More people than ever expected to bet on Summer Olympics after U.S. legal gambling boom

Sportsbooks and daily fantasy operators are preparing for a Summer Olympics bump.

The games in Paris, set to start July 26, will be the first to take place since legal gambling became widespread in the U.S. The gaming industry expects an increase in wagering from the previous Summer Games in Tokyo, particularly for sports like men’s and women’s basketball, soccer and tennis.

“The Olympics and gambling, for decades, have looked at each other from afar. This year we’ll see them meld together,” said Max Bichsel, North America executive vice president at Gambling.com Group.

These Olympic Games come at an opportune time for sportsbooks, during the offseasons of high-volume betting leagues like the NFL and NBA. But it remains to be seen whether they move the needle for gambling operators.

The effect could be more muted for giants FanDuel and DraftKings, which together hold about 80% of the U.S. online gambling market share, than for smaller players.

“If you want to look at this from an annual perspective for a company like DraftKings or FanDuel, it’s still going to have a relatively minor impact,” said Jordan Bender, a senior equity analyst at Citizens JMP. “Obviously positive, but it’s not going to be as big as we might think and a lot of it is going to be largely dependent on viewership.”

A representative of FanDuel, which is owned by Flutter, said the Olympics likely won’t move the needle much for the sportsbook. DraftKings didn’t respond to a request for comment.

Even so, the expected rise in Olympics gambling underscores just how much the market has boomed in recent years.

More than 30 states now allow some form of sports wagering, and many of them permit mobile and online betting, a dramatic increase from the last Summer Olympics.

The Tokyo Olympics came just a few years after the Supreme Court ruling that paved the way for legal betting across the U.S. In 2021, 97 million American adults were able to place a bet, compared with the 164 million American adults that will be able to wager this year, according to the American Gaming Association.

“Sports bettors are looking for something to bet on and incremental events are going to help,” Bender said. “The hard-core gambler, someone betting week in and week out on the NFL, NBA, NHL … that’s where a lot of the money is still going to be made.”

Still, the Olympics may not cause the betting surge seen with other sports in the U.S. Some state regulations may prevent betting on many events, and users may only be able to wager on medal competitions.

Viewership for the Olympics in the U.S. has suffered in recent years, particularly due to the difficult time difference in Tokyo in 2021 and Beijing in 2022 (the home to the Winter Games), as well as the absence of fans during the pandemic.

U.S. bettors will also face a time zone issue this year. While Paris’s time zone — six hours ahead of Eastern Time — presents fewer difficulties for Americans than Tokyo’s 13-hour gap did in 2021, prime-time events won’t be live this year.

Prime-time replays will air on the NBC broadcast network, and the entirety of the Olympics will be available on NBCUniversal’s Peacock, the first time there will be a significant streaming presence for the games.

Sportsbooks will be keen to see if that access improves betting interest.

Still, many in the industry consider the Olympics an opportunity to increase engagement and betting in the typically slow summer months.

The roughly two weeks of competition in Paris are a boon for betting operators because they come during what is typically a lull in U.S. sports. Many leagues, including the NFL, NBA and NHL, are in the offseason.

The Olympics taking place in the summer could also reduce competition for viewers.

Brandon Friedman, vice president of operations at PrizePicks, a daily fantasy operator which allows users to make entry fees on competitions but is not considered gambling under federal common law, said the company offered Olympic events in Tokyo and Beijing and learned that users prefer summer competitions.

“As a result, we are leaning into the Paris 2024 Olympics with a wider offering for our members to enjoy than ever before,” Friedman said.

The picturesque Paris backdrop, and the ability for U.S. viewers to watch many of the competitions live during the daytime, also are expected to drive engagement.

“Beach volleyball in the foreground of the Eiffel Tower and Equestrian in the Gardens at Versailles will undoubtedly be the most spectacular venues in recent years,” said Bichsel.

The sports included in the Summer Olympics help, too. Many operators, including FanDuel and Rush Street Interactive‘s sportsbooks like BetRivers, expect basketball, tennis and soccer to be the top sports for betting. He also noted the recent rise in the popularity of women’s sports will likely carry over to the Olympics.

Basketball wagers made up about half of FanDuel’s betting handle at the Tokyo Olympics. The company expects the emphasis on basketball to continue this year, a FanDuel representative said.

Plus, patriotism that fuels the Olympics fandom will play a factor in betting.

“Patriotism is No. 1 in the Olympics, and bettors love to back their country’s heroes no matter the event,” said Tim Whitehead, head of sportsbook at BetRivers, which is operated by Rush Street.

That may spill into betting on other countries, too.

“In the U.S., you see a melting pot of allegiances like where people not only support the U.S. but also have allegiances to their heritage in countries like Italy and Korea to Croatia and Brazil,” said Bichsel. “So., some sportsbooks, depending on the states and demographics, will respond differently to the Olympics and international games in general. For example, you might see an influx in bet volume from New York and New Jersey if an Eastern European country or Italy is playing.”

— CNBC’s Jessica Golden contributed to this article.

Disclosure: Comcast’s NBCUniversal is the parent company of CNBC.