The Growth and Surge of Arizona Sports Betting

Only a year into the sports betting industry, the state saw remarkable success that went above initial expectations.

FanDuel became one of the firsts to open a retail sportsbook at a pro venue in Arizona (Alyssa Esquivel photo/JMC306).

When the clock struck midnight on Sept. 9, 2021, sports betting became legalized for the first time in Arizona. One year later, the growth and numbers the state has produced have been unprecedented.

In just one full year, the Arizona Department of Gaming revealed how the state generated more than $5 billion in wages while fantasy sports contests earned over $3 million. These types of numbers are ones that have already surpassed expectations. With the kind of revenue created in just a short amount of time, there is no doubt that Arizona is serious about sports betting.

The success the state quickly saw can be attributed to the fact that Arizona was able to position itself in a way to truly capitalize on its new found opportunity with sports betting.

“I think Arizona was uniquely positioned to punch above its weight class, thanks to having friendly tax rates (10%) on operators, combined with the number of licenses (20) that were available,” said Christopher Boan lead writer for BetArizona.com. “That allowed a wide range of wagering companies, including the ‘Big Four’ of DraftKings, FanDuel, BetMGM and Caesars Sportsbook to gain access to a sports-hungry market, while also providing space for niche brands, like Hard Rock Interactive and Betfred, to gain traction in the state.”

Arizona’s sports betting law was passed in April of 2021 and was eventually signed into place by Gov. Doug Ducey. The state went on to issue 20 sports betting licenses with 10 being reserved for Arizona Tribes and the other 10 for a professional sports team or franchise.

Today, Arizona is home to 18 sports betting mobile apps and has opened several retail sportsbooks across the entire state. The best part is that the state has not fully maximized their potential profits so there is even more room for growth in the near future.

“I think we’ll continue to see a certain level of consolidation in the sector, with more brands either exiting the space outright (like Fubo Sportsbook and MaximBet), or going through traditional merger and acquisition (like Golden Nugget and DraftKings),” said Boan.

Since the initial launch of sports betting, the state has seen several positive impacts with a unique one being the ability to bring fans closer to their favorite teams. Not only can people watch their favorite professional or college team live, but they can also place bets on them which makes the games all the more exciting.

“The biggest impact has been the amount of interaction and interest it has helped draw to the state’s professional and college sports teams. We have seen Valley teams, like the Suns, dive head-first into their betting partnership (with FanDuel) and it has led to a direct response from their fans,” said Boan. “Fans want to wager on the teams they love most, so having a successful anchor team in the region, such as the Suns, allows them to wager on the players they love most.”

While the state has seen more fan interaction, the revenue Arizona has already generated in just over a year has been mind blowing. Arizona sports betting began to set several records in just a few short months after its initial launch and it is still setting some today.

“The other major impact that wagering has had on the state of Arizona is the $20M + in tax revenue that wagering has raked in over the first calendar year of operations,” said Boan. “That is a figure that won’t close any budget shortages, but that will help the state’s bottomline, which is always appreciated.”

The success Arizona saw has not only been beneficial for the state itself, but it has become a blueprint for other states looking to get started in the sports betting industry.

“I think that Arizona’s successful sports betting launch has become the textbook for states that have followed, such as Kansas and Maryland, and that’s a direct result of the legwork that went on by regulators, legislators, and operators alike,” said Boan.

Already a top 10 sports betting market in the United States, Arizona has surely positioned itself to make a successful run in the near future. There is no sign of sports betting slowing down anytime soon in Arizona as the industry only looks to rise from here.

“If there’s one thing we can guarantee about the short-term future of sports betting in Arizona (and beyond), it is that change will continue to be the name of the game, with more operators exiting (and entering) the space as the years pass,” said Boan.