• Loading stock data...
Thursday, June 26, 2025
Front Office Sports Launches Front Office Sports Studios Learn More

U.S. Sports Betting Companies Jostle Over a Key Moment for the Industry

  • U.S. sports betting companies are entering a period of incredible opportunity and risk.
  • Industry experts foresee consolidation and some major players entering the market.
Megan Mendoza / USA TODAY NETWORK

There’s never been a better time to be a U.S. sports betting company.

With college football and the NFL underway, this is “Christmas, Hanukkah, New Year’s, Thanksgiving, and your birthday all rolled into one,” said Patrick Keane, CEO of Action Network.

GeoComply reported 103.1 million geolocation verifications performed by sportsbook operators using its service from the NFL’s first regular-season game on Thursday, Sept. 8 through midnight of the following Sunday. That figure was up 71.5% compared to Week 1 of 2021.

This will also be the first full football season in which New York will allow mobile sports betting, one of 22 states to do so, plus another nine that only allow in-person betting, per Action Network’s tracker. An additional four states have legalization pending.

The stars are aligning, but that doesn’t mean it will be easy — or even profitable.

Income Incoming?

This fall, industry giants like DraftKings and FanDuel have the opportunity to make an immediate splash, while others like MGM, Caesars, Penn Entertainment, and European giant Bet365 can also show what they’ve got.

Now more than ever, sportsbooks have the chance to actually turn a profit, but it’s something that has largely eluded them to date.

  • Ireland-based FanDuel parent Flutter Entertainment claimed 51% of the U.S. sports betting market, notching $1.18 billion in first-half revenue and an adjusted EBITDA loss of $148.5 million in the country.
  • DraftKings brought in $466 million in revenue in Q2. The company projects $2.13 billion for the fiscal year and an $800 million loss.
  • BetMGM, a sports betting venture owned 50-50 by MGM Resorts and Entain, took a $71.2 million loss in the second quarter.
  • Penn Entertainment’s interactive segment, which includes online sports betting and iGaming, brought in $154.9 million and lost $20.8 million in the second quarter.

“The most pressing challenge this season for operators is finding a way to target returning customers, as well as acquiring new ones, without breaking the bank,” said Matt Rybaltowski of Sports Handle. 

After a year in which sportsbooks dangled generous promotional offers, many are dialing back acquisition spending, and we’re starting to see divergence in their strategies, many of which are focused on building — or buying — a community.

Different Profit Paths

FanDuel acquired horse racing-focused cable channel TVG, rebranded it to FanDuel TV, and hired big name talent like Kay Adams and Bill Simmons to broaden its audience. DraftKings has sought to build out its own roster of recognizable sports media names, including Mike Golic Jr. and Dan LeBatard.

“You think of traditional casinos that operate out of Nevada,” said Jon Cohen of Frequency. “They’re trying to get people on site to gamble. What do they do? They have Cirque du Soleil, great in-house residents. It’s about getting people in the door, and content is the best way to do that.”

While FanDuel and DraftKings are setting up somewhat conventional media operations, Bally’s, which has begun to roll out its Bally Bet sportsbook, struck a deal with Sinclair last year to rebrand 19 regional sports networks to its name.

Penn Entertainment, meanwhile, took a different approach by acquiring Barstool Sports for $550 million.

“Barstool is such an interesting play,” said Cohen. “[Penn’s] whole premise is, we don’t have to spend all these big marketing bucks because we have so much brand loyalty through our community.” 

The question is: Which of these models actually leads to efficient acquisition and retention of customers?

“I’ve always been skeptical of a product company or a brand that tries to become a media company,” said Ken Dorward, chief growth officer at XL Media. “As an operator, you need a good product, period. In the long term, those who have a good sports betting product will win.”

Waiting in the Wings

In my conversations with industry analysts and insiders, one name came up several times without prompting.

“The most fascinating thing happening on the operator side, to me, is Fanatics coming into the market,” said Dorward.

“They have a whole customer database already that I’m sure they’ll try and use for their marketing spend. So you don’t really have to market, right? They already have a name. They already have customers, and it’s just a bolt-on.”

