Online sports betting numbers from a few select states reveal that the edge FanDuel has enjoyed over rival DraftKings is narrowing, or may even have disappeared.
This according to analysis from the experts at Earnings+More, a financial newsletter from +More Media.
If this trend continues into the next quarter and beyond, by the time online sports betting in North Carolina launches, the industry may have a new market share leader.
DraftKings may have overtaken FanDuel in select states
According to the Earnings+More email newsletter, data from July from numerous states suggests that DraftKings might have eclipsed FanDuel, at least in regards to bets accepted (total handle). In a few jurisdictions, that’s translating to DraftKings leapfrogging FanDuel in gross gaming revenue (GGR) as well.
For instance, in New York, FanDuel’s home state, DraftKings has grown in GGR since last year.
In August of 2022, FanDuel earned $46.5 million in GGR to DraftKings’ $25.8 million–a $20 million edge. But this past July, Massachusetts-based DraftKings had surged and the two were neck-and-neck at just over $41 million in GGR for the month.
Turning to handle, In June, DraftKings surpassed FanDuel in total handle for the first time since New York launched online sports betting. However, FanDuel reclaimed the lead in July, suggesting that the battle for Empire State supremacy still wages.
Data from Michigan and Pennsylvania, two of the other largest sports betting markets, shows that FanDuel’s edge on market share has also shrunk.
In Pennsylvania in Jan. 2023, FanDuel had a nearly $60 million edge over DraftKings in net gaming revenue (gross gaming revenue minus payouts and promotional deductions), but that difference fell below $20 million by July.
In Michigan, FanDuel is still number one based on total handle and GGR from online sports betting, but the gap is narrowing. Since Feb. 2023, the difference in GGR between FanDuel and DraftKings has dropped by 55%.
As Earnings+More points out, even though the two leaders are tightening in their race for the top spot, their combined market share is holding steady. In most states, FanDuel and DraftKings garner at least 50% of the total handle, and in most states they have gobbled up as much as 60-70%.
The newsletter points out that according to research by “Deutsche Bank … the combined share between [FanDuel and DraftKings] in July comes in at 74%; in comparison, the last 12 months figures stands at 73.9%.”
Will that change in the months before legal online sports betting launches in North Carolina? Not likely. While DraftKings was first to indicate its intent to launch in North Carolina, FanDuel will certainly make its intentions clear in due time.
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FanDuel is hardly feeling satisfied with its dominance as one of the leading sportsbooks in the U.S.
When NC sports betting launches, FanDuel and DraftKings are expected to be at the top of the list in total bets accepted and gross gaming revenue. But, in which order remains to be seen.
The two leaders will be challenged by a few newcomers. Fanatics Sportsbook is entering the market and could make North Carolina one of its first states. In addition, international giant Bet365, which is licensed and operating its sports betting app in a handful of states, such as Virginia, could make a stand in North Carolina.
PENN Entertainment cast aside Barstool last month in a surprising bit of industry theater. The company will rebrand its app as ESPN Bet following a 10-year, $2 billion deal with the sports network. ESPN Bet, with its brand recognition and customer base, might be able to shake up the landscape and upend FanDuel and DraftKings’ dominance in online sports betting.
Ultimately, more competition is good for the consumers in North Carolina, who will begin downloading sports betting apps soon. The North Carolina online sports betting launch window opens Jan.8, 2024 and closes on June 14. NCSharp projects that North Carolina’s first year of online sports betting could generate $6-$7 billion in total bet spending, putting it among the highest-earning states in the country,