February ended a string of consistent and predictable months of impressive growth within the US legal sports betting industry. All states that have reported so far have shown a significant drop in their February sports betting handles and ultimately the profits gleaned off of the platform.
The latest state to report on its disappointing February figures is Colorado. Thanks to a 28-day betting period, the fact that there was only one NFL game during the month to bet on and the realization that the calendar brought us one less weekend for betting all played a factor in not only Colorado’s but the nation’s somewhat expected sports betting slump.
“February is a reminder that with the seasonality of sports betting, growth is never assured even in a market like Colorado,” said Jessica Welman, analyst for PlayColorado. “In nearly every legal betting market, a pullback from January was expected mainly because there is nowhere near the NFL inventory of games to bet on, even with the Super Bowl. Colorado is a unique market in many ways, but ultimately it is still subject to the same sports betting dynamics as any other state.”
Deep Dive Into the Data
According to Colorado Department of Revenue’s Division of Gaming, bettors in Colorado spent $266.5 million at the state’s sportsbooks, which is about a $60 million drop, or 18% from January’s $326.9 million. That falls in line with the percentage-drops of other participating US states and represents the first time Colorado’s sports betting industry has shown any sort of decline since its launch May 1.
Gross gaming revenues showed an even steeper regression. Colorado sportsbooks made $10.4 million in February, down 54.9% from the $23.1 million they made in January. The February hold was just 3.92% in February, a major drop from the 7.08% in January. The state generated $322,227 in taxes off the action.
“The month-over-month growth streak was bound to be snapped, but the underlying fundamentals of the market remain strong,” said Ian St Clair, analyst for PlayColorado. “Retail sportsbooks continue to struggle amid the pandemic, but hopefully they will rebound as we move closer to normal.”
Colorado’s online platform continued to be the envy of the US legal sports betting scene, however. Betting apps were responsible for $258.2 million of the $266.5 million total February handle, or an impressive 97%. Despite the lofty figure, the total is still a 19.1% drop from January’s $319.4 million mobile handle.
Basketball in the Driver’s Seat
For the first month in quite some time, football wasn’t he driver of the Colorado legal sports betting scene. It was basketball that led the way for Colorado bettors in February. $95 million was bet on pro hoops during the month, up from $88.4 million in January. That number represents 35.7% of the total amount spent at the state’s sportsbooks.
Football was next with $39.5 million with the Super Bowl contributing $31.2 million toward that total. College basketball came third in Colorado in February with a $24.2 million haul. While a decent total, the college basketball handle dropped $15 million from January’s $39.9 million.
Table tennis continued to impress, generating another head-scratching $13 million toward February’s betting totals, up from $11.8 million in January while hockey was responsible for $9.5 million of the total February handle.
Compared to the Rest of the Nation…
Colorado’s standing in the Top-5 bet-friendly states has slipped with the emergence of a pair of other states in the legal sports betting universe. At $266.5 million, Colorado sits sixth, with Illinois, which is expected to threaten a Top-3 spot still to report.
New Jersey is out of reach as per usual. Their February total handle was $743 million, which followed three straight months of over $900 million. Nevada maintains their #2 spot with $554 million and Pennsylvania is next with $509.5 million.
March figures to be better for not only Colorado but the rest of the US in terms of their sports betting handles. The State hopes to parlay its bettors’ love of basketball into a March Madness bonanza.
February is always a low point for the legal sports betting industry in the US. Expect a strong bounce back for the entire industry in March.