Promotions lead to negative tax revenue for the state, but online casinos help with record daily volume, according to PlayPennsylvania.
(LAS VEGAS) — Pennsylvania’s online and retail sportsbooks slowed to less than $600 million in wagering in February, an expected post-football hangover leading to the state’s lowest monthly handle since September. Meanwhile, a short month kept online casinos from reaching another monthly revenue record despite setting a state high for revenue per day, according to PlayPennsylvania, which tracks regulated online gaming and sports betting in the state.
“The Super Bowl is the most bet-on singular game in the U.S., but it can’t alone replace a full schedule of football games,” said Dustin Gouker, analyst for the PlayUSA.com Network, which includes PlayPennsylvania.com. “The lull in February is expected and always short-lived. March Madness should get sportsbooks back into record or near-record territory.”
Spurred by $68 million in Super Bowl bets, Pennsylvania’s sportsbooks attracted $597.1 million in wagers in February, according to official data released Thursday. That is up 17.2% from $509.5 million in February 2021. But February’s handle was the lowest since $578.8 million in September, and down 24.8% from the record $793.7 million in wagers in January.
Bettors fared well in February, too. Wagers produced $22.2 million in gross revenue for sportsbooks, down 33.2% from $33.2 million in February 2021 and down 58.5% from $53.4 million in January. With $22.6 million in promotional spending, Pennsylvania sportsbooks ended up with a loss of $442,847 in taxable revenue, which put tax revenue in negative territory at -$268,976.
Super Bowl betting is vital to sportsbooks, and the heavy promotion for the game shows how operators view it as an opportunity. But even with the big game, there wasn’t enough betting inventory in February to extend a streak of four straight months of $750 million in wagers or more.
“The Super Bowl is a prime opportunity for sportsbooks to expand their customer base, which is why they promote it so heavily,” said Katie Kohler, an analyst for PlayPennsylvania.com. “That took a significant bite out of tax revenue. But the industry is in excellent shape going forward, and poised for more growth.”
Online sportsbooks generated $558.1 million, or 93.5% of the state’s handle in February. FanDuel topped the state with $213.2 million in wagers. Those bets yielded $6.0 million in revenue for FanDuel.
DraftKings followed with $140.1 million in wagers, which produced $4.9 million in gross revenue. BetMGM was third in the state with a $72.3 million handle, which led to $4.3 million in gross revenue. Penn National’s Barstool-branded app was fourth with $46.8 million in online wagers, which created $2.0 million in gross revenue.
Retail sportsbooks took in $39.0 million in wagers in February, down from $56.3 million in January. Those wagers produced $1.0 million in taxable revenue, down from $5.8 million in January. Parx led all retailers with $6.4 million in wagers.
“The biggest concern for sportsbooks was whether or not they’d lose a significant portion of the baseball season, which makes up a relatively small share of annual handle but is the main bets generator over the slow summer months,” Kohler said. “With the Phillies and Pirates now expected to play full schedules, sportsbooks can look forward to the first normal sports calendar since 2019.”
Online casinos and poker
Business at online casinos and poker rooms remained brisk in February with $123.7 million in gross revenue, down 4.8% from $130.0 million in gross gaming revenue in January. Revenue was still up 36.6% from $90.6 million in February 2021.
In the end, online casinos and poker rooms gained a record $4.4 million in gross gaming revenue per day over the 28 days of February, up from $4.2 million per day over the 31 days in January. February’s revenue created $102.4 million in taxable revenue, which yielded $42.3 million in state taxes and local assessments.
“Online casinos aren’t subject to the same seasonal shifts as sportsbooks, which is a major reason why it is such a better revenue generator,” Kohler said. “When states see the success of online casinos in states like Pennsylvania, it’s a wonder why we haven’t seen the same wave of legalization that we have seen with sports betting over the last few years.”
Other highlights from February:
- Online casino games alone produced $120.9 million in revenue on $4.1 billion in wagers.
- Poker generated $2.9 million in revenue. PokerStars topped poker operators with $1.6 million in revenue, despite being one of two operators in the state that crashed for an entire weekend.
- Penn National, which includes DraftKings, BetMGM, Barstool, PointsBet, and Hollywood casinos, topped online casinos with $51.6 million in gross revenue.
- Rivers Philadelphia, which includes PlaySugarHouse, Borgata, and BetRivers casinos, was second with $30.8 million.
Pennsylvania sports betting revenue, February 2022
|Licensee||Online Brand||Total Handle||Total Revenue||Online Handle||Online Revenue||Retail Handle||Retail Revenue|
|Hollywood Penn National||Barstool||$48,075,172||$1,979,664||$46,772,593||$1,986,789||$1,302,579||-$7,124|
|Mount Airy||Fox Bet||$9,595,656||$554,038||$9,124,518||$551,961||$471,137||$2,077|
|Mohegan Sun Pocono||Unibet||$7,620,222||$526,968||$6,618,459||$484,594||$1,001,763||$42,374|
|South Philly OTB||$2,250,137||$73,143||$0||$0||$2,250,137||$73,143|
|Wind Creek||Wind Creek||$2,146,784||-$43,744||$1,018,495||-$48,426||$1,128,288||$4,682|
For more information and updates on legal betting in PA, visit PlayPennsylvania.com/news.
Contact: Zack Hall, Catena Media, [email protected].
Lead image credit: AP Photo/Adam Hunger