October 10, 2022

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With Expenses Restricted, Mercedes’ F1 Profits Rise [[link removed]]

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 [[link removed]] 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 [[link removed]] 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 [[link removed]] 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.

Google Leads Tottenham’s Search for Naming Rights [[link removed]]

Kirby Lee-USA TODAY Sports

Google could be the next tech giant to snag naming rights to a soccer stadium.

Tottenham Hotspur is reportedly [[link removed]] in talks with the company for naming rights to the club’s $1.1 billion home, which opened in 2019.

Spurs chairman Daniel Levy has been interested in securing a deal for the 62,850-capacity stadium with the “right brand, on the right money.”

Football Insider previously reported [[link removed]] the Spurs are holding out for a deal worth $32.8 million per year for at least 10 years. Nike and Amazon were reportedly [[link removed]] top contenders for a deal in 2020.

Google would be the latest technology giant to grab soccer stadium rights.

In March, Spotify purchased [[link removed]] naming rights to FC Barcelona’s Camp Nou stadium for a reported $310 million. It is thought [[link removed]] to be the most lucrative naming rights deal in European soccer.

Tottenham posted a $106.9 million loss for its fiscal 2021, and its club debt increased to $943 million from $808.1 million after 2020.

Google’s Gigs

Google isn’t new to sports deals.

In March, the company struck a multiyear deal with McLaren’s Formula 1 and Extreme E teams. In October 2021, Google announced [[link removed]] a marketing and technology deal with the NBA, and last week, Google Cloud renewed [[link removed]] its agreement with MLB.

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PSG Owner Adds SC Braga to Soccer Lineup [[link removed]]

SC Braga

The trend of owning multiple soccer clubs continues.

Paris Saint-Germain owner Qatar Sports Investments has entered an agreement to purchase a nearly 22% stake in Portugal’s SC Braga — the state-backed fund’s second soccer venture.

Qatar Sports Investments will reportedly [[link removed]] pay roughly $18.4 million for the stake acquisition, which is expected to close in the coming months. Bloomberg reported [[link removed]] that the price tag implies a valuation of $88 million, based on an expected media rights increase.

Qatar Sports Investments is interested in SC Braga’s potential for growth, according to the Financial Times. The club is currently third in Portugal’s top division.

Qatar Sports Investments acquired [[link removed]] a majority stake in PSG in 2011 for roughly $67.9 million and backs the Premier Padel tour. In 2019, it held discussions for a minority stake in Leeds United.

Multi-Club Movement

The fund joins a growing list of multi-club owners. Deloitte previously reported that there are over 70 multi-club groups operating — more than double from five years ago.

Abu Dhabi-backed City Football Group has full or part ownership in 12 clubs including Manchester City and New York City FC. RedBird Capital completed [[link removed]] its acquisition of AC Milan for $1.2 billion in August and also owns [[link removed]] Toulouse FC.

Chelsea FC owner Todd Boehly recently said he was interested in creating a multi-club group. Boehly led a consortium that purchased [[link removed]] the club for $5.2 billion in May.

Conversation Starters In The Leadoff, World Cup skiers decry the choice of Saudi Arabia as the host of the 2029 Asian Winter Games, Kylian Mbappé tops Forbes’ highest-paid soccer players list, Take-Two Interactive could see a share surge, and MLB’s attendance is slowly recovering. Click here to listen [[link removed]]. Reports that the Draymond Green-Jordan Poole video cost TMZ $120,000 were shut down [[link removed]] by former TMZ employees, who claim the video may have gone for even less than $10,000. Max Verstappen, who has a reported $53.3 million-per-year contract, secured [[link removed]] his second consecutive Formula 1 championship at the Japanese Grand Prix.

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Market Movers

U.S. stocks experienced declines across all three major indexes on Monday. Here’s a look at how some sports-related stocks performed:

SIRI [[link removed]]

Sirius XM Holdings Inc

[[link removed]]

$5.92

[[link removed]]

+0.85%

[[link removed]] CWH [[link removed]]

Camping World Holdings Inc

[[link removed]]

$26.52

[[link removed]]

+3.07%

[[link removed]] CMCSA [[link removed]]

Comcast Corp

[[link removed]]

$29.10

[[link removed]]

-1.95%

[[link removed]] PLNT [[link removed]]

Planet Fitness Inc

[[link removed]]

$60.18

[[link removed]]

-2.03%

[[link removed]] UA [[link removed]]

Under Armour Inc

[[link removed]]

$6.21

[[link removed]]

-2.05%

[[link removed]] BYD [[link removed]]

Boyd Gaming Corp.

[[link removed]]

$50.27

[[link removed]]

-2.39%

[[link removed]] (Note: All as of market close on 10/10/22) What to Watch

The Kansas City Chiefs (3-1) host the Las Vegas Raiders (1-3) on “Monday Night Football” at Arrowhead Stadium.

How to Watch: 8:15 ET on ESPN

Betting Odds: Chiefs -7 || ML -330 || O/U 51.5

Pick: Check out the expert betting pick on OddsChecker [[link removed]].*

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Written by Owen Poindexter [[link removed]], Abigail Gentrup [[link removed]] Edited by Matthew Tabeek [[link removed]], Brian Krikorian [[link removed]]

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