Online gaming revenue saw a boost in February across major U.S. markets, with Michigan, New Jersey, and Pennsylvania reporting significant year-over-year increases. Let’s dive into the details of this upward trend.
Key Takeaways:
- iGaming revenue surpassed brick-and-mortar casino revenue in New Jersey
- Pennsylvania’s online gaming revenue grew by 12.3% year-over-year
- Michigan’s iGaming adjusted gross receipts increased by 23.6% compared to February 2024
February Boost for Online Gaming
The largest U.S. markets for online gaming experienced solid revenue gains in February, with Michigan, Pennsylvania, and New Jersey all reporting year-over-year gross revenue increases from online operators. In New Jersey, iGaming once again outperformed brick-and-mortar casino revenue.
Pennsylvania’s Online Gaming Acceleration
While live casino revenue dropped in Pennsylvania in February, online gaming accelerated. Combined gross gaming revenue between online and brick-and-mortar venues reached $477.3 million, a 4.4% decrease compared to the same month in 2024. However, online revenue grew 12.3% to $202.7 million, with operators contributing $91.8 million to state coffers.
The breakdown of online revenue in Pennsylvania was as follows:
- Online slots: $154.3 million (up 22.6%)
- Online table games: $50.9 million (down 10.1%)
- Online poker: $2.4 million (up 0.4%)
Sports betting in Pennsylvania saw a total handle of $756.9 million in February, a 14.4% increase from February 2024. However, sportsbook revenue experienced a significant 75.26% year-over-year decrease, likely due to local bettors wagering on the Philadelphia Eagles in the Super Bowl.
New Jersey’s iGaming Dominance
In New Jersey, the brick-and-mortar casino industry continued to struggle compared to its online counterparts. The state’s nine land-based casinos reported $203.5 million in February revenue, a 3.8% decrease from 2024. Meanwhile, iGaming brought in $207.8 million, a 14% increase from February 2024.
Online poker revenue in New Jersey totaled $2.4 million in February, a 2.6% increase. Sports betting produced February revenue of $73.6 million, up 8.9% from 2024. Total revenue from all forms of gaming reached $484.8 million in February, a 5.1% increase from 2024.
Michigan’s Online Gaming and Sports Betting Performance
Michigan reported $268.5 million in online gaming and sports betting revenue in February, an 18.9% decrease compared to January. Online casino revenue reached $222.5 million, while gross sports betting totaled $46 million.
Combined adjusted gross receipts (AGR) were $236.3 million, including $209.1 million from iGaming and $27.2 million from sports betting. Compared to February 2024, iGaming AGR increased by 23.6%, and sports betting AGR rose by $14.3 million.
The total sports betting handle in Michigan stood at $379.8 million, down 31.6% from January. Operators submitted $43.8 million in taxes and payments to the state, while tribal operators reported $4.7 million in payments to governing bodies in February.
Implications for the Online Gaming Industry
The February revenue boost across these major U.S. markets highlights the growing popularity of online gaming and sports betting. As more states legalize and regulate these activities, the industry is likely to continue its upward trajectory. However, the impact of major sporting events, such as the Super Bowl, on sports betting revenue demonstrates the volatility inherent in this sector.
For operators and investors, these trends underscore the importance of diversifying offerings across various online gaming verticals. The strong performance of iGaming, particularly in New Jersey and Michigan, suggests that this segment may offer more stable revenue streams compared to sports betting.
As the online gaming landscape evolves, regulators and policymakers will need to stay attuned to the shifting dynamics between online and brick-and-mortar gaming establishments. The continued growth of online gaming may necessitate adjustments to tax structures and regulatory frameworks to ensure a balanced and sustainable industry.
