US Sports Betting Update – sports wagering industry has doubled in size over the past year

US Sports Betting Update – sports wagering industry has doubled in size over the past year

Nevada’s sports betting handle soared by 41% year-on-year to hit a record $780.8 million in February, according to the state’s latest revenue report. That impressive performance took the nationwide handle to $5.91 billion, which represents a 99.4% increase on February 2021. Six states – Arizona, Colorado, Delaware, Illinois, Virginia and Wyoming – have not yet reported their February trading figures, which means the industry has more than doubled in size over the past year.

Much of that growth can be attributed to new jurisdictions launching legal sports betting industries. Connecticut legalized sports betting towards the end of 2021, and New York and Louisiana rolled out online sports wagering at the start of 2022. Yet it is also due to demand increasing in established markets. For example, New Jersey saw its handle climb 32.7% year-on-year in February. Pennsylvania was up 17.2%, Michigan by 30.2%, Indiana by 49.4%, Tennessee by 77.7% and Iowa by 50.3%.

Are Bettors Becoming Savvier?

Nevada sportsbooks held just 3.96% of the $780.8 million they handled in February. That resulted in $30.9 million in revenue for the month. It was the third consecutive month in which the hold was unusually low by historic averages. Silver State sportsbooks have now held an average of 5.78% of wagers handled per month since June 2018, whereas the hold was previously between 6% and 7%.

Basketball was the most popular sport among bettors in Nevada during February, which is understandable, as there was just one football game. A total of $456.3 million was wagered on hoops, and operators only managed to hold onto 2.75% of that sum. Sportsbooks across the country have reported low holds over the past couple of months. It could be because bettors are becoming more astute when making picks, or it may simply be down to bettor-friendly results, with lots of favorites triumphing. It will be interesting to see the full figures for March following several major upsets at the NCAA Division 1 Men’s Basketball Tournament.

A Strong Month for Nevada Gambling Industry

Nevada remains the third largest state for sports betting. Its $780.8 million handle could not match the $1.53 billion from New York or New Jersey’s $985.6 million, but it was comfortably ahead of Pennsylvania and Michigan. It also managed to hold a slightly larger revenue than New Jersey – $30.92 million versus $30.87 million in the Garden State – despite handling a significantly smaller number of wagers.

However, the $30.92 million in revenue that Nevada operators earned from sports betting was a drop in the ocean compared to the overall gambling revenue. Nevada’s total gaming win for February was $1.1 billion, marking the 12th consecutive month in which it has smashed through the $1 billion barrier. Several big concerts were held in Las Vegas during the month, which helped attract visitors.

Despite rising fuel costs, inflation pressures and a tough comparison base, Nevada Gaming Control Board analyst Michael Lawton is confident the growth can continue. “Our comparisons are going to become extremely difficult in the upcoming months and we are optimistic that this level of gaming win will continue,” said Lawton. “However, as you are aware there is a great deal of macro-economic and geopolitical events that are happening in real-time, which are concerning and it is unknown how it could impact the trends we have been witnessing for the past year.” 

MGM Resorts director of trading Jeff Stonebeck pointed to the NCAA Tournament as driving continued momentum for the industry. “We get the same people who come out every single year for it,” he said. “It’s an annual ritual for a group that will get four, five, or six guys who come out every year. A lot of people don’t pay attention to college basketball until the tournament.” 

March Madness Fuels Growth in New York

The start of March Madness sparked a 5.3% week-on-week increase in New York’s online sports betting market. Operators handled $406.4 million in the week to March 13, when the conference tournaments were drawing to a close. That figure increased to $428 million for the week to March 20, which encapsulated the opening rounds of the NCAA Tournament.

FanDuel has tightened its grip on the Empire State. It accounted for almost 40% of the wagers placed in New York during the week to March 20. Its handle was $168 million and its revenue was $14.7 million. That left it comfortably ahead of its closest rival, DraftKings, which reported a $110.8 million handle and $3.3 million in revenue. Caesars Sportsbook ($67.8 million / $4.4 million), BetMGM ($43 million / $1.6 million) and PointsBet ($24 million / $718,167) round out the top five. The other three licensed sportsbooks – BetRivers, WynnBET and Resorts, account for less than 4% of the New York sports betting market combined.

Rush Street Interactive Gains RC Check Accreditation

In other news, Rush Street Interactive announced it has become the first U.S.-based online sports betting and casino operator to earn RG Check iGaming Accreditation from the Responsible Gambling Council. The accreditation applies to its BetRivers and PlaySugarHouse brands. “This achievement represents RSI's commitment to transparency, player safeguards, duty of care and continuous improvement, as well as contributes to creating a culture of responsible gambling and sustainable play,” said Responsible Gambling Council chief executive Shelley White. “RG Check is an invaluable tool for managing risk and increasing the effectiveness of RG programming.”

Rush Street Interactive now operates in 13 states, along with Colombia in South America, and it is poised to expand into Ontario, Canada, with BetRivers Sportsbook and Casino next week. Chief executive Richard Schwartz said: “Receiving RG Check Accreditation is a testament to our commitment and execution of RSI's corporate social responsibility strategy, which includes the continued implementation of the Company's responsible gaming initiatives. We want to ensure our valued customers and employees are equipped with the tools and resources necessary to help ensure a culture of safe, fair and fun gaming experiences.”

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