Gross revenue from online sports betting and igaming in Michigan reached $2.30 billion (£1.81 billion/€2.11 billion) in 2023, the highest annual total since the legal market opened in the Great Lakes State.

Revenue for 2023 was 18.3% higher than the $1.98 billion Michigan generated in 2022. It also far exceeds the $1.40 billion from the first year of legal betting 2021.

The reported numbers include licensed commercial and tribal iGaming operators in Michigan.

Broken down, $1.90 billion of total revenue came from iGaming and $420.4 million of gross revenue came from sports betting. Both figures also represented new annual records, although total annual sports betting revenue remained steady at $4.60 billion.

After accounting for advertising deductions, adjusted gross revenue (AGR) from igaming and sports betting was $1.96 billion. That was 18.8% more than in the previous year.

igaming’s AGR was $1.73 billion, with adjusted gross sports betting revenue reaching $223.5 million.

The operators paid a total of $369.8 million in taxes. This includes $354.0 million in igaming taxes and fees and $15.8 million from the sports betting sector. Detroit’s three casinos paid a total of $95.8 million in gambling and sports betting taxes, while tribal operators paid $43.1 million to governing bodies.

Michigan breaks monthly records in December

In addition to record annual sales, Michigan ended 2023 with a record high in December.

Total online gambling gross revenue was $181.4 million in December, the highest monthly total to date. That was 20.4% more than in December 2022 and more than in November 2023.

Growth was driven by the iGaming sector, where gross revenue reached a record $181.4 million. Gross sports betting revenue also reached a new monthly high of $61.1 million in December, with revenue also hitting a record $583.0 million.

Adjusted, total online gaming AGR was $198.4 million, up 29.8% year over year. Igaming AGR reached $163.3 million and adjusted sports betting gross revenue reached $35.1 million.

Tax-wise, monthly payments totaled $36.7 million, including $34.1 million from iGaming and $2.6 million from sports betting. Detroit casinos paid $9.4 million and tribal operators paid $4.3 million.

Detroit casino revenue fell in 2023

The online gambling results follow the release of figures for land-based casino gambling in Michigan. Revenue at Detroit’s three commercial casinos fell 3.1% year-over-year to $1.24 billion in 2023.

Declines were reported in table games and sports betting. Slot revenue was $984.1 million, slightly higher than the previous year’s $983.7 million. However, table games revenue fell 12.7% to $238.7 million and qualified adjusted gross revenue (QAGR) for retail sports betting fell 25.7% to $14.0 million.

In December, total market revenue rose 5.7% to $116.2 million. Table and slots revenue increased 2.9% to $111.4 million and sports betting QAGR increased 200.0% to $4.8 million.

Michigan is taking action against illegal operators

Additionally, the Michigan Gaming Control Board (MGCB) has sent cease-and-desist letters to three online gambling companies believed to be operating illegally in the state.

New York-based PredictionStrike Inc, California-based VGW LuckyLand and Cyprus-based Sweepstakes Limited (Stake.us) were all designated by the MGCB. Each has been contacted by the regulator in recent months.

The MGCB said the operators were offering some form of online gambling in Michigan without having a legal license to do so.

PredictionStrike was tagged for igaming and sports betting, Stake.us for online lottery, and VGW for offering games where players wager something of monetary value for a chance to win something of monetary value.

Regulatory authority fines operators for violating the law

The MGCB stated that each operator violated certain laws by offering such services. These include the Lawful Internet Gaming Act, the Michigan Gaming Control and Revenue Act and the Michigan Penal Code.

However, the MGCB also noted that operators have now taken steps to prevent Michigan residents from gambling on their sites.

“Gambling regulations exist for a reason and illegal gambling activities are not welcome in Michigan,” said MGCB Executive Director Henry Williams.

“We don’t want companies that circumvent the law to have access to Michigan residents and leave them vulnerable because they play on unregulated sites that leave them with no recourse and siphon the funds from communities because they don’t pay taxes like that a regulated, legal gambling establishment would do it.”