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The Michigan iGaming market is closing in on its two-month anniversary. Due to the timing with which revenue reports are released by the Michigan Gaming Control Board, however, we’ve only just received our first peek at what a full month looks like.
As it turns out, it looks pretty good.
The state’s 11 active operators collectively brought in nearly $80 million in gross gaming revenue, or a little over $75 million once adjusted for promotional payouts. That’s already on par with the Pennsylvania online casino market, which has enjoyed an 18 month head start.
Figures for this article come from the latest revenue report published by the MGCB.
The monthly total reported by the MGCB for January represents only 10 days worth of revenue, as the market only went live on Jan. 21. While a month-on-month comparison is therefore pointless, the daily average appears remarkably stable.
Michigan online casino operators averaged $2.85 million in gross revenue over the 28 days of February, or $2.69 million after promotional expenses. Those figures represent a small decrease from January’s numbers, by a margin of 3.0% and 2.5% respectively.
That’s probably no cause for concern. New online casinos tend to see a flurry of activity in their first few days, which then drops off before slower, long-term growth begins. The Pennsylvania market grew explosively in the early going, but that’s because the first operators launched with a limited array of products and added more over the course of those first few months. By contrast, Michigan was well prepared for launch day and has had a full range of operators and products since day one.
Other numbers to note from February’s report include:
Overall, the Michigan market tightened up in February relative to its first ten days.
The top three operators remain the same: BetMGM, FanDuel and DraftKings. All three saw a double-digit percentage drop in daily average revenue, however. Conversely, all of the smaller operators grew their revenue.
DraftKings took the biggest hit of the three. The pace it set in January put it on course for $17.4 million in February, but it pulled in just $13.7 million, a slowdown of 21%. That allowed FanDuel to edge it out for the second-place position in the market. That race should continue to be close, but BetMGM’s lead is so large that it looks unassailable at the moment. Its February iGaming revenue amounted to $26.9 million even after deducting promotions expenses.
There are a number of other interesting tidbits to be pulled from the data:
The story for Michigan sports betting wasn’t quite as happy. Overall handle declined to a slightly larger degree than iGaming revenue. A little over $300 million in bets were placed in Michigan in February, for a daily average of $10.8 million. That’s a drop of 6% from the pace established in the early days of the market.
More importantly in the short term, however, was the fact that most operators experienced a negative hold. It’s not entirely clear why, but perhaps Tom Brady fandom meant a disproportionate amount of Super Bowl money was on Tampa Bay, who won 31-9.
All told, Michigan sportsbooks came out a mere $9.5 million ahead in February, and three operators actually lost money even before deducting promotion expenses. After promotions, only two out of 12 came out in the black.
The race for market leadership in the sports vertical is much tighter than it is for online casinos. Looking at handle rather than revenue because of the anomalous month, FanDuel is the leader with $87 million in bets taken, but BetMGM, DraftKings and to a lesser extent Barstool are all in the running.
Read more about Michigan sports betting over at LegalSportsReport.
Here’s how February looked for each of the operators, ranked by market share. Dollar totals are given for the full month, but the percentage change is based on daily averages.
|Operator||Feb. Total||Jan. Total||Change (Daily Avg.)|
|TwinSpires||$1.1M||< $0.1 M||+598%|