Arizona’s sports betting industry has continued to impress, with September showing robust growth. Sportsbooks in the state saw a dramatic increase in both revenue and handle, solidifying Arizona as one of the leading markets in the U.S. for legal sports betting.
Arizona Sportsbooks Post Significant Revenue Gains
In September 2024, Arizona’s sportsbooks generated $77.4 million in gross revenue, marking an impressive 30% year-over-year increase from September 2023. The state’s sports betting handle—how much money was wagered in total—surged by nearly 20% compared to the previous year, reaching a whopping $732 million. This surge in both revenue and handle underscores the growing popularity of legal sports betting in the state.
The data shows that sportsbooks held 10.4% of the total handle, which is a healthy margin in the competitive Arizona market. However, the take-home revenue for operators was notably affected by promotional spending, which significantly cut into their earnings.
Impact of Promotions on Sportsbook Revenue
A closer look at the numbers reveals that nearly half of the gross sportsbook revenue was eaten up by promotional expenses. Arizona sportsbooks spent $37.7 million on free play credits and other marketing promotions—accounting for 49% of their revenue in September. This marked a slight increase from the previous year, when promotional expenses represented 46% of revenue.
These promotions have become a key feature of the market, especially as operators compete to capture new customers in a state that boasts a rapidly growing sports betting landscape. While they attract bettors, these expenses have a substantial impact on the bottom line of operators.
- Promotions spending breakdown for September 2024:
- DraftKings: $13.4 million
- FanDuel: $10.7 million
- Bet365: $3.4 million (highest percentage of handle at 12%)
Despite these promotional costs, sportsbooks have found that customer acquisition and retention strategies are proving effective in the long run.
Market Share Shifts Among Arizona Sportsbooks
Arizona’s sports betting market is becoming increasingly competitive, with several large operators jockeying for position. As expected, five major sportsbooks—FanDuel, DraftKings, BetMGM, Caesars, and ESPN Bet—captured nearly 90% of the state’s total handle and revenue. However, there were notable shifts in market share this past month.
FanDuel, long the market leader, saw its share dip slightly, from 38% in 2023 to 35% in September. This loss in market share largely went to the newcomer ESPN Bet, which quickly gained traction with Arizona bettors. While FanDuel still led in revenue with $27.4 million, it’s clear that competition is heating up.
DraftKings, the second-largest operator in terms of handle, was able to maintain a steady share of the market at 34%. Even though it led the way in terms of total handle with $264 million, DraftKings’ revenue of $26.6 million trailed FanDuel’s take for the month, highlighting how promotional outlays are affecting profitability.
Other operators also saw notable changes. BetMGM lost some market share, now holding 25% of the state’s sports betting handle, while Caesars and Bet365 saw small declines. ESPN Bet, in its first full month of operation, finished strong with $1.8 million in revenue, carving out a spot for itself in the highly competitive Arizona market.
Arizona Sportsbooks Revenue Breakdown by Operator (September 2024)
| Operator | Handle ($M) | Revenue ($M) | Promotions ($M) | Market Share (%) |
|---|---|---|---|---|
| DraftKings | 264 | 26.6 | 13.4 | 34% |
| FanDuel | 232 | 27.4 | 10.7 | 35% |
| BetMGM | N/A | 9 | N/A | 25% |
| Caesars | N/A | 3.6 | N/A | N/A |
| Bet365 | N/A | 3.4 | 3.4 | N/A |
| ESPN Bet | N/A | 1.8 | N/A | N/A |
| BetRivers | N/A | 0.4 | N/A | N/A |
The data confirms that FanDuel and DraftKings are still dominant, but ESPN Bet’s entry into the market is shaking up the status quo. As sportsbooks spend millions on promotions to lure in customers, it’s clear that these marketing efforts will continue to play a crucial role in shaping Arizona’s sports betting landscape in the coming months.
