US Online Betting Market Shows Uneven March Performance

Activity across the US online gambling sector delivered mixed signals in March. This reflected shifting player habits and the impact of difficult year-on-year comparisons.

Mixed Q1 Results as US Sports Betting Faces Pressure

A recent industry tracker compiled by analysts at Stifel highlighted that betting volumes fluctuated over the first quarter. February brought a slight improvement. Total wagers edged up 2% compared to the same period last year. However, when excluding launched jurisdictions, performance remained unchanged, as reported by Next.io. This suggests limited organic growth in established markets.

This modest uptick followed a challenging winter stretch. December and January both saw declines. These were attributed to unfavorable sports outcomes that reduced bettor recycling and overall engagement.

Early figures for March pointed to renewed pressure. Total betting handle dropped by about 3% year-on-year, with sequential declines also evident as operators faced stronger comparatives. Despite this, operator revenues moved in the opposite direction. Gross gaming revenue climbed, supported by improved hold rates approaching 9.6%, which offset weaker wagering volumes.

Competitive positioning among major operators shifted as well. DraftKings and Fanatics managed expansion of their presence, both reporting annual growth in February. FanDuel, on the other hand, experienced a downturn that analysts linked to ineffective promotional strategies. Its market share dropped compared to the previous year, though signs of recovery began appearing in March after increased marketing efforts. DraftKings, meanwhile, saw its growth pace slow as it tightened promotional spending during the high-profile March Madness period.

iCasino Growth Steady Amid Betting Market Shifts

Beyond traditional sportsbooks, prediction markets continued gaining momentum. Platform activity surged, with trading volumes rising from February to March and exceeding typical seasonal patterns. Analysts noted growing interest in multi-outcome wagers, which accounted for a sizable share of transactions, which tend to generate higher margins.

At the same time, operators across the sector reduced promotional reinvestment. Spending on incentives fell to between 2% and 4% of handle in February, showing a broader shift toward profitability. However, inconsistencies in reporting methods across states make precise comparisons difficult.

Regulatory developments added another layer of uncertainty. Discussions around limiting certain types of betting contracts, such as those tied to individual player performances, could restrict product offerings in prediction markets and slow their expansion.

Meanwhile, the iCasino segment remained a steady performer. Online casino revenue grew by around 20% year-on-year in February, keeping a consistent upward trajectory. Market dynamics varied by state, but overall demand proved more resilient than in sports betting.Looking ahead, analysts suggest the industry is entering a phase defined by tighter cost control and margin focus as operators adapt to fluctuating volumes and evolving competitive pressures.