game with bettors expected to wager "an estimated $7.61 billion on this year’s championship game, up $3.33 billion (78%) from last year."
That number was likely exceeded with the late lifting of the mask mandate and the huge pent-up demand caused by nearly two years of restrictions that even Las Vegas -- a city not known for playing by the rules -- could not ignore.
The game itself did not disappoint and, while the house always wins, something happened in Super Bowl LVI that brought some extra cash into the coffers of Las Vegas's casinos.
Image source: Daniel Kline/TheStreet.
Why Was the Super Bowl a Big Win for Las Vegas?
Most bets on the actual game are against "the line." That means that people bet on a team plus or minus however many points bookmakers think it will win or lose by. For the Super Bowl, the line actually moved toward Los Angeles as the favorite about three days before the game, Sports Illustrated reported.
"After opening at Rams -3.5, SI Sportsbook now has the home team at -4 for the game. The total points over/under has taken an even sharper turn, dropping from 50 to 48.5."
That half-point turned out not to matter given that the Los Angeles Rams ended up beating the Cincinnati Bengals 23-20. That's a victory margin of 3, meaning that L.A. won, but it did not cover the spread. The total points scored also came in at 43, still well under the 48.5 that was predicted.
Those are important distinctions for sportsbooks.
"The ideal scenario for sportsbooks in the Super Bowl is usually for the favorite to win but not cover and for the game to go under the total," the Las Vegas Review-Journal reported.
Las Vegas for the Win
“Most people betting on the Rams are laying points, and people betting the Bengals bet them to win the game. But the under was the big one,” Boyd Gaming (BYD) sportsbook Vice President Bob Scucci told the Review-Journal. “Because whether they bet the Bengals or the Rams, everybody seemed to parlay them with the over.”
Basically, while Las Vegas sportsbooks take a cut of every bet and win either way, the Super Bowl created a situation where Vegas won even bigger.
Ideally, the oddsmakers set the line and over/number so an equal amount of bettors place money on each side of the bet. In this case, that's not what happened and more gamblers placed their money on the losing side of the equation -- a rare huge win for the sportsbooks.
Both Caesars and MGM won millions on the game because of this unusual scenario. Both casinos did, however, lose millions on prop bets including Odell Beckham Jr. scoring the first touchdown of the game and Bengals running back Joe Mixon throwing a touchdown pass.
And while the casinos did come out ahead on the game, that's probably not the most important thing for Las Vegas. Super Bowl LVI may be the unofficial day where the pandemic ended (never mind that is hasn't actually ended). This could mark the all-clear signal where business travel and conventions -- two things that fill casinos and hotels -- return.
Perhaps most important, this weekend in February sets the standard for a return-to-normal March Madness.
The NCAA tournament generally stands as the largest cumulative betting event for Las Vegas casinos. And after the tournament was canceled in 2020 and returned on a very muted basis last year, this year's March Madness may very well bring Vegas's casinos all the way back to where they were before Covid.
