Sports betting has been legal in Arizona since the 9th of September 2021. Initially, just seven sportsbooks were operating online, with the likes of Barstool Sportsbook, Caesars, FanDuel, and WynnBet being amongst the first to launch their mobile betting apps.
However, since then, there have been an additional 11 sportsbooks that have launched their sports betting websites and mobile apps, with many also having retail locations in the state as well. And there could yet be more to launch in the near future.
But how has the industry looked since its launch? How much has been wagered, how much revenue have these sportsbooks made and what kind of tax revenue are state and local jurisdictions generating? Let’s look at what made the news.
Arizona Sports Betting Revenues
We have compiled a list of released figures covering the first five months of operation of both retail and online sports betting in Arizona. The table below will cover the Handle (the amount wagered over the month), Revenue (amount of money kept by sportsbooks from the Handle), Hold (the percentage of revenue sportsbooks kept from the Handle), and Taxes/State Revenue (the taxes that have been collected by state and local jurisdictions).
What The Figures Tell Us
As we can see from the Handle, there has been a steady increase over the first five months in the number of wagers being placed in Arizona. From its first month until January, the amount of the monthly wagers has increased by $272,481,723. This could be in part to marketing that has attracted new customers, as well as particular events taking place, which usually causes an increase in bets placed, such as the Super Bowl.
The revenue kept by sportsbooks also increased, although this did peak in November. Suggesting that they have been paying out a lot of winnings to new and existing customers. Although, it has averaged out at a Hold of 8.4% which was higher than three out of the five months.
It is understandable as well that sportsbooks would be paying out such high amounts, with offers like $1,000 risk-free bets being used to entice new customers. This supports the idea that customers are being encouraged to wager larger amounts than they normally would because of the security of not losing their stake.
And finally, tax revenues, another area that has seen increased growth over the months totaling $7,908,256. This will be exactly what state governors will have wanted from the legalization of sports betting.
What The Figures Don’t Tell Us
What these tables don’t show are two main things; the actual profit sportsbooks are making post-tax and the tax revenue increases of all the new jobs that the newly established sports betting industry in Arizona have created. This is important because we don’t actually know the costs of running these sportsbooks and therefore, despite the high numbers, some sportsbooks could actually make losses.
Then, with lower unemployment, more people will be employed and be able to contribute back to society by paying taxes via the Inland Revenue. Therefore, the amount of tax revenue generated will also be higher than the figures above, although not be included as a direct tax gained from the sportsbooks themselves. But with many people leaving tax filings until the very last moment to get them in, these figures may well not be truly known until some considerable time has passed.