At least in the world of the monthly New Jersey sports betting handle, the V-shaped recovery is real.Β Β
The New Jersey Division of Gaming Enforcement released August sports wagering handle and revenue figures on Monday, revealing what amounts to not only a New Jersey record, but a new height for any U.S. jurisdiction permitting legal wagering: NJ sportsbooks accepted a combined $668 million in wagers (the βhandleβ) in the month of August alone, clearing New Jerseyβs previous high mark by more than $100 million. The previous record was $562.7 million in November 2019. The previous nationwide record was $615 million in Nevada — also in November 2019.Β
Of course, for the bettors and bookmakers, separate from the entertainment it provides, the only number that matters is the corresponding margin. Collectively, New Jersey sportsbooks won (or βkeptβ) $39.5 million of the dollars wagered, or roughly 5.9%, which is about one point lower than what New Jersey has averaged since June 2018.Β
The least surprising figure in this report is the percentage of wagers coming online versus in person at physical sportsbooks. Many of those indeed were open in August under certain public health restrictions, but online wagering represented $601.9 million of the lot versus $66 million coming in person, for a total 90% coming via mobile devices and browsers. Prior to the COVID-19 impact, NJ sportsbooks took in between 80-90 percent of handle online/mobile for 14 consecutive months.
Strange days and big demand
Hereβs the obligatory: Everything these days and months in the world of sports, and the globe as a whole, is quite different. Fans and bettors in August, like never before, took in new NBA and NHL playoffs formats in their late July season reboots. Not just new formats, but programming schedules that in early rounds provided wall-to-wall live programming from afternoon into the late hours.Β Β
Major League Baseball finally got its act together and began a shortened season in late July; the PGA Tour had five tournaments touching August, including the major PGA Championship; and mixed martial arts continued to roll on, highlighted by the UFC 252 trilogy bout between heavyweights Stipe Miocic and Daniel Cormier, in which Stipe won by decision to retain his belt. On the flip side, COVID-19 subtracted the NFL preseason (which generates more betting handle than most think) and a large chunk of late August college football from the calendar.Β
Itβs hard to figure how much of the stunning jump in weight class to $668 million we can attribute to pent-up demand. August represented the first full month of quasi-normalcy in sports (in 2020 terms). The handle low came in April 2020 at $54.6 million, which rose to $315 million in July as more leagues resumed play.Β
Pent-up demand is at least one considerable factor, as the early months of the U.S. coronavirus response (or non-response) left the sports cupboards stocked with β¦ letβs put it this way: table tennis was Coloradoβs most heavily bet sport in the month of June. Based on geolocation pings and anecdotes, we know that New Yorkers continue to send dollars into Jersey, due in part to the lack of legal online sportsbooks in New York, where legal wagering remains limited to on-premises at a bunch of upstate commercial and tribal casinos.Β
Despite the record handle for NJ in August, from a revenue standpoint the the books actually fared better or close in two other months:
- January 2020: $53.5 million revenue ($504 million handle, 9.92% hold)
- October 2019: $46.4 million revenue ($487.9 million handle, 9.51% hold)
- September 2019: $37.8 million revenue ($445.6 million handle, 8.50% hold)
So August 2020 knocks September 2019 off the podium in terms of revenue. (A full breakdown of NJ casino revenue, brick-and-mortar and online, sports included, is available at NJ Online Gambling.)
Which sportsbooks performed best?Β
The results here are also less surprising than the top line figure: A combination of FanDuel Sportsbook and PointsBet — both operating in partnership with Meadowlands Racetrack — and DraftKings and FOX Bet, both operating through agreements with Resorts AC, led the way by a lot.
The DGEβs revenue report doesnβt allow us to parse out which online sportsbook accounted for exactly what through the Meadowlands or Resorts, but we postulate that PointsBet is accounting for an increasing percentage as its national profile begins to rise. FanDuel and PointsBet combined for $17.6 million in gross revenue — or nearly half of the $39.5 million (we donβt know what handle the pair generated). Meanwhile DraftKings and FOX Bet took in $10 million in revenue (likewise, we donβt know how much handle the pair generated, only revenue).
BetMGM via Borgata made a charge with $3.3 million for the month, and William Hillβs figures are harder to accurately parse out, but it’s definitely in fourth with somewhere in the ballpark of $2 million online revenue.Β
What will the New Jersey taxpayer see from the August haul? Roughly $5 million, with $4.5 million coming via online wager revenue, which is taxed at 13% versus 8% for revenue on in-person wagers.Β
How about September?
For starters, the last week of September will bring us the Nevada monthly revenue figures.Β Based on results in New Jersey, we shouldnβt underestimate how high it may go. Of course, tourism, as it is everywhere, is way down, and New Jersey has a threefold state population advantage. But underestimate at your own risk.Β
The September numbers for Jersey will include wagers on the later stages of the NHL and NBA playoffs, meaning fewer but higher-stakes games, at least for the players and teams involved. And of course the start of the NFL season, which, assuming the NFL proceeds without scheduling hiccups, will put the first three weeks of the NFL season in the books before turning to Week 4βs full Sunday slate on Oct. 1.
Seven hundred million or even three-quarters of a billion dollars in handle does not seem too far out of sight.Β
Of course, this being responsible gaming education week 2020 (Sept. 13-19), weβll close with a reminder that these sports betting dollars should represent entertainment, and not people overextending their budgets. Some help resources and information for responsible gambling are available here.Β