Braves chairman says ‘dry powder’ available for payroll; calls MLB-ESPN break-up a ‘non-event’

Terry McGuirk, the chairman of the Atlanta Braves, does not appear concerned that Major League Baseball no longer has an estimated $550 million annual payment coming from ESPN from 2026-28. The network last week decided to opt out of the final three years of its national TV deal with MLB, which it’s been partnered with for nearly 40 years.

“The ESPN-MLB breakup is getting really outsized public scrutiny,” said Terry McGuirk, the chairman of the Atlanta Braves, on an earnings call Wednesday. “I really think that from the Atlanta Braves’ standpoint, this is a non-event. It will have no effect whatsoever on our economics.”

MLB’s 30 teams evenly split national TV money, which means the ESPN deal would have paid roughly $18 million per team annually. Every team will be able to recover some of that money through a new deal the league reaches for those rights, be it with ESPN or another partner, but the industry expectation is that MLB will ultimately receive a lower number. McGuirk, however, is optimistic.

“I think the market is going to be surprised at the enthusiasm and uptake on the interest in these sets of rights that are coming available for next year, and I know that the interest is very strong,” he said. “And I’m sure you’ll hear more from Rob Manfred on this in the coming weeks.”

ESPN remains the home of Sunday Night Baseball through 2025 and has said it is open to a new deal with MLB. Manfred, baseball’s commissioner, said in a letter to the league’s teams last week that he does not believe it “beneficial for us to accept a smaller deal to remain on a shrinking platform,” but he also did not rule out a reunion with ESPN.

McGuirk’s comments came during a call where the Braves announced $663 million in revenue for 2024, a three percent increase from the $641 million the year prior. The Braves are owned by Liberty Media but exist as their own separate publicly traded company, Braves Holdings, and therefore have to report their earnings quarterly, offering a rare view into the finances of MLB teams.

The Braves’ broadcasting revenue, including both national and local streams, is listed at $166 million for 2024, up $5 million from a year earlier. Carried locally by FanDuel Sports Network, the Braves are available direct-to-consumer for the first time this season, meaning a fan who lives inside the team’s TV market can pay to watch games without a larger TV bundle such as cable or satellite.

The sport’s longstanding TV territory system has created many blackout frustrations for fans. Streaming offerings, like the Braves’ new venture, can help mitigate the problem. But the system simultaneously remains beneficial to many teams, including the Braves, whose territory spans six states.

“We want to try to create the maximum accessibility of our content throughout our available territory,” team president Derek Schiller said on the call. “We have one of the largest territories in all of pro sports, so our opportunity is quite large.”

Overall, the Braves reported a $40 million profit for 2024, citing their adjusted OIBDA (operating income before depreciation and amortization), up from $38 million in 2023.

The team divides its revenue into two buckets: baseball and mixed-use development. Baseball revenue — which includes ticket sales, concessions, advertising sponsorships, suites, premium-seat fees and broadcasting revenue — was reported to be up two percent in 2024, at $595 million, compared to $582 million in 2023.

Mixed-use development, which comes from the team’s real estate around the stadium, The Battery, was up 14 percent, at $67 million. The team reported $59 million in mixed-use revenue for the prior year.

Operating costs were listed at $504 million on the baseball side, compared to $482 million in the year prior, a 5 percent increase. Costs were $10 million for mixed-use development, up from $9 million the year before, an 11 percent increase.

“In 2024, the Battery saw a total of 8.7 million visitors throughout the year, helping to generate more than $130 million in retail revenue for our tenants,” said Mike Plant, who oversees the team’s real estate and development holdings. “On average, our visitors frequented the Battery over 2.4 times, with an average dwell time of 165 minutes per visit.”

To Tony Clark, the head of the Major League Baseball Players Association, the earnings report showed that baseball teams can fare well while carrying significant player salaries. The Braves in 2024 had a roughly $276 million payroll, per Cot’s Contracts.

“So a team outside a top-five media market without a massive local TV deal can run a $280 million payroll, lose in the wild-card round, and still make a $40 million profit?” Clark said. “And that doesn’t account for other revenue, never mind that their overall franchise value has gone up over $900 million in just three years.”

Forbes valued the Braves at $2.8 billion last year in its most recent annual rankings of MLB’s teams. In 2021, the outlet appraised the team at $1.9 billion.

On the field this year, the Braves have a projected $235 million payroll, which McGuirk said could grow.

“We have always been, over the last three or four years, a top-10 salary organization,” McGuirk said. “We expect that to be the same again this year. We have crossed the competitive balance tax each of the last two years. It’s possible we could do it again this year. … (President of baseball operations) Alex Anthopoulos has always had the resources to do what he needs to do to put a championship group on the field. I see no different situation this year. We have some dry powder.

“There are a tremendous number of free agents that still are out there in the marketplace. Just as an example, last year, we signed Adam Duvall on March 17. And so who knows exactly how this spring training shakes out from a salary standpoint.”

No other MLB team’s financial information is regularly released publicly. The Toronto Blue Jays are also owned by a publicly traded company, Rogers Communications, but are not traded as their own separate company, which means less granular information is available.

“Our ownership in sports and entertainment is significant and there’s significant value, which is not reflected in our share valuation today,” Rogers CEO Tony Staffieri said on an earnings call in January, per the company’s website. “Those assets continue to grow at double-digit rates in terms of value and so it’s a good growth opportunity for us strategically.”

(Top photo of McGurk and Braves manager Brian Snitker: Matthew Grimes Jr. / Atlanta Braves / Getty Images)

This post was originally published on this site be sure to check out more of their content.