Around the last week of July, Real Madrid CF Board of Directors met, prepared the annual accounts and quietly dropped the bomb claiming to become the first football club to surpass the €1bn revenue mark in a single season. Although it was in the making for some time and Football Benchmark did a report earlier predicting Real Madrid’s superior chances of being the first club to do so but nevertheless it is a monumental achievement
On that note, it’s good to say that Real Madrid has just become one of the top 0.0045% companies in the world! Here’s how. Statista claims there are 333.34mn registered companies in the world. Bloomberg claims 5973 public limited companies have shown more than €1bn in revenue. Assuming another similar number of private companies to show the same revenue, we can safely say Los Blancos belong to the top most layer, incredible!
In this blog, we will be deconstructing the factors leading to such an achievement by Real Madrid
Revenue Streams
Total revenue shows a 27%+ jump over 22/23 figures and 42% over 2018/19 revenue figures which were Real Madrid’s previous highest total. Factually, matchday and commercial revenue streams have contributed largely in this growth journey. With regards to broadcasting, in Real Madrid’s own words ‘revenues received from LaLiga in 2023/24 were lower than in the 2022/23 season’ and the contribution by revenue stream trend chart corroborates this as given below
The revenue generated by the renovated Santiago Bernabéu Stadium has been a key factor in this surge. As per Football Benchmark, the completely revamped stadium, once operational in 2025/26, has the capacity to churn out revenues in excess of €400mn alone with over 200+ event per year including NFL’s inaugural game in Spain. For now, it has already pumped estimatedly to more than double of the 22/23 figures
Similarly, the commercial revenue has shown a big growth bump. A slew of strong sponsorship deals, notably Adidas’ extension as kit partner, signing HP as sleeve sponsor, telecom partnership with Orange including 5G integration at Santiago Bernabéu and a boost in merchandising activities have expanded their commercial income. Some reports indicate jersey sponsorships alone (kit, front-of-shirt and sleeve) could gather upto €250mn+ per year which is roughly 62% of their commercial income!
Wages to Revenue Ratio
Another strong factor to be noted is the controlled wages/revenue ratio over the years. In the last 6-year period, W/R ratio has exceeded the UEFA-recommended 70% mark only once in 2021/22. In the other years, the ratio ranges between 50%-60% mark and in 23/24, it has reported a 47% ratio which is commendable
Interestingly, the growth rate of wages is lesser than the rate of revenue growth!
Adding the net player transfer balances, Real Madrid manages an operating profit before depreciation (EBITDA) of €156mn almost similar to the 22/23 value of €158mn. In the transfer market, Real Madrid have spent €766.5mn over six full seasons (summer & winter) in player signings and secured €558.2mn in player sales leading to a net balance of -€208.3mn
Fan Growth
One of the biggest growth areas for Real Madrid has been the social media fan following numbers. One possible reason are the individual growths of their players and future recruits which has led to a collective growth in the number of club followers. According to Football Benchmark, on the list of top 15 players with highest growth in SM followers, 10 were with Real Madrid during the 2023/24 season. Adding Kylian Mbappé, who joined them this season will only add to the already immense growth
Three years social media follower’s data (primary channels of Facebook, Instagram, Twitter/X, YouTube, TikTok only; from Aug 2021) shows the growth highlights (in the infographic)
In Conclusion
Despite this breakthrough result, a heightened period of growth is expected in the coming years due to multiple factors namely the new stadium expected to become fully operational in January 25 resulting in a higher ticketing, events and other form of revenue from stadium. Also, Santiago Bernabéu hosting a regular NFL game in 2025 will further add to the revenue growth
Key signings such as Mbappé and Endrick are expected to not only deliver impactful on-field performances but also add to the commercial repertoire
In other words, the strong brand and commercial position of Los Blancos are expected to become even stronger!
