The Tennessee sports betting market demonstrated robust growth in May 2025, with a 15.4% year-on-year increase in total handle. The state’s innovative tax model and diverse operator presence continue to drive this upward trajectory despite seasonal adjustments. Let’s dive deeper into the key metrics, trends, and the factors contributing to Tennessee’s success.
Tennessee’s Impressive Year-on-Year Growth
In May 2025, Tennessee posted a total betting handle of $437.5 million, a 15.4% increase from the $379.2 million recorded in May 2024. Additional adjustments totaling $3.2 million brought the gross monthly wagers to $440.6 million, marking an overall year-on-year growth of 16.2%.
This steady rise reflects strong consumer interest in legalized sports betting and the effective regulatory framework supporting market expansion. Tennessee’s performance showcases a healthy trajectory compared to other US markets.
Month-on-Month Trends: Seasonal Decline
Despite the impressive year-on-year growth, May 2025 saw a 5.6% decrease in betting handle compared to April’s $463.6 million. This decline aligns with seasonal industry trends, as betting activity tends to drop following major sporting events, such as the NCAA basketball season finale.
Such dips are common and expected across US sports betting markets, suggesting robust growth patterns are maintained when observed on an annual basis rather than monthly fluctuations.
The Unique Taxation Model in Tennessee
One of the standout features of Tennessee’s sports betting market is its unique tax structure. Unlike most US states, Tennessee taxes the handle—total wagers placed—rather than operator revenue. This approach applies a 1.85% tax rate on total wagers, ensuring a steady revenue stream for the state government.
In May 2025, privilege tax collections from sports betting surpassed $8.1 million, reinforcing the efficiency of Tennessee’s tax model. Compared to neighboring states that tax based on revenue, Tennessee’s approach delivers more predictable and consistent returns.
The Competitive Operator Landscape
As of May 2025, Tennessee had 11 active operators driving its sports betting ecosystem. Some of the major platforms include:
- FanDuel
- DraftKings
- Fanatics
- ESPN Bet
- BetMGM
- Caesars
- Bally Bet
- Hard Rock Bet
- Betly
- ZenSports
- Tennessee Action 24/7
This competitive environment fosters consumer engagement and provides a dynamic market driven by well-known brands and innovative offers.
Challenges with Revenue and Hold Data
The Tennessee Sports Wagering Council has not reported operator revenue or hold percentages since July 2023. This limits analysts’ ability to evaluate market profitability and operator performance. Nevertheless, state-level handle and tax data offer valuable insights into the market’s overall health and sustainability.
Conclusion
Tennessee’s sports betting market achieved a remarkable milestone in May 2025, with a 15.4% year-on-year growth in handle. Despite seasonal declines, the state’s innovative tax model and diverse operator lineup have ensured consistent revenue streams and fostered steady market growth. As Tennessee continues to fine-tune its regulatory practices and betting products, it sets the stage for sustained success in the rapidly evolving US sports betting sector.
