Player-friendly NFL results reduce sportsbook profits across US states

• Daniel Horvat
• November 26, 2024

October has been a fantastic month for US punters as most NFL moneyline, handicap and totals results were as expected by the general public. The trend has swept through all US states as all sportsbooks are reporting the same two things: an increased handle but reduced hold. DraftKings already called October the worst month in the company’s history when it comes to results of football games.

October is a uniquely busy month in the sports calendar because all major professional leagues in the US are in season and college football is also gearing up.

Handle increases; hold plummets

At least twelve states plus D.C. set new monthly highs for online sports betting handle. Here are the states ranked by handle, with a year-on-year increase or decrease in brackets:

New York $2.3bn (+16.0%), Illinois $1.3bn (+21.3%), New Jersey $1.13bn (-12.4%), Massachussets $748.1m (+30.8%), North Carolina $612m (n/a), Maryland $593.1m (+22.8%), Tennessee $547.8m (+23.4%), Indiana $537.9m (+25.2%), Iowa $294.9m (+15.5%), Kansas $275.9m (+10.5%), Oregon $81.7m (+14.7%), New Hampshire $79.4m (+2.1%) (+23.4%)Washington D.C. $65.8m (+513.5%), Arkansas $60.4m (+34.2%), West Virginia $56.0m (+17.4%), Maine $52.3m (n/a), Wyoming $24.5m (+15.6%), Delaware $24.5m (+278%), Vermont $17.3m (n/a), Montana $7.6m (+23.6%)

For 15 more states that were not listed, reports for October haven’t yet been published.

The NFL Results

In Week 6 of the National Football League, that lasted from 9 to 15 Oct, favourites went 13-2, eleven of them also covering the spread in the process. In Week 4, the trend continued with 12-3 for the favourites, with, crucially, ten of them also covering the spread.

In these two weeks, there were only two upsets and only two or three times that the big favourites failed to beat the spread. Seventy-five percent of games finished with a predicted outcome and a predicted spread.

New York

Nine online sports betting operators combined for only $176m in revenue, down 13.9% from September, with a hold that fell more than two points, now down to 7.6% for October. Two consecutive weeks of lack of NFL upsets led to a combined operator hold under 5% in the week ending Oct 13 and below 2% the following week, the lowest non-Super Bowl week hold ever in New York.

New Jersey

Total gaming revenue of $499.8m exceeds last October’s $487.1m and falls short of the $558.3m achieved in September this year. Licencees paid $55.0m in taxes for the month, with Internet gaming contributing $31.9m to that toal from a 15% gross revenue levy.

This was the first time that online casinos in New Jersey won more money from players in a month than their land-based counterparts in Atlantic City. October 2024 saw the online casinos take in $213.6m, about $4.9m more than retail casinos, and that’s not taking into account sports betting. This represents a 27.3% increase compared to September 2023 and a 2.6% increase from the previous record, set last month, of $208.1m.

At the same time, the land-based Atlantic City casinos are not doing very well at the moment, but this doesn’t necessarily mean that they’re getting profits taken from them by online casinos. It probably only shows that retail casinos need to perform well in all aspects of the business just to keep up. Also, they get a cut of the win that the online casinos in New Jersey bring in, as licensed online casinos operate in partnership with the nine Atlantic City properties.

Sports betting only brought in $77.5m, down 16% year-on-year and whopping 32.5% behind September this year. Online spending totalled $1.09bn and retail only $43.8m. As a result, DraftKings’ Q3 report warned of players’ NFL wins impacting performance in October, and forced the operator to reduce its fully year revenue and earnings forecasts. FanDuel, on the other hand, also noted the trend but said their pricing accuracy mitigated a similar impact on revenue and earnings.

FanDuel, in partnership with Meadowlands racetrack, has a 48% market share, while DraftKings has 30%. BetMGM has 10%, Bet365 and Caesars have 5% each. BetRivers, Fanatics and ESPN Bet all have about 2% each, and Hard Rock Bet is the only one that reported a loss.

Total market revenue in New Jersey for the 10 months of 2024 was $5.22bn, a 9.3% year-on-year increase. Land-based casinos are still the main source of revenue for the year as a whole, even with their 1.6% year-on-year reduction, and igaming revenue went up 23.7%. Year-to-date sports betting revenue was up 13.9% at $912.8m, and player spending was 14% higher at $10.33bn. The entire gambling sector has generated $560.7m in taxes for New Jersey this year.

Michigan

In Michigan, players spent a total of $560.4m on sports betting, which means the monthly handle is up 5.1% year-on-year and up 11.7% from September. However, this didn’t translate into revenue for the operators. October gross sports betting receipts, which is what this type of revenue is called in Michigan, totaled only $33m, which is a harsh reduction from September’s $58.4m.

FanDuel and MotorCity Casino are the leaders in this market with $17m in gross receipts. Having taken $211.3m in wagers, this represents a monthly hold of 8.05%. DraftKings and the Bay Mills Indian Community got $6.5m from $159.9m of wagered money for a 4.07% hold. BetMGM and MGM Grand Detroit are third with $4.6m and a 5.46% hold. ESPN Bet and Caesars got $1.8m and $1.2m respectively.

North Carolina

Online sportsbooks in North Carolina had the worst possible entry into the market. October marked the first full month of football betting for North Carolina digital sportsbooks as sports betting was made available in March. Revenue in October dropped $21.6m despite handle rising $36.6m against September.

In September, sportsbooks had a 12.2% hold rate, and in October that number dropped to 8%. During October, players wagered a total of $612m, which isn’t even the record but the third-highest total for this market.