Arizona Sports Betting Handle Tops $500 Million in April

The Arizona Department of Gaming released a report detailing their sports betting data from April. As expected, the handle was down from previous months that featured marquee sports betting events like the Super Bowl and March Madness, but the books still surpassed $500 million.

Some good news and some bad news

No industry wants to post numbers that show a 25.8% decrease from the previous month, but that is exactly what happened in Arizona for their April handle compared to March. Revenue dipped less, but was still down 21.5% from the amount they took in during the previous month that featured the flurry of March Madness betting. On the upside, $512.8 million is still a large handle, and the total made Arizona the sixth-best state in terms of overall betting action during the month.

Arizona’s relatively low 10% tax rate and allowance for online sports betting sites to deduct promotional offer expenditures from taxable revenue made the state’s tax haul a modest $1.6 million for the month. 11 of the state’s 18 sportsbooks were unable to generate enough revenue to be taxed, and four of them showed a net loss for the month. Online sports betting accounted for a whopping 99.3% of the state’s total handle, providing proof to the states lagging behind that many customers will not tolerate being forced to visit a retail sportsbook.

DraftKings leads in handle, while FanDuel generates the most revenue

DraftKings and FanDuel have been the top two operators in Arizona since their November 2021 launch. DraftKings edged out FanDuel in terms of handle in April, taking in $155.9 million compared to $149.8 million. FanDuel trounced their competitor in terms of revenue however, boasting a strong 11% hold while DraftKings managed to hold a slim 1.2%. The difference allowed FanDuel to pocket more than eight times as much profit as DraftKings in April. BetMGM was the only other operator to top $100 million in handle, getting over the mark by just $600,000.

Savvy sports bettors were not only a problem for DraftKings. Whether through skilled betting or just small sample size variance, many of the smaller operators posted a net loss. Desert Diamond reported a loss of more than $42,000 even after generating a handle north of $1.1 million. Bally Bet was Arizona’s smallest legal sports betting provider in terms of handle, and they were punished by bettors as they showed a $10,700 loss in spite of taking in less than $20,000 in handle.

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Plenty of room for growth in Arizona sports betting

Even with the decrease in handle compared to March, optimism is high for continued growth in the Arizona sports betting market. The state performs well on the national scale, and as the industry is less than a year old there is certainly additional growth to be had.

Most states, even ones larger than Arizona, allow for fewer operators than the 18 currently taking bets in Arizona. Between the large volume and the small revenue numbers and net losses posted by some of the smaller sportsbooks, there could be changes or consolidation coming. As the market matures all of these questions will be answered, but in the meantime it is clear that the overall industry is thriving.

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