June Proves to be Bad Sports Betting Month for Colorado

The annual summer sports betting slump has been hard on U.S. sportsbooks and the states that rely on the tax revenue generated from the platform.

June has proven to be an especially tough month with several states reporting heavy month-over-month dropoffs in handle, sportsbook revenue, and the tax contributions from their sports wagering industries.

On Monday, it was Colorado sports betting that reported heavy June losses for their previously robust legal sports betting scene. 

The Colorado Department of Revenue June report shed light on the healthy decline in month-over-month June sports betting activity, particularly sportsbook revenues and the taxes collected from state providers. The predictable seasonal slump is one reason for the wagering downturn, but digging deeper reveals the Denver Nuggets' run to the NBA Championship as being another.

The Colorado June handle

Colorado sports betting regulators are reporting a $310.656 million overall handle for June, their lowest total since the $290.1 million taken in last August.

June's numbers are a sharp decline from the $385.2 million in wagering activity from May, and it does represent just a slight 0.8% year-over-year drop from the $313.2 million in June 2022. 

While the month-over-month declines seem drastic, they fall in line with other participating legal sports betting states around the U.S.

Gross gaming revenue down from May

Gross gaming revenue for the best sports betting apps saw a huge drop from May to June, mostly because of Centennial State bettor wagering, and winning on their beloved Denver Nuggets.

A total of $9.2 million in gross gaming revenues was reported by the state's legal sports betting providers in June. It is the second lowest total in almost three years, eclipsed only by the $6.8 million in sportsbook profits from June 2022, when another Colorado team, the NHL's Avalanche were marching toward their own championship victory.

The $9.2 million represents a whopping 70% month-over-month decrease from the $31.4 million in profits reported in May. However, it is about a $2.5 million increase from the underwhelming $6.8 million in gross gaming revenues reported from June 2022.

Just $441,951 in taxes was collected from the state's best sportsbooks off of the weak revenue totals, which is an actual year-over-year improvement from the $268,280 in June 2022. By contrast, $2.2 million in taxes was paid in May.

Hold rate more than halved

The big reason for the revenue dive is the hold rate, which was greatly affected by the Denver Nuggets, a team that Centennial State citizens bet on and won, along with their team. The hold rate for Colorado's betting sites was a miserable 3% in June, down from 8.2% in May, but up from the 2.2% in last June.

Basketball betting took in a respectable $57.9 million in bets in June but paid out $68.8 million. That's an eye-opening $10.9 million loss for sportsbooks on hoops wagers alone. The takeaway is that when home state teams win, sportsbooks there lose. Just ask Nevada sports betting, which suffered a similar hold-fate when the Golden Knights won the Stanley Cup in June.

Colorado was unfortunate to have a similar hold-misfortune last June, when the Colorado Avalanche completed their run and won the Stanley Cup.