Cowboys First to Top $10 Billion

The Dallas Cowboys have not been to the NFC Championship Game in 28 years, and their resume includes 13 losses in 18 playoff games since that last appearance—including a crushing home defeat to the Green Bay Packers as a heavy favorite in January.

The response from Cowboys fans after the most recent loss: the highest season ticket renewal rate in the history of the franchise.

“All-in” is how Cowboys owner Jerry Jones has repeatedly described the franchise for the 2024 season, but it could describe his approach since 1989 when he put his life savings, and then some, into buying America’s Team for $150 million. The team was losing $1 million a month at the time, but Jones turned it into the world’s most valuable franchise—and the first worth $10 billion—by transforming how sports teams approach almost every facet of their business.

“I’ve been doing this 30-something years, and I don’t feel like I’ve ever worked a day in my life,” Jones said at his Cowboys training camp introductory press conference.

The Cowboys, worth $10.32 billion, head a league that’s the envy of every other sports property worldwide, thanks to its economic model that has built-in revenue escalators and strong cost controls. And even when it looks like the league might take a hit, as was the case with a potential $14.1 billion judgment against it in the Sunday Ticket class action lawsuit, the NFL wins in the end, as the judge dismissed the case last month.

Sportico spoke with more than 30 team owners, executives, investors, bankers, consultants and lawyers over the past month to gauge the health of the NFL. The average franchise is worth $5.93 billion, up 15.4% over last year. The 32 franchises are collectively worth $190 billion, including team-related businesses and real estate held by owners. The Cincinnati Bengals are the least valuable at $4.71 billion—a threshold that only 15 non-NFL teams worldwide are worth, per Sportico’s count.

Click for a ranking of all 32 teams or a data visualization comparing the teams.

The Cowboys operate on a different scale than any other NFL team. The franchise generated estimated revenue of $1.2 billion in 2023, 50% higher than the No. 2-ranked team (Los Angeles Rams) and the highest in the history of sports, a tick ahead of the $1.16 billion LaLiga’s Real Madrid made during their 2023-24 season. The Cowboys’ earnings before interest, taxes, depreciation and amortization (EBITDA) of $510 million were nearly double the next most profitable team (New England Patriots).

Jones revolutionized how NFL teams approached sponsorships, licensing, stadiums, hospitality and real estate; the league controlled almost all sponsor inventory before Jones challenged the rules. The Cowboys had roughly $250 million in sponsor revenue last year from partnerships with brands such as AT&T, Miller Lite, Bank of America, American Airlines and Ford Motor. In 2002, the Cowboys opted out of the league’s shared merchandise system and should approach $200 million in revenue this season from their licensed goods.

AT&T Stadium is now 15 years old, but an average of 1,500 fans still pay at least $40 daily for a guided tour, and Jones is spending $300 million to upgrade the venue. The team’s 91-acre, $1.5 billion headquarters and practice facility, The Star, opened in 2016 and expanded the team’s real estate empire with its mixed-use development. The Cowboys and New York Yankees launched hospitality company Legends to run concessions at their venues, and the venture now works with several hundred clients globally across every major sports league.

In 2023, the NFL’s 32 teams had $20.5 billion in revenue, including from non-NFL events, such as concerts, where teams own or operate the buildings. That number is up 9.5% from the prior season with central revenue representing 63% of the tally and local revenue the remaining 37%.

Each team received just over $400 million from the NFL for leaguewide media, sponsorship, licensing and merchandise deals. In addition, teams got $25 million apiece as part of the NFL’s shared gate receipt system, which pushed equally shared revenue to 67% of the total. The guaranteed annual checks from the league office in New York City have juiced the “get-in” price for an NFL team, with the Bengals value up 18% versus 2023 and 120% over the last four years.

Local revenue for most NFL teams ranges from $150 million to $200 million, paling in comparison to national revenue. It leads to most teams being valued in a relatively narrow range. The Cowboys are worth 2.2x the Bengals—the top to bottom spread is 1.6 times if you exclude outlier Dallas. The comps in other leagues are 3x (NBA), 3.4x (NHL) and 7.8x (MLB).

Supply continues to outstrip demand for NFL tickets, with each team hosting only 10 homes games per year, including preseason, and almost every stadium at or near capacity. Thirteen teams raised prices by double digits for 2023, and the average increase was 8.6%, per Team Marketing Report.

