Pennsylvania Online Casinos Win $172 Million in August as Fall Upswing Starts Early Again

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The US online casino industry has just about reached the end of its summer slump, with nationwide gross iGaming revenue (GGR) from regulated markets totaling $523 million in August and likely to surge over the coming months. As it was last year, Pennsylvania has been the first state to reap the benefits of the fall upswing. Other states will wait until September or October, but Pennsylvania’s online casinos bounced back 9.5% to put up a $172 million month in August, the second-highest total on record.

Online casino seasonality isn’t quite as strong as that of online sportsbooks. However, it follows a similar pattern and is, in part, the result of diminished crossover by sports bettors during the NFL off-season. However, there’s the added component that people spend more time outdoors during the warm months, and more entertainment options are competing indirectly for their time and discretionary income.

Connecticut was the only other state to see significant growth in August, but it is bouncing back from an uncharacteristically poor performance in July. By contrast, the other four states with regulated online casinos saw almost no change in revenue from July to August.

All told, national industry revenue was up 3.3% in August, thanks primarily to those two states. That has increased the annual growth rate to 22.5%, nearly two percentage points better than Bonus projected for the month.

Early Fall in PA: Anomaly or Trend?

Pennsylvania's seasonal cycle seems to show an earlier fall recovery than other states.The US online gambling industry is still very young, which makes it challenging to separate patterns from randomness. The New Jersey and Delaware markets turned 10 years old this year, but no other state has had legal online casinos for more than four. Meanwhile, the effects of the COVID-19 pandemic and subsequent recovery mean that data from 2020 and 2021 doesn’t bear much resemblance to how a market would perform in more normal times.

So, for most states, we’re limited to comparing 2023 to 2022. In that regard, Pennsylvania online casinos have been remarkably consistent.

Last year, too, Pennsylvania was the first state to begin a strong recovery from the summer revenue slump. GGR for operators in the state jumped 6.9% from July to August 2022. Michigan’s gains over the same period were less than half as large and came against the backdrop of faster year-over-year increases for that young market. Meanwhile, New Jersey revenue actually continued to fall in August by 3.4%.

At the time, it seemed likely that this would prove to be an anomaly. Yet, the similarity of this year’s curve to last year’s suggests that it might be a unique property of the market. In 2023, as in 2022, Pennsylvania’s daily average GGR dropped sharply in July, the only month weak enough to erase annual growth and dip below the trailing 12-month average. Both times, it has then rebounded immediately in August.

The shape of New Jersey’s curve is similar, but with the drop and rebound coming one month later. Conversely, Michigan seems to have a broader but shallower summer slump, beginning in May or June and remaining relatively flat through September.

(To avoid cluttering, the graph does not show 2023 data for those latter states, but both have likewise been consistent with their 2022 trend.)

Why Does iGaming GGR Recover Sooner in PA?

Assuming this is a pattern and not a statistical fluke, it’s not apparent what causes Pennsylvanians to fire up their mobile casino apps earlier in the year than their peers in other states.

This year, we did see two new operators launch over the summer: Bally’s and Golden Nugget. However, their combined revenue for August was only $4.3 million. Removing them entirely would leave $168 million for the state, an 8.1% increase over July, which is still a sharper rebound than in 2022. So, the new operators may have exaggerated the underlying growth, but they didn’t produce it.

In 2022, the gains came mostly from table games, revenue for which rose 20.2%, while slots jumped increased only 3.8%. That suggests that it was an early return by sports bettors (known to prefer blackjack) even though sports betting revenue only recovered in September.

Conversely, in 2023, the gain for slots was 11.0% compared to just 5.4% for table games. Removing Bally’s and Golden Nugget, it was 9.1% for slots and 5.8% for table games. That change could imply a different reason for the early recovery this year, but it might also just mean that operators have gotten better at convincing their sports bettors to try slots.

One clue that we might be seeing a genuinely repeating trend is that it’s the same licenses leading it: Penn National (including market leader BetMGM), Parx, and Mohegan (Unibet) had the best performances in August 2022. They are again the ones to begin their recovery early in 2023, although this time, Valley Forge (FanDuel) has joined them.

August Change (2022)August Change (2023)
Penn National+12.1% (2nd)+9.5% (4th)
Parx+15.3% (1st)+21.9% (2nd)
Mohegan+10.3% (3rd)+24.7% (1st)
Valley Forge+2.1% (5th)+13.0% (3rd)
All Others+2.3%+5.5%

Online Gambling Revenue Highlights — August 2023

Michigan

  • Michigan online gambling sites won $152.2 million in August 2023, up 16.3% year-over-year. That is a continued slowdown from 24.3% in June and 21.3% in July.
  • The daily average revenue was $4.9 million, down 0.9% from July.
  • Michigan’s year-to-date total iGaming GGR is now $1.24 billion, 2.6% lower than the Bonus forecast, though still on track for about $1.9 billion by the end of the year.
  • Barstool Casino has taken a 37.7% nosedive in revenue since its owner, Penn National, announced it was parting ways with the brand. It will soon change its name to Hollywood Casino. A reduction in marketing efforts by the company while it prepares for the change might explain the drop.

