Fact Check: Are NWSL teams profitable?

Are NWSL Teams Profitable?

The claim regarding the profitability of National Women's Soccer League (NWSL) teams has garnered attention, particularly in light of recent reports indicating significant increases in team valuations. Questions arise about whether these valuations translate into actual profitability for the franchises. This article explores the available data and analyses surrounding the financial health of NWSL teams.

What We Know

1. Valuation Increases: Recent reports indicate that the average valuation of NWSL teams has risen dramatically, reaching $104 million in 2024, a 57% increase from the previous year 1410. This valuation is based on various factors, including team revenues and market conditions.

2. Revenue Generation: In the 2023 season, NWSL teams collectively generated an estimated $112 million in revenue, with an average annual revenue per team pegged at approximately $9.7 million 68. Angel City FC reportedly led the league in revenue generation 2.

3. Profitability Issues: Despite the rising valuations and revenue figures, reports suggest that most NWSL teams are currently operating at a loss. For instance, a source notes that "every NWSL team is losing money," which is a situation not uncommon in professional sports leagues 8.

4. Attendance and Market Growth: The league has seen increasing attendance figures, with teams like the Portland Thorns averaging 20,000 fans per match as early as 2019 1. This growth in fan engagement is a positive indicator for future revenue potential.

5. Sponsorship and Investment: The financial landscape for NWSL teams is evolving, with new ownership groups entering the league and investing in teams. However, disparities exist in sponsorship revenue among teams, with some, like San Diego Wave FC, reportedly earning significantly less than others 3.

Analysis

Source Evaluation

• Reuters: The report from Reuters is a reputable news source known for its journalistic integrity. However, the specific article primarily focuses on valuation rather than profitability, which is crucial for understanding the financial health of the teams 1.

• Statista: This source provides statistical data and is generally reliable for numerical information. However, it lacks detailed context regarding how revenues are generated and whether they cover operational costs 2.

• Sportico: This publication specializes in sports business and finance, making it a credible source for valuation and financial analysis. However, it is important to note that their reports often reflect the interests of investors and may have a bias towards portraying the league positively 410.

• PR Newswire: The business analysis report offers insights into various financial aspects of the league. However, it is essential to consider that such reports may be influenced by the entities commissioning them 3.

• Front Office Sports: This source provides a contemporary overview of the NWSL's growth and investment landscape. While informative, it may also reflect a positive bias towards the league's future potential 10.

Methodological Concerns

The methodologies used to derive team valuations and revenue estimates often rely on a combination of public financial records, interviews with knowledgeable individuals, and market analysis. While this approach can yield valuable insights, it also raises questions about the accuracy of the data, especially if the sources of information have vested interests in the league's success.

Conflicting Information

While some sources emphasize the rising valuations and potential for future profitability, others highlight the ongoing financial struggles of the teams. This dichotomy suggests that while the NWSL is experiencing growth in certain areas, significant challenges remain in achieving overall profitability.

Conclusion

Verdict: False

The claim that NWSL teams are profitable is false. Despite significant increases in team valuations and revenue generation, evidence indicates that most teams are currently operating at a loss. Reports suggest that "every NWSL team is losing money," highlighting the financial challenges faced by the league 8.

It is important to note that while the league is experiencing growth in attendance and investment, these factors have not yet translated into profitability for the franchises. The financial health of NWSL teams remains precarious, and the rising valuations may not reflect their operational realities.

There are limitations in the available evidence, as the financial data is often derived from various sources that may have vested interests in portraying the league positively. Additionally, the methodologies used to assess profitability can vary, leading to potential discrepancies in the reported figures.

Readers are encouraged to critically evaluate information regarding the financial status of sports leagues and consider the broader context in which these claims are made.

Sources

1. Report: NWSL teams hit record $104M average valuation. Reuters. Link
2. NWSL franchise revenue by team 2023. Statista. Link
3. US National Women's Soccer League (NWSL) Business Analysis Report 2023. PR Newswire. Link
4. Most Valuable NWSL Team Rankings. Sportico. Link
5. NWSL teams hit record $133 million average valuation: Reports. The Straits Times. Link
6. Study: Angel City valued at US$180m as average NWSL team hits US$66m. SportsPro. Link
7. Average NWSL team valuation rises by 57% to US$104m. SportsPro. Link
8. NWSL Team Values 2023: Angel City Leads at $180M, Average is $66M. Sportico. Link
9. NWSL Franchise Valuation by Team - NWSLines. NWSLines. Link
10. The NWSL Is the New Darling of Ambitious Investors. Front Office Sports. Link