Analysts praised an exciting move in an area that has all the credentials to grow into a competitive market after the Arizona Senate passed HB 2772, paving the way for the state to enter the US burgeoning sports betting ecosystem.
Arizona will expand “into a particularly lucrative market for its fledgling sports betting industry,” according to PlayAZ, which claims it will generate more than $3 billion in annual wagers and $200 million in annual gross gaming revenue.
Governor Doug Ducey signed legislation legalising sports betting in Arizona, joining 26 other US jurisdictions and Washington, DC, that have controlled online sports betting in some way. Twenty-two of them have already gone live.
‘Particularly exciting development’
Eric Ramsey, analyst for the PlayUSA network said: “Arizona is particularly exciting development for legal sports betting in the US, with a collection of attributes that will likely help the market mature quickly.
“In fact, few other of the recently launched US markets have quite as many positive characteristics. Because of this, the future is quite bright in Arizona.”
According to PlayAZ estimates, Arizona sportsbooks could take in up to $3.3 billion in wagers each year when the industry matures, which could happen as early as the third year. Assuming a 7 percentage hold, this could result in gross gaming revenue of up to $225 million per year. The state estimates $12.3 million in annual tax revenue based on a 8 percentage tax rate.
Dustin Gouker, lead analyst at PlayUSA said: “There is no question that Arizona will be a fruitful market, but there are still a lot of moving parts that will need to be sorted before launch.
“Based on what is known now, though, the basic framework will be appealing for sportsbook operators.”
It’s also worth noting that among current markets, Indiana could be the closest match for Arizona. Despite major US sports being shut down for more than three months in 2020, the Hoosier State recorded $1.8 billion in bets and $138.4 million in gross operator revenue in 2020, despite having 500,000 fewer people.
Indiana sportsbooks have taken in $938.9 million in wagers in the first three months of 2021, including $316.7 million in March alone. Indiana sportsbooks generated $72.8 million in gross gaming income in the first quarter, raising $6.9 million in state taxes.