The NFL may delight millions of Americans throughout its relatively brief season. However, it provides enormous profits each year for the 32 franchises it includes.
In 2024, its total revenue was a little over $20 billion, 72% higher than the MLB. Taking it down to the franchise level, the average value of each one is $5.93 billion, a figure that tends to rise yearly.
So it hardly comes as a massive surprise that private equity firms have long been sniffing around, hoping to get a piece of the action. The good news for them is that in August of last year, the NFL eventually agreed to a specially selected group of them taking stakes of no more than 10% of their chosen franchises.
Another bonus for the owners of franchises is the salary cap imposed by the League. Currently, this is set at $225 million a year – so outrageous pay demand from players will never hit the bottom line.
But what are the primary sources of revenue for the League and, therefore, the franchises?
Media rights
Football is the jewel in any broadcaster’s crown as the most viewed sport in the US – the Super Bowl has no difficulty attracting 115 million viewers. This means that the NFL is virtually able to name its price.
The contracts now in force mean that each franchise receives around $12 billion a season from deals with Amazon, CBS, ESPN/ABC, Fox, and NBC, which are set to be in place at least until 2033.
Corporate sponsorship has significant benefits for both parties, and sponsors are willing to pay for the privilege.
The most valued of these is the right to have a stadium named after them and corporations that have signed on the dotted line in the past, including Mercedes Benz, AT&T, and Caesars Entertainment. In the case of the latter, this indicates the increasing number of gambling operators involved in sponsorship driven by, or perhaps driving, the growing interest of fans in NFL lines since sports betting was legalized in the US in 2018.
Licensing and merchandise
As a major brand, the NFL also protects the use of its identity very closely and charges very handsomely for the privilege of using it. Licensing is handled through NFL Properties LLC in the US and NFL International LLC worldwide.
So anyone wanting to use their trademarks and even the words Super Bowl must pay a licensing fee. It’s estimated that the licensing deals bring in $3 billion a year.
You can add to this the profits generated from the merchandise sales, from replica team shirts to all kinds of weird and excellent items.
Tickets and hospitality
Anyone who’s tried to buy a ticket for an NFL game but found it too expensive might be surprised by this fact. Ticket sales represent a relatively small proportion of the revenue raised by the NFL. Yes, the average ticket cost is estimated to be around $150, but a finite number is available for each game, which is limited by a stadium’s seating capacity. In addition, a team will only have a maximum of ten home games a year, which still limits the revenue potential further.
Then, compared with the amount raised by broadcast rights, it pales insignificantly.
One area in which more significant profits can be made is in corporate and other hospitality. Companies are prepared to pay enormous sums for this, which forms part of their marketing and self-promotion to existing or potential clients. This is why many franchises invest heavily in adding luxury suites to their stadiums, sometimes to the consternation of ordinary fans.
Concessions, parking, and other events
An NFL stadium is a prime location for food and drink sales, so concessions are charged accordingly. With many stadia being in out-of-town locations, there is also the question of how to get there and where to park, creating another profit opportunity.
During the off-season, many franchises also host music and other events that help boost their revenue. During her record-breaking era tour, Taylor Swift performed all her US shows at these venues. However, this hasn’t been the only way she’s said to have contributed to the NFL’s and, more specifically, the Kansas City Chiefs’ profits in the last couple of years.
So there you have them—the main areas contributing to the NFL’s profits. In the future, gambling and streaming services are set to play a more significant role – and that will be excellent news for the 32 franchises and their owners.
