In May 2024, North Carolina’s sports betting market experienced a significant decrease in handle and gross gaming revenue (GGR). With a total handle of $525.5 million, the state saw a 19% decline compared to April’s $648.9 million and a 20.3% drop from March’s $659.3 million. This decrease highlights a notable shift in the state’s sports betting activity during its second full month of legalized betting.
Total Handle Overview
May’s sports betting handle of $525.5 million marks a considerable reduction from previous months. In April, the state recorded $648.9 million in handle, while March saw $659.3 million. The 19% drop from April and the 20.3% decrease from March suggest a trend of diminishing betting activity. Factors contributing to this decline could include seasonal variations, shifts in consumer behavior, or increased competition from other states.
Gross Gaming Revenue
Gross gaming revenue for May stood at $63.1 million, representing a 40.1% decrease from April’s figures. This sharp decline in GGR indicates that while betting activity remains high, the profitability for operators has diminished. With $458.7 million paid out in winnings, the hold percentage for May was 12.3%. This percentage reflects the portion of bets retained by operators, showing a moderate rate of profitability despite the drop in overall GGR.
Tax Revenue and Market Details
Although North Carolina has not yet provided specific figures for tax revenue, the state imposes an 18% tax rate on the GGR of digital operators. This tax rate is crucial for understanding the potential revenue contributions to the state budget and the economic impact of the sports betting market.
Currently, North Carolina does not break down revenue reports by operator or sport, which limits detailed analysis of market performance. The initial launch phase in March saw eight platforms enter the market, including major players like FanDuel and DraftKings, as well as offerings from tribal casinos. This diverse market entry was expected to enhance competition and drive engagement.
Legislative Context
Sports betting in North Carolina became legal following Governor Roy Cooper’s signing of the relevant legislation on June 14, 2023. The new law allows for mobile betting on a wide range of events, including professional sports, college sports, Olympic events, esports, and horse racing. This comprehensive legalization aimed to attract a broad spectrum of bettors and generate significant revenue for the state.
Market Performance
The initial enthusiasm surrounding the launch of sports betting in North Carolina seems to be waning, as evidenced by the recent decline in handle and GGR. This pattern is not unusual in newly regulated markets, where early spikes in activity can give way to more stabilized, and sometimes lower, betting volumes.
Comparatively, North Carolina’s sports betting performance can be assessed against other states that have recently legalized similar activities. Observing trends in these states can provide insights into potential factors influencing North Carolina’s market dynamics.
Future Outlook and Policy Implications
The sports betting market in North Carolina may continue to experience fluctuations as it matures. Changes in consumer preferences, regulatory adjustments, and market competition will play significant roles in shaping future trends. Policymakers and operators will need to adapt to these changes to maintain a healthy and profitable market.
While North Carolina’s sports betting market saw a notable drop in handle and GGR in May 2024, the state remains a dynamic environment for sports betting. Ongoing analysis and adaptation will be essential for navigating the evolving landscape and optimizing the economic benefits of legalized sports betting.