FanDuel has grown its revenue and market share from sports betting in New York to more than 61% in just four months and has done so at the expense of its rivals, especially Caesars Sports, which has seen its fortunes trend in the opposite direction.
Revenue from mobile and online sports betting totaled $104.1 million in April, according to data from the New York State Gaming Commission (NYSGC). That represents a nearly 9% decline from March and a 16% drop from January, the market’s opening month.
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For the second consecutive month, FanDuel Sportsbook NY led in terms of revenue and market share at $63.6 million and 61.1% — both records in the Empire State. Revenue was up 9% month-to-month.
DraftKings Sports NY and Caesars held their positions as the market’s second- and third-largest operators in terms of revenue and market share, but both continued to yield ground to FanDuel. DraftKings posted $19.6 million in revenue, down 14.2% from March ($22.9 million), while Caesars grossed $11.8 million, a 45.4% decline month-over-month ($21.6 million).
Caesars’ collapse was noteworthy. Its revenue was down 80% from January.
Despite BetMGM’s lucrative partnership with Madison Square Garden, the brand doesn’t appear to be gaining traction with New York bettors. The golden lion has been stuck in a distant fourth place for every month the market has been live. It had just under $5 million in revenue in April, down 1.8% from March ($5.1 million).
BetRivers ($1.8 million), PointsBet ($1.5 million), WynnBET ($519k), and Resorts World Bet ($336k) rounded out the group. Combined, the four smallest operators represented less than 4% of April revenue.
NY Sports Betting Handle Down, But Not In Slump
Handle was under $1.4 million in April, down 15.3% from March. Although it was the lowest month for handle to date, that is likely due to the lull in action that follows the Super Bowl and March Madness but precedes betting on the NBA and NHL playoffs. The drop is not indicative of a market slump.
FanDuel led in handle with $599.5 million in bets, or 43.2% of the total. DraftKings was second with $327.1 million (23.6%), followed by Caesars at $212.8 million (15.3%), and BetMGM with $142.2 million (10.2%).
BetMGM, Caesars, and DraftKings each had a lower percentage of handle in April compared to March, but the declines were slight. None lost more than 2% month-to-month.
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Operators Chafe Under 51% Tax Rate
Three of the top four operators mentioned New York in their most recent earnings calls.
On May 4, FanDuel parent Flutter Entertainment plc said its launch in the Empire State was “exceeding expectations.” CEO Peter Jackson added that FanDuel “continued to deliver unparalleled scale” while beating several of its sports betting records.
Two days later, DraftKings blamed its negative gross margin in Q1 2022 in part on New York’s 51% tax rate. BetMGM did the same on May 12, with CFO Gary Deutsch saying the operator would pull back on trying to attract customers in the Empire State.
“We have hope that the New York tax environment will be updated, and we can then again more aggressively pursue New York players,” Deutsch said. “However, as rational allocators of capital, we simply can’t apply our capital against an irrational investment thesis. Players would never continue to play if the house always won, and the house cannot continue to play if it’s always going to lose.”
