With legal sports betting continuing to grow in the United States, iGaming and parlay betting are swelling in accordance, with data showing the two forms of wagering are seeing significant increases.
Before analyzing the numbers, it's important to define a key word — hold percentage..
In the gaming world, hold percentage refers to the amount of money a casino or gaming entity takes in without paying back to the player. For example, if a player were to wager $15,000 at a casino and they came out with $14,000, the hold percentage for the casino would be 6.7%.
In sports betting terms, on a standard -110 / -110 split for a sports betting spread, the implied hold for the sportsbook is 4.55%.
So with that accounted for, let's look at the numbers.
iCasino Returning Significantly Higher for Gaming Companies
There are seven states in the United States that permit iCasino wagering, as opposed to 34 states that offer legal online sports betting.
Despite this, iCasino accounts for 39%, or $6 billion, of the total revenue produced by legal and reporting gaming operators in the United States thus far in 2024.
Per the American Gaming Association, iGaming Gross Gaming Revenue (GGR) was up 27.6% YoY in comparison to January through August of 2023.
The iGaming total GGR of $5.33 billion is approximately 64% of the total sports betting GGR in the same timeframe.
For operators, this is why the push to increase iCasino access across states has increased. The hold percentage on iGaming is greater than sports betting by a significant margin.
The reward for states with iCasino is increased revenue through taxation, but much like the questions of harmful impact have been raised regarding sports betting, they are even more significant for iCasino.
On Thursday, members from the Council on Compulsive Gambling of New Jersey testified regarding the negative impacts that have been seen regarding legal online gaming in the state.
According to Felicia Grondin, executive director of the council, 6% of adults in New Jersey can be classified as problem gamblers. New Jersey is a state that has iCasino gaming available.
Across the nation, Grondin noted that 1-3% of adults could be classified as problem gamblers.
Parlays Producing for Operators
Courtesy of New Jersey's state data, hold percentage on parlays in September was 24.2%. For everything else? 4.4%.
From a YTD perspective, parlays are generating a 19.7% hold for operators in New Jersey. For comparison, sports such as football, basketball and baseball, who are at 1.2%, 4.2% and 4.2%, respectively.
This is in line with how operators are currently viewing the sports betting market, with sportsbooks placing an emphasis on generating parlay and same-game parlay wagering.
With that type of hold discrepancy, that approach is inevitable.
FanDuel parent company CEO Peter Jackson defends his company's massive future US market projections by saying there will be increased spending from existing customers; that means he expects even more parlays and single game parlays being placed by FanDuel bettors
— Ryan Butler (@ButlerBets) October 8, 2024
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