Sports betting is off to a lukewarm start in Missouri, at least in raw financial terms.
Regulated operators handled $276 million in February, slipping 28% from January and down almost 50% from launch month last December. February is a short month, of course, but Missouri’s downturn is the sharpest among the top half of US markets and a firm reminder of its newness.
Taken together, the first three months of regulated operations in Missouri have produced underwhelming numbers from a shorter-than-expected growth spurt ahead of a spring betting season that will likely bring further slowdowns.
February sports betting data comes from a Missouri Gaming Commission report published Tuesday morning.
Seasonal slowdown shows up in Missouri
Numbers for the first three months of Missouri sports betting look like this (Handle | Revenue | Hold):
- December: $542M | $104M | 19.2%
- January: $383M | $53.3M | 13.9%
- February: $276M | $30.7 M | 11.1%
That comes out to $1.20 billion in total handle and $188 million in gross revenue – a hold north of 15%.
Revenue only looks good on paper, though, as it is artificially inflated by $170 million in free bets awarded to customers since launch. Taxes on net proceeds so far amount to just $1.87 million, representing barely 1% of total gross revenue with several operators still stuck in the red.
Promotional spend will drop to more sustainable levels over time, of course, and this sort of start is not necessarily atypical for a new market.
Operators in Ohio, for instance, recorded a net loss of more than $100 million for their launch month in January 2023, winning just $210 million against almost $320 million in promos. The key difference is Ohio still collected more than $20 million that month via a tax on gross revenue rather than allowing for the type of deductions that Missouri operators have at their disposal.
DraftKings flexes its lead in February
It’s a fair fight between DraftKings and FanDuel for the early lead and one that reflects the broader dynamics between the two industry leaders.
DraftKings maintains a slight lead in handle, so far accounting for 37% of Missouri sports betting volume through the first three months. FanDuel is right there at 36%, but its momentum is starting to diminish all across the map. And indeed, DraftKings’ share of local handle has increased with each Missouri report so far, growing to 38% in February to move five percentage points in front of FanDuel.
It’s the opposite story in the revenue column, where FanDuel leads with a 41%-36% advantage – albeit outspending DraftKings $71 million to $61 million in promos so far. FanDuel does continue to lead in national revenue share by a few percentage points too, though DraftKings has begun to close that gap in a number of key markets.
Nearly 99% of all sports betting in Missouri so far has been conducted online.
Parlays proving popular for Missouri bettors
Basketball takes over the sports betting spotlight this time of year, accounting for $110 million (40%) of Missouri’s handle and $5.88 million of its revenue (19%) in February. The vast majority of February revenue, $21.2 million, came from parlays.
Parlays now account for 37% of Missouri handle and a whopping 70% of local revenue thanks to margins of almost 30%.
The $11.7 million in reported football tickets for the month (4.2%) meanwhile provides a sense of the local interest in Super Bowl betting in the immediate run-up to the game, long after the elimination of the hometown Kansas City Chiefs. Revenue from football betting was just $326,000.
