The Tennessee Education Lottery (TEL) has released revenue reports for Tennessee sports betting in the month of December.
Tennessee’s second month of wagering has proven to be even more impressive than the first.
With pro football in full swing, the first jump ball of NBA season taking place, and college sports gearing up, Tennesseans had plenty to wager on.
In fact, they wagered over $50 million more in December than in November.
December revenue reports- Tennessee handle is on the up
To recap numbers from November, total handle reached $131 million, players collected $118 million in winnings, and tax revenue amounted to $2.3 million.
In December, sports betting was the gift that kept on giving.
Each sportsbook ran a different set of promotions to spread the holiday cheer.
Action 24/7 had its 12 Days of Christmas, while BetMGM ran its Jolly Ol Saint Chuck campaign.
Sportsbook incentives were high, giving bettors even more reason to wager.
And wager they did.
Total handle for the month reached nearly $181 million. Of that money, players took home $167 million of it, and the state of Tennessee accumulated a $3 million privilege tax.
This comes out to a 7.7% hold for the month, with sports betting revenue hitting over $13 million.
|Total Revenue||Player Winnings||Privilege Tax|
|November||$131 Million||$118 Million||$2.8 Million|
|December||$181 Million||$167 Million||$3 Million|
Judging by two-month estimates, Tennessee is projected to have a first year handle of $1.872 billion.
However, it is a little too soon to know exactly how big this market will be.
Tennessee handle in month two sets even more records
Throughout its first two months on the market, Tennessee has generated over $312 million in sports wagers.
To put that in perspective, it shatters launch records.
The closest state to Tennessee is Indiana, which generated $126.9 million in its first two months in 2019.
Indiana previously held the record for a best second month in the legal US market, reaching $91.7 million in October 2019.
A few factors have led to this hot start for Tennessee. First, with online-only betting and no in-person registration requirement, sports betting in Tennessee is easy to access.
On top of that, none of Tennessee’s neighbors offered online sports betting during its first two months, with only two offering retail betting.
For those looking to get in on the action, making the drive to Tennessee was one of few options available.
Lastly, Tennessee launched in the middle of NFL season while the state’s home team, the Tennessee Titans, was off to a hot start.
A strong home football team and a new market with plenty of wagering incentives is a betting match made in heaven.
What is going on with the hold?
While handle was up for the month, hold was down.
Tennessee sportsbooks have to hold 10% of annual wagers, or cap payouts at 90% for the year. Failure to comply can lead to fines, or in severe cases, a loss of licensure.
In November, sportsbooks hit that number at exactly 10%, but hold fell to 7.7% in December.
To be fair, a 7.7% hold is very normal when looking at other markets.
For example, Iowa, New Jersey, Pennsylvania, and West Virginia all hover around that same mark.
Some surprising Tennessee Titans upsets can account for the larger hold in November.
On opening weekend for Tennessee sportsbooks, the Titans were heavy favorites against the Cincinnati Bengals. At FanDuel, around 81% of moneyline bets favored the Titans.
The game was bet more than any other event in Tennessee that day.
When the Titans suffered a shocking 30-21 loss, sportsbooks cashed in, and the hold went up.
With fewer NFL weekends in December than in November, and no surprising losses from the home team, hold seemed to near closer to the national average.
Sportsbooks will need to figure this one out, since starting in January, the Tennessee Education Lottery will be looking at the hold a lot more closely.
2021 and beyond
At the TEL’s Board Meeting on Jan. 6, a fifth operator was approved in Tennessee. Churchill Downs‘ sportsbook, BetAmerica, soon to be renamed TwinSpires, will soon join Volunteer State ranks.
According to meeting discussions, plans are to have the new sportsbook ready to launch in time for the Super Bowl on Feb. 7.
With the biggest wagering event in the US still to come next month, it doesn’t seem as if this upward momentum will slump anytime soon.
Although TEL CEO Rebecca Hargrove advised that sports betting revenue would see a fluid shift from month to month, numbers seem to be following a good pattern.
If more sports betting apps are able to launch before the Super Bowl, bettors will have more wagering options and more incentives than ever.