Despite what billionaire professional sports team owners say when they are peddling for tax handouts, hosting marquee sporting events like the Super Bowl is not an economic boon to anyone but them. Arizona’s latest sports betting numbers are further proof of that truth.
Legal sportsbooks in Arizona saw little if any boost from Super Bowl LVII taking place right in their backyard earlier this year. In fact, the NFL playoffs, which took place in other parts of the country, proved more lucrative.
Arizona sports betting under the microscope in February
February’s Arizona sports betting report has been anticipated for one reason; for the first time, the numbers would allow us to see what if any impact having the Super Bowl played within a state’s borders would have on legal sportsbooks.
The results met expectations exactly; there was almost no positive impact. First, a look at the raw numbers.
According to the Arizona Department of Gaming (ADG), the state’s physical and online sportsbooks took in more than $609.2 million in bets during the month. The ADG does not include information about how much of that money was bet on which events or sports.
Of that amount, sportsbooks won almost $34 million. That amounted to a hold percentage (the portion of the money bet that sportsbooks keep due to bettors losing their wagers) of around 5.5%. After taking their allowable deductions, the $33.9 million translated into $16.1 million in taxable revenue. Thus, Arizona took in about $1.6 million in taxes.
In terms of the amount of money that books took in, February 2023 now ranks fourth in Arizona history. At the same time, January was a better month for books.
Proximity to the Super Bowl didn’t deliver
In January, Arizona sportsbooks won $46.1 million from bettors. Thus, you could say the NFL playoffs were worth about 26.5% more than the Super Bowl for Arizona sportsbooks. That’s a simplistic reading of the situation, though.
To be thorough, bettors did put down more money in a shorter month (28 days versus 31 days) in February. In January, bettors wagered $591.2 million. That means Arizona sportsbooks simply had a much better month in January, holding 7.7%. As a result, so did the state. Sportsbooks paid $2.8 million in taxes in January.
However, the irrelevance of the Super Bowl here is the whole point. The sportsbooks didn’t do much different in February. They only claimed about 2.9% more promotional credit dollars against their taxable revenue in February than they did in January.
If proximity to the Super Bowl was a true boon for sports betting, it would be fair to expect more than a 3% increase in the amount of money wagered. Additionally, a sudden rush of bettors from all over should have translated into a better month for the books in terms of their hold percentage than 5.5%. As it stands, that is the third-worst hold percentage for books in a month in Arizona history.
Given the correlation between the small increase in promotional credits and dollars wagered, it’s possible to argue that bump in advertising, not the location of the Super Bowl, was behind the trivial spike in the amount of money that books took in. The books probably would have boosted their promotions regardless of where the actual game took place, too.
A narrower look at the action mere feet away from the game puts an even finer point on this assessment.
How things went at actual “ground zero”
There’s no better microcosm of this than the BetMGM physical sportsbook located just steps away from State Farm Stadium, the site of the Super Bowl this year. In January, bettors visited that book and wagered $1.3 million. February’s total at that book as far as dollars bet was just $1.2 million.
Furthermore, despite all that advertising at State Farm Stadium for BetMGM, the online sportsbook actually did more business in January. Additionally, both DraftKings’ and FanDuel’s online sportsbooks accounted for more of the online statewide total than BetMGM did in February.
If you consider the millions of dollars that Jeremy Duda of Axios Phoenix says Arizona and its cities paid out to host the game, $1.6 million in tax revenue is a paltry return. Of course, that isn’t the whole picture. However, if it’s any indication, the only people who made money off Super Bowl LVII were connected to the NFL.