• Loading stock data...
Thursday, December 12, 2024

With Expenses Restricted, Mercedes’ F1 Profits Rise

  • Mercedes’ Formula 1 profits rose by $60.7 million in 2021.
  • F1’s new cost cap helped drive expenses down, while revenue increased.
Mercedes-Formula-1
Mercedes AMG

A Formula 1 team previously known for its big spending is actually profiting from the series’ new cost cap.

Mercedes saw its profits rise by $60.7 million in 2021, due largely to the $145 million limit placed on teams this season. Profits totaled only $15 million in pandemic-affected 2020.

  • Team revenue grew to $423.3 million from $392.4 million last year.
  • Mercedes cut 75 jobs related to design, manufacturing, and engineering. Its headcount in administration — not counted against the cap — grew from 157 to 173.
  • The company attributed its revenue growth to increased sponsorship and applied science money.

The FIA said on Monday that Red Bull had exceeded the 2021 cost cap by under 5%. It has not yet determined a punishment for the team. Red Bull said its 2021 submission to the FIA was below the cost cap, and it will “carefully review” the governing body’s findings.

F1’s cost cap applies to expenses related to vehicle parts and performance, but not marketing, driver salaries, and other business expenses.

The cap dropped to $140 million this year and will be $135 million from 2023-25.

Cash Flow Accelerating

F1 saw strong growth in the second quarter, with its $744 million revenue up 49% year-over-year. The series flipped a $43 million loss in Q2 2021 into a $49 million profit.

Along with crowds returning in full, F1’s Paddock Hospitality Club luxury fan experience has proven more popular than ever.

Linkedin
Whatsapp
Copy Link
Link Copied
Link Copied

What to Read

F1’s TV Ratings Similar to 2023, but Still Below the Record Highs..

The F1 season averaged 1.1 million viewers in the U.S.

McLaren F1 Team Nearly Folded in 2020. An American Exec Just Led..

An investment from MSP Sports Capital in 2020 saved McLaren.
Nov 2, 2024; Denver, Colorado, USA; Detailed view of a Wilson NBA basketball held by a referee during the second half between the Utah Jazz against the Denver Nuggets at Ball Arena

‘Obvious Weak Point’: Refs Remain an NBA Gambling Concern

A season after Jontay Porter, the biggest risk may not be players.
Nov 2, 2024; Ann Arbor, Michigan, USA; Michigan Wolverines cheerleader runs with a flag before the game against the Oregon Ducks at Michigan Stadium.
opinion

College Football’s Billionaire Backer Era Begins

Is this the new normal in CFB recruiting?

Featured Today

LA Galaxy forward Dejan Joveljic (9) celebrates with midfielder Riqui Puig (10) after scoring a goal against Seattle Sounders FC in the second half in the 2024 MLS Cup Western Conference Final match at Dignity Health Sports Park

With or Without Messi, Major League Soccer Is Barreling Into the Future

After the Cup final, the league looks to accelerate its growth.
Dec 18, 2022; Lusail, Qatar; FIFA president Gianni Infantino claps during the awards ceremony after the 2022 World Cup final between Argentina and France at Lusail Stadium.
December 2, 2024

FIFA Wants More Matches. Resistance Is Growing Inside the Global Soccer World

Resentment and frustration over expanded schedules is nearing a breaking point.
November 30, 2024

U.S. Investors Are Gunning for England’s Small Soccer Clubs

Is another Hollywood-like success story possible among the U.K.’s smallest clubs?
Nov 1, 2024; Boise, Idaho, USA; Boise State Broncos running back Ashton Jeanty (2) leads the team onto the field prior to the first quarter against the San Diego State Aztecs at Albertsons Stadium.
November 29, 2024

Schools Are Scrambling to Prepare for the NCAA Revenue-Sharing Era

In the post–House v. NCAA world, “everyone’s kind of on their own.”

Endeavor, TKO Consolidate Sports Assets, Hoping They’re Better Together

The move brings On Location, Professional Bull Riders, and IMG under TKO.
Sep 11, 2024; Los Angeles, California, USA; The Nike shoes worn by Seattle Storm center Mercedes Russell in the first half against the LA Sparks at Crypto.com Arena.
opinion
September 28, 2024

New Nike CEO Must Do It

The biggest task the new CEO faces is intangible: Refresh the brand.
October 1, 2024

Nike CFO Says ‘Adversity Creates Sharper Focus’

Amid a downbeat but expected set of earnings, Nike says it sees signs of optimism.
Sponsored

How UBS Crafts Impactful Partnerships Across Sports, Arts, and Culture

As UBS continues to expand its impressive array of sports and entertainment partnerships, the company solidifies its position as a leader in wealth management.
A Nike swoosh on a building in Eugene, Oregon.
September 23, 2024

Wall Street: Things Will Get Worse for Nike Before They Get Better

Some analysts are skeptical of how much the new CEO will change.
Crypto.com soccer advertising
September 15, 2024

The Champions League Is Back. So Is Crypto Sponsorship

Crypto investment is making its debut in the biggest European soccer competition.
Sep 9, 2024; Santa Clara, California, USA; San Francisco 49ers wide receiver Deebo Samuel (1) warms up before a game against the New York Jets at Levi's Stadium.
September 12, 2024

The NFL’s Private Equity Era Won’t Be the Bloodbath You Think—for Now

“It’s a different kind of investment thesis entirely.”
ESPN commentator Jay Williams speaking at a conference.
September 11, 2024

Jay Williams Supports PE in College Sports: ‘I Would Like to Own 49% of Duke Basketball’

Williams wants in when PE gets into college sports.