Legal Sports Betting in Arizona Off to ‘Strong Start’ in September and October

The Arizona Department of Gaming recently released long-awaited figures that show the southwestern state's sports-betting handle for September was $291.2 million and that wagering in October amounted to $486.1 million.

Last Updated: Jan 4, 2022 1:34 PM ET Read Time: 3 min
Kyler Murray Arizona Cardinals NFL

If the first two months of legal sports wagering in Arizona are any indication, the state has already established itself as a major betting market.

The Arizona Department of Gaming recently released long-awaited figures that show the state's sports-betting handle for September was $291.2 million and that wagering in October amounted to $486.1 million.

It was a solid start for a region that had been coveted by sportsbook operators. Legal sports betting launched in Arizona on September 9 and the state had nine companies taking wagers during its first two months. 

The Arizona numbers stack up well against more mature betting markets, too. For example, the Indiana Gaming Commission reported that Hoosier State sportsbooks took $355.4 million in bets during September and $461.1 million in wagers in October. Indiana, however, has had legal sports betting for more than two years.

"Arizona’s event wagering and fantasy sports is off to a strong start here in the state and will only increase as the market matures," Ted Vogt, director of the ADG, said in a December 31 press release. "We worked diligently with the public and stakeholders to efficiently and responsibly set up these industries in just under five months, and we are starting to see the culmination of this hard work.”

In the beginning...

 Arizona Governor Doug Ducey signed legislation and an amended tribal-state gaming compact last April that, among other things, authorized event wagering in the state. Arizona’s legalization legislation allowed for 20 online sports-betting licenses, with 10 reserved for the state’s Native American tribes and 10 set aside for professional sports organizations (all 20 of which are allowed to partner with other companies to operate their sportsbooks).

Tribes are also allowed to offer retail sports betting on their lands under the terms of the gaming compact with the state. Professional sports licensees can also take in-person bets with their permits. 

The launch of legal sports betting and fantasy sports generated more than $15 million in revenue for the state’s general fund in September and October, according to the December 31 press release. Operators paid over $14 million in licensing fees to gain access to the Arizona market, in addition to around $1 million in taxes owed to the state.

As has become the norm for sportsbooks, most of their action during Arizona's first two months of legal wagering flowed from laptops and smartphones. Online sports betting accounted for $288.1 million of the total handle in September and $479.3 million in October.

Eight sportsbook operators took bets in Arizona during September: BetMGMCaesars SportsbookTwinSpiresDraftKingsFanDuelBarstool SportsbookUnibet, and WynnBETBetRivers joined that fray in October. 

The ADG’s figures show sportsbooks were pouring on the promotions and free bets in September and October as well, with approximately $57.2 million in related deductions reported by operators.

Those promo-related deductions put a dent in the amount of sports-betting revenue ultimately generated by the books and taxed by the state. 

In September, operators won $31.6 million from Arizona bettors before promotions were factored in, which was good for an unofficial hold of about 10.9% for the books. But after approximately $31.2 million in free bets and promotions were accounted for, adjusted sports-betting revenue was $392,417.83 for the month.

In October, the books won $36.3 million from players, for a hold of 7.5%. Still, after giving bettors about $26 million in freebies, operator revenue was just shy of $10.4 million.

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