How Do Online Casinos Make Money? GGR, NGR and Who Takes a Cut

TL;DR: Online casinos make money from the house edge: every game pays back slightly less than players wager, and the difference is gross gaming revenue (GGR). Bonuses reduce GGR to net gaming revenue (NGR). Game studios, the platform provider, payment processors, affiliates and the regulator are then paid out of that. In our hypothetical example below, EUR 100,000 of wagers becomes EUR 4,000 of GGR, EUR 3,000 of NGR, and EUR 370 before fixed costs. It is an illustration, not a benchmark.

We run ads and SEO↗ for iGaming operators. We do not build platforms or sell licenses. This page is for someone thinking about becoming an operator; our guide on how to start an online casino covers the launch models.

How do online casinos make money on each bet?

Every casino game is designed to return a set percentage of stakes to players over a long run of play. That percentage is the return to player, or RTP. What the game keeps is the house edge, so a game built to return 96% has a 4% edge.

The UK Gambling Commission↗'s live RTP monitoring guidance↗, read on 11 November 2026, gives the calculation: "By dividing the win and turnover figures generated from a game you can determine the actual RTP." Its own example is a game designed at 91.68% that took £1,200,000 of turnover and paid £1,085,000 in wins, an actual RTP of 90.42%. The same page says the tolerance is wide when little play has been measured, and that "after a significant amount of plays the actual RTP should be very close or equal to the theoretical RTP."

A new casino with few players can lose money in a given week. The edge only shows up with volume.

These numbers are public in Great Britain. The Commission's technical standard RTS 3↗, read the same day, requires that the information available before a customer gambles include the "house edge (or margin)" and the RTP percentage or the probability of winning.

What is the difference between turnover, GGR and NGR?

Turnover (also called handle) is the total staked. The Commission's regulatory returns guidance for remote casinos describes it as "the total gross income received, such as total stakes, before any operating costs or winnings have been deducted". It is the biggest number in the business and the least useful, because the same deposit gets wagered many times.

GGR is stakes minus winnings. The Commission uses a close cousin, gross gambling yield, and its GGY guidance↗ (read 11 November 2026) sets the formula as A + B − C: stakes, plus other amounts that accrue to the licensee from the licensed activity, minus prizes or winnings. That page also says the Commission asks for GGY "rather than Gross Gambling Revenue (GGR)", so do not swap the terms in a UK filing.

NGR is GGR after bonus costs, and often after other deductions. No regulator page we read defines it. It is a contract term.

The Commission's bonus rule shows how far a regulatory figure can sit from a commercial one. Its GGY guidance says free bets or bonuses "should only be counted when calculating GGY if the customer has the unrestricted right to opt instead to receive a cash equivalent". A bonus with wagering conditions gives no such right. So the number reported to a regulator and the number a platform contract calls NGR can differ for the same month of play.

For scale: the American Gaming Association↗ reports that iGaming revenue across the seven US states with lawful online casinos reached $10.73 billion in 2025, up 27.6% (State of the States 2026, read 11 November 2026). That is revenue after winnings, not money wagered.

What happens to 100,000 of wagers?

Every percentage in this table is a hypothetical input we chose to make the arithmetic easy to follow. It is an illustration, not a benchmark. We also assume, hypothetically, that the EUR 100,000 of wagers came from EUR 20,000 of deposits, because payment fees are charged on money moved, not on bets placed.

With these hypothetical inputs, EUR 370 is left from EUR 100,000 wagered. That is 0.37% of turnover, 9.25% of GGR and about 12.3% of NGR. Staff, hosting, compliance, gaming tax and license fees all come out of it. Quote a "margin" without naming the base and the same business looks either tiny or healthy.

Fixed costs bite at low volume. The Curaçao Gaming Authority's fee schedule↗, version 2.0 of 15 October 2025, puts annual B2C fees at EUR 47,450. At the hypothetical 0.37%, covering that fee alone takes 47,450 ÷ 0.0037 = about EUR 12.8 million of wagers a year, roughly EUR 1.07 million a month. Anjouan Gaming's fee page↗ lists EUR 17,828 a year, which needs about EUR 4.8 million a year on the same math. Both were read on 11 November 2026; details are in our Curaçao and Anjouan license cost breakdowns.

Why does the base of a revenue share matter?

Take the platform line. In the table it is a hypothetical 15% of NGR: EUR 450. The same 15% charged on GGR is 0.15 × 4,000 = EUR 600. The EUR 150 difference takes what was left from EUR 370 down to EUR 220, a drop of about 41%, with no change in the headline rate.

The base also decides who carries the bonus cost. On GGR, you fund every bonus alone. On NGR, the provider shares it.

Before signing, get these in writing:

• The base for each percentage: GGR, NGR, deposits or turnover.
• The contract's own definition of NGR, line by line.
• The monthly minimum fee, and what happens in a month with negative GGR.

How should an operator judge acquisition cost?

This is our side of the work, and the mistake we most want new operators to avoid is judging ad spend against deposits. In the hypothetical example, EUR 20,000 of deposits produced EUR 3,000 of NGR, and EUR 1,270 after game, platform and payment costs. That is 6.35% of deposits. A player who deposits EUR 200 has contributed about EUR 12.70 toward marketing and everything else (200 × 0.0635). Paying EUR 30 to acquire that player is a loss until they come back and deposit again.

So ask of any channel what a first depositor costs and how much NGR that cohort produces over the following months. Return on deposits does not answer that. Our iGaming ROAS benchmarks article covers the measurement, and iGaming acquisition at RedClaw describes how we run it.

Comparing platform offers? You can ask us for a provider introduction. The introduction is free for you; a provider may pay us a referral fee.

FAQ

How do online casinos make money if players can win?

Individual players win, but each game is designed to pay back less than 100% of stakes over a long run. The gap is the house edge. With enough play, actual results move toward the designed RTP.

What is the difference between GGR and NGR?

GGR is stakes minus player winnings. NGR is GGR minus bonus costs and whatever other deductions a contract lists, so read that definition before comparing offers.

What is a typical online casino profit margin?

We have not found a regulator that publishes one, and we will not invent a figure. In our hypothetical example, EUR 370 was left before fixed costs from EUR 4,000 of GGR. Change any input and the answer moves.

Is a revenue share on GGR or NGR better for the operator?

At the same percentage, NGR is cheaper for the operator because bonus costs come off before the provider's share is calculated. Compare the rate, the base and the monthly minimum together.

This article explains general mechanics using hypothetical figures and regulator-published definitions. It is not financial or legal advice. Gambling is restricted or prohibited in many countries, and a license from one jurisdiction does not make a site legal everywhere its players are.

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