A general rule of thumb in Michigan is that the better an online sportsbook does, the better an online casino does. But Golden Nugget has been a bit of an outlier in the Mitten State since launch last January.
To wit, for the whole of 2021, the casino brought in over $50.5 million in gross revenue, good for fifth-best in the state behind BetMGM, FanDuel, DraftKings, and BetRivers, according to numbers released by the Michigan Gaming Control Board. But on the sportsbook side, Golden Nugget was a laggard, finishing the year 13th with a little over $10.2 million in handle, and only beating out Gun Lake and Firekeepers’ online sportsbook offerings because those two didn’t launch until half the year was over.
And the same has held true thus far in 2022, with Golden Nugget holding on to the unlucky 13 spot in sportsbook handle while maintaining its spot at number five in the casino revenue race.
One reason for Golden Nugget’s success might be due to its outsize success in New Jersey, the only other state where Golden Nugget operates an online casino. And while New Jersey lists revenue by license holder and not operator, it’s blazingly obvious that the Golden Nugget brand has carried the water in the Garden State.
Of course, things are changing for Golden Nugget’s online operations, as they are now officially part of DraftKings.
Today, @DraftKings announced the completion of its acquisition of Golden Nugget Online Gaming, allowing the company to deploy a multi-brand approach and broaden its reach into additional customer segments. Read more here: https://t.co/LFcUrpj5Y1 pic.twitter.com/9u5vmr6yS9
— DraftKings News (@DraftKingsNews) May 5, 2022
“Acquiring Golden Nugget Online Gaming gives us synergies across our business,” Jason Robins, chairman and CEO of DraftKings, said in a May 5 press release announcing the completion of the deal. “We anticipate that this acquisition will provide meaningful revenue uplift by utilizing our data-driven marketing capabilities and a dual brand iGaming strategy, gross margin improvement opportunities, and cost savings across external marketing and SG&A. I am proud to welcome the Golden Nugget Online Gaming team to the DraftKings family.”
In short, while DraftKings plans on keeping Golden Nugget operating as its own concern, all the money will be flowing into one company instead of two. And while this will barely move the needle in the Michigan online sportsbook world, it will create an interesting battle in the online casino market.
For starters, DraftKings has been battling FanDuel for second place in revenue since Day 1. With Golden Nugget’s monthly revenue, the combined haul is almost certainly going to give DraftKings breathing room on that front, as combined revenue will jump at least 25% based on prior months.
In total, the DraftKings/Golden Nugget combined revenue number should hover around $25-$26 million in the short term, while FanDuel’s monthly revenue has been in the $21 million range.
Of course, the bigger question is how much of a dent the combined forces will make in BetMGM, the clear market leader.
It took several years for the entire NJ online casino market to do $25mm in revenue in a single month. BetMGM alone did it in its first full month in Michigan. https://t.co/bMKn1PnpDp
— Adam Small (@AdamLoebSmall) March 16, 2021
BetMGM keeps topping itself, and April — the last month numbers are available — saw the company nearly hit the $50 million mark in revenue.
Clearly, the DraftKings/Golden Nugget team is a ways away from nearing BetMGM’s haul, but it’s certainly possible the “dual brand” strategy DraftKings plans to employ might bring more people to Golden Nugget’s tables. Time, as it’s said, will tell.