Arizona sportsbooks fall just short of $500 million handle in February

(PRESS RELEASE) -- The Super Bowl helped Arizona sportsbooks generate nearly $500 million in wagers in February, but that wasn’t enough to stave off Arizona’s first month-over-month decline in sports betting. The modest downtick is typical among legal U.S. sports betting markets during what was a short month with just one football game, according to PlayAZ.com, which tracks Arizona’s sports betting market.

“Arizona is following a similar pattern to more mature markets,” said Eric Ramsey, analyst for the PlayUSA.com Network, which includes PlayAZ.com. “As big a single event as the Super Bowl is, it can’t match a month like January that had five full weekends of football games. U.S. sports betting has predictable seasonal ebbs and flows that generally follow the football season, with a one-month exception in March because of the NCAA Tournament.”

Bettors poured $491.7 million in wagers into Arizona’s online and retail sportsbooks in February, a 13% dip from the record $563.7 million in wagers sportsbooks collected in January, according to official data released Tuesday by the Arizona Department of Gaming. Bettors placed an average of $17.6 million in wagers per day over the 28 days of February, down from $18.2 million per day in January. Still, February’s handle marked the third-highest monthly volume since Arizona sports betting launched in September.

Sportsbooks won $25.6 million in gross revenue from March’s bets, down 39% from $41.9 million in January. With $17.6 million in promotional deductions, the state taxed $6.9 million in adjusted receipts. That yielded $670,686 in privilege fees for the state.

Through the first six months of sports betting, Arizona’s sportsbooks have produced:

$2.8 billion in online and retail wagers
$228.6 million in gross revenue
$8.6 million in privilege fees for the state.

“The first six months have been pretty extraordinary. If it wasn’t for New York, Arizona would be off to the fastest start in U.S. sports betting history,” said C.J. Pierre, lead analyst for PlayAZ.com. “As the industry begins its seasonal dip, which typically begins in April, operators can take heart in knowing that the market has taken a giant leap forward.”

Online sportsbooks accounted for $488.3 million, or 99.3% of the statewide handle in February. Retail sportsbooks generated $3.4 million in bets.

FanDuel held off rival DraftKings in February with $142.4 million in online wagers, the majority of the $149.8 million FanDuel’s retail and online books generated over the month. That produced just $2.5 million in gross revenue, though. DraftKings was the state’s No. 2 with $131.7 million in wagers, all of which came online. Those bets yielded a market-best $10.1 million in gross revenue.

BetMGM ($99.8 million in wagering, all online; $8.8 million in gross revenue) and Caesars ($79.0 million in wagering, including $78.4 million online; $2.5 million in gross revenue) most closely trailed the state’s leaders.

The Super Bowl was obviously the largest draw for sportsbooks in February, and wagering for the game seemingly met expectations. The Super Bowl’s importance to sportsbooks goes beyond the revenue generated. It is also viewed by the industry as a prime opportunity to reach new customers, typically bringing significantly higher promotional spending than any other game of the year.

“The Super Bowl is a key part of operators’ long-term strategies to expand their reach,” Pierre said. “Even if the game itself was mildly profitable, it can mean a big win down the road for sportsbooks that successfully utilize the game to attract new customers. That dynamic takes on an added importance when a market is just a few months old and every operator is still clawing for a larger share.”