April Sports Betting Slump Extends to Virginia

One of the newcomers in the US legal sports betting scene, Virginia is out with their April sports betting figures and like other jurisdictions that have reported before them, they reveal an expected late spring/summer slump. April's numbers represent the first step back for a market that just completed its third full month of legal sports betting services but still put it on track be the earliest state yet to hit the $1 billion lifetime sports betting handle mark.

"April is a reminder of the seasonality of sports betting, and Virginia is not immune," said Jessica Welman, analyst for the PlayUSA.com Network, which includes PlayVirginia.com. "In the U.S., there really isn't any way to replace the popularity of the NFL or the NCAA Tournament with bettors. The seasonal slowdown should last until football season, which will almost certainly return the market to significant growth."

Like other jurisdictions, the Virginia legal sports betting scene is forced to look toward September and the start of the NFL season before approaching record handles again. The state can’t even point to the post-COVID re-opening of casinos to keep it afloat – Virginia has no retail at present and that platform is still at least a year away.

The April Dive

The Virginia legal sports betting scene had been on an impressive path prior to the April downturn. The Virginia Lottery report released Friday revealed a $236.4 million handle, which is a healthy 22.2% drop from the record-$304.1 million handle in March. The per/day betting average over that span fell from $9.8 million in March to $7.9 million in April.

Revenues also declined in fairly drastic fashion. There was a month-to-month 26.8% drop in gross gaming revenues for Virginia sportsbook - from $26.6 million in March to $19.4 million in April. Adjusted gross revenue declines weren’t as stark. They fell 17.8% from $13.8 million in March to $11.4 million in April, thanks in part to a reasonable 8.22% hold.

State and local coffers benefitted to the tune of $1.7 million in taxes, which is an actual increase of 40% - from $1.18 million in March to $1.7 million in April.

Following the Leaders

A peek into the numbers posted by competing states hinted at the scale of the downturn expected in Virginia. It happens that the Virginia scene wasn’t on the high end or low end of the jurisdictional drops.

Virginia's 22.2% handle slide pales in comparison to the 30.5% handle dip in Michigan in April, the 26.7% drop in Iowa and the 25.4% decrease in Indiana's month-to-month sports betting handle.

The least affected states in terms of their April handle drop-off include New Jersey that saw 13% less betting activity over the 31-day period, Tennessee which experienced a 13.6% month-to-month drop, Pennsylvania which saw a 14.4% slide and Colorado where an 18.8% drop-off was reported.

A Look at May and Beyond

The Virginia legal sports betting scene is in its relative infancy but so far, sportsbooks have experienced better-than-expected results. When May's sports betting figures come in, they should easily take the state's lifetime handle to over $1 billion, making it the fastest jurisdiction to hit that milestone. Tennessee, the previous record holder took six months to reach that milestone.

The Virginia market finished April as the sixth-biggest legal sports betting market in the nation which is respectable to say the least. They could easily be bumped to seventh however when Illinois, which has come in fourth the last few months, reports.

Hopes are that the summer won't be as bad for the Virgnia legal sports scene as advertised. The late start and end to the NBA and NHL seasons could keep the state's industry afloat and the Olympics and Euro 2020 could provide a spark. The addition of Penn National’s Barstool Sportsbook is also good news for the market.

All of those factors prompted Jessica Welman to say that: "Virginia's market remains in an excellent position. In fact, Virginia stands should be able to avoid the worst of the typical summer swoon, which will really set the market up for a huge fall."