Arizona sportsbooks started 2026 on a strong note with nearly $150 million in gross revenue across two months as the state’s Department of Gaming released figures for January and February on Wednesday.
The $87.3 million in winnings before any deductions reported for January came within $60,000 of the all-time high set last December and marked a fourth consecutive month with operator revenue above $80 million. That streak ended in February when the house claimed $62.2 million.
The Grand Canyon State posted top-five national handles for each month. The $881.1 million wagered in January was up 2% from the same month in 2025, and the $760.4 million worth of bets accepted in February represented an 8.7% year-over-year increase. The handle increases in both months came despite a dip in promotional spending. Outlay on credits and bonuses was down 8.9% in January and 20.6% in February.
The state collected $9.6 million in tax receipts from the $98.3 million in adjusted gross revenue. All-time tax revenue from sports betting since launch in September 2021 has now topped $175 million.
Fanatics hunting No. 3 handle spot
The rise of Fanatics nationwide over the past year-plus in a bid to become the No. 3 sportsbook for mobile handle behind DraftKings and FanDuel has been playing out as well in Arizona.
It cast aside a challenge from bet365, moving beyond the England-based competitor last fall while also offering fewer promotional credits and bonuses. The next target is the more-established BetMGM, whose Las Vegas base provides strong regional support in the West.
Fanatics did not overtake BetMGM in either month, but it has narrowed the gap considerably compared to last year. Fanatics came within $189,000 of $100 million handle in January, a near-80% year-over-year increase, and followed that up with a 76.6% rise in February to $88.4 million. Its revenue results were mixed, though, as Fanatics followed up a record $8.7 million haul in January with only $3.2 million in February when its hold plunged more than five percentage points to 3.6%.
BetMGM’s year-over-year handle increases were not as pronounced — 6.9% in January and 16.2% in February — as it kept Fanatics at arm’s length for the final podium spot. But BetMGM fared much better in terms of performance with a 10.3% win rate in January to reap $10.9 million and an 8.2% hold in keeping $7.4 million the following month.
FanDuel’s handle ‘woes’
Part of Fanatics’ rise has come at FanDuel’s expense as the colossus has slipped behind DraftKings in the handle pecking order despite continuing an aggressive promotional spend.
FanDuel led all operators in combined outlay the first two months with $16.7 million, highlighted by a $10.5 million spend to kick off 2026. But its $455.3 million combined handle lagged 9.8% in January and 10.3% in February; DraftKings had a decline of less than 1% in January and a 4.3% uptick in February in generating $496.1 million worth of wagers.
FanDuel, however, persevered as it almost always does by way of performance. It notched 11%-plus holds in both months to claim $50.8 million in gross revenue compared to $45.8 million by DraftKings, which had a 10.1% win rate in January and 8.2% mark the ensuing month.
Caesars appeared to have a whale in its midst in February; its $74.4 million handle was nearly double 2025 and its highest for any month since reporting $95.3 million worth of wagers in March 2022. A 6.2% hold, however, left $4.6 million in gross winnings and meant year-over-year revenue increased only 57.4%.
Though now lagging behind Fanatics, bet365 fared well revenue-wise to open the year. Winnings were up 46.1% from the first two months of 2025 to $7.9 million, including a 22.4% increase in February despite handle slipping 16.9% to $40.7 million. When March’s figures are released, bet365 is on target to surpass $1 billion in accepted wagers.
The national picture
In reviewing national year-over-year figures for the first two months of 2026, it appears there is some impact from prediction markets putting a drag on sportsbook action.
Even with the inclusion of Missouri, handle numbers were down ever so slightly (less than 1%) each month, with $15.68 billion wagered in January and $12.66 billion for February. Revenue was just about flat in January with $1.62 billion, and the public did slightly better in February as the $1.14 billion in known gross winnings was down 5.5%.
Despite the dip in winnings, tax increases enacted by multiple states over the past 12 months led to a larger inflow to coffers. January receipts totaled $382.9 million, an increase of $6.6 million from 2025, and the $275.1 million accrued in February was a jump of $12.8 million.
