California Lottery Budgets Increase In Scratch Sales, Dip In Draw Games For FY24-25

Though trends may point in one direction, the California Lottery is hoping to change course next year.

The state’s lottery commission approved its fiscal year 2024-25 budget on Thursday during its monthly meeting.

While the overall sales are projected to drop by $263 million, California is forecasting growth in its scratch ticket sales.

That bucks the trend that many states in the US have been seeing, as scratch purchases have been on the decline. In fact, it’s the lottery draw games that have carried states to new sales records in the last fiscal year.

Still, California is projecting a jump of nearly $180 million in scratcher sales for next year.

California Lottery budgets over $9 billion in sales

Here’s how the California Lottery budget looks for the next fiscal year.

SalesFY 2023-24 Year-End EstimateFY 2024-25 BudgetDifference
Scratch Games$6,650,000,000$6,830,000,000$180,000,000
Multi-State Draw Games$1,598,000,000$1,175,000,000-$423,000,000
SuperLotto Plus$266,000,000$240,000,000-$26,000,000
Hot Spot$424,800,000$438,000,000$13,200,000
Daily Games$424,200,000$417,000,000-$7,200,000
Total$9,363,000,000$9,100,000,000-$263,000,000

Only in two categories is California projecting higher sales next year compared to this one. That’s in the scratch tickets and in Hot Spot.

The scratchers aren’t a big increase, just a 2.7% jump. Still, that’s a notable projection given that the produce has been on the decline in many states.

Also, California’s FY23-24 budget called for $6.68 billion in scratch sales. The current estimate for the year is $6.65 billion.

Scratch tickets targeted for 75% of California’s sales

When it comes to bumping up its scratch sales, California is targeting a big market share for FY24-25.

The $6.83 billion would equate to over 75% of the total lottery sales for the state.

According to the proposed budget plan, the California Lottery ran several product plan scenarios for its scratch games to identify the optimal mix that will yield the highest sales next year.

It may be tough for California to find the right formula that other states aren’t finding.

Here’s some of the states that have reported recent struggles with their scratch sales toward the end of the fiscal year:

  • Arizona: Scratcher sales are down 2.5% year-over-year through May and down 7.2% from the state’s projection for FY24. In total, scratch tickets have sold $24.8 million less this fiscal year.
  • Massachusetts: Instant ticket sales (scratchers) are down $12.4 million through May, which is just 0.3% year-over-year. However, May’s scratch sales were down $27.3 million on their own.
  • North Carolina: Despite success from its Digital Instants, retail instant tickets are down 2.1% through 11 months of the fiscal year. That is over $56.3 million in difference.
  • Texas: Even with $100 scratch tickets up 22% in sales, the Texas Lottery was down over $100 million in scratch purchases through mid-May.
  • Washington: Though scratch tickets are up slightly (just under $500,000) year-over-year, they are still over $1 million behind budget with a month remaining in the fiscal year.

Will jackpot fatigue actually hit draw games in FY24-25?

Similar to last year, the California Lottery is expecting the draw game sales to decline.

A year ago, the state budgeted less than $500 million for Powerball and Mega Millions, respectively.

Instead, the multi-state games produced an estimated $1.6 billion in combined sales. Powerball was particularly the driving force for sales around the nation, as massive jackpots throughout the year helped drive purchases.

It’s understandable to be cautious with projections for those games in the next 12 months. California is calling for just under $1.2 billion in sales.

When it comes to games like Powerball and Mega Millions, it’s ironically about the luck of the draw. The larger the jackpots get, the better the sales.

Mega Millions is also set for a major change, as it will increase its ticket price to $5 in 2025. That is currently planned for an April launch.

While the odds are improving and the prize matrix is changing, the increase in price could impact sales negatively or positively. Either way, it will have a big impact on the bottom line for the last quarter of the fiscal year.

 

Photo by Wirestock Creators via Shutterstock
Graphic from the California Lottery

About the Author

Drew Ellis

Drew Ellis

Lead Writer
A member of Catena Media since 2020, Drew Ellis is the Lead Writer at PlayiLottery, where he handles coverage of the online and retail lottery industry in the US. He previously spearheaded news content at PlayMichigan, where he covered one of the most prominent online lottery industries in the US — among the many other aspects of Michigan's sprawling iGaming market. You can email him at [email protected].
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