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New Jersey Sports Betting Handle Surges to $261M, Revenue ‘Just’ $11M as Bettors Exact Revenge

Brett Smiley by Brett Smiley
November 15, 2018
in Industry
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The good news for the New Jersey sportsbooks in the newly released revenue report for October is a large jump in handle from $186 million in September to $261 million in October. The downside is that the bettors took a bigger bite of the books this month than usual, cutting revenue by more than half month-over-month from $24 million in September to “just” $11.7 million in October.

Overall that spells a 4.4 percent hold, down from 13 percent in Sept., which may be partly attributable to baseball (more on this below) and perhaps morseo a lot of “public” teams covering the spread in October NFL contests. The rise in betting handle is almost entirely attributable to the mobile/online sector, which grew from $105 million in September to $174 million in October. On-site sports betting inched up from $79 million in the prior month to $86 million.

Resorts Digital continues to lead the way by a lap on the revenue front, reporting $5.1 million in October, which is nearly half of the entire haul across all sportsbooks for the month. An arm of Resorts Casino, Resorts Digital figures represent DraftKings Sportsbook as well as BetStarsNJ.com.  We can no longer parse out which side is driving what, but based on prior figures we can safely say that DraftKings is responsible for the lion’s share as well as the cub’s share.

New Jersey Sports Betting Handle Climbs to $261M Thanks Mostly to Online Sports Betting, but Revenue Dips to $11 Million

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Next, let’s break down the numbers by individual licensees/properties and their sportsbooks, first brick-and-mortar followed by online sportsbooks:

October Brick-and-Mortar Sportsbook Revenue:

  • Meadowlands (FanDuel Sportsbook): $1.1 million
  • Monmouth Park: $606K
  • Ocean Resort: $438K
  • Bally’s: $303K
  • Borgata: $120K
  • Harrah’s: $104K
  • Resorts: $97K
  • Golden Nugget: $46K
  • Tropicana: $15K

A spokesperson for FanDuel Sportsboook said: “Demand for the FanDuel Sportsbook continues to outpace our expectations with online handle 2.5 times higher than September and continued double digit growth in retail handle. It was an exciting month for bettors who won at a high rate on football and benefitted from our industry leading pricing and odds boosts.”

October Online Sportsbook Revenue:

  • Resorts Digital (combination of DK Sportsbook and BetStarsNJ.com):  $5.1 million
  • FanDuel Sportsbook (Meadowlands): $2.43 million
  • Monmouth Park (William Hill and PlaySugarHouse): $609K
  • Ocean Resort (William Hill): $385K
  • Golden Nugget (PlaySugarHouse): $151K
  • Bally’s (combination of CaesarsCasino & 888sport): $108K
  • Borgata (PlayMGM): $67K

 

An Observation We Made on Twitter About Resorts Digital’s Dominance:

So far in New Jersey, Resorts Digital (probably ~95% @DKSportsbook) is responsible for $16,566,524 of the entire NJ industry's $34,229,340 YTD gross revenue.

That's just about half (48.3%). The DK book went fully live on Aug. 6. Make of that what you will.

— Sports Handle (@sports_handle) November 15, 2018

Meanwhile, DraftKings is installing a brick-and-mortar sportsbook at Resorts, perhaps as soon as Nov. 20.  

Keep in mind, New Jersey Division of Gaming Enforcement reports are based on an accrual method that counts wagers on futures/undecided events (such as Seahawks o/u 8 wins) as revenue at the time the wagers are made.

Accordingly, one reason for the drop in hold may be the cashing of winning baseball tickets; all of the wagers previously placed were counted as revenue. Anyone holding Boston Red Sox World Series champion tickets, or Red Sox and Los Angeles Dodgers winning their respective leagues could begin cashing them on Oct. 28, when the World Series ended with another Boston title.

Odds & Ends:

(1) The state of New Jersey’s year-to-date tax revenue attributable to sports betting is up to $5.53 million — $2.34 from brick-and-mortar sportsbooks (taxed at 8.5 percent) and $3.19 million via online (13 percent tax rate). That should cover more than half of the legal bills accrued in the state’s fight against the pro sports leagues and the NCAA, which submitted to the Supreme Court of the United States that sports gambling would destroy their games. Which segues:

(2) Nationally, bigger picture, MGM Resorts International and Caesars Entertainment are cutting deals with NHL teams, the NBA and NHL itself, in connection with sports betting. Will these “official partner” statuses pay off? If the New Jersey handle/hold is a proper marker, the revenue is coming through online/mobile sports betting. The playMGM sportsbook initially opened for Android users only, but sometime in October became available for iOS systems as well. However there is no web-based sportsbook as of yet. Put simply, the playMGM sportsbook is antiquated compared to what DraftKings, FanDuel, SugarHouse and William Hill are offering, all of which include live in-game wagering while playMGM does not.

(3) In October, MGM’s Borgata’s sportsbook either got hammered by their clientele or saw a big dropoff in business, or some combination. In September, the book generated $2.39 million on the retail side. Compare with just $120K in October.

(4) DraftKings and the FanDuel Sportsbook (at the Meadowlands and online) are responsible for most of the state’s betting handle and tax revenue at this point, as they both are continuing to make moves into new sports betting jurisdictions (some net yet born) including Mississippi, New York, and Pennsylvania. If the early success in New Jersey is any indication, and make your case why it shouldn’t be, both of the DFS-turned-sportsbooks are going to be major national players. Speaking of PA. …

(5) The Pennsylvania sports betting market, despite the onerous 36 percent tax rate on revenue and $10 million licensure fee to play, will launch soon at a couple locations, Parx Casino and Hollywood Casino among them. Will this pause the growth in New Jersey? To what extent have Pennsylvanians contributed to the handle so far?

(6) For all the predictions about how New Jersey market will ultimately surpass Nevada’s market… well, the Garden State is still climbing upwards but is not yet halfway there on the handle side: US Bets reported on the Nevada September figures a record win of $56.3 million on a record handle of $571 million.  Of course, we’re still in just Month Five of the N.J. market’s existence, compared with Nevada’s ,which dates back to 1949.

(7) Finally, what are people betting? Football, baby. With two months of college football and NFL play on the books, football has surpassed baseball for handle and also net hold.

Parlay wagering has produced a hold of 8.5 percent, which is actually very low. Overall parlay wagering typically has produced a 25-30 percent hold for Nevada sportsbooks over the past 25 years.

What’s in the “other” category? That includes anything not otherwise parsed out — golf, mixed martial arts (Conor vs. Khabib took place in October), darts, you name it.

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Brett Smiley

Brett Smiley

Brett Smiley is editor-in-chief and co-founder of Sports Handle, which joined forces with the US Bets team in November 2018. He focuses on the sports betting industry and legislation. He's a recreational sports bettor and DFS player himself, focusing on the NFL. In a past life, Smiley practiced commercial litigation in New York City and previously wrote for FOX Sports and SI.com. He lives in New Jersey with his family.

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