Final week LIV Golf’s UK arm filed its 2023 financials and its already huge losses have reached new heights.
LIV’s Cash Pit Grows Even Deeper
‘Staggering’ Losses
A report by Cash In Sport examined the monetary filings of LIV Golf’s UK arm. This entity manages all of LIV’s operations outdoors the U.S.
They’ve reported vital monetary developments for 2023. Whereas revenues elevated to $37.1 million from $4.9 million in 2022, working losses additionally rose sharply to $394 million, up from $244 million the earlier 12 months.
The Saudi Public Funding Fund, which is backing LIV Golf, has already invested virtually 4 billion {dollars} within the league. That quantity is predicted to achieve the 5 billion mark by the top of 2025.
For nearly some other firm all over the world, numbers like those LIV is producing would change into a one-way ticket to chapter. However for somebody with the capital just like the Saudi PIF, this in all probability seems like when a mean Joe loses a few quarters within the sofa cushions. In different phrases, they’ll afford to maintain throwing cash on the wall till it sticks.
Breakdown of the Spend
In 2022, LIV hosted simply six tournaments. That quantity jumped to 14 for the 2023 season. Though the per-tournament price went down, the whole price jumped greater than $40 million. LIV spent $10 million paying Performance54, the group that phases all of LIV’s tournaments,
LIV Golf UK incurred practically $16 million in authorized {and professional} bills. These prices had been virtually on par with the PGA Tour’s authorized charges, which amounted to $18.7 million.
Over the previous few years, LIV Golf has spent an estimated $1.5 billion on participant prices, together with signing bonuses, assured contracts, and different funds. These figures present the large monetary dedication LIV has made to constructing its roster of gamers.
Many of those gamers who LIV splashed out on merely haven’t made the return on funding that LIV had hoped for. Gamers like Dustin Johnson and Phil Michelson are two gamers that LIV spent over $300 million on signing bonuses alone. They’ve drawn nowhere close to the eyeballs essential to justify their payday.
Along with particular person compensation, LIV Golf has additionally arrange a team-based competitors with its occasions, the place gamers can earn cash as a part of groups. This extra layer of funds will increase the whole price of supporting the gamers.
The place LIV Can Cease The Bleeding
Even with a mind-boggling sum of money spent since its inception, the shortage of funding in comparison with operational prices hasn’t actually come as a shock to many. LIV continues to be so younger and mainly a brand-new firm. In a battle towards the monopoly of their sport for many years, LIV knew they’d lose quite a bit earlier than they’d see a win on the board. However the creativity and initiative they’ve already proven within the sport give them hope in separating themselves from the PGA Tour and offering an expertise that they merely can’t provide.
LIV’s group format, the place gamers compete in teams and groups, provides a contemporary and thrilling factor to the sport of golf. This format has confirmed to be interesting for each followers and sponsors, and the individuality of the league’s construction helps it stand out from conventional excursions.
Turning into a extra international model has been a big purpose LIV has been working onerous to achieve. Australia is definitely the place LIV discovered its most success with LIV Adelaide offering 45% of its complete income from these tournaments.
LIV Golf and social media has been a subject of focus as nicely. With an increasing number of gamers that includes on totally different YouTube and TikTok channels, that’s a straightforward method for LIV to achieve extra consideration. Gamers like Bryson DeChambeu who’ve change into huge within the YouTube golf world will solely make followers need to watch them extra throughout LIV occasions.
Whereas LIV Golf’s income streams are nonetheless maturing, broadcasting rights, sponsorships, prize cash, and a rising fanbase are key to the longer term monetary well being of the league. The league’s capability to draw big-name gamers, safe profitable sponsorships, and broaden globally will finally decide whether or not it turns into worthwhile in the long term.
Foremost photograph credit score
© Raymond Carlin III-Imagn Photos
