The second full month of Tennessee sports betting is in the books.
The four online/mobile sportsbooks handled $180.9 million, according to figures released late Tuesday by the Tennessee Education Lottery, the state’s sports betting regulator.
The books retained $13.9 million of the handle in the form of winnings, the TEL reported.
The state does not release a handle/revenue breakdown by operator, like other sports betting states do.
The state reported $3.08 million in tax revenue off the books’ reported winnings. The state charges a 20% tax on a sports gambling operator’s adjusted gross income.
What exactly is adjusted gross income here? Here’s how it’s defined in the regulations:
“Adjusted Gross Income” means the total of all money paid to a Licensee as Bets minus the total amount paid out to winning Bettors over a specified period of time, which includes the cash equivalent of any merchandise or thing of value awarded as a prize. Player incentives to deposit or Bet (e.g., free plays, etc.), including, without limiting the foregoing, prizes, premiums, drawings, benefits, or tickets that are redeemable for money or merchandise or other promotional allowances, may not be deducted as losses from winnings. Additionally, cash or non-cash prizes awarded to Players in a contest or tournament are not deductible. Promotional consideration and discounts shall not be considered an amount paid out to winning Bettors when determining taxable adjusted gross income.
Month-over-month handle growth
Sports betting in Tennessee kicked off on Nov. 1, and during that month the books took $131,444,523 in bets. So, the month-over-month growth in December was 37.6%.
The books won $13,224,908 off the November handle.
In case you are wondering: The TEL decided to not report handle and revenue to the dollar from last month, unlike how it did from November. It is unclear what will be the standard going forward.
Tennessee is a very unique market — it is the only state with legalized sports wagering that has no retail sportsbook locations.
How did the $180.9 million compare to other states in the nation?
Last month, Tennessee outpaced Iowa ($104,815,630) but was behind Indiana ($313,112,474). Both those states started sports betting in 2019 and have significantly more apps, along with retail books.
Tennessee also trailed Colorado ($284,551,472), which kicked off betting in May 2020. The Volunteer State is one of six to report a nine-figure handle for the month of December, though Nevada and Illinois are expected to do likewise when those respective state agencies release their final 2020 monthly reports.
New Jersey led the nation with $996,300,794 last month.
The $180.9 million in Tennessee December 2020 handle, a 37.6% month-over-month increase, should not really surprise anyone. Substantial growth was expected, and the increase in terms of a percentage makes sense for a fledgling market with pent-up demand.
A playoff-caliber Tennessee Titans team this season surely did not hurt, but NFL fans will bet on a team pretty much regardless of its record.
December is typically a busier month for sportsbooks than January, so while Tennessee should see another month-over-month handle increase thanks to more bettors downloading and signing up for the apps, growth will probably be less than it was from November to December.
Image credit: Shutterstock