The lack of any marquee sports betting event is having an adverse effect on the entirety of the US legal sports betting scene. All jurisdictions that have reported their June figures so far, with the exception of Michigan that saw a slight 0.7% increase, have acknowledged a dip in their month-to-month legal sports betting figures.
The latest state to repot a downturn is one of the industry’s top dogs, Pennsylvania which has consistently come in as a top-3 performing jurisdiction. But not unlike a host of states that have already reported, the drop in handle didn’t equate to a revenue dip. In fact, profits for the legal sports betting industry experienced a double-digit rise leading to a nice spike in the amount of tax contributions the platform made for Pennsylvania’s needy state and local coffers.
About That Handle Slide
Pennsylvania is not unique in its seasonal summer sports betting handle skid. Most competing states have seen lower sports betting activity during the summer months. June’s figures represent the second straight month that the state’s sportsbooks saw a decline in overall bets. The slump is widely expected to continue through the summer despite the Summer Olympics and only be snapped with the kickoff of the NFL season in September.
The Pennsylvania Gaming Control Board (PGCB) is reporting a $420.2 million sports betting handle for June – a 6.1% decrease from the $447.5 million taken in by the state’s sportsbooks in May. June’s figures are a whopping $195 million off the state’s record handle of $615.3 million posted back in January.
How About the Revenues?
There has been one positive that has emerged from the nationwide sports betting handle slowdown – revenue increases that can be attributed the American sportsbooks’ increased hold rates during the summer months.
Pennsylvania has followed the trend of handle decreases coupled with revenue spikes. In June, the Keystone State sportsbooks made $34.2 million, which is a healthy 23.4% increase from May’s profits. June represents the second straight month of climbing revenues for the state, thanks to a 10.1% hold rate.
Due to the combination of increased revenues and Pennsylvania’s 34% tax rate, sportsbooks contributed a tidy $12.3 million in taxes to the state.
The Pennsylvania legal sports betting industry is almost completely reliant on its mobile operators. When the apps are doing well, so too is the total Keystone State industry. June’s numbers are further proof of that fact.
Consistently responsible for north of 90% of Pennsylvania’s overall handle, any dip in the betting app effectiveness will impact the state’s bottom line. In June, the mobile sports betting handle was still 90.3% but dropped 6.9% from $407.4 million in May to $379.3 million in June.
Pennsylvania’s retail sports betting sector looks to be on a path back to relevance however with a $40.9 million contribution in June.
Where the Market Stands This Fiscal Year
To say that the Pennsylvania legal sports betting industry is healthy is an understatement. Buoyed by a post-COVID full betting menu, a typically rabid fanbase and some top-notch competition within the market, fiscal 2020-2021 has already generated a whopping $5.6 billion in bets. With the NFL just a couple of months away, the best is yet to come for the Pennsylvania scene.
Revenues for the fiscal 2020-2021 year currently stand at an incredible $308.8 million and mobile apps in the Keystone State have been responsible for 91.9% of the overall bets taken in by the state so far.
Crystal Ball Time
Pennsylvania’s legal sports betting scene has elevated into rarified air the last eight months or so. While New Jersey continues to be beyond its reach, there have been occasions where the Keystone State has outperformed Nevada with respect to its legal sports betting industry.
While that may not continue with Las Vegas and Reno returning to their pre-COVID glory, Pennsylvania’s spot as a top-3 performing jurisdiction certainly isn’t in danger.
The edge Pennsylvania has over Nevada is a robust mobile betting platform and two iconic teams in sports betting’s bread-and-butter NFL. So, while New Jersey doesn’t look like it will be touched, the race for second place on the bet-friendly list is intriguing and will be closely monitored by analysts within the US legal sports betting industry.