For the first time, the province of Ontario is revealing how much online casinos are contributing to total iGaming revenue — and the numbers are significant.
Today, iGaming Ontario released its revenue report for the first quarter of the 2023-24 fiscal year (from April 1 to June 30, 2023). Of the $14 billion in total bets (handle) and a record $545 million in total gaming revenue over those three months, 83% of the handle ($11.6 billion) and 72% of the revenue ($392 million) came from online casinos.
According to iGO, the percentage of the total gaming pie coming from online casinos in Ontario is up from a year ago. In the previous fiscal year, “casino games, including slots, live and computer-based table games as well as peer-to-peer bingo” accounted for 78% of total wagers and 67% of gaming revenue.
By comparison, Ontario sports betting handle of $2 billion in Q1 only accounted for 14% of total bets and 25% of revenue ($138 million). Poker bets of $350 million and revenue of $15 million accounted for 2.5% of handle and 2.8% of revenue.
While sports betting gets the majority of the attention, that sector of the online gaming world is small potatoes in Ontario compared to online casinos.
It’s important to point out, as always, that Ontario Lottery and Gaming corporation online gambling figures are not included in the iGO numbers. And the OLG is a significant online player in Ontario. At the recent Canadian Gaming Summit, OLG president and CEO Duncan Hannay said last year was the OLG’s “strongest financial performance on record.” Online gambling is widely believed to have been a strong driver of the OLG’s record numbers.
Also, unlike comparable US jurisdictions, Ontario’s regulator also does not allow the advertisement of bonuses, inducements and credits. One could make an argument that this has a negative impact on customer acquisition and thus, handle and revenue.
Record revenue, handle was stagnant, province collected $108 million
Ontario’s record revenue of $545 million in Q1 was up 3.6% over revenue of $526 million in the last fiscal quarter (Q4 of FY 2022-23 – Jan. 1 through March 31).
Considering the province taxes online gambling revenue at 20%, that means the Ontario took in some $109 million in tax revenue in the latest quarter.
Meanwhile handle of $14 billion was basically stagnant compared to handle of $13.9 billion in the last reported quarter.
However, comparing Q1 from the current fiscal year to Q1 of the 2022-23 fiscal year shows significant improvement. Q1 from last year was the first quarter of Ontario’s open online gambling industry, which launched April 4, 2022.
In a year’s time:
- Total handle is up 243% (from $4.076 billion to $14 billion)
- Total online gambling revenue is up 236% (from $162 million to $545 million)
- The number of live operators grew 156% from 18 to 46
- The number of total live gaming sites grew 129% from 31 to 71
- The number of active player accounts is up 87% (from 492,000 to 920,000)
- The average monthly spend per active player account is up 74% (from $113 to $197)
Compared to US states, Ontario a solid fifth in sports betting handle
It’s difficult to compare Ontario’s online gambling industry to US jurisdictions, but PlayCanada can provide a rough idea how Ontario is faring.
There are currently six US jurisdictions that, like Ontario, offer both online casinos and sports betting. However, a few of those states have not, yet, reported numbers for June. So, we’ll save the comparison of total online gambling handle and revenue for another day when those figures are in.
Also, US states report monthly and Ontario only reports quarterly. So, let’s look at the average sports betting handle and revenue in the period from April 1 through June 30, 2023.
And, let’s stick to sports betting only, for now, since this is the first time we have a picture of Ontario’s sports betting market.
Over those three months, Ontario sportsbooks handled $2 billion (again, not counting the OLG’s Proline sportsbook). That makes the average sports betting handle in Ontario about $666 million per month. In US dollars, at today’s exchange rate, that’s $505 million US.
Let’s see how that compares with some of the larger sports betting states. Keep in mind that some of the states listed have not reported June figures, yet, so their average will be taken from two months of activity, not three.
For April through June, the average monthly sports betting handle ranked accordingly:
- New York — $1.36 billion
- Illinois — $860 million
- New Jersey — $734.6 million
- Nevada — $553.9 million
- Ontario — $505 million (US $)
- Ohio — $484.6 million
- Pennsylvania — $480.3 million
- Massachusetts — $453 million
- Virginia — $414.8 million
- Michigan — $321.7 million
That’s not too bad, all things considered — and especially without OLG numbers included. But it is important to remember three things:
- Ontario is the fifth-largest jurisdiction by population in either the US or Canada
- Despite only being 15 months into an open online gambling market, Ontarians have perhaps as many as 20 years’ worth of experience gambling online in the illegal “grey market.” So, Ontario isn’t a nascent market.
- Also, Ontario has, far and away, the most gambling operators of any jurisdiction in North America.
