Virginia Becomes Fastest Sports Betting Market To Reach $1bn
Virginia has become the fastest new sports betting market to clear $1 billion in overall handle in May, beating Tennessee which made the record in April. The commonwealth made the national record in four months and 11 days since the state launched its online-only industry in January.
According to the latest numbers released Thursday by Virginia Lottery, the state saw $226.9 million in May handle, representing a 4% decline from April’s $236.4 million. Despite a dipping handle, Virginia sportsbooks saw a 38% increase in adjusted gross revenue month-over-month.
May continued the downward trend for the young market, which saw its first declining month in April when the monthly handle nosedived to 22% from March.
However, Virginia is not the only market to show a lack of sports betting action lately. It has been a general trend across legal sports betting jurisdictions, most of which reported slow sports betting activity since March Madness. The late spring slump is likely to continue in the coming months until the football season.
Seven operators of the commonwealth reported a combined AGR of $15.7 million for the month of May, compared to $11.4 million (AGR) in April. The hold rate was 10.2% for May.
According to the report, four of the operators saw positive AGR. The Old Dominion does not break down sports betting handle/revenue numbers by individual operator.
The state – with a 15% tax rate – raised $2.4 million from the industry, representing a 44% increase from $1.65 million generated in April.
Virginia sportsbooks can deduct bonuses and promotions dished out to customers from total revenue. In May, it amounted to $5.2 million, compared to $5.5 million handed out a month prior.
Eleventh State to Reach $1bn
Virginia became the 11th state in the post-PASPA era to top $1 billion in sports betting handle. The commonwealth also became the fastest state to reach new sports betting market to reach that milestone, outshining Tennessee, which could retain that record for just one month.
While Tennessee reached the $1 billion handle benchmark in its sixth month, Virginia did it at four months and 11 days of legal sports betting. Virginia sports betting went live on Jan. 21 and became the second after Tennessee to launch the online-only operation. However, unlike Tennessee, Virginia sports betting plans to build casinos with sportsbooks in 2022.
Virginia’s May handle also puts it sixth among states that have released their handles for the month. New Jersey still rules US sports betting with $814.2 million in handle in May. Nevada also showed some improvement with $477.2 million. However, things can drastically change when Illinois reports its May numbers, which could change the equation for most states except New Jersey.
Seven Operators Live, and counting…
As of now, there are seven sportsbook operators currently operating in the commonwealth – including FanDuel, DraftKings, BetMGM, BetRivers, William Hill (Caesars Entertainment), WynnBET, and Unibet Interactive.
The state’s regulators have also approved three more but Bally Bet, Golden Nugget, and Barstool have yet to launch.
In May, the Virginia Lottery opened up an application window for up to five new licenses, and received 18 new applications, according to a spokesperson.
Virginia Market to Expand Further
Earlier this year, lawmakers rectified an old mistake made in the original legislation of 2020, which had restricted Virginia sports betting to 12 mobile operators, including those tethered to five casinos.
The new legislation corrected the error that counts five casino licenses against a cap of 12 online licenses, pushing the total number of Virginia sportsbooks to 18. Any mobile sportsbook that will tether to one of the five casinos – in the future when they’re built – will be excluded from the 12 standalone licenses.
The new changes also include Olympics as a legal sports betting option for Virginians, besides authorizing the lottery more powers.