Arizona sports betting revenue dips in December
Arizona’s Sports Betting Landscape: December 2023 Review
In December 2023, Arizona’s sports betting market experienced a significant downturn, with revenue plummeting by 28.9% year-on-year, even as consumer engagement reached elevated spending levels. The Grand Canyon State reported a robust total handle of $849.3 million (£655.5 million / €778.3 million), marking a 20.2% increase compared to December 2022, yet falling 5.4% short of November 2023’s record-breaking performance.
Monthly Handle and Online vs. Retail Betting Trends
The data from the Arizona Department of Gaming reveals that online wagering dominated the landscape, with $844.3 million wagered digitally, leaving a modest $5.1 million attributed to retail sportsbook operations. This shift reinforces the growing trend of online sports betting, reflecting a broader national inclination towards digital platforms.
Revenue Breakdown: Online vs. Retail
When examining revenue figures, adjusted gross event wagering receipts (before the impact of free bets) totaled $49.3 million. This figure represents a stark decline from the $69.3 million recorded in December 2022 and a significant 41.4% decrease from the record $84.1 million reported in November 2023.
- Online Revenue: $49.3 million, making up the entirety of the online wagering segment.
- Retail Revenue: A mere $45,000 was generated from retail sportsbooks, evidencing the overwhelming preference for online betting options.
Additionally, $23.5 million was allocated to free bets and promotional deductions. After these adjustments, the resultant adjusted gross event wagering receipts fell to $25.8 million, reflecting a significant 44.2% dip year-on-year and a dramatic 55.1% decrease compared to November.
Hold Rates and Tax Contributions
Calculated prior to free bet deductions, the sportsbook’s hold rate stood at 5.8%. However, when free bets were factored in, the effective monthly hold reduced to 2.77%. Players collectively recovered $798.2 million of their stakes, while Arizona’s tax revenue from sports betting reached $2.6 million. This revenue was predominantly driven by online betting activities, with the retail sector contributing only $3,600 to the state’s coffers.
Market Leadership: FanDuel Dominates Arizona
In the competitive arena of Arizona’s sports betting operators, FanDuel, owned by Flutter Entertainment, continued its reign as the market leader. For December, FanDuel reported an impressive $20.7 million in revenue—entirely from online transactions—on a handle of $276.2 million, resulting in a hold of 8.41% based on pre-deduction receipts.
- DraftKings: Secured the second position with $16.3 million from a handle of $275.6 million, translating to a monthly hold of 5.91%.
- BetMGM: Finished third, generating $3.9 million in revenue from a handle of $112.3 million, yielding a hold of 3.47%. Notably, BetMGM was the only operator to report retail revenue in December, indicating its distinct positioning within the marketplace.
Other notable performances included:
- Fanatics: Recorded $2 million in revenue from a $43.2 million handle, achieving a hold of 4.6%.
- Caesars: Mirrored Fanatics with $2 million in revenue from a handle of $47.6 million, resulting in a 4.2% hold.
- Bet365: The only other operator to surpass $1 million in revenue, reporting $1.8 million derived from a $40.1 million handle, leading to a hold of 4.49%.
In summary, despite the year-on-year revenue decline, the substantial handle figures indicate that Arizona remains a tightly contested market for sports betting, with online platforms firmly establishing their dominance. The continued evolution of consumer preferences and promotional strategies will undoubtedly shape the future landscape of the industry as operators adapt to maintain their competitive edge.
