Synonyms:
What Is Net Gaming Revenue (NGR)？
Net Gaming Revenue (NGR) is a key metric for measuring profitability in the gaming industry. It represents the total revenue generated from player wagers, minus payouts to players, promotional bonuses, discounts, and any other direct costs.
NGR Calculation Formula:
NGR = Total Bets − Player Winnings − Bonus and Discount Costs
Key Components of NGR:
- Total Bets：The total amount wagered by players in gaming activities.
- Player Winnings：The amount that gaming operators pay out to players as prizes or rewards.
- Promotional and Discount Costs：Various incentives offered to attract or retain players, such as free bets, cashback, etc.
NGR Example：
Assume a gaming platform has the following data：
- Total Bets：$1,000,000
- Player Winnings：：$850,000
- Promotional, Reward, and Discount Costs：：$50,000
NGR Calculation：
NGR = Total Bets − Player Winnings − Promotional Costs
NGR = 1,000,000 − 850,000 − 50,000 = 100,000
In this example, the platform’s Net Gaming Revenue (NGR) is $100,000.
This figure represents the operator’s net income after paying out player winnings and deducting promotional expenses—an accurate reflection of actual profitability.
Uses of NGR：
- Financial Metric：NGR helps gaming operators evaluate actual profitability by revealing net income after essential business costs.
- Tax Basis：In certain countries, gaming taxes are calculated based on NGR because it more accurately reflects real earnings than gross revenue.
- Business Analysis：NGR reveals the relationship between marketing expenses and player activity, making it a key indicator for measuring operational efficiency and campaign effectiveness.
NGR differs from Gross Gaming Revenue (GGR), which only considers the difference between total player bets and winnings, without accounting for promotional activities, bonuses, or related discount costs.
Summary：
Net Gaming Revenue (NGR) is a key metric for assessing profitability in the gambling industry. It represents the net income of a gaming operator after deducting player winnings and all promotional, bonus, or reward-related expenses. The formula is: NGR = Total Bets − Player Winnings − Promotional Costs Compared to Gross Gaming Revenue (GGR), NGR provides a more accurate reflection of the operator’s actual earnings. As such, it is widely used for financial reporting, tax calculation, and strategic performance analysis.
The importance of NGR lies in its ability to accurately evaluate profitability, measure the return on marketing investments, and guide more efficient spending and business optimization strategies.