Ontario’s New iCasinos Outpace Sports Betting by nearly 6 to 1

Ontario Market Handles $14B in Online Gambling Wagers in Q1 FY23-24

It’s been 15 months since the launch of Ontario’s competitive online gambling market. Throughout that time, provincial regulators have been very busy. The AGCO and iGO agencies have reviewed countless applications, doled out more than 70 licenses, monitored the activities of authorized operators, and even handed out a few fines for non-compliance. And, in the background, they’ve been eagerly scripting reports indicating the fiduciary success of their endeavors.

The latest report, published last week, details the market’s performance in the first quarter of fiscal year 2023-24 (a.k.a. Q1 FY23-24). Being the second fiscal year of operation, the information within this report is particularly exciting. It illustrates growth by comparing the very first Q1 (April 4 thru July 30, 2022), to the latest quarter (April 1 to July 30, 2023). The numbers are rather staggering, and to the veteran eye, a bit ironic. Let’s have a look…

Ontario Handles $14B in Online Gambling Wagers

According to the report, Ontario’s iGaming market took in $14 billion in wagers across all verticals. These are actual monetary bets and do not include any wagers made with bonus or promotional credits (of which there were surely many). I repeat; $14,000,000,000.00 in cash wagers on casino games, sports bets, poker, and bingo games.

That’s a lot of zeroes, right? But that’s not the ironic part.

The irony is that the Canadian Gambling Association (CGA) spent years advocating for legal iGaming and single-event sports betting in Canada. In doing so, its president, Paul Burns, estimated time and again that Canadians were “wagering approximately $14 billion annually” through offshore gaming sites.

Now, we find Ontarians alone – that’s just Ontarians, not all Canadians as Burns estimated – are betting $14 billion on locally regulated iGaming sites. And they’re doing it in just three months’ time – not annually, also as predicted.

Okay, that’s enough retrospect. Back to the report…

Online Casino Takes the Cake (Most of the Icing Too)

One of the more interesting aspects of the report is the breakdown of wagers by gambling vertical. Ontario’s most prominent markets are online casinos, online sportsbooks, and online poker rooms – in that order.

Of the $14b in total wagers, $11.6b of that went to casino games, $2b to sports betting, and about $350m to poker.

Breaking that down into percentiles, we find that online casino games – these include slot machines, RNG and live dealer table games, video poker, as well as bingo – account for 83% of total revenue. On the sports betting side – inclusive of sports, esports, DFS, props, and novelties – that $2b equals 14% of all bets. P2P poker games – Texas Hold’em, Omaha, etc. – comprise the smallest portion at 3%.

For the most astute bettors, an even more intriguing number is the amount of revenue Ontario is collecting from each vertical. Let’s have a look, then I’ll explain why this information is so important.

The province’s Q1 Fy23-24 haul – the amount Ontario keeps – was $454 million, or 3.24% of the total intake. Breaking that down, we see casino games bringing in $392m (72%) in revenue. Sports earned the province $138m (25%), and poker $15m (%3).

The takeaway: Casino games account for nearly 5/6 of wagers, but only 3/4 of revenue.

Likewise, sports bets account for just 15% of wagers, but 25% of intake. 

What this Means for Ontario’s Gamblers

Avid gamblers are always looking for an edge; a way to win more and lose less. When we compare these numbers, we find that Ontario’s online casinos are paying back more to players than sportsbooks. If we look at this from an RTP perspective – the gambler’s oh-so-important Return to Player – we can surmise the following:

Ontario casinos have a 96.76% RTP (or 3.24% house edge). In contrast, Ontario sportsbooks are dishing out a 93.1% RTP (6.9% house edge).

When you observe the market from this standpoint, those online casino games start to look a lot more enticing. Or, we could surmise that Ontario’s sports betting community lacks a good balance of successful handicappers.

Q1 2023-24 vs. Fiscal Year 1