As the American sports betting industry continues to expand, it reached an unprecedented milestone in 2023, recording a staggering $10.92 billion in revenue, according to the American Gaming Association’s (AGA) annual report. This represents a 44.5% increase from 2022, which previously held the record. The 2023 figures were bolstered by a handle of $119.84 billion, marking a 27.8% year-over-year increase, and an improved sportsbook win percentage of 9.1% compared to 8.1% in 2022.

These impressive numbers were achieved even without the latest data from Arizona and Kentucky. The inclusion of five new legal betting states—Kentucky, Maine, Massachusetts, Nebraska, and Ohio—also played a significant role in this growth. Ohio quickly became a sports betting hub, generating $936.6 million in revenue, placing it fourth among the highest-earning states. Collectively, the five new states contributed $1.49 billion to the industry’s 2023 revenue.

Record-Breaking Performance in 2023

New York led the charge in 2023, topping the revenue charts with $1.697 billion. New Jersey and Illinois also surpassed the $1 billion mark, each recording over $1 billion in annual revenue for the first time. The sports betting industry capped off the year with a record-breaking fourth quarter, bringing in $3.41 billion, a 30.8% increase from Q4 2022 and a 19.6% rise from the previous record set in Q1 2023.

With the launch of legal online sports betting in North Carolina in early March 2024, just in time for March Madness, another record-breaking quarter seems inevitable.

Looking Ahead to The Future of U.S. Sports Betting

Despite the impressive growth, the industry faces challenges as fewer states are left to legalize sports betting. AGA Senior Vice President of Government Relations, Chris Cylke, noted that with 38 states plus Washington, D.C., already legalizing and regulating sports betting, the pace of new state adoptions may slow. Nevertheless, the industry is poised for continued growth, particularly as existing markets mature and consumer spending on sports betting increases.

The Broader Gambling Industry

In 2023, the broader American gambling industry, which includes land-based casinos and internet gambling, also had a record year, generating $65.52 billion in revenue—a 10% increase from 2022. Land-based gambling alone contributed $50.02 billion, accounting for 75.3% of total revenue. The AGA also highlighted that gambling taxes generated $14.4 billion for state and local governments in 2023.

The Potential of U.S. Sports Betting

According to Goldman Sachs Research, the U.S. sports betting market, which has rapidly grown into a $10 billion industry since the 2018 Supreme Court decision allowing states to legalize sports betting, could reach $45 billion annually as the market matures. Ben Andrews, Head of Leisure and Travel Research for Goldman Sachs in Europe, noted that growth will be driven by the opening of new states and an increasing share of the consumer wallet being spent on sports betting.

The Evolution of Sports Betting

The rise of app-based betting has significantly changed the types of wagers bettors make, with parlays—bets that combine multiple wagers into one—becoming increasingly popular due to their potential for high payouts. This trend, along with the growth of in-game betting, is expected to continue shaping the industry. The convergence of media and sports betting is also on the horizon, with in-game betting and personalized user experiences becoming more integrated into live sports viewing.

Looking ahead, the Super Bowl remains a critical event for customer acquisition and brand visibility, though its revenue impact is limited compared to the year-round diversity of sports and events that drive the industry’s growth. As the U.S. sports betting market continues to evolve, it is clear that the future holds even more opportunities for expansion and innovation.

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