Kentucky sports betting handle tops $2.39bn in first year
Kentucky launched legal retail sports betting on 7 September 2023, with online wagering going live three weeks later. State regulator, the Kentucky Horse Racing Commission, has now published figures for the 12 months to the end of August.
Players in Kentucky favoured online betting, with total spend over the internet at $2.3bn in year one. In contrast, retail sportsbook attracted $87.1m in wagers during the 12-month period.
Revenue-wise, online betting generated $264.3m and retail wagering $7.8m. Figures related to adjusted gross revenue, which is revenue after player winnings and federal excise tax.
On the subject of tax, Kentucky collected $37.7m from online sports wagering and $756,517 retail betting. As for hold, the state’s total in year one was 9.28%, with online at 11.5% and retail 8.91%.
FanDuel pips DraftKings in Kentucky
Looking to individual operators, Flutter Entertainment-owned FanDuel led the online market during the first year of regulation. FanDuel reported $105.9m in adjusted gross revenue off $817.0m in bets, leaving a 12.96% hold.
DraftKings placed just behind its long-term rival with $100.9m in revenue, despite a larger handle of $895.0m. This resulted in an 11.27% online hold for the year.
Other stand-out performers – albeit some way behind the leading pair – include BetMGM. In year one, BetMGM posted $18.9m in online revenue off a $143.6m handle, resulting in a 13.16% hold. Bet365 was next with $13.5m from $157.3m and an 8.58% hold, then ESPN Bet, formerly Penn Sports Interactive, on $10.6m off $104.3m, resulting in a 10.16% hold.
Caesars also had a solid first year with $9m in revenue from a $117.5m handle, leaving a 7.66% hold. Fanatics rounded off the major brands with $3.7m off $51.6m for a 7.13% hold.
As for retail betting, Churchill Downs and partner Kambi led with $2.5m off $35.1m, putting hold at 7.06%. Turfway Park, also partnered with Kambi, placed second on $920,878 from $14.7m, leaving a 6.25% hold.
Revenue dips despite handle rise in August
As for the final month of the 12-month period, total spend in August was $151.4m. This is up 17.1% from the previous month. Online wagers topped $147m and retail bets $4.4m.
However, adjusted gross revenue in August hit $11.8m, down 21.9% from $15.1m in July. Of this, $11.5m came from online betting and $265,547 retail wagering.
Overall monthly hold for Kentucky was 7.79%, with online at 7.82% and retail 6.07%.
DraftKings led the online market with $4.9m in revenue off $56.7m in handle. FanDuel placed second on $3.8m from $45.2m, then BetMGM at $889,558 off $8.8m. Red Mile and partner Caesars were the retail leaders with revenue of $68,281 from $1.3m in bets.
How does Kentucky compare to other states in year one?
Kentucky is the latest state to complete a 12-month period of legal sports betting, with its year running from early last September to the end of this August.
Of all US states, Kentucky ranks around the middle in terms of total population, with 2023 estimates of around 4.5 million citizens. Comparing Kentucky with other, similar-sized states and how they performed in year on, the Bluegrass State fared well.
Louisiana, which has a similar population, generated around $188.3m in year one, behind the $272m in Kentucky. Year one in Louisiana ran from November 2021 to October 2022.
Elsewhere, Oregon, which has a slightly smaller population than Kentucky opened its legal market in October 2019. In its first year revenue reached just $2.9m off a $45.3m handle.
Finally, Colorado, which is home to around three-quarters of a million people more than Kentucky, was quite similar in terms of handle during its first year. For the 12 months to the end of April 2021, revenue reached $66m, some way lower than Kentucky, although handle was close at $2.34m.