Disney is likely to join the fray as well, though perhaps just through licensing the ESPN name.

“It looks like Disney is going to go more of the rent-the-brand route and get a big check,” said Keane.

And then there’s a big company that already has certain key elements already in place. In fact, there’s a good chance you’re reading this on one of its devices.

“When you start thinking about the robust ecosystem that Apple has with their payments and credit card, and the connectivity of the phone to the big screen,” said Cohen, “I think you’re going to have in-game betting going on the television.”

The tech giant scooped up 10 years of MLS streaming rights in a $2.5 billion deal and has a deal to stream a package of Friday night MLB games. For the latter, Apple incorporates odds on certain events that could occur during the at-bat, updated with each pitch (which you should probably take with a grain of salt).

“I don’t think there’s any other reason for them really to go get sports rights other than to help their subscription service and make more services revenue,” Cohen added. “And I think gambling is a big part of it.”

The Long Game

Right now, it’s easy to find generous entry offers designed to lure bettors to their platform. But to make that play worthwhile, the book has to keep that customer around for a while.

“Most books that we talked to say that they need to have these users be profitable in two years for them to be the kind of attractive bettors that they want,” said Keane. “For that [promotional money] to come back, that user is going to have to bet not just with high frequency, which is a key for these operators, but also high redeposit rates.”

Then again, the sportsbook itself doesn’t have to be the end of the customer funnel: Revenue is generally steadier in iGaming.

“A lot of the sportsbooks are going to rely on converting a sports bettor over to certain casino games for long-term profitability,” said Dorward.

Golden State Rush

While New York has taken the lead among sports betting states in revenue and handle, California could surpass it before too long — depending on the preferences of myself and 40 million or so of my neighbors.

Two ballot initiatives put before voters would legalize sports betting in California — a fact I am reminded of by relentless banner and YouTube ads.

  • Proposition 26 would legalize sports betting, but people would only be able to place bets on tribal lands and at racetracks. That would make sports betting legal but logistically challenging for many residents of the state.
  • Proposition 27 would allow mobile sports betting anywhere in the state. Operators would be required to work through tribes.

Spending on the props has already topped $400 million with six weeks to go.

That seemingly hasn’t been enough: A September poll from the Public Policy Institute of California found that Prop 27 is well underwater with 54% opposed to 34% in favor. Should sportsbooks be able to turn public opinion around, they will open up the biggest market in the U.S., but they face long odds.

Legalization bills in Texas, the second-largest market in the country, failed to gain traction in 2021 but could get another look in 2023.

Change Coming

As multiple powerful companies make a play for the same market real estate, it’s fair to wonder if the players in the game right now will be the same ones we see in a few years.

“I’ve been frankly surprised that there haven’t been more mergers and acquisitions,” said Keane. “There’s a lot of blood in the water, if you will, of books trying to acquire customers, acquire them profitably, retain those users, and get them to continue in the platform.”

Each of the major players is placing a high-stakes wager on a certain approach to this nascent industry. Even in this wide-open market that can grow by an entire state with little warning, it’s unlikely that every sportsbook will play the lines the right way, especially with the high cost of betting on sports betting. 

The house always wins — except when the houses are playing each other.

Linkedin
Whatsapp
Copy Link
Link Copied
Link Copied

What to Read

Jun 17, 2025; Sunrise, Florida, USA; Florida Panthers center Sam Reinhart (13) hoists the Stanley Cup after winning game six of the 2025 Stanley Cup Final against the Edmonton Oilers at Amerant Bank Arena

Stanley Cup’s International Summer Tour: Rules, Repairs, and Raucousness

No pro trophy tour compares to the NHL’s three-month global victory lap.

