Midterm Results Upend U.S. Gambling Industry and Open Doors in Texas
According to gaming industry executives, the period following the midterm elections has produced fresh avenues for U.S. gaming growth while simultaneously increasing the likelihood of heightened political and legal scrutiny facing prediction markets. Gaming executives addressing investors on earnings calls in early November pointed out that state leadership changes have altered expansion calculus.
The whole landscape changed,
said Craig Billings, CEO of Wynn Resorts, during the company’s earnings call Thursday. Beyond monitoring developments in the Middle East as Wynn looks toward opening the United Arab Emirates’ first legal casino in 2027, Billings pointed directly to Texas as a prime target of opportunity.
He isn’t alone in eyeing the Lone Star State. Following the reporting of record third-quarter revenue and raising guidance for its brick-and-mortar business, Penn Entertainment CEO Jay Snowden told analysts that Election Day proved to be a very good day overall for the industry, and certainly for Penn.
The catalyst for much of this optimism stems from a major upset in state races: Democrat Vikki Goodwin defeated longtime Lt. Gov. Dan Patrick, who has been persistent in blocking gambling expansion in the Lone Star State.
Texas Markets Draw Major Industry Players
For years, major gaming corporations have positioned themselves for a potential opening in Texas. Billings described the state as a stealth market, noting that numerous consumers frequently travel to Oklahoma to gamble at tribal casinos.
Penn Entertainment has spent years building a position in Texas, operating two of the state’s three Class 1 thoroughbred racetracks while establishing relationships with local leaders. We’re ready to play offense,
Snowden said, adding that he expects Penn is positioned as well, if not better than really anybody in the sector
if lawmakers move toward legalization.
Similarly, Las Vegas Sands has invested heavily for many years to get casino gambling legalized in Texas. Patrick Dumont, Sands Chairman and CEO, noted in an October interview in Macao that a future Dallas Mavericks arena—following his acquisition of the controlling stake from his mother-in-law Miriam Adelson—could incorporate a future casino. Golden Nugget casinos are owned by Tilman Fertitta—who currently acts as the U.S. ambassador to Italy, serves as Wynn Resorts’ top investor, and is acquiring Caesars to take the company private. Following a CNBC interview in Italy, he said, Of course I want gaming in Texas!
Despite the political shift, an immediate deal remains out of reach. Legalizing casino gambling or sports betting in Texas still requires a constitutional amendment approved by two-thirds of both chambers and then voters. State control remains divided: Democrats flipped the state House and Gina Hinojosa won the governorship, but Republicans kept the Senate.
State Elections Change Legislative Outlook for Gaming
The legislative map shifted elsewhere across the country as well. In a Wednesday note, Truist gaming analyst Barry Jonas stated that the midterm outcomes present a mixed bag of consequences, noting that the pro-regulated online casino stance of Ohio governor-elect Amy Acton could boost the likelihood of iGaming legalization. Conversely, Nebraska voters rejected ballot measures to legalize online betting, while Georgia, where Democrat Keisha Lance Bottoms won the governorship, could provide an opportunity if voters decide whether to legalize casino gambling to help fund education.
At the same time, operators are watching skill-based gaming machines. Snowden highlighted that candidates who support skill-based gaming machines lost seats or influence in several states, and the shutdown of skill games in Pennsylvania in mid-October contributed to year-over-year revenue growth for Penn.
Industry advocates emphasize that the core business model remains steady despite the political noise. What hasn’t changed with the election is what works, and that’s state-regulated sports betting and iGaming, built on accountability, consumer protection, and tax revenue for states,
said Joe Maloney, president of the Sports Betting Alliance. That’s our lane, and we’ll make that case to every new lawmaker willing to listen.
Intensifying Scrutiny on Prediction Markets
While brick-and-mortar operators find new openings, prediction markets face heightened political and legal pressure following Democratic victories. Control of Congress grants Democrats subpoena power and committee resources to investigate the president’s family and business dealings, potentially putting figures like Donald Trump Jr.—who is a paid strategic adviser to Kalshi and sits on Polymarket’s advisory board—back into the spotlight.
Congress might additionally weigh measures to restrict the reach of these platforms; specifically, the Prediction Markets Are Gambling Act enjoys bipartisan backing to prohibit exchanges supervised by the Commodity Futures Trading Commission from running contracts centered on athletic contests or casino games, though the legislation had only reached the committee referral stage at the time of the election.
Trade groups have ratcheted up their opposition. Bill Miller, CEO of the American Gaming Association, asserted that prediction markets face a tsunami of criminal charges, major civil investigations and significant defeats in court,
and expects bipartisan scrutiny to intensify.
State-level enforcement is already progressing. Utah has filed criminal charges against Kalshi and its founders, and the U.S. Ninth Circuit Court of Appeals turned down Kalshi’s petition for a rehearing regarding its Nevada litigation. Newly elected Democratic attorneys general in Ohio, Michigan, and Nevada will decide how to handle inherited disputes, while states like Arizona also carry pending criminal charges against operators.
