Formula 1 posts record $386m loss for 2020 season

Formula 1 posted a huge loss in 2020 as the COVID pandemic impacted the calendar and races were run without spectators.

Formula 1 posts record $386m loss for 2020 season

Liberty Media's full-year financial results, which were released on Friday, reveal that F1's income tumbled by 44% for a total loss of $386m - compared with the previous year.

Overall revenue crashed from $2022m in 2019 to $1145m last season, while the modest profit of $17m in 2019 turned into an operating loss of $386m after the teams were paid.

The total payments shared between the 10 teams fell from $1012m in 2019 to just $711m last year.

Liberty explained: "Team payments decreased in the full year driven by the contraction in F1 revenue and the associated impact on the calculation of variable elements of team payments.

"Team payments in 2020 included one-time fees paid to teams upon signing the 2021 Concorde Agreement."

The huge dive in race promotion fees was reflected in the fall in their percentage share of F1's primary revenue, down from 30% of the total in 2019 to just 12% last year. Most races either paid no fee, or a renegotiated one-off lower figure.

Explaining the fall Liberty noted: "Race promotion revenue decreased as fans were prohibited from attending all but three races, which led to one-time changes in the contractual terms of the originally scheduled races that remained on the 2020 calendar and limited revenue generated from the replacement races that were added."

Broadcast revenues accounted for a bigger percentage of the primary income total, up from 38% to 55%.

Although passing the minimum total of 15 races ensured that most broadcasters paid the full contracted amount for the season, Liberty has admitted that there was a payment reduction in some cases.

"Broadcast revenue decreased as the altered schedule triggered lower fees pursuant to the contractual terms of certain broadcast agreements, as well as other one-time contract negotiations that took place in 2020."

Advertising and sponsorship revenue's share of the primary income total was up slightly from 15% to 17%, although some income was lost, for example because races with specific title sponsors didn't take place.

Liberty explained: "Advertising and sponsorship fees declined driven by one-time changes in sponsorship contracts due to the cancellation of races to which contracted sponsorship inventory specifically related and the limited activities at the races, including hospitality."

While revenues were down, F1's costs also fell because of the shorter schedule and reduced number of flyaway races.

"Costs decreased in the fourth quarter and full year due to lower hospitality and lower freight costs from fewer, logistically cheaper races."

shares
comments

Related video

Alonso will be absent from Alpine F1 launch

Previous article

Alonso will be absent from Alpine F1 launch

Next article

Rowland hopes Mercedes doesn't dominate Formula E like F1

Rowland hopes Mercedes doesn't dominate Formula E like F1
Load comments

About this article

Series Formula 1
Author Adam Cooper
Why Russell was right to be wrong about Bottas after Imola F1 clash Prime

Why Russell was right to be wrong about Bottas after Imola F1 clash

George Russell and Valtteri Bottas' collision at Imola on Sunday prompted fury in the Formula 1 paddock. But Russell's carefully-worded heartfelt statement later, acknowledging that his initial response was wrong, proved the right move

How Verstappen and Hamilton’s Imola clash sets the tone for 2021 Prime

How Verstappen and Hamilton’s Imola clash sets the tone for 2021

In Max Verstappen's Formula 1 career to date, he has been cast as the 'pretender', an acknowledged top-line performer without the car to regularly challenge Lewis Hamilton. But that no longer applies in 2021, and the start to the Emilia Romagna Grand Prix was the most telling signal yet of what we can expect from their duel this year

Formula 1
Apr 21, 2021
How "overwhelming" McLaren move has given Ricciardo a new verve Prime

How "overwhelming" McLaren move has given Ricciardo a new verve

Daniel Ricciardo has found a new lease of life at McLaren – a move that’s been years in the making, as he explains to STUART CODLING…

Formula 1
Apr 20, 2021
How 2021's midfielders have taken lessons from F1's top teams Prime

How 2021's midfielders have taken lessons from F1's top teams

Formula 1’s latest Imola adventure turned into an expensive trip for many teams due to several crashes throughout the weekend. While balancing the books is an added factor in 2021 with the cost cap, a few midfield teams have cashed in early on development investments.

Formula 1
Apr 19, 2021
Emilia Romagna Grand Prix Driver Ratings Prime

Emilia Romagna Grand Prix Driver Ratings

A frantic wet race at Imola produced plenty of excitement and drama as drivers scrabbled for grip. Amid the hatful of mistakes and incidents that ensued, who kept their noses cleanest?

Formula 1
Apr 19, 2021
How the Emilia Romagna GP result hinged on three crucial saves Prime

How the Emilia Romagna GP result hinged on three crucial saves

Rain before the start of the Emilia Romagna Grand Prix promised to spice up the action, and the race certainly delivered on that. Max Verstappen got the best launch to win from Lewis Hamilton, but both got away with mistakes that could have had serious consequences

Formula 1
Apr 19, 2021
The back-bedroom world-beater that began a new F1 era Prime

The back-bedroom world-beater that began a new F1 era

The first in a line of world beaters was designed in a back bedroom and then constructed in a shed. STUART CODLING recalls the Tyrrell 001

Formula 1
Apr 18, 2021
Why Mercedes isn't confident it's really ahead of Red Bull at Imola Prime

Why Mercedes isn't confident it's really ahead of Red Bull at Imola

While Mercedes struck back against Red Bull by topping the times at Imola on Friday ahead of the Emilia Romagna Grand Prix, the overall picture remains incredibly close. Despite having a possible edge this weekend, the reigning Formula 1 world champion squad is not taking anything for granted...

Formula 1
Apr 16, 2021