The only way a casino loses that much money is that the employees are skimming cash off the take.
It’s like any other business with a mixture of fixed and variable costs - it is possible for revenue to be so low that despite the profitability of the gambling proposition (55% house, 45% to winnings), it’s not enough. Atlantic city is an accident of history and transportation technology. Just far enough form NYC, nice beaches some of the year. When inexpensive air fares got you to Miami as fast as a drive to AC, they were done. Bada bing, bada boom.