The Virginia Lottery’s recent wagering revenue report reflects a significant development in the Commonwealth’s betting industry, with a surge in online activity and the appearance of multiple new operators shaking up the market. According to the report, Virginia’s 11 licensed sportsbooks successfully concluded February with a “net positive Adjusted Gross Revenue (AGR),” an indication of thriving business amid an evolving regulatory landscape.
In the month under review, mobile betting dominated the scene, racking up $540 million of the total handle, while in-person betting added a modest $4.9 million from retail locations across Virginia. Such figures underscore the increasing preference among bettors for the convenience of digital platforms.
Promotions and deductions—common tactics used by operators to attract and retain customers—have reportedly declined. This downturn follows legislative initiatives aimed at reining in these practices. Virginia Governor Glenn Youngkin has proactively introduced a measure slated to phase out promotional deductions over the next year. The proposed budgetary amendment will eliminate a significant allowance that operators have been using to lessen their taxable AGR.
The Virginia betting landscape has also been broadened with the entry of four new operators, diversifying options for consumers. Bet365 commenced its operations on January 31, 2023, and was promptly followed by Betfred on February 1. Later in the year, Betr and SuperBook joined the fray, starting September 6 and October 19, respectively. With Bet365 and Betfred reaching the end of their promotional deduction benefits, only Betr and SuperBook remain eligible for such perks. Barring any additional launches, the state may see the end of such deductions in 2024.
In an interesting twist, rather than introducing new platforms, both ESPN BET and Fanatics Sportsbook overhauled existing ones in November 2023. ESPN BET reinvented the former Barstool Sportsbook, while Fanatics Sportsbook took over the PointsBet platform. Such rebranding efforts are strategic moves in a fiercely competitive market but do not qualify these new incumbents for the promotional deductions that new operators enjoy.
The report indicated a dip in overall betting activities in Virginia compared to January, as the AGR, the hold percentage, and tax payments to the state all saw declines. Notably, in January, sportsbooks attained an adjusted win rate of 10.34 percent, which led to $9.9 million in tax revenue for the state, according to data from Sports Handle’s revenue and tax database.
The Virginia Lottery, however, does not disclose granular data such as individual operator performance or which betting markets are driving revenue, maintaining a degree of confidentiality on operational specifics within its reports.
Looking ahead, the dynamics of regional betting competition are set to change as North Carolina launched its own operators in March, just in time for the NCAA March Madness. This event traditionally garners significant betting interest, and Virginia operators may feel the impact of a neighboring state entering the market.
Virginia’s betting industry is indeed in a flux—a mix of regulatory adjustments, market expansions, and strategic corporate maneuvers continue to shape the landscape. While the report paints a picture of robust activity with room for best practices to evolve, the entry of North Carolina into the fold marks the next chapter in the East Coast’s betting narrative—a potentially game-changing addition sure to transform the fabric of the region’s sports wagering economy.
