Internet Casino Revenue Hits $912 Million For August

The seven states that offer online casino play combined to generate $912.7 million in gross operator revenue for August.

All seven reported year-over-year revenue growth of 25% or better, with Michigan, New Jersey, West Virginia, and Delaware reporting monthly all-time highs. Combined gross revenue was up 31.5% compared to the $694 million reported in August 2024. Pennsylvania, which led the group in gross revenue at close to $289 million, had its second-best month.

Adjusted gross revenue (AGR) totaled $828.4 million, a 31.9% increase from a year ago. Monthly year-over-year increases in AGR have been slightly outpacing gross revenue because Michigan, now in its fifth year of offering iGaming, reduced its promotional deduction percentage on all but one internet platform from 10% to 6% at the start of the year.

State taxes, which do not include local taxes in Pennsylvania as well as tax revenue to the city of Detroit and tribal disbursements in Michigan, was $189.5 million for the month. That was up $55.8 million from 12 months prior.

Big 3 keep getting bigger

The strong August numbers led into a crucial month of trying to further revenue growth for internet casino operators. September is a time where cross-promotion for online casino gaming and mobile sports betting is more widespread given the vast increase of wagering available in the latter.

September marked the start of college and pro football, two of the biggest drivers of handle in sports betting. It is usually a time when mobile platforms will offer more promotional credits and bonuses as a means of attracting new business and retaining existing customers.

Online casino revenue in September 2024 totaled $700.1 million, a 29% year-over-year increase. A combined $1 billion monthly haul last month may be out of reach for the seven states, but it cannot be completely ruled out.

Pennsylvania, Michigan, and New Jersey continue to comprise the bulk of online casino revenue, and the trio accounted for $800.6 million of August’s operator winnings. The Garden State nipped Michigan by $1.1 million for the highest AGR among the three at $248.3 million. Promotional deductions for Pennsylvania platforms meant the Keystone State had $231.2 million in taxable winnings, a healthy 25.8% increase that lagged slightly behind its 30% rise in gross revenue.

Michigan’s and New Jersey’s changes in terms of taxation — New Jersey raised its online casino revenue tax rate to 19.75% in July to start its fiscal year — have made clear impacts on the bottom line.

Michigan concluded its fiscal year Tuesday and, after collecting $51.6 million in receipts for August, the $511.4 million in taxes raised through the first 11 months was $92.6 million ahead of last year’s pace. The first two months in New Jersey with the new tax rate has produced an inflow of $97.9 million into state coffers, an increase of $38.8 million.

Both states are also poised to join Pennsylvania in surpassing $2 billion in year-to-date gross operator revenue in September. The Keystone State’s $2.21 billion in the first eight months is 31.6% higher than last year. Michigan’s $1.99 billion in gross winnings are up 28.2%, and New Jersey’s $1.88 billion represents a 25.3% gain.

‘Other 4’ faring just fine

Connecticut continues to be the best de facto duopoly in all the land as FanDuel Casino and DraftKings combined for $58.6 million in gross winnings, an increase of 31.3%. The two put together a record monthly drop of $1.76 billion in the Nutmeg State, up 42.3% from last year. While the $11.3 million in promotional spend by the two digital leviathans was up 31%, it represented only 0.64% of total wagering compared to 0.7% the year before.

West Virginia set a new monthly standard for revenue at $37.4 million while drop surged 57.3% to $855.5 million. The Mountaineer State had cleared $30 million only twice previously, reaching $36.4 million in March and $34.3 million in May. The Greenbrier, home to the FanDuel and BetMGM platforms, set a state record for a casino tether with $17.7 million in winnings.

The two marketplaces with a lone operator conducting online casino — Delaware and Rhode Island — also had strong gains. BetRivers has maintained impressive growth in its second year in Delaware after reporting a 70.1% increase in gross revenue to a record $11.3 million in August. Bally’s haul of $4.8 million in Rhode Island was up 62% from a year ago, and the year-over-year comparisons from its March 2024 launch are stronger than that with both drop and revenue more than double for the comparable six months.