The rollout of sports betting in Massachusetts has not been pretty at times. From uncertain licensing statuses to ambiguous and staggered launch dates, the entire process has felt like a never-ending slog. That feeling persists even now. Massachusetts sports betting is up and running, but not yet fully operational in the online gambling sector.
And yet, despite it all, The Codfish State continues to obliterate revenue projections.
Massachusetts has now released three monthly reports since on-site wagering went live at the end of January. Online sports betting followed suit a little while after, in the middle of March. And it is still in the process of waiting on finishing touches right now. Even so, these first three Massachusetts sports betting revenue reports leave little doubt that the state is on track to rake in millions—and maybe tens of millions—more than they initially expected this year.
Massachusetts Sports Betting Revenue Tops $10 Million in the Month of April
According to numbers obtained by WWLTV in Springfield, Massachusetts, the state cleared more than $10 million in tax revenue for the month of April. Here are the full details provided by Nick DeGray on WWLTV's official website:
"Sports betting in the month of April continued to be a popular choice in Massachusetts, with the state collecting more than $11.7 million in sports betting alone. n the month of April, $579,262,822.66 was wagered through current and future in-person and online sports bets. Retail licensees allowed for in-person sports wagering received $364,481.54 in taxable gaming revenue in April. The total gaming revenue across six online platforms was $58,548,295.26. The total taxes collected by the state in April for sports betting was $11,799,200.04."
This $11.8 million is on top of the $9.3 million Massachusetts generated in March and around $2 million generated during the month of February. Though February ended up paling in comparison to March and April, this was to be expected.
Sportsbooks in Massachusetts are not required to pay taxes on promotional "free bets." And since February was the first full month sports gambling was live, the promotional credits given out were especially large. The Massachusetts sports betting revenue immediately trickled up in March, when not as much bonus money was being tossed around.
State Officials Blown Away by Initial Sports Betting Revenue
Based on the above figures, The Bay State has churned over $23 million in additional tax revenue through the first three months in which they offered legal sports gambling. That's an average of nearly $8 million per month. And, well, state officials are thrilled by these returns so far.
“We had projections initially for $50 to $60 million for the year, so [$9.3 and $11.8 million] for one month, that’s impressive that is beyond projections,” Senator John C. Velis recently said, per Western Massachusetts News. “I will say it’s early. It’s the first [few months]. People are excited.”
Despite the rousing success, many in Massachusetts didn't really know what to expect from this year's sports betting launch. They worried the delays soured peoples' appetite. Launching just before the Super Bowl, without online betting, also led many to wonder whether this year's numbers would be deflated by a lack of betting on the NFL. While a couple of members from the House of Representatives and state Senate predicted that the market for Massachusetts sports betting would explode right out of the gate, they were in the minority.
However, it turns out the optimists were on the right side of projections. At this current rate, Massachusetts stands to collect more than $95 million in sports betting revenue during the first 12 months of operations. That's roughly double what Senator Velis said they were expecting.
And yet, there's reason to believe the sports betting revenue for Massachusetts in 2023 has an even higher ceiling than that.
Massachusetts Sports Betting Revenue Hasn't Come Close to Peaking Just Yet
More than anything, it seems that projections underestimated the impact of online sports betting in Massachusetts. Indeed, state officials understood there was a market for the service. Plenty of residents found ways to take their business elsewhere before gambling was legalized in The Codfish State. And it wasn't particularly hard to do so. For instance, many of the sites from our reviews of the best online sportsbooks allow just about anyone to create an account and begin placing wagers.
Regardless, whether it's because Massachusetts' off-shore betting market was more robust than the state realized or because residents are especially drawn to it now, the mobile wagering arena is presently crushing it. Most of the sports betting taxes collected by the state in April came from online operators' gross gaming revenues. That keeps in theme with a longstanding trend in the United States. Online betting has a monopoly on the sports gambling industry.
This might suggest that Massachusetts' revenue streams are approaching something like a normal. But they're not. For starters, a handful of online sportsbooks still need to launch in the state. In fact, the rollout process won't be officially wrapped up until the first quarter of 2024. Massachusetts still has plenty of other betting options to debut.
On top of that, at least one major online sportsbook reported a net loss in April. This happens when a gambling operator pays out more in winning bets than they accepted in total wagers. It is a common occurrence early on in the legal sports betting process. Gambling operators are still taking mass amounts of bets placed with promotional money. They typically start turning larger profits after the market has settled for a little while. Granted, months of net losses still happen, but they're much less frequent.
This should add up to more money in Massachusetts' pocket. We would expect May to beat out April's $11.7 million in total revenue. More than that, we'd also expect Massachusetts to generate more than $100 million in sports betting revenue for 2023 when all is said and done. Not bad when they were only expecting between $50 and $60 million, eh?
Take a look at this list of the top online sportsbooks so you can find one that works for all of your sports betting needs:
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