- New Jersey’s total March sports betting handle decreased 51.2% and its revenues decreased 58.4% from 2019.
- The nationwide shutdowns caused by COVID-19 severely impacted the bottom line for New Jersey sportsbooks, especially after a disappointing February.
- There is no reliable timeline for the safe return of sports, so sports betting operators will need to stretch their February and March revenues or find new revenue streams to pursue.
ATLANTIC CITY, N.J. – After posting disappointing totals in February, New Jersey’s sports betting revenue saw a year-over-year decrease of nearly $18.5 million from 2018 to 2019. The drastic decrease was powered largely by COVID-19 shutting down most major global sporting events.
New Jersey sportsbooks collected $13.2 million in sports betting revenue in March. This was only a $3.7 million decrease from February, but February was already an abnormally poor month. The hold rate, or the percentage of total bets a sportsbook captures as income, increased from 3.42% to 7.25%.
Year-over-year changes in March revenue are much more concerning than the raw totals. In 2020, March revenue decreased 58.4% from the $31.7 million posted in 2019. This is the first time New Jersey sportsbooks have ever posted a year-over-year decrease in revenue.
The total betting handle is even more alarming— a paltry $181.9 million, down 63.2% from February and 51.1% from March 2019. This represents the lowest monthly handle for New Jersey since August 2018, the first full month of sports betting in the state.
Financial Impact Of COVID-19
The widespread shutdown of sports in mid-March was a harbinger of the turmoil to come. COVID-19 has become the most devastating global pandemic since the 1918 influenza virus that infected 500 million people.
On March 11, the NBA became the first major sporting league to suspend operations in response to the virus, but college basketball and the NHL followed suit shortly after and within a week, the sports world was on hiatus. Atlantic City casinos and retail sportsbooks closed on March 16.
March legal sports betting in New Jersey essentially lasted only 11 days because of the shutdowns, meaning that the state was on pace for $512.6 million in handle and $37.1 million in revenue.
Both the human and economic costs of the virus are unprecedented in modern times, and the global economic downturn will likely be the worst since the Great Depression.
Sportsbooks are feeling this impact as well, as every brick-and-mortar casino in America has now closed its doors. Online sports betting continues, but with few events to bet on.
Unfortunately for sports betting operators around the country, including those in New Jersey, revenues from Super Bowl betting were very uneven this year. February will likely be the last full month of sports betting for a long time, so operators will need to find ways to stretch that revenue and make it last.
There is no firm timeline for when it will be safe to gather in large numbers again, but realistically it might not happen until a vaccine is rolled out, which could take anywhere from 12 to 24 months.
The only thing left to do for New Jersey sportsbooks is to hope that leagues quickly come up with a solution to resume their seasons without putting players, staff or fans at risk.
With a dual background in English and sports performance and business analytics, Carter aims to write stories that both engage and inform the reader. He prides himself on his ability to interweave empirical data and traditional narrative storytelling. When he isn’t keeping readers up to date on the latest sports betting legal news, he’s banging his head against a wall regretting his decision to be a Tampa Bay Buccaneers fan.