The Wolverine State feels the effects of legal sports betting after a football weekend.
Michigan’s legal sports betting market has been drastically reduced, according to the Michigan Gaming Control Board.
Michigan sports betting revenue dropped to $357.1 million in February, down 27% from January’s record high of $490.8 million. Another factor lowering the state’s tax take was the sportsbooks’ gross revenue of $23.1 million, a decrease of 32% from the previous year before any deductions were made.
While Michigan’s sportsbooks saw less action last month, bettors in the state actually improved their luck. The February take from wagers was 6.4%, down from 6.8% the previous month. After reaching a high of 10.2% in December, the percentage of holdings has fallen for two months in a row.
The state of Michigan racked up a tax bill of $606,602, far below the $1.1 million that was owed in January. Since the sports betting lows of July, this is the first tax collection of less than $1 million.
Retail standing tall over online sportsbooks
The state’s massive pool of online sports betting sites was responsible for the February drop in handle, revenue, etc., while the state’s three retail casinos posted gains.
While retail handles decreased by 20%, online operators saw a 27.5% increase in revenue, tripling their earnings to $475,912. Tax revenue nearly doubled from $8,939 to $17,340.
Retail wagering action was led by Greektown Casino (Barstool) with $4.31 million, followed by MotorCity Casino (FanDuel) with $4.11 million and MGM Grand Detroit (BetMGM) with $3.71 million.
FanDuel, the largest online betting site, saw betting volume drop by 18% to $122.7 million. Next in line was DraftKings with $89.5 million (a 24 percent drop from the previous year), and BetMGM came in at number three with $62.6 million (a 44 percent drop from the previous year).
Of the 15 online sportsbooks, only two saw an increase in action in February compared to January. This includes all online operators with more than $2 million in handle.
The decrease in Michigan’s sports betting revenue in February reminds of the industry’s volatility, which various factors such as the outcome of sporting events and consumer preferences can influence. However, it’s worth noting that despite the decline, the state still generated significant revenue from sports betting.
Additionally, the report highlights the importance of the retail sports betting market, which includes basketball betting and is holding its own in the face of increasing competition from online operators. As the industry continues to evolve and mature, it will be interesting to see how these trends develop and their impact on consumers and industry stakeholders.