Online gambling other than sports betting hits $54 million in revenue

A Look Inside Pennsylvania Online Casino And Poker Revenue Growth For July

Pennsylvania online casinos had a solid month to kick off the state’s second year of iGaming.

July 15 marked one year of nearly uninterrupted growth for online gambling in the Keystone State. The reopening of the state’s land-based casinos resulted in its first-ever loss of online revenue in June. That has proven to be just a blip, however, as the upward trend resumed in July.

Three factors have been driving the rise in revenue:

  • Organic growth for individual operators as the market matures.
  • The entry of new operators to the market.
  • The COVID-19 economic shutdown pushing retail casino users into the online space.

Although the last of these is now reversing itself, the other two are going strong. All but one of the state’s existing PA online casino operators saw an increase in revenue in July. Meanwhile, Wind Creek Casino became the 12th to launch in the state on July 24. Although it only contributed one week’s worth of revenue to July’s numbers, it should make a bigger impact in August, as will PlayLive! which launched last week.

All told, online casinos and poker rooms brought in $54.3 million in July. Operators kept $30.6 million of that, while the state collected $23.7 million in combined state, county and local taxes.

Retail casinos produced about $218 million, sports wagering brought in a bit less than $14 million, and fantasy sports added less than $1 million. That makes for a grand total of about $289 million in gaming revenue from the private sector.

Data comes from the latest report published by the PA Gaming Control Board (PGCB).

PA online gambling highlights: July 2020

Here’s what those PA online gambling trends look like by the numbers:

  • Online revenue from slots, casino games, and poker totaled $54,352,149, an increase of $4,296,898 over June.
  • Rivers remains the top licensee with $15,549,938 in combined revenue from its two casinos, BetRivers and PlaySugarHouse.
  • Total taxes were $23,685,729, with slots contributing $21,300,706 of that.

Although revenue was up in July, it wasn’t quite enough to set a new monthly record. For now, May remains the best month in the state’s short history, with a total of $55,838,788.

With the addition of PlayLive! this month, the only license-holders who have yet to enter the market are the two qualified gaming entities, BetMGM and Golden Nugget. Additional operators can still launch on the existing licenses, but we shouldn’t expect much more market growth due to new entries.

Even if revenue merely stabilizes at the current level and doesn’t grow much further, however, the state is currently on pace for almost $650 million in gross revenue for its second year. By contrast, the total for the first year was just $240 million, most of that in the final three months. And, given what we’ve seen in NJ, we still expect growth.

It’s a competitive market with no single dominant force. However, the top four licensees together account for almost 80% of the total revenue.

Rivers holds a bit less than a 30% market share in terms of revenue. Penn National is its closest competition, with $10.8 million in July, or about 20%, which includes DraftKings as well as Penn’s own Hollywood Casino. Behind it are Valley Forge (FanDuel) and Mount Airy (PokerStars), in a virtual deadlock with $8.4 million and $8.3 million respectively.

Wind Creek’s first week was negligible, with just $25,409 in slots revenue and $9,005 from table games. It should do better in its first full month, but still looks likely to be more of a niche site like Unibet or BetAmerica than one of the state’s major players.

PA online gambling revenue breakdown

Revenue / ∆ Monthly / ∆ Yearly:

  • Total: $54.4 million / +9% / +6,491%
  • Slots: $39.4 million /+7% / +7,519%
  • Table games: $11.9 million / +19% / + 3,946%
  • Poker: $3.0 million / -8% / N/A

Although the rise in revenue was shared by almost all operators, it wasn’t so even across verticals. Slots, for the most part, held steady, with only Parx seeing a large increase in that revenue stream. Table game revenue did much better, up 19% for the market as a whole, with big increases for Penn National, Valley Forge and Caesars.

Online poker in PA saw the quickest and most dramatic spike in traffic when casinos shut down, but began coming back down equally quickly. In fact, poker revenue was already declining again in May, before Pennsylvania’s casinos began reopening. July was the third straight month of decline for PokerStars Mount Airy, but it now appears to be leveling off.

Now that Pennsylvania online gambling is into its second year, we can start looking at year-on-year changes as well. July’s numbers produce comically large annual growth in the thousands of percent, however. This is because the state’s launch date fell halfway through the month, there were only three sites ready to go live, and they had a limited selection of games at first.

Revenue more than doubled from July to August 2019, and continued to grow rapidly from there for several months. We’ll see annual growth figures drop to a more reasonable (and meaningful) level over the next few months. It will, however, be some time before it’s possible to separate organic growth from the impact of casino closures and the launch of new operators.

Detailed numbers by operator/product

Rivers Philadelphia$13,923,955$1,535,983$-$15,459,938$7,764,693
Penn National$8,321,348$2,431,156$-$10,752,504$4,882,513
Valley Forge$4,402,474$4,002,712$-$8,405,186$3,017,770
Mount Airy$3,175,326$2,093,762$2,986,498$8,255,585$2,527,518
Mohegan Sun$2,165,866$690,163$-$2,856,028$1,279,994
Presque Isle Downs$321,815$6,061$-$327,875$174,750
Wind Creek$25,409$9,005$-$34,414$15,162

PA online sports betting revenue

  • Total PA sports betting: $13.7 million
  • Online sports betting: $12.4 million
  • Retail sports betting: $1.3 million

Sports betting made a huge comeback in July, thanks to the return of many major league sports. Already in June, bettors had the option of wagering on UFC, NASCAR and the first few games of the MLB baseball season. In July, MLS and NBA got back underway as well. The first opportunities to bet on the NHL playoffs appeared too at PA online sportsbooks, though the games themselves didn’t start until the beginning of August.

As a result, handle nearly doubled, from $88.3 million to $164.8 million. Hold also improved, to 8.3%, such that revenue more than doubled, from $6.6 million to $13.7 million.

There’s still a long way to go in order to get back to where sports betting was before COVID-19. The Pennsylvania market’s peak was January, with $348 million in handle and $31.6 million in revenue. The NHL and NBA playoffs will help with that, and if the NFL season starts as scheduled in September, we may see monthly records being hit once more.

See more of July’s sports betting data at Legal Sports Report.

- Alex is a journalist from Dartmouth, Nova Scotia, Canada. Now site runner for Online Poker Report, he has been writing about poker and the online gambling industry in various capacities since 2014.
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