Forbes released its annual ‘Most Valuable NBA Teams’ list for this year, and whilst the Golden State Warriors top the standings for the second straight year, the league has undergone an explosion in terms of average team valuation. 

According to Forbes, the average worth of an NBA team in 2023 is $3.85bn, an increase of 35% from just one year prior and 75% higher than in 2019 with valuations not set to dip anytime soon. 

Much of this has been credited to the NBA’s growth in sponsorship deals which has experienced“double-digit growth” ahead of the 2023-24 season. More franchises are inking jersey patch deals, while the league is  generating new sponsorship opportunities through the creation of the inaugural in-season tournament which begins this November. 

The rise in NBA team valuations was evidenced in the sale of the Phoenix Suns last February, bought by mortgage lending billionaire Mat Ishbia for $4bn. NBA legend Michael Jordan also sold his majority share in the Charlotte Hornets for $3bn – initially bought in 2010 for $275m – to Gabe Plotkin and Rick Schnall

The NBA franchise which exemplifies the league’s growth over the last several years is the Golden State Warriors, topping Forbes’ list for the second consecutive year with a valuation of $7.7bn. 

The Warriors’ valuation is over $1bn more than the New York Knicks’ valuation of $6.6bn, who lie in second place on the list, followed by the Los Angeles Lakers ($6.4bn), Boston Celtics ($4.7bn) and the Los Angeles Clippers ($4.65bn). 

Forbes broke down the NBA’s overall revenue for the 2022-23 season into five key facets, arena sponsorship/advertising, general seating, media, premium seating and other. 

Media revenue contributed to just over half of the league’s revenue (50.47%), general seating contributed to 16.53%, premium seating 12.1%, arena sponsorship/advertising 9.1%, and other contributed to 11.81%. 

Overall revenue grew by 6% in comparison to the 2021-22 season with each team earning on average $353m. However, operating income fell by 22% to an average of $71m per franchise, mainly due to the salary cap expanding and player salaries increasing year on year. 

But the NBA’s revenue and overall growth is not set to slow down anytime soon. The league is about to embark on a landmark media rights renegotiation after its current deal with broadcasters ends after the 2024-25 season. 

The next media rights cycle will see the NBA reportedly look for a total valuation figure between $50bn – $75bn, which would be a 212% increase than its total $24bn valuation of its current deal.

If the NBA is successful in landing the $75bn benchmark, this would have a significant boost to NBA teams’ worth over the next decade, as TV revenue is split evenly between all 30 franchises. 

Forbes estimates that once the next media rights deal is signed, the average valuation of an NBA team will balloon between $4bn to $5bn. 

And this TV revenue may not just be split into 30 teams anymore, as reports have surfaced recently that the NBA is looking into adding two expansion teams, with franchises most likely to land in Las Vegas and a return to Seattle

Aiming to announce the expansion teams once the next media rights deal is secured, this would mean more money for the other 30 franchises, as each team will get a cut of the $2.5bn entry fee per expansion team that enters the league.

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