Tennessee Sportsbooks Stay Hot in December With $340 Million in Wagers
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Tennessee closes year with third-highest handle, an apt finale to 2021 that brought nearly $3 billion in wagers, according to PlayTenn analysts
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LAS VEGAS, Jan. 21, 2022 /PRNewswire/ -- Bettors poured more than $340 million in bets into Tennessee's sportsbooks in December, the third highest monthly handle in state history. The month was a fitting end to a year that brought nearly $3 billion in wagers and $240 million in revenue, establishing Tennessee as the ninth largest state in terms of betting volume in a rapidly expanding U.S. market, according to PlayTenn, which tracks the Tennessee gaming market.
"The playoff push from the Tennessee Titans and the momentum of the Memphis Grizzlies gave sportsbooks a nice boost to make up for a dwindling college football schedule," said Alec Cunningham, an analyst for PlayTenn.com. "Sportsbooks have pushed the envelope over the last four months, offering an avalanche of incentives and promos to help grow their customer bases. Those efforts have been a success, and should continue to help grow the market once football ends."
Tennessee's eight active sportsbooks accepted $341.8 million in wagers this December, up 88.9% from $180.9 million in December 2020, according to data released Friday by the Tennessee Education Lottery's Sports Wagering Advisory Council. December 2021 is part of a torrid four-month stretch for sportsbooks, which included a record $375.3 million in October and $365.7 million in November.
Bettors fared worse on December's bets than in November, when sportsbooks won a record $36.9 million. But gross revenue was still up 77.0% year over year, to $24.6 million from $13.9 million in December 2020. Promotions whittled adjusted revenue to $16.5 million, which yielded $3.3 million in tax revenue.
December marked the end to Tennessee's first full year of sports betting, concluding with an impressive four-month run that brought $110.4 million in gross revenue on $1.3 billion in wagers. For all of 2021, sportsbooks in the Volunteer State generated:
- $2.7 billion in online wagers, which will presumably place Tennessee ninth among legal sports betting jurisdictions in the U.S.
- $239.9 million in gross revenue
- $39.3 million in tax revenue
"Tennessee has overall performed well, especially considering it is still a very young market," said Eric Ramsey, an analyst for the PlayUSA.com Network, which includes PlayTenn.com. "Tennessee will continue to mature over the next year. It would not be a surprise to see it make up ground on more established markets like Colorado and Indiana, which have similar populations but drew significantly more in wagers in 2021."
Tennessee's cumulative hold percentage —the revenue sportsbooks keep as a function of handle — will presumably fall below 10%, though official data has not been made public. That means at least some operators will face a small fine for 2021 operations. The Tennessee Sports Wagering Advisory Council continues to review the rule, which is the only one of its kind in the U.S.
According to the TEL, operators who do not meet the capped payout rule for the year, or the part of the year they were in operation, could be assessed up to a $25,000 fine. But operators can alternatively pay the "true-up" to avoid the assessment of the fine.
"When operators combine for a hold rate that is one of the highest in the U.S., yet still fall short of the state's requirement, we begin to see how challenging a threshold this truly is to meet," Cunningham said. "In addition, the hold requirement appears to have slowed growth somewhat. It's not ideal, but the upside is that sportsbooks in Tennessee continue to be innovative in growing the market."
For operator data and more information on regulated sports betting in Tennessee, visit PlayTenn.com/revenue.
About the PlayUSA.com Network:
The PlayUSA.com Network and its state-focused branches is a leading source for news, analysis, and research related to the market for regulated online gaming in the U.S.
Contacts: Zack Hall, Catena Media, 775-338-0745, [email protected]
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