The NBA has had a banner financial year, revenue topping $10 billion for the first time. In another record, basketball-related revenue hit $8.9 billion.
Commissioner Adam Silver said the numbers are solid considering the league is still dealing with a pandemic and because it wasn’t easy for any entity in the world to return to activity after that period.
“The numbers surprised me to some extent, because they beat the projections, and the projections represent where we think our business is going. I think it’s pretty remarkable to get this, considering where we were two and a half years ago,” he said.
And taking into account the results of the last seasons as a result of the restrictions due to the pandemic, there were plenty of elements for him to have been surprised by the fantastic numbers of the 2021-2022 season. According to CNBC data:
-In the 2018-19 campaign, the last one prior to the pandemic, revenues reached 8.8 billion dollars.
-A season later, the League generated 8.3 billion dollars in revenue.
-At the end of 2020-21, it generated approximately 6.41 billion dollars. A 35 percent drop in revenue compared to the previous year.
And the NBA knows a lot about this business, because when there were moments of uncertainty and crisis they managed to transform this into business opportunities and profit from it. A clear test is the Play In, criticized at first, but which was enormously successful in the two years in which it was tested. In the tournament, the seventh, eighth, ninth and 10th in the East and West meet to determine the final two playoff spots in each conference.
It’s been a success, not least because it tends to give a sense of NCAA ‘March Madness’, as well as providing more incentive for teams to have something to compete for in the later games of the season.
And as expected, this week the League announced that the successful tournament will remain permanently on the calendar. Other data that demonstrate the financial success of the NBA:
-It had its best ratings since the 2018-19 season with a 19 percent increase for the just ended 2021-22. This ties in with the fact that the league earned $1.4 billion in sponsorship revenue, a 50 percent increase from 2020-21.
-There has also been a significant increase in subscriptions to the NBA League Pass, an increase of 30 percent this season. Confirming the excellent work that the League does in content creation and in hooking fans to its product.
-Going into the 2022-23 season, the average maximum contract for an NBA player increased 76 percent compared to 2016.
What’s coming for the future? The NBA is discussing the possibility of creating a cup tournament like those played in European soccer. All teams will participate, with the Semifinals and Final being played on neutral ground, as in the NCAA Final Four.
In addition, the current agreement for the broadcasting rights of the NBA for 9 seasons and 24 billion dollars is about to end in the 2024 season25. The new package aims to receive 75 billion dollars for the same 9 years. With this, only for broadcast rights, the league would increase its annual income by more than 8 billion dollars.
Considering that professional sports leagues and people around the world are still dealing with the pandemic, $10 billion in annual revenue is quite an achievement. Which shows the enormous capacity that the NBA has to understand this business and overcome moments of crisis.
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