The Kansas City Chiefs, despite their recent success in the NFL, are not among the most valuable teams in the league. According to CNBC’s Official 2024 NFL Team Valuations, the Chiefs are ranked 18th with a value of $6.07 billion. This is lower than the New York Jets, who have not made the playoffs since 2010, and the Denver Broncos, who have not played in the postseason since 2015.
One might assume that making the playoffs and performing well in them would generate significant revenue for a team. However, the bulk of a team’s revenue comes from media rights fees. In the 2023 season, each team received an average of over $350 million from the league in media rights fees, accounting for more than half of their annual revenue. The Chiefs, despite their success on the field, earned $590 million in revenue last season.
Furthermore, most of the revenue from postseason ticket sales goes to the league to cover expenses. While the home team does receive a stipend, hosting playoff games does not provide much financial benefit. In contrast, leagues like the NBA and NHL allow clubs to retain a larger portion of playoff ticket revenue.
Stadium ownership and operating rights also play a significant role in a team’s revenue. Dallas Cowboys owner Jerry Jones has set the standard for maximizing revenue through sponsorship deals and non-football events at AT&T Stadium. However, the Chiefs, as tenants of Arrowhead Stadium, do not have the same opportunities for additional revenue streams.
Arrowhead Stadium, which is over 50 years old, lacks the sponsorship and advertising opportunities that newer venues like Allegiant Stadium and SoFi Stadium offer. The Chiefs had plans to renovate the stadium, but a proposed sales tax extension to fund the project was rejected by Jackson County voters.
While postseason appearances and success can boost a team’s finances, the immediate impact may not be significant. Factors such as a team’s record and the potential for increased ticket prices can influence revenue. The Chiefs, with an average ticket cost of $131.81 in the 2023 season, above the league average of $120.94, demonstrate their appeal to fans. Additionally, perennial playoff teams can be more attractive to sponsors due to the guaranteed influx of fans at their stadiums each year.
In summary, the Kansas City Chiefs may not be among the most valuable teams in the NFL, but their success on the field and consistent postseason appearances have the potential to boost their finances in the long run. As they continue to compete and entertain fans, their value as a franchise may increase.
