New York mobile sports betting handle slips to year-low in May

| By Robert Fletcher
Consumers in New York spent $1.26bn (£1.01bn/€1.18bn) on mobile sports betting during May, the lowest monthly total since the state opened its regulated online wagering market in January of this year.
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The May figure was 9.4% lower than the $1.39bn wagered in April, which was incidentally the previous monthly-low of the state’s opening months of legal mobile betting.

However, gross gaming revenue from mobile sports betting in May reached $109.8m, which was 5.5% higher than $104.1m in April, but lower than both $114.3m in March and $124.1m in January.

Breaking down performance by individual operators, Flutter Entertainment-owned FanDuel Group remained the frontrunners in New York with $63.9m in revenue from $552.6m in wagers.

DraftKings ranked second with $21.5m in gross gaming revenue off a handle of $313.6m, then Caesars Sportsbook with revenue of $10.8m from $192.7m in total bets.

BetMGM was next, posting revenue of $7.9m and a monthly $123.0m sports betting handle, followed by PointsBet with $2.9m in revenue from a $33.8m handle.

Rush Street Interactive generated $1.8m of revenue from $31.3m in bets, while WynnBet posted $786,588 in revenue off $9.8m in wagers, and Resorts World $236,096 from a $6.7m handle.

The latest monthly figures come after BetMGM chief financial officer Gary Deutsch in May said the business would continue to adopt a “conservative” approach in New York until the state’s “irrational” tax environment changes.

During its latest investor day, BetMGM reiterated its net revenue guidance for 2022 of $1.3bn, up from $850m in 2021. Executives also said BetMGM’s earnings before interest, tax, depreciation and amortisation (EBITDA) for the year should be similar to 2021, when the business reported an EBITDA loss of $430m.

However, Deutsch noted that there was a change in the portions of this $1.3bn produced by different states.

“Within this guidance, the revenue mix is different than previously expected,” he said. “We expected lower New York revenue and higher revenue in our other online sports and igaming states.

“The specific problem in NY is that it has a high 51% [tax on] gaming revenue and that it applies that rate to ‘phantom’ revenue from promotional credits. That means that the real tax rate on net gaming revenue is well over 100%.

“We simply can’t apply our capital against an irrational investment thesis. Players cannot continue to play if the house always wins, and the house cannot continue to play if it will always lose.”

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