State of the Union: US Sports Betting Update – New Jersey Breaks Records During Bumper August Trading Period

Admin    Admin     September 18, 2020    

New Jersey sportsbooks set a new nationwide record when they took $668 million in wagers during the month of August. It was their best monthly performance since the Garden State legalized sports betting, and it smashed the previous record of $614 million that Nevada set in November 2019. New Jersey has now surpassed $8 billion in sports betting handle since launching in the summer of 2018.

Sports fans wagered $601.9 million online during August, according to results from the New Jersey Casino Control Commission. The remaining $66 million was placed at retail sportsbooks, which have reopened at a reduced capacity following the coronavirus lockdown. The total handle increased 112% month-on-month, from $315.1 million in July to $668 million in August. The NBA and NHL playoffs were in full swing, the MLB regular season delivered a flurry of action and the NFL was gearing up to return during August, sparking a bumper trading period for sports betting sites.

The total revenue for New Jersey sportsbooks in August was $39.5 million, which amounts to a win of 5.9%. Meadowlands, which hosts FanDuel on its license, once again led the way with $21.1 million in revenue. Next up was Resorts Digital, which hosts DraftKings, with $10 million in revenue. The remainder was shared among a wide range of operators in the competitive New Jersey sports betting sector.

Casino revenue also rebounded during August. “Recovery is underway, even with continuing travel advisories that decreased visits from out of state,” said James Plousis, chairman of the New Jersey Casino Control Commission. “Atlantic City’s casino win was almost 70 percent of last August’s strong performance, although the months are not reasonably comparable because of restrictions on capacity, amenities, and entertainment.”

Records Tumble in Pennsylvania

Pennsylvania sportsbooks also enjoyed their best ever trading period last month. The handle hit a record $365 million, up 121.5% on July. It was also a 234.7% increase on August 2019. August is generally a quiet month for US sportsbooks, but the Covid-19 pandemic has turned the sporting calendar on its head, resulting in a glut of action across several major leagues. Many Americans remain reticent to visit retail sportsbooks, but online betting sites are experiencing huge demand for their services.

Revenue reached $27.6 million in August, according to a report from the Pennsylvania Gaming Control Board. The caveat is that a third of that revenue came from promotion credits. Sportsbooks are fighting tooth and nail for market share, and that has seen them launch various free bet offers to stand out from the competition.

FanDuel is the clear market leader in Pennsylvania. It accounted for $149.2 million of the August handle, giving it a market share of more than 40%. Nearly all of it came from online betting. DraftKings is comfortably second, with $88.2 million in handle, and Rush Street Gaming – which owns BetRivers and SugarHouse – combined for $57.4 million in handle to take third place. Parx was a distant fourth with $28.8 million.

Barstool Goes Live

A new competitor will emerge in September after the Barstool Sportsbook went live in Pennsylvania this week. Barstool began life as a rowdy Boston sports blog in 2003, and it was valued at an eye-watering $450 million this summer when it sold a 36% stake to Penn National Gaming for $163 million in cash and stock. Penn National is obliged to pay another $62 million to bring its stake up to 50% by 2023, and it has the ability to take a controlling stake at a later date.

Penn National has already launched a sportsbook at its Hollywood Casino property in Pennsylvania, but it sees great potential for the Barstool brand. Barstool, a sports and pop culture blog covering the latest news and viral highlights, claims to have 66 million users across the country, and it will promote the new app heavily in each state that it goes live in. New Jersey and Michigan are reportedly next after Pennsylvania. The Barstool sportsbook is powered by Kambi, which also provides the sportsbooks for Parx, 888 Sport and DraftKings, among others.

“The Barstool Sportsbook app is the centerpiece of our company’s omni-channel strategy,” said Jay Snowden, president and chief executive at Penn National. “Since forming our exclusive sports betting and iGaming partnership with Barstool Sports in January, our product, marketing and operations teams have worked hand-in-hand with Barstool’s top talent, including Dave Portnoy and Dan ‘Big Cat’ Katz, to create a sports betting experience that we’re confident will appeal to Barstool’s army of loyal followers, as well as our extensive database of existing casino customers and sports betting fans at large.”

Growth in Indiana and Illinois

Several other states reported their best ever performance in August, according to the latest figures from the Indiana Gaming Commission. Sports betting handle jumped 138% to $169 million in Indiana during the month. Revenue increased 47.7% to $9.8 million. It has now taken more than $1 billion in wagers since it launched last summer, and the number of operators in the state continues to grow.

Illinois has not yet reported its August figures, but it did reveal that sportsbooks took $52.5 million in wagers during July, their first full month of operations. William Hill has just become the fifth operator to launch in the state, and FanDuel and DraftKings could soon follow. “We’re excited to bring our top-performing mobile app to my hometown state of Illinois,” said Ken Fuchs, president of digital for William Hill. “We look forward to providing millions of sports fans in the state with the best markets and great service.”

FanDuel and DraftKings were banned from entering the Illinois market until December 2021 as punishment for offering DFS games when they were technically illegal. However, they appear to have found a way to skate around that penalty box, and they could launch soon. They have also helped to find a campaign that seeks to legalize sports wagering in Maryland. FanDuel and DraftKings sent a combined $750,000 to “Vote Yes on Question 2” between June 26 to August 18 in a bid to help legal sports wagering spread across the country.

 

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