As gamblers, we’ve seen it all. Next to nothing surprises us about sports and about this business. That was true, up until this past week. The New Jersey sports betting report came out for the month of October and the numbers are absolutely incredible. They would be unbelievable, but they are right there in print for everybody to see. What remains unbelievable is that it took until May 2018 to overturn PASPA and open the United States up to legalized sports betting. The mantra has always been to regulate it and tax it. Had the states and legislatures known what the dollar figures were going to look like, it would have happened a long, long time ago.
Since the start of 2019, operators in New Jersey have taken $3,462,480,227 in sports betting handle. That is three commas, folks. That means $3.46 billion (with a b) in sports wagers. It sure seems safe to say that this has gone over very well in New Jersey.
In the month of October 2019, specifically, the monthly handle on sports betting was $487,924,504. That’s right. Almost $500 million was wagered in New Jersey during the month of October. And keep in mind that college basketball hadn’t even started yet, so November is likely to blow right by these October figures. The heart of the NFL and college football seasons plus the start of the NHL and the NBA clearly drove a lot of betting interest.
It is also very clear to see the value behind online sports betting in these jurisdictions that have started to take wagers. We’ve talked about it in other states like Indiana, Pennsylvania, West Virginia, and Iowa before, but the New Jersey numbers are simply mind-blowing. Of that nearly $488 million in handle, $416,964,519 of it was bet online. Only about $71 million of the total handle was bet in the retail sportsbooks. Well over 85% of the sports betting dollars put on the line in New Jersey came through the apps or the websites for the respective books.
New York City has certainly been a big help in the equation, as residents of the Big Apple simply need to get across the border into New Jersey so that the geolocation tracking can pick up their physical location and allow them to bet on sports legally. How the state of New York, which does have retail sportsbooks upstate, continues to allow that much money to leave the state to bet in New Jersey is certifiably insane, but it remains the case for now.
It is important to understand that “handle” means the total dollars bet. It is the sum of all of the sports bets, from the $5 parlays to the $10,000 straight bets.
The “revenue” is the amount won by the sportsbooks, which is then taxable according to the policies and provisions set out by the state. In terms of the revenue, New Jersey sportsbooks wound up with $46,393,537. That was a 297% increase from October 2018. Given the sports betting taxes outlined by the state of New Jersey, the state took in a grand total of $26,815,503 in taxes for October 2019.
Many know that FanDuel, who also operates the retail sportsbook, has licensing through Meadowlands Racetrack. PointsBet also has a license through Meadowlands. Meadowlands posted the highest revenue figure in October 2019 with nearly $24.8 million. Second was Resorts Digital, where DraftKings and Fox Bet have their licenses. DraftKings has been a major player in the New Jersey sports betting scene, but even Resorts Digital came in around $10.6 million, which is still a lot less than Meadowlands.
Hard Rock has a license with Unibet and Astros superfan and furniture maven “Mattress Mack” placed his $1.25 million bet on Houston to win the World Series there. That accounted for 69% of the month’s revenue for Hard Rock.
The “hold” percentage is essentially known as the “win” percentage for the house. At a standard -110 price, the hope would be for something in the 5% range for the house. New Jersey came in at 6.4% for the completed events in October. Keep in mind that the total handle will also include things like futures bets on teams to win the Super Bowl, NBA Championship, Stanley Cup, etc. Those get included in the handle, but those events are not completed, so they do not factor into the hold.
Not surprisingly, as 13.4% hold on parlay betting led the way. New Jersey held 6.3% in football, which is an excellent return. The hold percentage in basketball was 4.6% and then 3.9% in baseball. “Other”, including hockey, came in at 5.0%. The low hold in baseball included the payout of futures and just games in the MLB playoffs. We should see better hold percentages during the regular season when that fires up again in March.
To see the numbers for yourselves, check out the New Jersey Division of Gaming Enforcement official report here.
