In the first four weeks of New York mobile sports betting, Caesars Sportsbook captured a 35.4% market share of the $1.98 billion in total handle. FanDuel and DraftKings followed closely behind at 31.9% and 22.9%, respectively. The remaining three sportsbooks collectively held the remaining 9.8% market share.
Two of these sportsbooks, BetMGM and PointsBet, launched a few weeks after New York mobile sports betting went live. The third, BetRivers, launched alongside Caesars, FanDuel, and DraftKings on Jan. 8 but attracted a fraction of the handle that its competitors did over the full four weeks.
BetMGM is particularly well-positioned to grow its share of the New York market, and while BetRivers’ market share is low, its gross margin paints a more favorable picture.
New York Mobile Sports Betting Market Leaders
That DraftKings and FanDuel were among the top sportsbooks in New York is unsurprising. They’re two of the largest sportsbook companies in the United States.
But Caesars Sportsbook’s aggressive marketing seems to be paying off. It offered unprecedented welcome bonuses worth as much as $3,300 to new customers.
However bettors cut it, Caesars, FanDuel, and DraftKings were New York bettors’ favorites in the mobile sports betting market’s first four weeks.
New York Mobile Sports Betting Market Laggers
Two sportsbooks launched late in New York. BetMGM went live one week after New York’s mobile sports betting launch. PointsBet went live two weeks after the launch. But BetRivers was live from Day One and still struggled against the top three sportsbook brands.
Even after a late launch, BetMGM captured a 5.7% market share. That’s low compared to the top three operators but more than double the bottom two entrants. Of January’s laggards, BetMGM has the best chance to gain a greater share of New York’s mobile sports betting market.
PointsBet could move into a more competitive position, too. Its high-risk, high-reward PointsBetting product is a unique offering and could appeal to New York’s high rollers. But BetMGM still has a mainstream awareness PointsBet could struggle to overcome in New York.
At a glance, BetRivers seems to be the most concerning brand of the bottom three. It had the same four weeks of sports betting the top three operators did but struggled to capture market share. (Its market share is actually 0.04% smaller than PointsBet’s.)
But BetRivers had higher profit margins than BetMGM and FanDuel, improving the brand’s picture from the single snapshots presented in unfavorable graphs.
New York’s Mobile Sportsbooks By Win Percentage
Even though some sportsbooks attracted more handle, others kept (or won) a higher percentage of money wagered. This is where some of the smaller sportsbook brands outdid their larger counterparts during January. That’s an important advantage for operators because New York taxes gross revenue at a 51% tax rate. So, the higher a book’s gross margin, the better it’ll be able to withstand that large tax bill.
Caesars Sportsbook held the highest percentage of handle among New York operators, with a gross margin of 9.2%. After Caesars DraftKings and PointsBet had gross margins of 7.9% and 6.1%, respectively. DraftKings captured a much larger market share than PointsBet and kept more of the money bettors wagered.
Lower-Hold New York Sportsbooks
BetMGM had the lowest gross margin at 3.3%, but we’re looking at a small sample size in the early going. FanDuel has done slightly better with a 4.8% gross margin. Finally, BetRivers came out ahead of the bottom three with a 5.8% gross margin.
These seem like small variances, but they mean millions of dollars. Keeping an extra 0.5% of $100 million in betting handle means an extra $500,000 in gross gaming revenue.
But the biggest reason major brands forego revenue in the early weeks of sports betting is the same reason they are popular with bettors: Sportsbooks offer generous bonuses and promotions to new customers as they try to capture market share. So especially in new markets, sportsbooks are often content with lower revenue if they are acquiring customers.
That’s what happened to FanDuel. Over its first weekend in January, FanDuel lost $2.7 million. But over the next four weeks, it made $63.2 million. FanDuel attracted customers early through bonusin and won some money back.
BetRivers did a better job holding onto its money than FanDuel and BetMGM. BetRivers had only one week of negative gross revenue compared to FanDuel’s two. But BetRiver’s losses were smaller, so its gross margin was higher over the first four weeks. If BetRivers can maintain small edges in hold, that is one potential advantage it may have in New York’s highly competitive mobile sports betting market.
What’s Next For New York Mobile Sports Betting
There are still three sportsbooks largely unaccounted for in New York. WynnBET launched February 3, so its impact remains negligible in New York. It wrote just over $251,000 in handle and held over $33,000 of it. WynnBET still has to build its customer base in New York before drawing any serious conclusions about its performance and potential in that market.
BallyBet and Resort World Bet haven’t launched yet in New York yet.
Caesars Sportsbook, DraftKings, and FanDuel will likely remain the most popular sportsbook brands. Based on its performance in other markets and its marketing spend in New York, BetMGM has the best chance of improving its market position.
BetRivers may not improve its market share, but it could still carve a comfortable space out for itself in New York.
However, PointsBet and BetRivers are the most vulnerable to customer losses to the remaining sportsbook brands approved to launch in New York. The top three operators have large bases of customers that can afford to be chipped away at. PointsBet and BetRivers lack that luxury. So, WynnBET’s recent entry and BallyBet’s and Resort World Bet’s impending entries are most dangerous to PointsBet and BetRivers.
New York’s first four weeks of sports betting produced some clear winners and clear losers. But together, these sportsbook brands accepted more money in wagers than they had in multiple months in smaller markets. Even a small piece of New York’s mobile sports betting market is valuable, and each sportsbook would do well to hold onto their piece.
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