New Jersey

  • New Jersey online gambling sites won $155.3 million in August 2023, up 18.1% year-over-year. Although not really pulling out of the summer slump quite yet, it is beating its performance during the same period in 2022, increasing the annual growth rate from 13.5% in July.
  • The daily average revenue has been virtually unchanged since June at just a hair over $5.0 million. The monthly growth rate has been less than one-tenth of a percent for the past two months. However, the Bonus forecast called for a slight drop in August, so even a flat month is 3.1% ahead of the projection.
  • New Jersey’s year-to-date total iGaming GGR is now $1.24 billion, still almost identical to Michigan’s and now within 1% of the Bonus forecast.
  • Caesars’ launch of its new standalone casino product seems to have caused a temporary setback, with revenue down 26% since July. Some technical difficulties came along with the switch from the old product to the new Caesars Palace, and we expect revenue to rebound when September numbers come in.

Connecticut

  • Connecticut online casinos won $31.2 million in August 2023. Things are picking up again in the Nutmeg State, as its 41.2% annual growth rate beat the 35.5% in July.
  • The daily average revenue is back over $1 million, up 10.6%.
  • Although not as thunderous as it was in the first half of the year, Connecticut is back to exceeding our projections, 5.2% ahead of the forecast for July.
  • Connecticut’s year-to-date total iGaming GGR is now $249.5 million, on track to beat the estimated full-year total of $370 million by 6.5%.
  • DraftKings is once again putting some marketing pressure on its rival, Mohegan. It added another half-million in promotional spending in August compared to July and received almost a half-percentage point more market share in return, now at 55.3% of GGR.

West Virginia

  • West Virginia online casinos won $11.6 million in August 2023, up 20.6% year-over-year. This is a huge slowdown for a market that had been annually doubling in size not too long ago. It’s now looking a bit more like the bigger and better-established states in terms of growth.
  • The daily average revenue was almost $373,606, a 1.4% increase from June. It’s still much worse than what Bonus forecast, 11.1% below the projection. That said, we were expecting a slowdown of this magnitude, just beginning slightly later in the year, so the Mountain State should find itself back on the projected trend as we get into the fall.
  • West Virginia’s year-to-date iGaming GGR is now $98.9 million, 6.9% below the forecast.
  • WynnBet’s hot start has come to a screeching halt. The newcomer’s GGR tumbled 46% in August while its market share dropped to 3%, similar to what it has in Michigan and what it’s trending toward in Pennsylvania.

Delaware

  • Delaware’s lottery monopoly generated $1.1 million in revenue from its three online casino brands in August 2023. That’s an annual increase of drop of 14.6%. No other state has ever experienced a negative annual growth rate, let alone one of that size.
  • The daily average revenue was $35,713, plunging 6.3% from July and 27.6% below the Bonus projection.
  • Delaware is now 14.1% behind the year-to-date Bonus projection. The lottery’s operator partner, 888, is presumably dialing back its efforts in the state now that it is official that its contract won’t be renewed. The new partner, Rush Street Interactive, will take over operations in the state by Nov. 1 at the latest.

US Online Gambling Revenue Summary Table

StateGGR - August 2023Monthly ChangeAnnual Change
Pennsylvania$171,941,388+9.5%+30.6%
New Jersey$155,274,526 +0.1%+18.1%
Michigan$152,244,046 -0.9%+16.3%
Connecticut$31,194,218 +10.6%+41.2%
West Virginia$11,581,791 +1.4%+20.6%
Delaware$1,107,133-6.3%-14.6%
US Total$523,343,102 +3.3%+20.3%

Notes on the Data

  • Raw data for this article comes from reports issued by the state regulators: the New Jersey Division of Gaming Enforcement, Pennsylvania Gaming Control Board, Michigan Gaming Control Board, West Virginia Lottery, Delaware Lottery, and the Connecticut Department of Consumer Protection.
  • 2023 online gambling revenue projections are original calculations performed by News Managing Editor Alex Weldon on behalf of Bonus. Please cite Bonus and Alex Weldon if reporting projected numbers or market performance compared to the projections.
  • Monthly growth figures are adjusted for the number of days in the month. That is, they represent the change in daily average revenue, not full-month gross revenue.
  • West Virginia reports revenue weekly, not monthly. Its monthly totals are an estimate, assuming that revenue for partial weeks is distributed evenly between the seven days.
  • Pennsylvania only reports adjusted revenue (gross revenue, less promotional spending). Bonus calculates gross slots revenue by subtracting payouts from coin in, but no such data is available for table games and poker. Therefore, actual gross revenue is probably somewhat higher than what we report.

Previous Monthly Trends

About the Author

Alex Weldon

Alex Weldon

Alex Weldon is an online gambling industry analyst with nearly ten years of experience. He currently serves as Casino News Managing Editor for Bonus.com, part of the Catena Media Network. Other gambling news sites he has contributed to include PlayUSA and Online Poker Report, and his writing has been cited in The Atlantic.
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