HomeFinanceFormula 1 achieves substantial year-on-year growth for third quarter, earns $887m

Formula 1 achieves substantial year-on-year growth for third quarter, earns $887m

Formula 1 achieves substantial year-on-year growth for third quarter, earns $887m

Formula 1, the pinnacle of motor racing, has revved up an impressive year-on-year growth of 24 percent during the third quarter ending on September 30, 2023.

The financial results, disclosed by Liberty Media, the series’ parent company, reveal a substantial boost in income, with F1’s earnings surging from $715 million for the same period in 2022 to a robust $887 million this year.

Operating revenue has witnessed an even more remarkable ascent, skyrocketing by 61 percent year-on-year to reach $132 million for quarter three.

The 10 F1 teams collectively received $432 million in payments during this quarter, compared to $370 million during the same period in 2022.

In this year’s third quarter, a total of eight races were held, drawing significant hosting fees – notably from the Singapore and Japanese Grands Prix. In contrast, the corresponding period of 2022 saw only seven races.

The primary F1 revenue for quarter three in 2023 amounted to $790 million, showing a substantial increase from the $624 million recorded the previous year. However, while hosting more races has boosted income, it has also led to increased costs for Liberty Media.

“F1 continues to experience sell-out crowds, record race attendance, and strong growth across our social and digital platforms, outpacing that of other major sports leagues,” Stefano Domenicali, the CEO of Formula 1, stated.

“This growth is attracting commercial partners, including our recent agreement with American Express that marks the first new sports vertical it has sponsored in over a decade.”

Liberty Media’s CEO, Greg Maffei, commented on the inaugural F1 race in Las Vegas, scheduled for November 19:

“(It) will be the highest attended sporting event drawing the biggest viewing audience in Vegas history. This event will deliver a spectacular fan experience and is accruing long-lasting commercial benefits for the broader F1 ecosystem.”

Liberty Media disclosed that the rise in costs was due to ‘higher hospitality costs driven by cost inflation and the mix of events held in the current period, as well as increased freight costs due to two additional races outside of Europe (Singapore and Japan)’.

They also pointed to $8 million in associated costs for planning the Las Vegas event.

In total, Liberty Media’s revenue for the third quarter reached an impressive $3.2 billion.

Over the past few months, F1 has sealed several significant commercial deals, including a multi-year regional partnership with American Express and the renewal of Pirelli as the global tyre partner.

An extension was announced to continue racing in Sao Paulo, Brazil, until 2030, ensuring the Sao Paulo Grand Prix at the Interlagos circuit remains a fixture on the 24-race F1 calendar for an additional five years. This extension was unveiled just before this year’s Sao Paulo Grand Prix, which was won by Red Bull megastar Max Verstappen last week.

F1 has also extended its contract with the Belgian Grand Prix at the Spa-Francorchamps racing circuit, ensuring the race will continue until at least 2025.

Image credit:sucrose1134

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