Missouri sees massive sports betting handle after legalization
Sports betting platforms have finally started operations in full in the US state of Missouri after a long wait for legalization, and sportsbooks in the state have reported massive handles for the first month of that new operation.
Only 11 US states remain with sports betting kept illegal, and Missouri took a secondary route when bills to bring sports betting to the state proved unable to pass. Missouri’s gambling stakeholders lobbied for a constitutional amendment that legalized sports betting. Voters in the state approved the addition in 2024, but a legislative and regulatory processes stalled the launch.
December 2025 was the first month for Missouri’s sports betting market, and it saw players in the state wager roughly $543 million.
Missouri generates light gambling tax revenue despite massive sports betting handle
Legalizing sports betting in Missouri has been remarkably beneficial for operators, as players wagered almost half a billion dollars within the first month. This seems like it would come with great benefit for the state, but Missouri only generated roughly $521,000 in sports betting taxes in December. This was in large part because of how the constitutional amendment handles sports betting adjusted gross revenue.
While most US states include promotional spending in the AGR, Missouri sportsbooks can deduct them from their tax liability. This led to the two top sportsbooks, DraftKings and FanDuels, to report a net loss of $16.9 million and $7.2 million after deducting promotions and free bets given out, respectively. These losses are attributable to such marketing tactics as the proliferation and success of DraftKings promo codes and the same from FanDuels bringing new players to these platforms.
An image showing someone placing a bet using an online sportsbook.
Missouri residents remained partial towards mobile and online betting sites, which accounted for 99% of all wagers placed in the state. In-person sportsbooks, such as casinos and racetracks, accounted for less than 1% of the total handle.
This could be because digital operators were fully operational from Day 1 of the market’s launch. But this online betting dominance can also be considered a potential reason for operators reporting some losses, as online sportsbooks typically rely heavily on promotions and bonuses to attract new players. This promotion-focused model works well for online sportsbooks, but the deduction affects the AGR and ultimately the state’s betting tax.
Every player in Missouri is new given that sports betting legalization is itself new to the state, so it stands to reason that promotions focused on new players
Operators are expected to taper off free bets, bonuses, and other promotions as Missouri’s market matures. Industry analysts speculate that Missouri’s sports betting market will generate approximately $4 billion in total handle in its first full year, with operators’ revenue being roughly $525 million and the state generating more than $50 million in taxes.
It has already been firmly established that US states are able to generate massive revenues from taxing sports betting operators, and this will almost certainly be the case in Missouri as well once the state’s new market stabilizes.
The December launch was also overshadowed by the NFL season, which, paired with launch promotions, drastically decreased operator AGRs. Regulators expect tax revenue to stabilize once operators establish their local clientele and stop promoting as heavily.
Feature image credit: Canva
Khizar Mundia has been playing video games for as long as he can recall. Things have come a long way since the many days he spent playing the original NES, though. He now covers a variety of competitive games and esports, as well as the world of streaming, ranging from Twitch to Kick. If it’s of interest to gamers, it’s of interest to Khizar.
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