It has become a monthly right-of-passage for observers of the US legal sports betting industry to wait on the numbers out of New Jersey, the unquestioned king of the US sports betting scene. The Garden State is out with their May sports betting numbers and as per usual, they failed to disappoint.
The month of May lands in the middle of what is typically an industry-wide slowdown in all jurisdictions across the country. While some states that have reported such as Michigan have shown month-to-month declines in their sports betting figures, others like Indiana and now New Jersey posted a small spike in their sports betting activity over the 31-day period.
“New Jersey’s sports betting market has not only grown into the largest in the U.S., but it has evolved into the state that is least affected by the seasonality of sports betting. No market can entirely escape the natural ebbs and flows, of course. But New Jersey is less reliant on football and sports betting holidays than any other major U.S. market,” said Eric Ramsey, analyst for PlayNJ.com.
Getting Into It
New Jersey sportsbooks seem to have shrugged off what most analysts predicted would be a broad, industry-wide summer sports betting slowdown. May came in as the third-best month the state has had in terms of sports betting activity in 2021.
New Jersey’s mobile and retail betting sectors combined for a $814.3 million May handle which represents an 8.9% increase from the $748 million that was bet in April. While respectable, May’s total was no where near the record $996.3 million total sports betting handle the Garden State recorded back in December.
Revenues unfortunately didn’t follow the rise in handle. In fact, sportsbook profits dropped slightly from April to May. They were reported to be $52.89 million for the Jersey scene, down 3.5% from the $54.83 million sportsbooks made in April. The revenue drop was due to a slip in hold rate which was 7.3% in April and 6.5% in May.
$7.9 million in taxes was paid by sportsbooks to state and local coffers.
A Few More Numbers
New Jersey regulators included their year-over-year numbers in their May sports betting report and predictable they are eye-opening, considering that May 2020 was smack in the middle of COVID-forced global casino closures and the pause of sports leagues around the world.
The handle spiked 501.1% in a year from May 2020’s $117.8 million to $814.3 million last month. Revenues over that time grew 433.6% from $9.9 million in May 2020 to $52.9 million in May 2021.
May’s handle puts New Jersey on track to obliterate their record $6 billion yearly handle they set last year. With May’s figures added in, New Jersey’s total 2021 handle stands at just over $4.1 billion with the best months still to come. Basketball is responsible of $1.5 billion of the impressive total.
Carrying the Load
To nobody’s surprise, it was New Jersey’s mobile sports betting apps that carried the handle-load for May. 90.2% of the betting dollars taken in during May came form the Garden State’s internet-based betting platform. That works out to $736.7 million of the $814.3 million overall betting total.
Baseball shockingly passed basketball as the most popular sport to bet on during May, even though regional NBA teams like the Philadelphia 76ers, the New York Knicks and Brooklyn Nets have had a presence in the league’s postseason. Baseball generated $326 million in bets in New Jersey in May while basketball was still strong with $216.7 million in bets.
“Success from regional teams almost always gives a market a boost, and basketball is particularly popular with New Jersey bettors,” Dustin Gouker said. “Even more, after a year of strict capacity limits and with so many regional favorites in the NBA Playoffs, bettors seemed particularly motivated to get out and place a bet. All of it is great news for a gaming market on the mend.”
Steady As She Goes
“New Jersey’s gaming industry appears healthier than anyone would have thought possible a year ago,” said Gouker, analyst for PlayNJ.com. That’s a pretty big understatement.
It is accepted that the New Jersey legal sports betting scene may have another month or two of just-OK numbers before September and the start of the NFL season. But numbers will spike dramatically as we head into fall. There has been rumors of a change in policy surrounding college sports betting as well that will allow New Jersey bettors to wager on in-state teams and ultimately lead to more wagering activity.
It all adds up to New Jersey maintaining their status as the unquestioned King of the betting states with little reason to think any other jurisdiction will even be close.