Betfred's state-by-state withdrawal from the U.S. mobile sports betting market appears set to continue with a scheduled Oct. 21 exit from Virginia.
On Betfred Sportsbook's Virginia landing page, Betfred said it had stopped accepting online deposits, online wagers or new registrations in the Old Dominion as of 10 p.m. EDT on Tuesday. It added that "all outstanding wagers will be settled based on a fair market value as an early cash out on October 21, 2024. Any stake and/or winning eligible will be credited to your account to be accessible for withdrawing."
Virginia is the fifth large-state market where Betfred has opted not to continue doing business. It has a Nov. 4 exit date for Arizona and already shuttered operations in Colorado, Ohio and Maryland during the 2024 calendar year. Betfred continues to offer mobile sports betting in Iowa and Pennsylvania, and has brick-and-mortar sportsbooks in Nevada, Louisiana and Washington State.
Struggle to Gain Market Share Without Promo Spend
The exit from Virginia looks to follow the same pattern that led to Betfred closing shop in Arizona — a small market share of the mobile sports betting handle that resulted in a challenge to get ahead of its promotional spend in terms of net revenue.
The UK-based sportsbook had $3.8 million handle through the first seven months of 2024, accounting for barely more than 0.1% of the $3.29 billion in online bets accepted across the state. Its year-to-date handle was down 45.8% compared to 2023, when it was allowed to deduct promotional spend against its gross revenue.
Betfred reported $660,300 in allowable promotional deductions in 2023 — 5.2% of its $12.7 million handle — but it finished with negative adjusted gross revenue in nine of 12 months last year. Betfred's overall negative AGR reached as low as minus-$372,824 after December's operator revenue figures were obtained via a FOIA request to the Virginia Lottery.
It was no longer eligible to count promotional deductions as of February, which meant all of Betfred's gross revenue after the federal excise tax and voided wagers were deducted went towards zeroing its balance. While it had a 7.3% hold in 2024 to generate $275,400 in gross winnings this year, its total AGR entering August was still minus-$106,796.
Betfred paid monthly taxes from sports wagering to the state only once — a $154 remittance in January 2023, when it finished the month with $1,024 in AGR.
Marketplace Contraction Continues
Betfred will be the fifth mobile sportsbook to leave Virginia in the calendar year, an exodus that started with Unibet in March and followed by Sports Illustrated Sportsbook, Betway and the SuperBook this summer.
Betway parent company Super Group shut down its sports betting arm in July to focus on internet casino gaming in Pennsylvania and New Jersey, while the SuperBook shuttered all its mobile operations outside Nevada in late July.
Despite this fluid marketplace, Virginia is one of eight states to surpass $4 billion sports betting handle in the calendar year after reporting $416.7 million worth of accepted wagers in August.
