The legal sports gambling industry in New Jersey is entering a critical phase of its natural lifecycle — contraction and consolidation.
Yet, despite a shrinking number of NJ sportsbooks, the market is thriving.
In just the last 12 months, the NJ sports betting industry has seen voluntary exits due to underperformance, swift market access through acquisition and strategic purchases for increased market share. During that same time, legal sportsbooks in NJ have set new monthly records for handle (the amount wagered) and revenue.
What any of this means for the market’s long-range prospects is still to be determined.
Top tier of sports betting in NJ is clear
What is perfectly clear is the separation that exists between the top two operators — FanDuel Sportsbook NJ and DraftKings Sportsbook NJ — and everyone else.
Since the Division of Gaming Enforcement began tracking betting revenue in January, only FanDuel and DraftKings have surpassed $100 million in revenue.
The two of them have combined for $275.7 million in 2024, representing a 37.3% share of the entire industry.
The dominance of the big dogs of legal sports betting does not just exist in New Jersey. A similar scenario plays out in most of the 33 other regulated sports gambling jurisdictions throughout the United States.
A second tier of operators follows closely behind, including Fanatics, BetMGM Sportsbook NJ, bet365 Sportsbook NJ and Caesars Sportsbook NJ – the only four other operators to eclipse $10 million in 2024. Combined, they have totaled $133,820,932 million, which is still more than $40 million behind FanDuel.
Where does NJ sports betting go from here?
The question that looms over the industry now is: who will challenge the established giants, and how will they do it? While various M&A proposals have recently emerged – such as MGM reportedly eyeing Tipico (according to Earnings+More) or Hard Rock purchasing the US holdings of 888 – the impact of these deals on expanding market share or improving positioning remains minimal.
The industry’s future trajectory hinges on numerous variables, chief among them being the potential for further growth in the New Jersey sports betting market. Should growth continue, which operators will capitalize on this momentum?
Conversely, if the market reaches a plateau or experiences a decline, will we witness an exodus of online operators unable to weather the challenges of the landscape?
In this era of consolidation and strategic maneuvering, the US sports betting industry stands at a crossroads. Each decision made by key players will shape the market’s trajectory for years to come.