The numbers on the first full month of legal wagering on sporting events in the Hawkeye State are in. While the September Iowa sports betting revenue report shows solid numbers, there is potential for so much more.
Legal Iowa sportsbooks have just begun operating, and many of them still don’t have online components. Because of that, the numbers could get far better in the future.
The numbers from September sports betting revenue
August’s numbers were only from the last 17 days of the month, so September 2019 was the first full month of legal sports betting in Iowa. With 19 licensees, 15 of which reported revenue from wagers on sports, the numbers are respectable.
- Hawkeye State residents and visitors bet over $38.52 million on sports over the course of September. That is the total for wagers placed in person and online.
- More than $21.79 million (over 56.6%) of that handle came from mobile bets. Only seven of the 19 licensees had their online products live during the month.
- Of that $38.52 million, sportsbooks paid out a little more than $33.57 million to bettors. The remaining $4.95 million was revenue for the 15 operators accepting wagers during September.
- The state collected $334,552 in taxes for the month. Iowa has one of the lowest tax rates in the country for sports betting at 6.75%.
While revenue of just under $5 million would be a great month for most businesses, all operating expenses including taxes had to be paid out of that. That means the profit margin was pretty low.
Better days could be ahead, however. The handle on mobile betting could grow exponentially in the future.
Putting Iowa’s sportsbook figures into proper context
A revenue figure under $5 million for the first month of legal sports betting is far from impressive compared to other states. For example, Indiana’s sportsbooks did over $8 million in their first month with zero legal mobile betting.
Iowa has half the population of Indiana and zero franchises in the five most popular professional sports leagues, so a comparison of those two states on this front has to account for those differences. Another important part of the context is the aforementioned lag in mobile options.
The more online sportsbooks are available, the better the chance of people using them. Iowa has an in-person registration requirement until New Year’s Day 2021. That could be hampering handle as well.
A final possible player in the drama is simple ignorance. Many Iowans could simply not yet be aware that legal sports betting exists in their state, or how to take advantage of it. A recent study by the American Gaming Association showed 44% of its nationwide respondents didn’t know about legalization.
An increase in mobile sportsbooks should address that awareness issue. When online books launch, they often do so in concert with ad campaigns.
Even if all 19 licensees get online components up and running, sportsbooks are still likely to be just a part of gaming operations in the Hawkeye State. Iowa’s casinos and “racinos” reported over $120.48 million in revenue from slots and table games in September.
It’s unlikely that Iowa sports betting revenue will ever surpass slot and table games revenue. There is potential for much more, however, and that will likely come as more operators start accepting internet wagers.