Online sports betting volume surges for the first two weeks of the NFL season

Online sports betting has seen strong betting volume for the start of the NFL season, per data from GeoComply. The first week of the season saw a 73% year-over-year increase in the number of transactions, with unique users up 39%. The data indicated that older state cohorts continued to grow strongly, including New Jersey, which saw transactions grow of +50%. While sportsbooks operators had a lower hold rate for the first week than a year ago due to the mix of results and some unbalanced positions, analysts believe that could translate into higher betting volume for the next several weeks with bettors enthused.

BetMGM (NYSE:MGM) (OTCPK:GMVHF) and FanDuel (NYSE:FLUT) were highlighted by Jefferies as early winners from the first week of the NFL season. BetMGM was noted to have seen its handle and GGR move up significantly, likely due to product improvement, according to analyst David Katz. FanDuel (FLUT) continues to dominate in GGR share, by adding another three percentage points compared to a year ago.

Looking ahead, the NFL online sports betting market is forecast to see unprecedented growth in the 2024 season. According to the American Gaming Association, an estimated $35 billion is expected to be wagered on NFL games this season, marking a substantial 30% increase from the previous year. The surge in betting volume can be attributed to the expanding legalization of sports betting across the United States, with 38 states and the District of Columbia now offering legal betting markets. The convenience of online and mobile platforms has significantly contributed to this growth, with some states seeing over 95% of sports betting volume occurring via the internet. The NFL remains the most popular sport for betting, attracting the largest wagers and generating the most interest among bettors. An area of focus for online sportsbook players this NFL season is the hold rate. A higher mix of parlay/prop betting and a reduced level of promotional activity are two ways that hold rates could improve this season.

By the numbers: Bank of America estimates that two platforms control the majority of total money bet across the country, with FanDuel (FLUT) at 42% and DraftKings (NASDAQ:DKNG) at 34%. The online sports betting handles of smaller players include a 7% share for BetMGM (MGM) (OTCPK:GMVHF), 5% for Caesars Sportsbook (NASDAQ:CZR), and 3% for ESPN Bet (PENN). While the latter just launched online sports betting in New York in an expansion push, others are also hoping to boost their national market share, like Fanatics and Rush Street Interactive (RSI).