Online Poker Revenue To Highest Total In Two Years

The New Jersey online poker industry registered its highest revenue tally since April 2014, largely thanks to the timely entry of PokerStars.

In total, the state’s three operators, now consisting of Stars, WSOP/888 and PartyPoker/Borgata, generated $2,461,064 in March, up a cool 23.4 percent over the month prior, and 10.5 percent since last year. This, despite PokerStars only hosting full operations in New Jersey for the last 11 days of the month.

PokerStars also helped lift the entire New Jersey online casino industry to its sixth consecutive month of growth, and yet another revenue record. The industry cracked the $15 million barrier ($15,507,459) for the first time last month, representing a 5.1 percent monthly increase.

That being said, daily industry averages were down slightly: $500,240 in March versus $508,608 in February, marking a 1.6 percent decrease.

A full breakdown of the numbers, as provided by the NJ Division of Gaming Enforcement, can be found here.

PokerStars rises at expense of competition

In just half a month, PokerStars generated an eye-popping $597,677, good for a 24 percent market share.

Unfortunately, a portion of its revenue came at the expense of the state’s two existing operators (see chart below), both of whom experienced month-over-month declines.

Party/Borgata was only moderately impacted, with revenue dropping from $1,061,706 to $1,033,380 – a 2.7 percent drop. Last March, the operator’s revenue climbed 11.4 percent.

The partnership of and 888 Poker was hit harder, posting its lowest monthly tally ($830,007) since September 2015, down 11 percent over February. This time last year the network saw modest monthly gains of 5.9 percent.

Assuming both existing networks would have posted similar monthly gains to last year, PokerStars’ entry cost them roughly $310,000 combined. The rest of PokerStars’ revenue (~$290,000) was strictly additive.

Stretching PokerStars’ revenue out over an entire month, we arrive at $1.16 million – or $55,000 more than Party/Borgata generated last month.

However, in reality the divide would be considerably bigger because:

  • PokerStars capped liquidity at 500 players during its soft launch (March 16 – 20) period.
  • The operator would have been siphoning traffic away from other sites for a longer stretch.

The narrative here is that come end of April, New Jersey will undoubtedly have a new market share leader – and it shouldn’t be close.

Predictions for April and May

In what will amount to a rare occurrence, New Jersey online poker revenue should experience yet another sizable uptick in April.

From March to April last year, revenue fell 10.9 percent, largely due to April’s shorter duration and the beginning of the seasonal downtrend.

However, this April will be the first full month PokerStars is live in the Garden State – and based on the early numbers, it looks like approximately 50 percent of its revenue will be additive. That good news for state coffers.

Granted, industry cash game traffic (as per Poker Industry Pro via PokerScout) is down 9 percent since the beginning of the month, and should continue to decline incrementally throughout the April and May. But even a moderate decline won’t completely undo the 23.5 percent gains the industry has experienced since PokerStars’ opened its doors to the New Jersey masses.

Factor in the money printing machine that are Spin & Go’s, which are receiving a heavy promotional focus this month, and it wouldn’t shock if New Jersey online poker came close to hitting the $3 million mark, with PokerStars holding only a small lead over WSOP/888 in the ring game traffic department, but a substantial revenue share lead due to its strong tournament turnouts and the popularity of its casino/poker hybrid.

However, any flirtation with $3 million will likely be short-lived, as the initial hoopla tied to the PokerStars launch will probably die completely by early May. That, and the advent of summer weather will take its toll on liquidity. The running of the first SCOOP in early May will offset the inevitable downturn somewhat – but only somewhat.

Still, it’s pretty clear that online poker in New Jersey is better off with PokerStars than without.