Las Vegas is facing a decline in tourism, raising questions about the resilience of the Vegas Golden Knights' business model. The team's success has been intertwined with the city's vibrant tourism industry, but recent data indicates a significant drop in visitor numbers.
In June 2025, Las Vegas saw only 3.1 million visitors, an 11.3% decrease compared to the previous year. This double-digit decline is the first since 2021 and reflects a broader trend of sluggish tourism in Sin City. The first half of 2025 saw 19.5 million tourists, compared to 21 million in the same period last year, a 7.3% decrease. The first quarter of 2025 also experienced a 6.9% shrinkage in Las Vegas tourism, with only 9.7 million visitors. Even convention attendance has dipped slightly, down 1.6%.
Several factors contribute to this decline. Rising costs, including flights, resort fees, and service charges, make Vegas trips less affordable. International travel is also down, especially from Canada and Mexico, which accounted for over half of Las Vegas' international tourists in 2024. Fewer visitors from California, who comprised a significant portion of air travelers into Vegas in 2024, also contribute to the slump.
The drop in tourism is impacting various sectors. Hotel occupancy is down 6.5%, with average daily room rates dropping to $163.64. Harry Reid Airport has experienced a 4.1% year-over-year decline in traffic. Some locals report casinos are empty, with workers experiencing a significant drop in tips.
Despite the decline, major casino operators remain optimistic. They attribute the slump to normal seasonality following a record year in 2024. MGM Resorts International CEO Bill Hornbuckle is optimistic about the second half of 2025, with several large conventions and trade shows planned. Clark County collected $1.16 billion in gambling revenue in June 2025, up 3.5% from a year earlier.
The Vegas Golden Knights have become a major success story since their inception in 2017. The team's marketing strategy revolved around being community-focused and building partnerships with local companies. They cultivated a strong connection with the city, using the motto "Vegas Born" to unify fans. This strategy resulted in a large number of sponsorship deals. The Golden Knights have also benefited from on-ice success, making the playoffs in their first four seasons and winning the Stanley Cup in 2023. This success translated into high attendance, with the team routinely selling past 100% of their 17,500 seating capacity at T-Mobile Arena.
The team's ability to maintain its revenue streams amidst declining tourism will be a key test of its business model. The Golden Knights generate revenue through ticket sales, sponsorships, merchandise, and revenue sharing within the NHL. A significant drop in tourism could affect ticket sales and potentially impact sponsorship deals, especially those with local businesses. However, the team's strong community ties, diverse revenue streams, and continued on-ice success could help mitigate the impact of the tourism downturn.
The situation is evolving, and the long-term effects on the Golden Knights remain to be seen. The team's ability to adapt its marketing strategies and maintain its connection with the local community will be crucial in navigating this challenging period.