Colleges Are Raising Student Fees to Pay for Athlete Revenue-Sharing

Schools are preparing to pay student athletes up to $20.5 million annually.
Mar 15, 2025; Fort Worth, TX, USA; UAB Blazers forward Yaxel Lendeborg (3) dribbles the ball upcourt against the North Texas Mean Green during the first half at Dickies Arena

NIL Is Shrinking the Pool of NBA Draft Entrants

Agents are now advising many players to stay in school.
Apr 24, 2025; Green Bay, WI, USA; Penn State Nittany Lions defensive end Abdul Carter on the red carpet before the 2025 NFL Draft at Lambeau Field

‘More Is More’: The Elite Luxury Jewelers Decking Out Athletes

Meet the elite group of luxury designers crafting the biggest statement pieces.

Featured Today

Dec 5, 2024; Miami, FL, USA; FIFA president Gianni Infantino presents the FIFA Club World Cup trophy during the Club Word Cup draw at Telemundo Studios.

Revamped Club World Cup Is FIFA’s Billion-Dollar Gamble

The revamped soccer event debuts amid controversy.
Jun 10, 2025; Nashville, Tennessee, USA; United States head coach Mauricio Pochettino stands during the anthem against the Switzerland during the first at Geodis Park
June 14, 2025

Gold Cup Is Complicated for USMNT—but U.S. Soccer Has Its Eyes on..

Uncertain tournament success isn’t fazing forward-looking U.S. soccer.
Jan 24, 2017; Davidson, NC, USA; The Davidson Wildcats student section cheers during the first half against the Duquesne Dukes at McKillop Court at John M. Belk Arena. Davidson defeated Duquesne 74-60.
June 6, 2025

Every College Wants a Flashy Basketball GM Hire Right Now

The role is more important than ever, and the definition is ever-evolving.
August 31, 2024; Columbus, Ohio, USA; The Goodyear blimp flies over Ohio Stadium during the first half of Saturday’s NCAA Division I football game between the Akron Zips and the Ohio State Buckeyes.
June 6, 2025

Why the Goodyear Blimp Is at Every Major Sports Event

The airship wasn’t built to cover sports. Now it’s a regular presence.
Quincy Taylor

Several Americans Banned in British Basketball Game-Fixing Scandal

Five former Surrey Scorchers players were hit with lengthy gambling suspensions.
A view of the FanDuel Sportsbook betting area at Belterra Park Cincinnati.
exclusive
June 13, 2025

FanDuel, Kalshi Have Discussed a Deal

Could FanDuel take an equity stake in Kalshi?
Mar 30, 2025; Spokane, WA, USA; LSU Lady Tigers guard Flau'Jae Johnson (4) shoots against UCLA Bruins center Lauren Betts (51) during the second half of a Elite 8 NCAA Tournament basketball game at Spokane Arena.
June 17, 2025

Louisiana Sports Betting Set to Aid LSU and Other State Schools

Louisiana lawmakers have been creative in finding state money for NIL.
Sponsored

Hottest Matchups Following NFL Schedule Release

The NFL released the 2025 regular-season schedule, and anticipation is already building in the ticket marketplace with four months to go.
Fanduel
June 10, 2025

FanDuel, DraftKings Add Illinois Transaction Fee in Response to New Tax

FanDuel will charge 50 cents per bet starting Sept. 1.
May 1, 2024; Los Angeles, California, USA; A general overall view as Dallas Mavericks and LA Clippers players run across the Clippers logo at midcourt in the first half during game five of the first round for the 2024 NBA playoffs at Crypto.com Arena.
June 6, 2025

Kalshi’s Momentum Fuels Crypto.com’s Fight Over Sports Markets

Crypto.com cited a recent Kalshi court victory in its own fight against Nevada.
Illinois Gov. JB Pritzker speaks after giving his annual State of the State address on Wednesday, Feb. 19, 2025, in Springfield.
June 2, 2025

Illinois Passes New Sports Betting Tax in Middle of the Night

This is the second straight year Illinois approved a tax increase on sportsbooks.
May 18, 2025; Los Angeles, California, USA; Minnesota Lynx forward Napheesa Collier (24) looks to shoot against Los Angeles Sparks forward Dearica Hamby (5) during the first quarter at Crypto.com Arena.
May 27, 2025

Napheesa Collier Is Odds-On WNBA MVP Favorite After Caitlin Clark Injury

Collier and Clark had been close in the odds.