Newsletter Signup
Stay informed with the
NEW Casino City Times newsletter!
John Grochowski Archives
More Strategy Experts

Gaming Guru

author's picture

How the Casino Makes Money in Random Games

29 January 2015

By John Grochowski
On a recent Tuesday morning, my wife Marcy and I had the day free, and we decided to head for a casino, play a little and have some lunch. Midweek mornings are my favorite time to play, but the days we’re both free with no work demands aren’t all that common.

In the couple of hours we were there, I heard five announcements of jackpot winners. “Our latest winner is …” along with a first name and a platitude about how that casino is your place to win.

A fellow playing a video poker a couple of seats away from me said, “I guess they’ve won their quota.” I asked what he meant, and he replied, “[The casino] must have won enough to meet their goals, and now they can let there be a few winners for show.”

I laughed, and went back to my game. I’m not on any mission to educate random strangers on the vagaries of the random number generator. However his comment did address a common belief of slot players that casinos can control when jackpots come.

That’s something I see in my email just about every month, such as this recent question: “How can casinos make money if the games are really random? They have to be able to control the results to know how much money then can count on a game producing.”

Casinos don’t have to control individual results to know what to expect from a game. It’s enough to control the odds of the game, and the odds are set so that the payout is less than the true odds of winning your bet. That’s how the house makes money on table games, it’s how it makes money on video poker, and it’s how it makes money on slot machines.

There are many more possibilities on slot machines than on table games, and the math behind it is a lot more complex on slots. So let’s make up a simple example. Pretend there’s a game where all the stops are either single bars or blank spaces, and the only paying combination is three single bars. Let’s further pretend the odds of the game are set so there’s a 25 percent chance of a winner, so the odds are 3-1 against you on every spin. If you’re betting $1 per spin, you risk $100 per 100 spins, and for it to be a breakeven game, then each winner would have to pay $4. But if the machine pays only $3 on each winner, then an average 100 spins will bring back only $75 for your $100 in wagers.

That’s basically how the games make profits for casinos. There’s more than one winning combination on actual slots, and bonus events complicate the math, but the bottom line is that the casino pay less than the true odds of winning the bet, and that drags long-term results toward an expected payback percentage.

Let’s look at it another way. Say you’re betting $1 per spin at a slot set up to return an average of 90 percent of money wagered back to players --- it doesn’t matter if you’re playing a reel-spinner or if you’re betting 2 cents per line on a 50-line penny slot or any other combination. And let’s say you’re playing a modest pace of 500 spins per hour, risking $500 per hour. One more step: Let’s say you’ve just won a $5,000 jackpot.

Does the casino have to control the results to overcome that jackpot? Does it have to send the machine into some kind of makeup mode?

No, it does not. The normal odds of the game will drag the overall payback percentage back toward 90 percent. Let’s say that you and other players keep averaging $500 in wagers per hour, meaning a 90 percent game would average $450 in paybacks per hour. In one day, there would be $12,000 in wagers, with $10,800 in non-jackpot paybacks plus your $5,000. The machine has paid out $15,800 for the day, so its one-day payback percentage is 132 percent.

But after six more days of normal paybacks to bring the total to a week, wagers are $84,000 and paybacks are $80,600, and the return is 95.6 percent. After two weeks, wagers are $168,000 and paybacks are $156,200, or 93.0 percent. After three weeks, the return is down to 92.0 percent, and so on, drawing ever closer back toward the expected percentage.

The casino doesn’t have to control individual results to get something very close to its targeted percentage. Random results and the odds of the game will accomplish that.

Look for John Grochowski at, on Facebook ( and Twitter (@GrochowskiJ).

This article is provided by the Frank Scoblete Network. Melissa A. Kaplan is the network's managing editor. If you would like to use this article on your website, please contact Casino City Press, the exclusive web syndication outlet for the Frank Scoblete Network. To contact Frank, please e-mail him at


The In and Out of Blackjack Play

25 January 2015
QUESTION: I have played a lot of blackjack, with moderate success. I basically play the plastic card strategies and have read a few books as well. What I never see covered in any detail is optimum settings. When should you get up and leave? You buy, make minimum bets to check the counts (if you can do that sort of thing). ... (read more)

The First Line of Defense

22 January 2015
Many, many years ago, I was invited by a large gaming company to take part in a weeklong crash course in casino operations. Other students were all employees from non-gaming parts of the company, such as building operations, hotel management and food services. The company had identified them as up-and-comers who might be well suited to move into the casino end of the business. ... (read more)

Playing for Royals

11 January 2015
QUESTION: I've been studying a “how to play video poker” article you have online. I notice you talk about a two-, three-, or four-card royal flush; but you never talk about an inside royal flush. For instance, you don't say anything about 10-J-K-A inside royal. I think you mean: Don't play any inside royal flushes unless you treat it as an inside straight flush. ... (read more)

Next 10 Articles >

  • Featured Articles

Craps Systems

Craps players love systems, trying to mix and match bets in hopes of finding the magical formula that will beat the casino. Just about any system will work sometimes, and when a player wins with a system, it encourages another try, and another, and another. In the long run, of course, the casino comes out on top. ... (read more)

Multi Strike Poker

It was a Friday morning in Joliet, and I'd been playing a little video poker aboard Empress II, waiting for the 11 a.m. opening of Empress I and its video poker room. Soon, if it hasn't already happened by the time you read this, Empress' new barge will open, ending such little scheduling inconveniences, but on this day, I found myself passing time with a little quarter Triple Play Poker. ... (read more)

Comps - The Basics

A colleague of mine likes to refer to casino comps as "free stuff." And for those who know their basic strategy in blackjack, optimal strategies for certain video poker games and who know how comping systems work, the "stuff" really is free--the value ... (read more)

Basic Strategy for Spanish 21

In the last couple of weeks, we've looked at basic strategy in blackjack. Sit down at most blackjack tables in any jurisdiction, play basic strategy and you'll narrow the house edge to a half-percent or so, perhaps a little more or a little less depending on house rules. ... (read more)

Single-Deck Basic Strategy

Those whose casino memories stretch back far enough may recall a time when the standard "Las Vegas Strip" blackjack game was dealt from a single deck of cards, with the dealer standing on all 17s. That started to change in the 1960s as operators grew ... (read more)
John Grochowski
John Grochowski is the best-selling author of The Craps Answer Book, The Slot Machine Answer Book and The Video Poker Answer Book. His weekly column is syndicated to newspapers and Web sites, and he contributes to many of the major magazines and newspapers in the gaming field, including Midwest Gaming and Travel, Slot Manager, Casino Journal, Strictly Slots and Casino Player.

Listen to John Grochowski's "Casino Answer Man" tips Tuesday through Friday at 5:18 p.m. on WLS-AM (890) in Chicago, with podcasts at Look for John Grochowski on Facebook ( and Twitter (@GrochowskiJ).

John Grochowski Websites:

Books by John Grochowski:

Winning Tips for Casino Games

> More Books By John Grochowski