Sports Betting, Commercial Gaming Revenues Set Quarterly Records To Start 2023

Stop if you’ve heard this before: Sports betting is taking off in the American market.

According to the American Gaming Association (AGA)’s Commercial Gaming Revenue Tracker, the first quarter of 2023 resulted in a three-month record revenue total of $2.79 billion. That’s a 70.1% increase year-to-year and a slight improvement over the previous quarterly record of $2.61 billion from Q4 2022. 

The sportsbooks’ huge wins were a byproduct of a new record betting handle of $31.1 billion, a 15.1% increase. And there is no reason to believe that they will slow down any time soon.

Part of the growth of legal sports betting in early 2023 (and also in 2022) was its expanded jurisdiction. Ohio and Massachusetts both launched their markets in 2023 (Ohio on January 1 and Massachusetts on March 10), and Kansas is still growing into its market, formed later in 2022. 

Ohio has been the biggest hit of those three so far, coming up with $387.3 million in revenue during the first quarter. A major part of that was the Cincinnati Bengals’ success in reaching the AFC Championship Game against the Kansas City Chiefs, who ultimately went on to win the Super Bowl. It now only trails the more densely-populated New York in as far as revenue and betting handle goes. 

Another big help was the yearly period of “March Madness,” an annual college basketball tournament the AGA estimated would draw over $15 billion in wagers nationwide. 

Above all, the resounding success of sports betting can be attributed to a changing climate in the entertainment world. Sports betting, which was illegal everywhere outside of Nevada as recently as 2018, is quickly becoming an integral part of sports patronage. Television broadcasts of games regularly feature live odds from sponsored sportsbooks, betting apps are highly commercialized, and teams are partnering with betting operators.

Earlier this year, Fanatics struck a deal with the Washington Commanders to build the NFL’s first in-stadium sportsbook for game-attending fans. That’s despite growing concerns over regulations for athletes, whether it be Iowa and Iowa State’s investigations into gambling bylaw breaches or the NFL suspending a group of players for placing bets.

Sports betting is only a small part of the overall gaming scene that has also been on the rise. The AGA reported that all in all, commercial gaming—which includes iGaming, casinos, sports betting, and in-person betting shops—resulted in $16.6 billion in 2023 first-quarter revenue. That's the eighth quarter in a row that revenue has increased.

A major part of the unimpeachable performance was the special month of March, which produced $5.9 billion in revenue. That’s the all-time high mark for commercial gaming revenue in a single month. 

“After two full years of successive growth post-COVID, the U.S. gaming industry has never been stronger,” said AGA President and CEO Bill Miller. “With record growth across every gaming vertical — from brick-and-mortar casinos to mobile gaming — American adults continue to choose gaming as one of their top entertainment options.”

Those American adults are also showing no interest in backing off of gaming. 37 states plus Washington D.C. have already legalized sports betting, while casinos are popping all over the country. Bally’s is leading the build of Chicago’s first-ever casino, while New York Mets owner Steve Cohen is interested in  erecting a new facility on top of the team’s overflow parking .

The unenviable “dead season” in sports is fast-approaching as the NBA and NHL wrap up their postseasons, leaving the MLB as the only major American sports league still in action. But at this rate, the gaming industry will still find a way to continue its two-year streak of growth every quarter.