As the six-month anniversary of the landmark U.S. Supreme Court ruling on sports betting arrived on Wednesday, the casino, racetrack, and online sports betting operators in New Jersey had just submitted their monthly gross revenue numbers to state regulators.
The results, announced the following day, showed a collective nose dive in revenues from $24 million in September to just $11.7 million in October — in spite of a major 41.7% uptick in the amount of money wagered.
For Meadowlands Racetrack operator Jeff Gural, it was a jarring month.
“It’s just the opposite of horse racing, where you know your takeout number,” Gural, a prominent Manhattan real estate developer, told NJ Online Gambling. “That Giants Monday night game [against the 49ers a week ago], we got killed on that one. I find myself watching to the end of these games, and a lot of them did not go well. I really feel like a bookmaker now. Everything is just so volatile.”
“Did not go well” may be an understatement. The Meadowlands track’s gross brick-and-mortar sports betting revenue dipped from $4.4 mm in September to $1.1 mm in October.
Silver lining to big month for bettors?
Monmouth Park also took a big hit, dipping from $2.1 mm to $600,000 in a month’s time. But Dennis Drazin, whose company manages the track for the state’s thoroughbred horsemen, took the struggles more in stride.
“The bettors have had some big weeks, but that’s okay — it all evens out in the end,” Drazin said. “You want people to win sometimes because, look, it’s not like they just put it in the bank and never come back. They’ll play some more, and they’ll be welcomed.”
Drazin’s business partner, Joe Asher, runs the William Hill Sportsbook at that track as well as the book at Ocean Resort (formerly known as Revel). And with his company’s extensive experience in Nevada and in Europe, Asher has seen plenty of ups and downs on a monthly basis.
For instance, Asher referenced the November 4 NFL Sunday card — not included in these latest revenue figures — as “a bloodbath” in Las Vegas, Atlantic City, and William Hill’s Mississippi and West Virginia properties. He said there is only “a little bit of regional favoritism,” so a bad weekend cuts across all jurisdictions.
“That was a brutal day, but we’re not asking for anyone to feel sorry for us,” Asher said.
Past futures become present
A Borgata official, asked about the Atlantic City casino’s eye-popping drop from $2.4 mm in sports betting revenue in September to just $120,000 in October, referenced the fact that when “futures” bets are cashed out, they alter the monthly numbers. And indeed, the Boston Red Sox winning the World Series no doubt produced some happy customers late last month.
But Asher said the fluctuations mainly can be attributed to October’s game results being “just a bit customer-friendly.”
FanDuel’s online sports betting site, in partnership with the Meadowlands track, saw a modest decline in gross revenues from $2.9 mm to $2.4 mm. A spokesman called it “a great month” despite the dip, and there was certainly reason to be optimistic given the 66 percent increase in online handle across New Jersey in October.
Gural reiterated his stance that while sports betting can be a modest boost for his track operations, a $20 mm annual purse subsidy pending in the legislature is the more significant boost the track needs. He also lamented the power of the Giants and Jets to have a monopoly on parking at the Meadowlands Sports Complex for most of each Sunday, but added, “They’re trying to give their customers the break they can with traffic, and I can’t blame them. Saturdays here have been terrific, at least.”
Other ups and downs
Drazin said that staffing at Monmouth Park has proved a challenge when many bettors wait until the last minute before NFL games start to try to bet.
“On Sunday, I saw us doing the best we could at 12:30, I’m getting concerned at 12:50, but then most people got their bets down,” Drazin said. “Then at 1:15, no one is betting, so workers are standing around watching games.”
Drazin said the soon-to-come addition of self-betting kiosks will streamline the process. He added that a larger sportsbook on the premises — a $5-$10 mm project — should be open sometime in the next 12 months.
DraftKings Sportsbook Head of Digital Jamie Shea did not seem too distressed by a drop in revenues in October. Joint betting across Resorts Digital’s sites DraftKings and BetStars NJ produced $5.1 mm in revenue (at least 95% of it estimated to come from DK), a dip of more than $3 mm from September’s numbers.
“When a lot of the popular teams win, and parlays come into play, it’s a great time for a bettor,” Shea said. “We want fans to play more.”
DraftKings’ haul was still about double what rival FanDuel took in with its online platform. Being “first to market” online has paid off, clearly. “For us internally, that was a huge success, because we felt that being first was so important,” Shea added.
Broader reflections at the six-month mark
Looking back on the six-month anniversary of the Supreme Court ruling, Asher said that the big disappointment of this time period was a holdup in App Store approval of William Hill’s mobile sports betting offering. It delayed launch until late September, putting them at a significant disadvantage.
But on the positive side, Asher pointed to a deal reached with the New Jersey Devils to build out a sports betting lounge at the Prudential Center in Newark and an agreement with MSG Networks to feature the brand during Devils games.
“The important thing in these early days is to keep things in perspective,” Asher said. “These are the first steps in a marathon for a new business that will still be going long after we are all gone.”