New York sports betting is now America’s unchallenged leader in handle. When the National Football League returns this September, the most popular sport in the U.S. should be like a booster rocket to that sports betting market.
But how high can New York sports betting fly this fall?
A wagering spike should hit New York sportsbooks when the NFL season begins. That’s because the NFL is wildly popular, and it’s also because the summer months always result in a lull of wagering.
To make our projections in this article, we’ve poured through gaming reports from the New York State Gaming Commission and looked at trends in NFL betting in other states.
In July and August, sports betting handle goes down. Folks are doing other things, and of America’s team sports leagues, only MLB and the WNBA are in-season.
In September, when the NFL kicks off, bettors will pour money into their NY sports betting apps.
Last year, in the first NFL season with legal online sports betting in New York, the total handle from August to September jumped 44.0%, with a resulting increase of 43.9% in tax revenue sent to Albany. The total monthly handle soared to $1.2 billion, up from $872 million that August.
But sports betting numbers are up in 2023, compared to the first year that NY had online sportsbooks. Through June, total handle is up 6.7%, and that increase is even higher for the last two months. In May and June of 2023, sports betting handle is up 9%.
If we project a modest 8% increase in total handle for the rest of the year, we can forecast what we might see in August and September.
In August, we could see total handle in the $940 million range. Then, if we assign the 40% increase we saw last September to this year, we may expect nearly $1.32 billion in total handle when the NFL returns later this year.
But NFL betting increases as the season goes on. In December, New York reported $1.623 billion in total handle. Given 10% to 12% growth, we could see that figure drift upward to approximately $1.8 billion. The NFL Playoffs and road to the Super Bowl puts more money and wagers on the pile.
This means the first $2 billion month in U.S. history is very much in play. New York sports betting may be growing slower than New Jersey’s industry, but that doesn’t mean it’s stalled out.
If you’re going to have a legal sports betting market, you may as well ensure it’s profitable for the state, right? New York has passed that test with flying colors, and the colors are all a shade of green. As in, money to the state coffers.
In May, the state surpassed $1 billion in sports betting tax revenue, making it the first state to reach that figure from retail and online sports betting activity.
That’s occurred because New York taxes adjusted gross gaming revenue at a rate of 51% for online sports betting operators. That rate, the highest in the U.S., is reaping benefits for citizens of New York by funding education and other state works.
Last March, helped by March Madness, NY sportsbooks set a record by paying $83 million in taxes. Eight times since its market launched in Jan. 2022, the tax bill has been over $70 million.
With our projected New York sports betting total handle growth of a modest 8% the rest of 2023, we might eventually see the first month where the state takes in $100 million in tax revenue. That could also happen in January of 2024, when the NFL playoffs take place. If the sportsbooks were able to get their hold (rate of winning wagers) to the 9-9.5% range, it’s very possible.
Some sportsbooks have balked at the tax rate in New York. Some operators have slowed their promotional spend, meaning fewer NY sportsbook bonuses.
We could also see more mergers and acquisitions, too. In June, Fanatics purchased PointsBet’s U.S. operations, signaling a possible consolidation in the marketplace.