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Sports Betting Revenue Declines Despite Increased Handle
Sports betting operators in Michigan generated gross revenue of $43.6 million in September, representing a 25% decrease compared to the same month in 2024. This decline occurred despite total sports betting handle reaching $524.3 million, up 54.7% from August’s $338.9 million and showing a modest 2.7% increase year-over-year.
The adjusted gross revenue for sports betting stood at just $13.2 million in September, down 61.3% from August and 52% lower than September 2024. The sharp decline in profitability can be attributed to a significant drop in hold percentage—the amount retained by sportsbooks from total wagers—which fell to 8.2% in September compared to 11.3% in the same month last year.
Major Operators Face Challenging Market Conditions
Among the market’s major operators, DraftKings reported particularly difficult results, posting adjusted gross revenue of only $10.6 million from a handle of $165.6 million. This performance fell below the industry standard win rate of 7%.
FanDuel emerged as the top performer in the sports betting sector, recording a handle of $180.6 million and gross revenue of $18.2 million. However, even FanDuel saw revenue decline by more than $6 million compared to the previous year, despite a slight increase in handle.
Retail sportsbooks in Detroit also struggled during September. The three retail locations collectively generated $13.6 million in revenue, with Hollywood Casino at Greektown reporting losses exceeding $236,000.
Online Casino Sector Shows Strong Growth
In contrast to sports betting, Michigan’s online casino sector demonstrated robust performance. Online gaming revenue reached $259.1 million in September, down just 1.6% from August’s $263.27 million but up 28% year-over-year.
Adjusted gross revenue for online casinos totaled $243.4 million, representing a 1.5% decline from August but a 33.5% increase compared to September 2024. Year-to-date, the iGaming sector has generated $2.1 billion in total revenue.
Tax Revenue Impact
The decline in sports betting profitability had a direct impact on state tax collections. Sports betting operators contributed just $768,038 in tax revenue for September, bringing the year-to-date total to approximately $15 million.
Online casino operations provided significantly more substantial tax contributions, generating $50.8 million in September. Combined, total online gambling taxes reached $51.6 million for the month.
Market Outlook
The September results highlight the volatility inherent in sports betting operations, where hold percentage fluctuations can dramatically impact profitability even when betting volume increases. The timing coincided with the NFL season kickoff, a full month of college football, and the conclusion of Major League Baseball’s regular season—typically a period of heightened betting activity.
The continued strength of the online casino sector provides a stabilizing force for Michigan’s overall gaming market, with consistent growth demonstrating sustained player engagement and market maturity.
Source: Michigan Gaming Control Board
