After the legalization of the sports betting in June 2018, New Jersey is seeing a phenomenal rise in the money generated by this new segment. It won’t be wrong to say that sports betting have grown into one of the most robust markets in the country. And, the interest and popularity generated by the segment is showing no signs of a slowdown.
NJ sports betting - a growing industry
For January, the sports betting in the region hit $540 million in wagers, as per the data from the Division of Gaming Enforcement. Though the number was down marginally from December, it was 40% more from January last year. This marked the third straight month when NJ generated over a half a billion from the segment. A point to note is that Nevada never surpassed the $500 million mark in wagers in January.
New: NJ sports betting handle for January reported at $540 million.
Nevada has never surpassed $500 million in handle in any January.
— Dustin Gouker (@DustinGouker) February 12, 2020
Mobile, as was expected, was again the biggest contributor, with NJ online sports betting accounting for about 87% of the total wagers. However, it was down from 88% in December. Talking of the revenue, the number increased by 185% to $53.6 million in January from last year, as per the state report. This resulted in state treasury getting $6.6 million in tax revenues.
With New Jersey sports betting industry starting the year with a strong note, analysts expect 2020 numbers to breach last year’s record handle of about $4.6 billion. Overall, the operators paid more than $36.5 million in taxes to the state and local governments last year. The sports betting is proving to be a steady stream of revenue for the state as the operators are required to pay 13% tax on online sportsbook revenues.
For twelve months since the launch of legal sports betting in the state (i.e., from June 2018 to June 2019), New Jersey's retail and online sportsbooks generated about $3 billion in bets and about $200 million in revenue.
Operators that performed well
Talking of the performance of the individual sportsbooks, Meadowlands Racetrack continues to lead the way in January as well. The Meadowlands reported $26.5 million in revenue, including $22.2 million from internet gaming operation and about $4.2 million from its brick-and-mortar sports book, compared to $5.8 million and $1.16 million in January 2019, respectively. Meadowlands offers sports betting via FanDuel Sportsbook and PointsBet.
At number two was Resorts Digital, which includes DraftKings Sportsbook and Fox Bet, with $15.9 million in revenue. The DraftKings Sportsbook continues to be a major player in the NJ online sports betting.
Other major players with over $1 million in revenue were Monmouth Park (Rush Street Interactive, theScore Bet and William Hill) with $3.7 million, Borgata (BetMGM) with $3.2 million and Ocean (William Hill) with $2.3 million. New Jersey has 10 in-person sportsbooks and 19 online and mobile sportsbooks.
In terms of sports, basketball was at the top in terms of the handle. Completed event handle for basketball was at $178 million, compared to $129 million for football
What about the future?
Currently, 14 US states have legalized sports betting, while seven more are in the process of making it legal. The prospects of overall U.S. sports betting market look bright. Jefferies analysts estimate the market to bring $5 billion in profits or gross gaming yield of about $19 billion by 2023.
The impressive growth of sports betting in New Jersey is one of the reasons for Jefferies’ positive take on the market. “We upgrade our estimates for the U.S. sports betting markets and see a $5 billion Ebitda opportunity,” Jefferies analysts said in a recent note, according to Barrons.
Along with NJ online sports betting, online casino gambling also saw a remarkable growth last month. When compared to last January (2019), online casino grew by about 64% to $55.1 million. This marked the first time when online casino revenue breached the $50 million mark.