North Carolina Sportsbooks’ Revenue Drops Despite Betting Surge

In October, North Carolina’s digital sportsbooks saw mixed results as football’s first full month caused a spike in bets but a significant drop in revenue. According to the latest report from the North Carolina Lottery, the total betting handle rose by $36.6 million from September, reaching $612 million for the month. Despite the higher activity, sportsbooks saw revenue decline by $21.4 million due to a dip in hold rate—the percentage of bets retained by operators after payouts. October’s hold rate, a modest 8%, was the lowest since sports betting launched in the state in March.

 

The Hold Rate’s Impact on Revenue

A sportsbook’s hold rate is a major determinant of its revenue. For North Carolina operators, hold rate had remained above 10% for six of the eight months since launch, with notable highs of 16.2% in April and 12.4% in July. September, the month before, saw a strong hold of 12.2%, but October’s 8% hold—a bettor-friendly figure—cut significantly into potential revenue. This month’s figure aligns with a broader trend seen across the U.S., where sportsbook operators reported similar low holds and voiced frustrations over unusually favorable outcomes for bettors during quarterly earnings calls.

In October, $612 million in bets marked North Carolina’s third month with a handle exceeding $600 million, indicating consistent demand since sports betting went live. Promotional play accounted for $23 million, bringing the adjusted handle to $589.1 million. After paying out $560.6 million in winnings, operators reported an adjusted gross revenue (AGR) of $48.7 million, leading to $8.8 million in tax contributions to the state. North Carolina’s tax structure requires operators to pay 18% of AGR.

The North Carolina State Lottery Commission, also responsible for regulating sports betting, announced an extension of the public comment period for new rules on parimutuel wagering. Initially launched in September, the comment period now extends until November 27, following revisions based on initial feedback. A public hearing on the topic is scheduled for November 18, allowing stakeholders to provide input before the rules are finalized.

These latest developments highlight both the challenges and opportunities within North Carolina’s rapidly growing sports betting market. As operators navigate fluctuations in revenue amid high bettor engagement, the state continues to develop regulatory frameworks for other forms of wagering, showing its commitment to broadening and refining its betting landscape.

 

October’s hold rate dropped to 8%, the lowest since sports betting went live in North Carolina, reflecting a broader trend of bettor-friendly results across the U.S.

 

Conclusion

The mixed results from North Carolina’s digital sportsbooks in October underscore the volatile nature of the sports betting industry. While the state saw a notable rise in betting activity, with handle exceeding $600 million for the third time, the sharp decline in revenue due to a significantly lower hold rate highlights how unpredictable outcomes can affect operators’ profitability. This drop in hold, the lowest since the state’s sports betting launch, mirrors a broader trend in U.S. sportsbooks where bettor-friendly results have been a common theme in recent months. Despite these challenges, the growing interest in sports betting—especially with the NFL season in full swing—demonstrates a strong market potential.

Looking ahead, North Carolina’s regulatory landscape continues to evolve, with the state preparing to finalize rules on parimutuel wagering. While sports betting operators face fluctuating revenues, the state’s consistent engagement with new wagering options and its substantial tax revenue indicate a promising future for the industry. As North Carolina fine-tunes its approach to gaming, the coming months will likely reveal whether the state can stabilize sportsbook revenue amid its growing betting market.