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In March, Virginia sportsbooks hit $300 million in wagers, making it the eighth and earliest state in the United States to do so. According to market analysts at PlayVirginia, March’s results were good enough to give Virginia its first positive month of adjusted gross revenue, a much-needed boost for the economy.
Virginia sportsbooks took in $304.1 million in bets in March, up 14.4 percent from $265.8 million in February wagers, in the Commonwealth’s second full month of regulated sports betting. Sportsbooks took in $9.8 million a day in March, up from $9.5 million in February, as the NCAA Tournament sparked interest amid a ban on betting on any of the five Virginia teams that qualified for the tournament.
Dustin Gouker, analyst for PlayVirginia.com noted: “We expected Virginia to do well when sports betting launched in January, but the market is surpassing expectation.
“With the Super Bowl and the NCAA Tournament soon after the market launched, timing has been key.
“And bettor enthusiasm has been strong. About the only way Virginia could have had a better start is if the state hadn’t barred betting on in-state college teams, which would have boosted interest in March Madness.”
Sportsbooks made $26.6 million in March, up from $12.2 million in February. Even with strong marketing around the NCAA Tournament swallowing up half of the state’s take, this resulted in the first month of positive adjusted gaming revenue with $13.8 million. AGR produced $1.2 million in state taxes, which included $29,587 for problem gambling assistance.
Virginia is the newest of the eight states to cross the $300 million mark, having raised $628.7 million in bets since launching in late January. Illinois first reached the $300 million mark in September, as the sportsbook was off to the fastest legal sports betting start, after launching retail betting in March 2020 and online betting in July.
Michigan saw an increase in total handle since introducing online betting in January, but it took 11 months for retail betting to hit $300 million for the first time in February.
Virginia also outperformed Colorado ($301 million in March) and surpassed Indiana ($316.7 million) to become the US’s seventh-largest market, behind only New Jersey, Nevada, probably Illinois, Pennsylvania, Michigan, and Indiana.
Healthy position for a young market
Analyst Jessica Welman added: “Virginia’s market is in such a healthy position for such a young market. Local bettors have responded enthusiastically, obviously, giving the state an unprecedented start. And with such a solid foundation in place, Virginia’s market should easily be able to withstand future challenges, including future competition from a neighbouring state like Maryland.”
The operators have taken care. Virginia now has seven online sportsbook operators, with WynnBet launching in March and Unibet launching in April, a fast ramp-up for a state with so little gaming experience.
However, as effective as Virginia’s launch has been, tax revenue is a problem. Sports betting has only raised $1.5 million for the state so far due to heavy marketing eating up gross proceeds. Sportsbooks also advertise aggressively during the NCAA Tournament and the Super Bowl to help expand their consumer base, and any market launch comes with considerable marketing on behalf of sportsbooks.
“Virginia isn’t the first state to see promotional credits sap tax revenue, and March’s results help alleviate some concerns,” Welman said. “The coming months will be slower for sportsbooks, but with books becoming more established in the state and with fewer major events to promote around, the state should get a greater percentage of the win. However, if tax revenue continues to disappoint, it could be a sign of a structural problem in Virginia’s regulatory framework.”