Virginia Sportsbooks Top $50 Million For Fourth Straight Month

The Virginia Lottery reported gross sports wagering revenue of nearly $50.7 million for the month of December on Wednesday, capping an incredibly strong performance by operators in the second half of 2022.

It was the fourth consecutive month gross revenue cleared $50 million, the only occasions that has occurred in the 24 months of wagering in the Old Dominion. The $276.2 million in gross operator revenue generated from July through December nearly equaled the $285.9 million for all of 2021.

Handle surpassed $500 million for the third consecutive month as the 14 operators conducting business accepted $503.1 million worth of bets. That was 3% lower compared to November’s handle of $518.8 million but also 17.9% higher than December 2021, when three fewer operators were taking action.

The 10.1% hold for the final month of 2022 was the fourth time in five months it reached double digits, though it was also down one full percentage point compared to November, contributing to an 11.9% dip in gross revenue. Virginia operators posted win rates of 10% or higher in five months last year, cresting at 13.1% in September.

Promotional revenue counted as deductions continued to dwindle — the $567,709 total being the second-lowest all-time. Other deductions, including permitted monthly carryovers by operators, amounted to nearly $3.1 million, leaving the state eligible to levy taxes on more than $47 million in adjusted revenue. The eight operators that finished with positive AGR for December made payments to the state totaling just over $7 million.

The budget amendment that limited promotional deductions for the start of the 2023 fiscal year had a dramatic effect on state tax receipts. Virginia received $36.6 million in tax revenue for just the final six months of 2022 compared to $35.5 million spanning the first 18 months of operations.

Virginia is for lovers … and winning sportsbooks

Running Top 10 #SportsBetting handles 2022 YTD (Dec in CAPS):

1 NEW YORK $16.28B
2 NEW JERSEY $10.94B
3 Illinois $8.72B
4 NEVADA ~$8.7B
5 PENNSYLVANIA $7.25B
6 COLORADO $5.18B
7 VIRGINIA $4.91B <-NEW
8 Arizona $4.85B (Oct)
9 MICHIGAN $4.81B
10 INDIANA $4.47B#GamblingTwitter

— Chris Altruda (@AlTruda73) February 1, 2023

Though the Virginia Lottery does not disclose handle and revenue numbers by operator, it is clear operators held the upper hand for much of 2022 against the public. The 9.8% hold for the calendar year on more than $4.9 billion handle was easily the highest among the top 10 betting handle states in the U.S. in 2022. It was more than one full percentage point better than second-place Michigan and within one-half percentage point of doubling 10th-ranked Nevada.

That has been the status quo in Virginia since its launch in late January 2021, as there have been only three months with holds below the industry standard of 7%. One of those months, February 2022, was a narrow miss at 6.8%, while the other two took place in the first two months of legal wagering.

In terms of year-over-year comparisons, handle was up 52.6% versus the $3.2 billion generated in 2021. The surge in handle, coupled with the hold climbing nearly one full percentage point, resulted in gross revenue climbing 71.8% to $481.2 million.

Adjusted revenue showed a far bigger spike, as the state was eligible to tax $348.3 million last year. That was 166.2% better than the previous year, as Virginia reaped nearly $51.8 million in tax receipts for 2022. Taxes collected last year were $31.4 million more than the first year of business, as the ratio of adjusted revenue to gross revenue went from 45.8% in 2021 to 72.4% last year.

December’s handle also made Virginia the ninth state in the post-PASPA era to clear $8 billion in all-time handle.