Formula 1 posted a loss of nearly $400 million as a result of the impact of COVID-19 on the 2020 season, according to Liberty Media’s latest earnings report.
With the season postponed indefinitely on the morning of the first practice session of the year in Australia last March, F1 eventually put together a 17-race schedule that took place largely behind closed doors due to the pandemic. The changes had an impact on race-hosting fees, broadcast deals and sponsorships, as well as the lucrative Paddock Club due to a lack of guests at each event.
In the fourth quarter and full-year earnings released by Liberty on Friday, Formula 1’s revenues were shown as being hit by 43%, dropping from $2.022m in 2019 to $1.145m in last year. However, the sport was able to increase its primary revenues — consisting of race promotion fees, broadcasting fees and advertising and sponsorship fees — across the final three months of the year, thanks to the fact it held seven races in the fourth quarter of 2020 compared to five in 2019.
Despite that, when taken as a full year, what had been an overall profit of $17m for F1 in 2019 turned into a $386m loss.
Team payments are influenced by the sport’s revenues and dropped from $1.012m in 2019 to $711m last year, with the latter figure also including one-time fees that were related to the teams signing up to the new Concorde Agreement.
While a number of other one-off agreements were put in place relating to 2020, the results show that some advertising and sponsorship revenues were deferred to future years.
F1 also had a change in management as Stefano Domenicali took over from Chase Carey as CEO at the end of 2020, with the Italian saying the sport is looking to bounce back with its biggest ever race calendar this year.
“I am thrilled to join the Formula 1 organization and continue to build on the strong foundation set by Chase Carey and the team,” Domenicali said. “We are planning a record-setting 23-race calendar in 2021 and continue to work with governments, promoters and local organizations as we navigate COVID-19 protocols and regulations.
“We’ve been excited to see drivers, celebrities and fans engage as we once again hosted the F1 Esports Virtual Grand Prix in 2021 and we look forward to the start of the season in Bahrain on March 28th.”