The NBA has 30 teams with an owner, coach, manager, and other operating entities. According to several sources, they earn approximately $12-30 million dollars per NBA season.
The annual income of this premier professional basketball league varies from one team to another. Many people are curious about how much the NBA team owner makes yearly. Some of the team makers make an average of $100 million annually.
NBA owners are not allowed to share their financial information with anyone. Like other sports companies, the NBA doesn’t disclose the owners’ annual or monthly income to other agencies or third parties. Hence, we have estimated the basketball team owners’ income based on the reported figures we have received.
Let’s find out how the National Basketball Association and the team owners make money:
How Does the National Basketball Association Generate Revenue?
The NBA has acquired widespread recognition for being the most innovative North American basketball league. The company makes money from different sources, which a sports enthusiast needs to be made aware of. Teams in the NBA also share revenues from sponsorships and other league-based activities.
One team in the National Basketball Association is from Canada, and the other 29 are from the United States. Everyone in the team earns millions by participating in matches scheduled by the NBA.
How many matches each NBA team plays per season? These 30 teams play an average of 82 matches in a season. The professional basketball season starts in October and ends in April every year.
Everyone knows that the National Basketball Association is a private company. Hence, the company’s revenues aren’t issued publicly, making it difficult to assume the team owners’ income.
However, it can be assumed that the NBA generates its revenue from multiple endorsements and product replacements. This means that the NBA owners earn more money from these sources than what they invest in the teams.
What are the Income Sources of an NBA Team Owner?
Well, the NBA has the top-paid professional basketball players across the globe. Hence, it is clear that this basketball league pays professionals well. Let’s see how much revenue the NBA has generated in the last 4 seasons.
They generated $8.3 billion in the United States in the 2019/20 season. The NBA earned an annual revenue of $8.8 billion in the 2018/19 season. It witnessed a slight fall in the 2019/20 season due to the sudden Coronavirus outbreak.
The NBA team received revenue of around $10 billion in the 2021/22 season. This reputed professional basketball league managed to collect only $6.4 billion in the season of 2020/21. So, the NBA team generated more revenue in the 2021/22 season than in the 2020/21 season.
SponsorUnited reported that the National Basketball Association is expected to reach $1.4 billion in the 2022/23 seasons. NBA also revealed that their sponsorship portfolio rose to 3.5% year-over-year with 2000+ new brand deals.
NBA owners make a significant amount of investment in their teams. They recover these investments from these revenue sources:
- Media placements
- Match ticket selling
- Concession stands in arena sources and sports stadiums
- NBA athletes merchandise
National Basketball Association Owners Earnings Breakdown:
Most of the NBA revenue generation comes from arena, advertisement and branding. The National Basketball Association also makes money through the NBA-contracted athletes. Let’s learn how the 30 teams help the NBA owner to generate revenue:
1. Media Income
The National Basketball Association’s media income comes from television viewers. It varies yearly as the same number of viewers don’t always watch the basketball matches. The more popular the NBA team is, the more viewers they will attract, increasing the owners’ revenue.
Television plays a major role in the NBA’s business strategy, like other major sports matches. Television is one of the best options for NBA fans as they can watch their favourite players for free.
Did you know an average of 1.59 million viewers have watched the 2022-23 season from TV channels like ESPN and TNT? However, the number of viewers (1.61 million were more in the last season. So, the NBA witnessed a slight decline in viewership in the 2022-2023 season.
2. Arena Income
You might be surprised that most of the NBA’s revenue comes from the arena. It earns a huge amount of money from ticketing. It is one of the primary sources of income for this professional basketball league.
The ticket cost for one NBA match is around $74. The money earned from ticket sales increases the NBA’s annual revenue. However, the stadiums where the NBA team plays are rented out for occasions. This is another revenue stream for the NBA owners.
Along with tickets, the arena or stadium the team plays in makes money from merchandise deals. Did you know that the NBA earns billions annually from merchandise accounts? Yes! Furthermore, teams with popular players receive sponsorships from companies like Adidas and Nike.
3. Brand Income
Let’s start with the meaning of brand income. The sale of a team player’s caps, shoes, jerseys and other wearables is known as brand income. The NBA jerseys feature the number and the last name of the player. There is a huge craze among sports enthusiasts for branded team jerseys.
The brand income is also based on the NBA team’s popularity, like media income. The NBA has signed a contract with Fanatics, a leading retail company for trading team players cards.
CNBC confirmed that the NBA receives an average of $30 million yearly from shirt sponsorship. It started in the 2021/22 seasons for the American professional basketball team Brooklyn Nets.
4. Sports Income
Every viewer who watches every NBA match knows that only some teams are popular in the league. The more popular team undoubtedly earns more. High-paid teams share some of their income with the less popular teams to neutralise this wage inequality.
Based on the NBA rules, all teams must reveal their income at the end of the season. They will equally redistribute their annual revenues to the small teams from their earned money. It means all NBA team players and owners receive equal revenue per year.
Who are the Highest-Paid National Basketball Association Owners?
The NBA owners pay the team players, coaches and even the support staff in the arena. Team managers receive their salaries from the National Basketball Association owners. The team owners also bear the NBA stadium maintenance and running costs.
Many of the National Basketball Association owners earn billions of dollars each season. For instance, Daniel Gilbert, the owner of the Cleveland Cavaliers, earns $500 million per year. His team’s worth is over $1 billion, and he also generates revenue from ticket sales.
Steve Ballmer is another highest-paid NBA team owner. He owns the Los Angeles Clippers, which was formed in 2014. Steve Ballmer, the former Microsoft CEO, bought the team for $2 billion. Los Angeles Clippers has an annual revenue of $258 billion, and Steve Ballmer’s annual income is $800 Million.
You must have heard about Richard DeVos, right? He owns the popular NBA team – Orlando Magic, and is Amyway’s founder. Richard DeVos has been investing in this team since 1991 and spends $85 million annually.
Orlando Magic’s currency value is $1.85 billion and its market value is $0.402 billion. This team’s owner, Richard DeVos, is one of the wealthiest people in the world. He has an estimated net worth of $5.1 billion.
Other Revenue Streams of NBA Owners:
Many NBA owners invest in different sectors to generate more income. Some of them invest in basketball-related real estate to earn extra cash. However, NBA players earn more than their owners.
Moreover, NBA viewers make money by live streaming the events. They use different online streaming apps to broadcast NBA matches. So, the NBA has become a prime source of income, even for live streamers.