New York’s Online Sports Betting Slump: A Seasonal Dip or a Sign of Things to Come?
Player spending on online sports betting in New York experienced a significant drop in June, reaching its lowest total in ten months. The decline became more evident when comparing this June's figures to those from previous months and years. The total monthly handle for New York in June was recorded at $1.47 billion, showcasing a 25.4% drop compared to May’s robust $1.97 billion handle.
However, this decline is not entirely unexpected. A deeper dive into the numbers reveals that June’s handle represents a 25.6% increase from the same month last year, indicating a year-on-year growth even amidst the monthly downturn. The gross gaming revenue for June stood at $133.9 million, which, while falling 34.1% short of May’s total earnings, still marks a 29.0% increase compared to June of the previous year.
Several factors contribute to these fluctuations. The conclusion of the NBA and NFL finals in early June, without a New York team contending for the championship, likely played a role. The summer months traditionally witness a slowdown in sports betting activities, not just in New York but across the United States. This period is characterized by a lack of high-stakes events that typically drive higher betting volumes.
Operator Insights
Among the operators, FanDuel took the lead, posting an impressive $67.1 million in revenue from $571.3 million in total wagers for June. The company made a substantial contribution of $34.2 million in taxes for the month, adding to its nearly $998.3 million total paid into state coffers since January 2022. DraftKings followed closely with revenue of $40.9 million derived from a $521.6 million handle. In contrast, Caesars saw customers stake $127.7 million, which resulted in $6.8 million in revenue.
Other operators also experienced varied success. BetMGM reported $6.8 million in revenue from $100.6 million wagered, while Fanatics reported a handle of $67.3 million and revenue of $6.7 million. Fanatics’ hold percentage for June stood at a notable 9.96%. Rush Street Interactive generated $2.5 million from $68.8 million in total wagers, and BallyBet posted revenues of $658,294. Resorts World and Wynn Interactive also made smaller contributions, with revenues of $572,891 and $66,665, respectively.
The Seasonal Effect
June’s lower figures can be partly attributed to the cyclical nature of sports betting activities. The MLB season, which spans the summer, does not traditionally drive significant betting activity, unlike the NFL season. June’s betting scenario also included events like horse racing’s Belmont Stakes, golf’s US Open, and the Copa América football tournament, the latter being held in the US for only the second time. Despite these events, June is typically the strongest of the summer months for sports betting, yet it marks the beginning of a traditionally slower period that sees further declines in July and a slight recovery in August.
As major sports leagues are in their off-seasons in June, fewer high-stakes events captivate bettors, leading to reduced betting activity. Consequently, the dip in June is expected and aligns with historical trends. The New York sports betting market, alongside other states, is likely to experience a resurgence with the onset of the NFL season in September, which consistently drives high engagement and wagering.
In conclusion, while June showed a marked decrease in both handle and gross gaming revenue compared to May, the year-on-year growth and the traditional summer slump suggest that these figures are part of the expected seasonal ebb and flow. The sports betting industry in New York is poised to bounce back with the return of high-stakes sports events in the fall, particularly with the NFL season known for its high levels of bettor engagement.