The NFL's Untouchable Business: Teams' National Revenue Grew 21% Last Year
The National Football League's revenue-sharing pool grew 21% to $7.3 billion last season, based on financial data released Monday by the Green Bay Packers.
Each of the league's 32 teams received $226.4 million in national revenue in the year through March, up from $187.7 million last year, according to Packers accounts. The amount comprises mostly TV revenue and also includes national sponsorships, licensing and most merchandise sales.
Packers total revenue rose 16% from 2014 to a record $376 million. Green Bay's operating profit, which fluctuates due to stadium renovation expenses and the cyclical nature of player salaries, was $39.4 million, $15 million shy of the franchise record.
"The Packers had another very strong year financially," team President Mark Murphy said in a conference call. "Really for three main reasons -- the continued strong performance by the team on the field, great fan support that we receive off the field, and then the continued very strong popularity of the NFL nationally."
The Packers are the only publicly owned franchise in major North American sports and the team's annual financial release provides a rare look at the books of an NFL franchise. The team issues shares that don't appreciate in value and cannot be resold.
NFL teams split a record $6 billion last year due largely to increased carriage agreements with NFL Network. Since then, the NFL began nine-year extensions with broadcast partners CBS, Fox and NBC -- deals that represented a 60% rights-fee increase.
The league last year also sold CBS the rights to eight Thursday night games for what Guggenheim Securities estimated was between $250 million-$300 million. There will be another increase next season, as the Thursday night contract was renewed in February and the league reached an eight-year, $12 billion agreement with DirecTV through 2022.
Mr. Murphy said that while league revenue has grown in areas outside of TV -- such as NFL.com and NFL Network -- broadcast rights are a "high percentage" of each team's revenue share.
The Packers' local revenue increased 9% to $149 million, with more than half coming from the new team pro shop, which opened in July 2014. It puts the team's local revenue -- and overall revenue -- at ninth in the 32-team league, Mr. Murphy said, even though the team plays in the country's 68th-largest media market, the NFL's smallest.
"We strive to be right below the league average in terms of our ticket prices, so we don't want to generate all the revenue on the backs of our season-ticket holders," Mr. Murphy said, citing meetings and special events in the Lambeau Field atrium, as well as stadium tours.
Higher expenses at a time when player costs shrunk were a product of stadium renovations, debt refinancing and costs affiliated with Titletown, a project on team-owned land around Lambeau Field being developed to create local jobs and attract consumers. A Cabela's store in the district had 2.8 million visitors in the past year, Mr. Murphy said, calling it a "first step" to the project.
"As we bring more people into the community, we will have more people going to our pro shop, going to our Hall of Fame and taking tours," Mr. Murphy said. "Hopefully we'll have some revenue from our leases and other things, but we're really trying to make an attraction and bring more people into the community."
Lambeau Field is the second-largest stadium by capacity in the NFL behind MetLife Stadium, the home of the New York Giants and New York Jets. The Packers are undertaking a $55 million renovation of suites and club seats.
Green Bay Packers Inc. has been a publicly owned non-profit since 1932. In 2012 the team raised $64 million from more than 250,000 shareholders in its fifth stock sale.
~ Bloomberg News ~