Racetracks
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 500 racetracks in the US operate facilities for horse, dog, motorcycle, and automotive racing. Racetracks are either indoor or outdoor facilities that host scheduled races. For animal racing, track facilities draw in guests with gambling activities through pari-mutuel and off-track betting on race results. Racetracks promote races at a national or local level, depending on the size of the event. About 80% of the industry is comprised of small racetracks with less than 20 employees.
Heavy Regulation
The racetrack industry earns the majority of its revenue from gambling activities, resulting in significant legal and taxation requirements.
Transaction and Data Security
In an industry with massive amounts of digital money flowing back and forth between gamblers and racetracks, along with significant volumes of personal data collected from customers, horse racing is a particularly attractive target for online thieves, hackers, and other bad actors.
Industry size & Structure
The average firm operates from a single location, employs fewer than 20 workers, and generates $16 million annually.
- The racetrack industry consists of about 500 companies that employ 28,200 workers and generate $8.2 billion in annual revenue.
- The industry is concentrated with the 20 largest firms representing 76% of industry revenue. The 25 largest companies employ 64% of the industry's total workforce.
- Large companies include Churchill Downs, The Stronach Group, New York Racing Association, National Association of Stock Car Racing, and Del Mar Thoroughbred Club.
- Gamblers bet a total of about $11 billion on horse racing each year.
Industry Forecast
Racetracks Industry Growth
Recent Developments
Aug 19, 2024 - States Lose HISA Challenge
- The US Supreme Court in mid-2024 rejected a challenge by some states to the establishment of the Horseracing Integrity and Safety Authority, a new federal agency designed to standardize animal safety rules and enforce non-compliance penalties at a national level. Previous safety rules were a patchwork of regulations in states where horse race gambling is legal. The agency was created after several years of scandal in the industry, including the deaths of almost 30 horses during a single season at California's Santa Anita Park in 2019, as well as years of doping scandals by several Triple Crown trainers and owners.
- With an estimated 2,000 racing horse fatalities in 2023, safety in the industry is under increased scrutiny. One solution being studied is the impact of artificial racing surfaces (rather than dirt or mud) on equine injury and mortality rates. A study spearheaded by the New York Racing Association found that races on synthetic materials reduced horse deaths by roughly 30% compared to races on mud.
- The use of artificial intelligence in the racing industry is on the rise and somewhat controversial. Horse racing is an industry heavily reliant on data such as race odds, track conditions, and injury reports. The use of predictive analytics AI can benefit both racetrack owners and bettors when it comes to analyzing race results to pick outcomes. While the fairness of AI in gambling has its detractors, use of the technology is likely to increase.
- An annual study of horse racing statistical data by the New York Thoroughbred Horseman's Association last year found evidence of an industry that has declined significantly over the past 20 years. The data found the total number of horses racing has declined 40%, trainers with at least one horse making a start went down 55%, and owners with more than one horse fell 42%.
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