New York Reports Record Setting Online Sports Betting Returns in 2023

As if anyone expected any different, New York had another dominant year of legal online sports betting. 

The New York State Gaming Commission revealed in its final report for 2023 that the state generated more than $1.69 billion in gross gaming revenue (GGR) from more than $19 billion in sports bets which resulted in $861 million in tax funding for the state.

New York instantly became the national leader in sports betting when it launched its online market on Jan. 8, 2022. If 2023’s results are any indication, it is only consolidating its spot as the out-and-out leader in wagering.

The Big Apple was set up to be an instant hit for gamblers because of its population, infrastructure, and list of local sporting attractions. However, even those most bullish analysts would have been impressed if they were told the state would produce these kinds of numbers within two years. 

The $861 million in tax contributions was a $169 million (24.4%) year-to-year increase on the 2022 pool. It was also, unsurprisingly, the highest amount of combined taxes paid by sportsbook operators in any state.

December was also incredibly fruitful for New York sports betting as operators combined to accept more than $2 billion in wagers for the third straight month, resulting in $188.3 million in GGR and $96 million in taxes.

FanDuel led the state’s market with a $7.8 billion handle and $815.1 million in GGR. DraftKings, which briefly overtook FanDuel during the summer, finished with a $6.8 billion handle and $571.8 million in GGR.

In total, the two leading operators produced roughly 86% of the state’s online handle and 82% of its online GGR.

The two operators also combined to produce a handle exceeding $25 billion in the two years that New York online sportsbooks have been legal and operational. That’s more than all of the operators (Caesars, BetMGM, Betrivers, PointsBet, WynnBET, Resorts World, and Bally Bet) combined. 

Caesars and BetMGM, the second two of the “Big Four” operators, were the third and fourth-busiest New York sportsbooks. 

Notably, Fanatics Sportsbook was still counted for the yearly totals despite the company selling its North American assets to Fanatics earlier this year. There is an expectation that a license transfer will occur soon, and Fanatics, not PointsBet, will be counted in 2024.

One of the reasons New York has been able to collect so much tax revenue is because of the state’s high 51% tax on all online sports betting revenue. 

Leaders at both FanDuel and DraftKings testified early last year and implored lawmakers to lower the tax rate while threatening to shorten betting odds, meaning that it would be harder for customers to become profitable, if the 51% threshold was maintained. 

Despite their pleas, the rate did not change.

Another factor in the state’s overwhelming returns is the on-court and on-field success of local sports teams—and with the NFL playoffs getting underway this weekend, the state is due for another shot in the arm.

Although Aaron Rodgers and the New York Jets will be watching from home, as will the New York Giants, the Buffalo Bills enter the playoffs on the back of a five-game win streak. States often produce higher-than-expected betting totals when teams are still actively involved in the playoffs and especially when they are at home, which presents a huge opportunity for New York.

According to betting odds provided by FanDuel Sportsbook, the Bills are the third most likely team to win the Super Bowl LVIII trophy (+650). That trails only the San Francisco 49ers (+230) and Baltimore Ravens (+350).

The Bills’ first playoff game will be played at home against the Pittsburgh Steelers, who won their final three regular-season matchups. If they win, they’d be at home again, where they’d face the winner of the Miami Dolphins-Kansas City Chiefs showdown.

They’d have a chance to go on the road in the AFC Championship Game if they face the Ravens, but any other matchup would also take place in Buffalo.