Arkansas casinos took hit on sportsbook switch
Add Axios as your preferred source to
see more of our stories on Google.
Illustration: Lindsey Bailey/Axios
Two Arkansas casinos that recently partnered with national sportsbook brands posted a combined mobile sports betting loss of more than $10 million in March, even as betting volume surged, the Arkansas Democrat-Gazette first reported.
Why it matters: The results show how a splashy sportsbook launch can drive customer activity while still producing short-term losses.
Driving the news: The Arkansas Racing Commission approved FanDuel's partnership with Oaklawn Sports of Hot Springs and DraftKings' partnership with Southland Casino Hotel of West Memphis in late February.
- The two casinos previously ran their own online sportsbooks.
By the numbers: Southland lost $6.1 million in its mobile sportsbook in March, per a monthly report from the Arkansas Department of Finance and Administration. Its mobile sports handle — the total amount bet — hit a record $18.23 million, but payouts were $24.32 million.
- Oaklawn's handle of $35.7 million and payouts of $39.9 million point to a roughly $4.2 million loss.
- Saracen of Pine Bluff, which still operates its own platform, reported it was $2.15 million in the black on mobile sportsbook for the month on $32.6 million in handle.
The caveat: DraftKings and FanDuel went live in Arkansas on March 20, so only 11 days of the month were impacted by the change. How the platforms perform for the casinos won't be apparent for a few months.
What happened: Heavy March Madness betting, including strong local interest in the Razorbacks' tournament run, likely helped drive the unusually high volume, University of Arkansas hospitality lecturer Robert W. Powell III told the Democrat-Gazette.
- Promotional credits and other launch incentives from FanDuel and DraftKings may have also increased payout, he said.
What they're saying: Southland is now in the "growth phase" of its DraftKings partnership and has seen strong early player activity, president and general manager Osi Imomoh said.
- Saracen chief market officer Carlton Saffa said his casino is not interested in using "millions and millions of dollars" in free play to chase growth.
The bottom line: The losses didn't sink overall business results. The state's three casinos posted a combined first-quarter net win of $185.66 million, up about 1% from a year earlier, and paid $30.62 million in taxes, up about 3%.