The San Francisco 49ers led the NFL in ticket revenue for the second straight year at $151 million, followed by Dallas ($145 million) and Philadelphia ($129 million). Tennessee ($73 million), Arizona ($74 million) and Washington ($80 million) ranked at the bottom. The Titans were one of five NFL teams that “hosted” an international game in 2023, which effectively cut their ticket revenue by 10%, with one less game in their home stadium.

Bankers and investors have traditionally used revenue multiples to value sports teams. NFL revenue multiples have expanded to 9.3 times on average but still trail the NBA (11) and MLS (9.6). The NHL, MLB, NWLS and WNBA all range from 6.2 to 7.3.

Most team valuations are completely untethered to traditional financial metrics that govern transactions outside of sports, i.e. profits. It is why bankers use revenue multiples, as profits are often low or nonexistent. The Boston Celtics are on the market and will likely fetch at least $6 billion. "We are also losing money,” Wyc Grousbeck, the Celtics owner, told the Boston Globe in June, and the losses should expand with payroll costs, including its luxury tax, likely headed above $500 million for the 2025-26 season.

The NFL is the one major global sports league that can point to profits and make a somewhat reasonable valuation case. Teams earned $143 million on average last season, and the $5.93 billion average value represents 41 times that EBITDA. The Cowboys are valued at just 20 times their EBITDA.

Compare that to the English Premier League, where only five of the 20 teams made money after player trading during the 2022-23 season. The aggregate loss before taxes and finance costs was £530 million ($673 million based on current exchange rates), according to company filings. The NFL’s pre-tax profit was $4.6 billion.

The advantage of the NFL is an economic system that prevents individual teams from spending over the cap for an extended amount of time and guarantees profits. The 2023 salary cap was $225 million, but every team received more than $425 million from the league in shared revenue, including gate receipts.

That unparalleled model in the sports industry is why institutional investors want to get in the football business.

Private equity has been circling the NFL in recent years, as other leagues dropped their restrictions and allowed PE firms to buy passive non-control stakes. Per its usual M.O., the NFL has moved judiciously on opening its doors to institutional funds.

This spring, the league retained investment bank PJT Partners to serve as a liaison between the NFL and private equity firms. The NFL is on the verge of codifying its rules on institutional buyers with a final vote expected either Aug. 27 or in October, with a slim chance it gets pushed to December. Commissioner Roger Goodell told CNBC he expects the cap to be 10% at a starting point, and most teams Sportico contacted expect that as well, although several owners still want an initial 5% cap on investments.

A handful of private equity groups are meeting with the NFL this week. Arctos Partners is one of the firms and is widely expected to have access to NFL deal flow. It has been the busiest investor in teams to date, with stakes in more than 20 franchises in MLB, NHL, NBA, F1 and soccer. It recently raised $4.1 billion for its second sports team fund and has about $7 billion in assets under management. Another favorite to get NFL approval is a consortium of industry giants including Blackstone, Carlyle and CVC and Dynasty Equity. Apollo, Ares and Sixth Street are other firms still in the running, according to sources.

There have not been any major limited partnership sales of NFL teams over the past 12 months, although teams such as the Dolphins, Eagles, Chargers and Bills have explored LP transactions. Several deals are expected to be completed shortly after PE investment is approved, with a goal to close before year-end for tax purposes. The current capital gains tax is capped at 20%, but President Joe Biden proposed nearly doubling it to 39.6%.

Scarcity is a major driver of NFL franchise valuations, as clubs rarely hit the market. The average ownership tenure is 41 years, and only four NFL teams were sold in the last 12 years—the NBA had four in 2023. NFL values have increased 300% over the past decade, but there is still more runway for growth, thanks to several driving forces.

“As great as the growth in NFL valuations and revenue has been over the last decade, I expect the next decade will eclipse it,” Marc Ganis, NFL consultant to multiple teams, said in a phone interview. “There are so many different places and business lines still to tap.”

Every NFL owner did a happy dance when they saw the NBA secure TV deals worth roughly $77 billion over 11 years. NBC and Amazon are now paying significantly more for their rights to NBA games than NFL games, while ESPN’s cost is similar for both leagues on a yearly basis. Yes, the NBA packages carry more game inventory, but football still dominates the airwaves. NFL games represented 93 of the 100 most-watched TV broadcasts in 2023.

