Virginia has become the ninth state in the post-PASPA era to surpass $10 billion in all-time sports wagering handle, after the Virginia Lottery on Thursday reported close to $426 million in accepted wagers for the month of April.
The Old Dominion joined New Jersey, Nevada, New York, Illinois, Pennsylvania, Indiana, Colorado, and Michigan in reaching the benchmark, doing so in 28 months of wagering since launching in late January 2021. Virginia has topped $400 million handle for eight consecutive months, its longest such run since legalization. This year’s handle represented a 6.6% increase compared to April 2022, when the total was just shy of $400 million. The April handle was 16.7% lower than in March, which is traditionally a month with more betting.
Operators had a relatively strong April, generating more than $45.1 million in gross revenue for a 10.6% hold. Virginia sportsbooks have posted a 9.1% or better win rate for 10 months running, with April marking the sixth time in that span it topped 10%. The state was able to levy its 15% tax rate on more than $38.9 million in adjusted revenue, resulting in nearly $5.8 million entering tax coffers.
The $157.1 million in adjusted revenue through the first four months of the year is 156.7% higher compared to the same period in 2022, which has contributed to an additional $14.8 million in tax revenue year-over-year. Virginia has received close to $24.3 million in tax revenue from sports wagering through the first four months of 2023.
Promo spend drops notably from March
All-time Top 10 #SportsBetting handles post-PASPA (thru April in CAPS):
1 NEW JERSEY $37.5B
2 NEVADA $32.5B
3 NEW YORK $23.3B
4 Illinois $21.7B
5 PENNSYLVANIA $21.6B
6 INDIANA $12.04B
7 Colorado $11.68B
8 MICHIGAN $10.5B
9 VIRGINIA $10.02B <-NEW
10 Arizona $8.98B (Feb)
— Chris Altruda (@AlTruda73) June 1, 2023
With the smaller inventory of sports in the second half of April following the conclusion of the NBA and NHL regular seasons, it would make sense that deductible operator promotional spend — for those mobile books eligible to deduct such offerings — would drop notably. The four operators believed to be eligible to deduct promotional offers — Betway, SI Sportsbook, Betfred and bet365 — reported a combined $1.9 million in such deductions, down 48.9% from the previous month. It is also believed April is the final month Betway and SI Sportsbook were eligible to do so, having launched operations in May 2022.
The Virginia Lottery, which does not disclose individual operator handle or revenue totals in its monthly release, reported 10 operators finished with positive adjusted gross revenue (AGR) to be eligible for taxes. It did not, however, specify if either retail book was among the 10 or if it was exclusively mobile operators. The deductions for operators who either carried over a negative AGR from March or had negative AGR in April totaled more than $4.2 million in April, up 11.6% from March.
Year-over-year numbers trending upward
Running April Top 10 #SportsBetting handle by state:
1 New York $1.55B
2 New Jersey ~$834M
3 Nevada $598M
4 Massachusetts $579.3M
5 Pennsylvania $572.2M
6 Ohio $522.7M
7 VIRGINIA ~$426M <-NEW
8 Michigan $338.1M
9 Maryland $328.5M
10 Indiana $321.4M#GamblingTwitter
— Chris Altruda (@AlTruda73) June 1, 2023
Virginia has bucked the trend of declining handle found in some other large-market states. The nearly $1.9 billion in accepted wagers through the first four months of the year is 7.3% higher compared to the same period in 2022. Gross revenue is up 39.1% to $189.9 million, aided by the 10.1% hold that is 2.3 percentage points higher than last year.
The budget amendment passed prior to the start of fiscal year 2023, which ended promotional deductions for mobile operators that have accepted wagers for more than 12 months, continues to have a profound impact on tax revenue. With two months remaining in FY2023, Virginia has collected over $60.8 million in tax receipts, more than double the $27.7 million for the prior fiscal year.
The adjusted gross revenue has accounted for 86.6% of gross revenue this year, which also is already 21.4% higher than the full 2022 fiscal year at $466.1 million. The AGR as a percentage of gross revenue in FY2022 was only 47.7%, totaling $183.2 million.