The NFL distributed approximately $400 million to each team after accruing around $13 billion in media, sponsorship, and royalty revenue during the 2023 season, according to Sportico’s Kurt Badenhausen. Some team payouts totaled as much as $425 million, Badenhausen reported.
These payouts, each of which almost doubled the 2023 salary cap, increased by between six percent and eight percent over what teams received following the 2022 season, Badenhausen noted.
Significant Growth in Team Payouts
The NFL’s robust financial performance in 2023 was driven by several factors, with national media rights, league sponsorships, and shared revenue playing pivotal roles. The funds originated from the league’s various affiliates and subsidiaries, including NFL Properties, NFL International, and NFL Enterprises. This substantial revenue stream underscores the league’s successful monetization strategies and its ability to capitalize on its brand and global appeal.
The increase in team payouts is significant, with each team receiving between six percent and eight percent more than they did the previous year. This increase is indicative of the NFL’s growing financial health and its ability to negotiate lucrative deals that benefit all franchises.
Valuations of NFL Teams
Heading into the 2023 season, NFL teams were valued at an average of $5.1 billion each, according to Mike Ozanian and Justin Teitelbaum of Forbes. This valuation surpasses the average valuation of NBA teams ($3.85 billion each) and MLB teams ($2.4 billion each), highlighting the NFL’s dominant position in the sports industry.
One of the contributing factors to these high valuations is the NFL’s hard salary cap, which, despite increasing to $255.4 million next season, still limits the amount owners must spend on payroll. This financial structure ensures that teams can remain competitive without overspending, maintaining a level of parity that is attractive to both fans and investors.
Long-term Financial Outlook
The NFL’s financial future looks promising, particularly with the 11-year media rights deal signed in 2021, valued at over $100 billion. This agreement is set to significantly boost team payouts, which are projected to exceed $800 million per franchise by 2034. This long-term deal not only secures substantial revenue for the league but also provides financial stability and growth for its franchises.
The league’s payout revenue is also supported by long-standing sponsorships from major companies such as Gatorade, Pepsi, Bud Light, Verizon, Visa, and Subway. These partnerships, some of which have spanned more than a decade, provide a reliable source of income and reinforce the NFL’s strong market presence.
