The summer legal sports betting slide within the US scene has apparently started early. The Super Bowl and March Madness hangovers are already adversely affected jurisdictions all over the country with the latest to report being one of the three big Heavyweights, Pennsylvania.
Pennsylvania is one of the last jurisdictions to report their summer slide and figures released show that the state’s skid isn’t quite as bad as the ones that we have seen so far. While most so far have reported between a 20%-25% drop in their monthly handles, Pennsylvania’s is nearly half of that.
April’s legal sports betting figures though, represent the lowest total the state has recorded since September’s $462.8 million and snaps a streak of four straight months in which Pennsylvania was able to post $500+ million sports betting handles.
Now for the Numbers
The legal sports betting handle for Pennsylvania was $479.4 million in April, a 14.4% decline from the $560.3 million that sportsbooks in the state took in during a busy March. March Madness provided a huge energy jolt to the Pennsylvania scene.
Revenues followed Pennsylvania’s handle trend but were also less drastic than we have seen in other jurisdictions around the US. There was a 10.4% drop from the $29.35 million that the state’s sportsbooks made in March to the $26.3 million reported in April.
Tax revenue generated for state programs remained healthy largely because of Pennsylvania’s high 36% tax rate but also showed a minor decline. $8.9 million still went to the state and $525,930 went to local coffers.
The hold percentage was the only metric that ticked up in April – from 7.3% in March to 7.5% last month.
Pennsylvania’s mobile betting platform continued its dominance over the state’s overall sports betting handle in April, unsurprisingly. Betting apps were responsible for $439.1 million, or 91.6% of all the bets that came into Pennsylvania last month.
Reasons for the Slide
To most that follow the US legal sports betting industry, a summer months’ skid isn’t unexpected. Generally, with no football, college basketball and with the winding down of the NBA and NHL seasons comes a short betting menu, mostly made up of Major League Baseball.
Things could be a tad different this year, however. The betting menu will be unusually large this summer compared to other years mostly because of COVID related delays of North American leagues and major global sporting events that were supposed to take place last year.
Compared to Last Year
The state of Pennsylvania saw an enormous year-over-year spike mostly because of the COVID nightmare that saw casinos shuttered at this time last year, along with the pause of global sporting events and the overall disruption to everyday life.
Pennsylvania’s sports betting handle came in 941.8% higher – from $46 million in April 2020 to $479.4 million in April 2021 while revenues spiked from just $2.9 million in April 2020 to $26.3 million last month. That is a 812% rise.
Obviously, April tax contributions were 10 times that of a year ago at this time.
Looking Forward
Pennsylvania, like the rest of the legal sports betting scene in the US will likely have to wait until late summer/fall before they approach record handles again. The NFL is that big a draw.
Dustin Gouker, analyst for PlayPennsylvania.com, said: “Sports betting is following normal seasonal patterns seen in almost every legal jurisdiction, so it might be until September that the state’s sportsbooks begin to challenge the state record books again.”
Hopes are that the Olympic games, if they indeed take place and Euro 2020 will at least soften the blow of the typical summer betting slump. Perhaps the late end to the NBA and NHL seasons will also help carry sportsbooks through what are typically lean few summer months.
What About Retail?
There is the retail betting industry in Pennsylvania that is slowly emerging from their COVID slumber. Valerie Cross, analyst for PlayPennsylvania.com, commented: “Retail betting, whether casino games or sports betting, continues to inch toward normal, while the gains in online revenues made over the last year continue to hold. That has created an overall gaming market that easily surpasses pre-pandemic level, even if retail betting is not quite where it was.”
So, while a slump in almost unavoidable for Pennsylvania, their mobile platform, their retail awakening and the fact that every big name in the legal sports betting industry are battling it out for market share in Pennsylvania should keep the state in the top-3 on the list of most successful legal sports betting states.
Pennsylvania has bee strong and reliable so far – no reason to think any differently right now.
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