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With more than $300 million in bets in their first full month since opening, Michigan’s online sportsbooks stretched their record-breaking debut into February, becoming the sixth — and by far the earliest — state to do so.
This total comes as online casinos cross another significant milestone, with Michigan becoming just the third state to surpass $75 million in gross receipts. According to PlayMichigan, a leading outlet for news and study of the Michigan gaming industry, it all adds up to an online debut unlike any other in US history.
One of the largest US gaming markets
Matt Schoch, analyst for PlayMichigan.com said: “Michigan’s gaming industry travelled a winding road before January’s launch of online sportsbooks and casinos, but it is difficult to imagine how an online debut could have gone any better.
“It took less than 40 days to transform Michigan into one of the largest US gaming markets. Operators’ enthusiasm for the state before launch has proven prescient.”
February brought $301.9 million into Michigan’s online sportsbooks, up 162.1 percent from $115.2 million in bets made over the final ten days of January, but the per-day average fell to $10.8 million in February from $11.5 million in January.
The estimated gross sports betting earnings for February were $9.5 million, down from $13.3 million in January. After a combined loss of $5.2 million in January, taxable income dropped to a $10.8 million loss as a result of the Super Bowl, which is a traditional promotion-heavy affair. Despite this, the state received a $142,240 injection into its accounts.
Michigan’s hot start has pushed the state into territories historically only held by the country’s biggest sports betting markets. In February, Michigan sportsbooks brought in $325.6 million in bets, including $23.7 million from discount casinos. Indiana, which had $273.9 million in online and retail wagers in February, is now the nation’s No. 5 market.
Potential to be a Top 5 market
Jessica Welman, analyst for PlayMichigan.com said: “Michigan has long had the potential to be a Top 5 market, but its rapid ascent shows just how much pent-up demand was unleashed.
“As exciting as the early returns are, though, we’re still in a period where enthusiasm is in part a product of legal betting still being novel. That said, there is no reason to believe that the market’s growth will stop after enthusiasm normalises.”
With 12 operators, the fight for market share in Michigan is as fierce as it is everywhere else in the world. FanDuel, the nation’s biggest online sportsbook operator and a partner of MotorCity Casino in Michigan, led the market for the second month in a row with $87.2 million in online handle, up from $32.6 million in January.
In gross sports betting receipts, those bets ended in a loss of $78,889, down from a win of $622,372 in January. The BetMGM/MGM Grand Detroit handled $75.7 million, up from $22.8 million in January. However, BetMGM beat gross receipts with $5.3 million, up from $5.1 million, resulting in $2.4 million in taxable income, the highest in the state.
With a $72.9 million handle, up from $28.2 million in January, DraftKings/Bay Mills Indian Community came in second, but losing $161,496 in gross receipts.
Competitive Michigan market
Welman added: “The promotional spend by most operators sapped taxable revenue in the short-term but shows just how competitive the market in Michigan is right now.
The extended roster of online operators is perhaps the most distinguishing aspect of the Michigan market. Having so many quality operators has clearly paved the way for this early success, and fierce competition will continue to benefit bettors as the market matures.”
In February, online casinos and poker produced $79.7 million in revenue, up from $29.4 million in January. The results for February would likely place Michigan in the No. 2 or 3 market in the nation, behind only New Jersey ($103.8 million in January), but on par with Pennsylvania ($80.4 million in January).
In February, Michigan’s online casinos and poker rooms combined to win $2.8 million a day, down marginally from $2.9 million a day in January. The state collected $14 million in tax income from adjusted gross receipts of $75.2 million. With $26.9 million in gross receipts and $5.3 million in taxation, BetMGM/MGM Grand Detroit once again led the industry.
To place Michigan’s rise in context, it took New Jersey more than six years since its launch in November 2013 to hit $79 million in online casino sales in a single month, which happened in April 2020.
“The interest in online casino games in Michigan has been off the charts for a new market, but expect the growth to settle a bit in the coming months,” Schoch said. “Regardless, there has never been a more impressive debut.”