Published on: May 19, 2026, 04:19 AM.
Updated on: May 19, 2026, 04:19 AM.
- The casino sector is gradually embracing AI technology
- This innovation could lead to significant growth in earnings over time
- Gaming firms are exploring various applications of AI
In comparison to other sectors, the casino gaming industry has been relatively slow to adopt artificial intelligence (AI). However, as the sector begins to integrate this technology more fully, there is a notable opportunity for substantial long-term earnings growth.
Recently, Clayton Peister from Differential Labs, a firm that collaborates with both land-based and online gaming operators on AI integration, sat down with Truist Securities analyst Barry Jonas to explore AI trends in the gaming realm. They concluded that the union of AI and gaming is still in its early stages, yet it holds the promise of significant earnings growth before interest, taxes, depreciation, and amortization (EBITDA).
“Overall, most initial AI efforts haven’t fully realized their potential because operators have primarily concentrated on technical adjustments rather than a comprehensive vision,” notes Jonas. “Peister anticipates that AI could unlock a 20-30% EBITDA increase for both brick-and-mortar and online casinos in the long run.”
However, achieving this earnings growth is a complex challenge.
Closing the AI Gap in the Casino Sector
Gaming companies have various methods to utilize AI, and while this adaptability is advantageous, the industry must address several gaps to fully leverage the technology’s capabilities.
As Peister pointed out during the Truist discussion, the current use of AI in the casino industry is heavily reliant on machine learning technology. This focus limits the exploration of the full potential offered by generative AI (GenAI) and large language models (LLMs).
“Peister remarked that the industry has struggled to implement AI by demanding drastic changes from frontline staff. However, with LLMs, Differential Labs is customizing AI to fit existing workflows,” Jonas explains. “Ultimately, the synergy between LLMs and machine learning could bring about a 10-20% increase in EBITDA.”
According to Differential Labs, LLMs can significantly enhance casino operators’ capabilities in areas such as real-time marketing, risk management, asset optimization, patron strategies, and reinvestment goals—all of which contribute to heightened EBITDA.
Challenges Posed by Outdated Systems
Certain agile gaming firms, like DraftKings (NASDAQ: DKNG) and Flutter Entertainment (NYSE: FLUT), the parent company of FanDuel, are already leading the charge in AI adoption. Furthermore, it appears that some casino operators in Asia are making noteworthy progress in AI implementation.
In the United States, the prospect of realizing increased earnings and other advantages of AI is appealing for land-based operators. However, they face challenges stemming from outdated management systems.
“A considerable implementation barrier exists due to legacy Casino Management Systems (CMS) and regulatory constraints specific to different markets. Most CMS frameworks are often inflexible and stringently regulated, compelling forward-thinking operators to create a network of applications around the core system to circumvent data bottlenecks,” Jonas adds.
During the Truist discussion, Peister indicated that US casino operators are currently mostly viewing AI as a means to reduce labor costs. However, this perspective may evolve as these companies increasingly adopt cloud computing solutions.