The regulated commercial betting sector in the United States has crossed the monumental $100 billion mark in FY2023, marking five years of buoyant operations.
Industry continues remarkable growth
With substantial year-on-year (YoY) spikes witnessed throughout the year, the US sports betting segment is poised to conclude the year on a high note, propelled by a record-setting volume of over $934 million in November, primarily driven by Pennsylvania.
Unprecedented growth in legalized jurisdictions
Before 2023, 32 states permitted online and retail sports betting in the US. This year, the industry expanded further with five additional states joining the ranks.
Particularly noteworthy performances were observed in the newly legalized markets of Ohio and Massachusetts, contributing significantly to the nation’s $100 billion betting handle achievement.
The upward trajectory continues, with a total of $79 billion wagered in the first three quarters of this year.
Growth in 2022 sets the stage for massive expansion
Last year (2022), the annual wagering handle surpassed $93.79 million, solidifying its position as the fastest-growing gambling segment in the country.
In 2022, the Gross Gaming Revenue (GGR) reached $60.42 billion, marking a remarkable 14 percent increase from 2021.
While Slots retained its dominance, the sports betting segment exhibited the most promising growth, experiencing a YoY surge of 72.7 percent, resulting in a $7.5 billion revenue for 2022.
Sustained momentum in 2023
The final quarter of FY2023 is anticipated to witness yet another YoY and quarter-on-quarter increase, with sports betting now legal in 38 states and Washington, DC. Vermont is poised to join the market in 2024, while efforts to legalize betting in California face opposition from tribal groups.
Despite this, the sports betting segment continues its exceptional performance.
Yearly growth highlights
In Q1 2023, the sports betting GGR soared to $2.8 billion, marking a substantial 70.1 percent YoY increase and surpassing Table Games to become the second-largest segment, trailing only behind Slots.
The momentum continued in Q2 2023, with a 56.6 percent YoY increase, resulting in a GGR of $2.3 billion, outpacing iGaming’s growth of 22.5 percent. The cumulative sports betting GGR for the first half of 2023 witnessed a remarkable 65.5 percent increase, reaching $5.15 billion.
Continued surge in Q3 2023
The growth trajectory of the sports betting segment persisted in the third quarter of 2023, with a 27.7 percent YoY spike in GGR, amounting to $2.23 billion from regulated jurisdictions. The majority of the revenue was generated online, showcasing a shift in consumer preferences toward digital platforms.
This digital trend was mirrored in iGaming, which saw a 26 percent increase, accumulating $1.52 billion.
Overall gaming revenue soars
For the first nine months of 2023, the total GGR reached $48.78 billion, with Slots contributing $26.7 billion (3.8 percent YoY increase) and Table Games reaching $7.6 billion (2.3 percent YoY increase).
The sports betting segment raked in $7.2 billion, marking a substantial 53 percent growth, while iGaming GGR rose to $4.49 billion after a 23.8 percent spike.
Record-breaking year
The American Gaming Association (AGA) reports that legal gambling segments generated $16.26 billion in revenue in Q3 2023, contributing to a total GGR of $48.78 billion for the nine-month period. On track to surpass the annual GGR of FY2022, legal gambling operators in the US are poised for a third consecutive record-breaking year, projecting a quarterly revenue of well over $16 billion for Q4 2023.
Despite expectations of reduced gambling activity in Q4 2023, a minimum quarterly GGR of $12 billion could secure another annual revenue record. State and local governments have also reaped the benefits, with $3.42 billion generated in gaming taxes in Q3 2023.
Sports betting defies year-end slowdown
Traditionally, sports betting experiences a slowdown toward the end of the year globally. However, the US sports betting segment showcased an impressive 27.7 percent increase, accumulating $2.23 billion GGR in Q3 2023.
Maryland, Massachusetts, Nebraska, and Ohio legalizing sportsbook operations contributed significantly to this surge, with a total of $358.7 million generated from these new markets.
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