Healthy Hold Helps Pennsylvania May Sports Betting Revenues Rise Despite Handle Drop

Pennsylvania sports betting experienced an expected annual drop-off in May, with its overall handle slipping below the $500-million mark for the first time since August 2022. The Keystone State on Wednesday became the latest U.S. legal sports betting jurisdiction to report a double-digit month-over-month percentage drop in its sports betting sector.

It isn't all bad news with regard to Pennsylvania sports betting apps, though. A healthy hold rate for the state's providers helped revenues increase month-over-month. The most recent report from the Pennsylvania Gaming Control Board (PGCB) also revealed year-over-year improvements in both sports betting handle and revenues.

A peek at Pennsylvania's May handle

According to the Pennsylvania Gaming Control Board, $495.6 million in bets was taken in by the state's sports betting sites. That number represents a 13.4% decrease from the $572.1 million that was reported by the Keystone State sportsbooks in April. The 13.4% drop is certainly in line with what we have been seeing nationwide.

Meanwhile, 92.9% of all sports bets in Pennsylvania were placed with the state's best sportsbooks.

However, the sports betting activity in Pennsylvania is slightly higher than it was in May 2022. Bettors spent $493.35 million with the state's betting providers last year over the same period, just over $200,00 less than in May 2023.

What about revenues?

Revenues from the Pennsylvania legal sports betting industry showed mostly positive signs in May. Profits from the Keystone State sports betting sector are up, both month-over-month and year-over-year.

A total of $57.5 million in revenues was reported for May 2023, an 11% month-over-month increase from April's totals. It is also a 20.3% year-over-year increase from the $47.8 million reported in May 2022. Adjusted gross revenue (taxable revenues) came in at $41.1 million after Pennsylvania sportsbook promo deductions. That's up from $37 million in April.

The revenue increases can be attributed to a healthy hold rate for the state's sports betting providers. Bettors in Pennsylvania weren't so lucky in May, allowing the House to hold 11.6%, which is an increase from 9.1% in April and 9.7% in May of 2022.

Taxes collected from Pennsylvania sportsbook revenues were $14.8 million in May, with just over $740,0000 going to local entities.

FanDuel once again leads the way

Once again, it was FanDuel that came in as the most popular sports betting app in the Pennsylvania market. It made up $194.3 million of the overall $495.6 million handle in the state - a 13.8% drop from April. FanDuel Pennsylvania enjoyed a 15.1% hold rate during May.

FanDuel was tops in the revenues race, as well. Their $22.2 million in revenues accounted for 60% of the net profits made by all of the state's sportsbook revenues combined.

DraftKings finished second in terms of betting activity in the Keystone State during May, as $133.2 million was spent with DraftKings Pennsylvania, a 15.5% dip from April's totals.

Despite slumping numbers in May, DraftKings has been outpacing FanDuel's growth in Pennsylvania so far this year. DraftKings has seen year-to-date growth of 24.8% in the Keystone State, while FanDuel grew 13.75% through the first five months of 2023.

BetMGM was the third-most-popular Pennsylvania sports betting app with almost $36.9 million in bets - that's an eye-popping 86.8% increase from their May 2022 totals. Caesars was fourth with $26.8 million in bets and BetRivers was fifth with $22.7 million in wagers during May.

Barstool continued to slide down the list of Pennsylvania sports betting apps in May. Once the third-most-popular betting site in the Keystone State, Barstool has let BetMGM, Caesars, and now BetRivers leapfrog it during the last few months. Barstool’s $21.5-million May handle was eclipsed by BetRivers for the first time ever last month.