January proved to be a powerful sports betting month in the Valentine State.
January represented the second-best month in handle ever and it’s the third straight month in which $800 million was placed in wagers. But unlike in December, Arizona sportsbooks reported strong revenue numbers as well.
Key takeaways
- Revenue increased significantly month over month.
- Retail markets still struggle to make money.
- The smaller operators saw huge revenue swings.
The Arizona Department of Gaming reported $864.2 million in handle, slightly higher than the $849.3 million placed in December. Year over year, the Valentine State enjoyed a 22% increase.
On the revenue side, operators are certainly celebrating. After December’s misses, bettors had a poor start to the year. Compared to the previous month the adjusted gross receipts came to $53.2 million, more than double December’s $25.7 million.
Bettors may not have been happy overall but there were some areas to enjoy. Free bets increased from $23 million to $30 million. On top of that, the retail sportsbooks paid out more in winning bets ($6.8 million) than they took in ($6.3 million).
Of the 12 sportsbooks that reported more than $1 million in action for the month, every single one of them took in more than they paid out (Bally Bet’s free bet deduction technically put them in the red).
From that, the tax bill came to just over $5 million.
Sportsbooks see massive revenue swings
| Operator | January Handle | Gross Revenue (after free bet deductions) |
|---|---|---|
| FanDuel | $286.5 million | $21.2 million |
| DraftKings | $268.1 million | $18.2 million |
| BetMGM | $99.8 million | $6.8 million |
| Fanatics | $55.5 million | $1.4 million |
| Caesars | $47.6 million | $2.5 million |
| bet365 | $42 million | $905,000 |
It's no surprise that FanDuel and DraftKings dominate in the Arizona sports betting market. Together their handle exceeds the rest of the field combined. Plus when the handle is so large, there seems to be some protection from wild changes in revenue. The other operators may be scratching their heads on what to expect doing forward.
BetMGM, Fanatics, and bet365 all reported a 10-times higher revenue versus December while FanDuel and DraftKings saw more moderate gains. Every operator with more than $40 million in handle saw higher revenue.
Handle-wise, most sportsbooks didn’t see much change. Fanatics saw one of the largest increases while BetMGM saw the biggest drop, although the jump in revenue makes up for the limited action.