The NFL won’t match those gaudy top 100 stats in 2024 with the Olympics and a presidential election this year, but the league still carries enormous momentum on TV. The current $12 billion-a-year NFL TV pacts run through 2033, and the league will almost certainly exercise its opt-out option after the 2029 season. By that point, the NFL will likely be an 18-game regular season, producing an uptick in revenue by swapping a preseason game for one that matters. More important, the 18th game will add at least one more week of TV programming, and maybe two weeks if a second bye week is also added.

Other expanded revenue opportunities for teams exist in gambling, international and direct-to-consumer, with the NFL still in the first quarter in those areas. The Global Markets Program launched in 2022 to grant teams marketing rights in specific countries, and most teams are still barely generating seven figures in revenue from the initiative. A half-dozen teams could also be in new stadiums by the end of the decade, including Buffalo, Cleveland, Tennessee and Washington, which will goose league revenue.

Ganis also expects the NFL to expand on its current venture fund, 32 Equity. “The NFL will have a larger role in the businesses that it creates, supports and enhances, and I expect the [Players Association] could be part of this also,” Ganis said.

Singapore’s central bank cited Taylor Swift’s global tour as a boost to its first-quarter GDP, and the Federal Reserve Bank of Philadelphia said the pop star increased tourism in the region. The Shake It Off singer also moved the needle for NFL owners in 2023.

Swift’s romance with Chiefs tight end Travis Kelce got credit for boosting TV ratings for NFL games. The ratings impact was a tad overblown, but Swift directly affected NFL coffers since her 53 U.S. shows in 2023 all took place at NFL stadiums. Swift kept almost all ticket revenue, with teams entitled to a small cut or rental fee for their venue. Yet, teams cashed in with concessions, parking and merchandise at the sold-out events. Premium seating revenue boomed, as local company CEOs and other executives competed for high-priced luxury suites and club seats for family and friends. Teams netted $4 million or more per night after expenses for Swift’s concerts. Swift won't be touring every summer, but live events in general have returned in a major way since COVID-19 shut them down.

The economics of the NFL team are the engine for these owners, but they are increasingly thinking about their stadiums and the opportunities to maximize their use. AT&T Stadium in Dallas and SoFi Stadium in Los Angeles both target around 30 major non-NFL events a year in their buildings—SoFi had six nights of Swift. The 49ers host seven to 10 major ticketed events a year and roughly 100 corporate events a year.

Mercedes-Benz Stadium, which is home to the Falcons and MLS’ Atlanta United, is one of the busiest arenas in the world. The main kitchen at the stadium was in use all but 14 days of 2023, as the building hosted 3 million peope at pro sporting events, concerts, college and high school football and 115 private outings.

Harris Blitzer Sports & Entertainment CEO Tad Brown says non-NFL events are a “massive focus” for the Washington Commanders, which Josh Harris’ group bought last year for $6.05 billion. Brown said HBSE’s Entertainment team has been supporting the Commanders in attracting top events to Landover, Md., including a series of soccer friendlies this summer and booking concerts and other non-football events for summer 2025.

Harris has continued to invest in the current stadium to upgrade the fan experience for NFL and non-NFL events but is also looking at the club’s next home. Brown said the Commanders’ eventual new venue will be designed as a world-class football stadium and to host the biggest concerts and special events on a global scale.

The Miami Dolphins are one of only five NFL teams that own their stadiums, joining the Commanders, Panthers, Patriots and Rams. That distinction allowed them to create the most lucrative single event for any NFL stadium, an F1 race.

Stephen Ross has a 15-year agreement to host the Miami Grand Prix next to Hard Rock Stadium. The race economics were included last year when Ross explored selling an LP stake, with conversations ongoing. The race generates an estimated $45 million a year in EBITDA for Ross, and Sportico assigned a 10 multiple to cash flow and included the value in Sportico’s related businesses category for the first time, along with the value of the stadium and surrounding land. The business of the football team has also prospered coming out of COVID-19, helping push the total franchise value to $6.76 billion, up 29% and ranked seventh overall.

The Dolphins are headed for a record 2024 with revenue north of $700 million and will get a boost from Swift. Her first stop when her tour returns to the U.S.: three nights in Miami.