F1 News
Formula 1 sees huge drop of 84 percent in revenue due to the coronavirus
- GPblog.com
The coronavirus strikes like a bomb in many sectors and that also applies to Formula 1. During the presentation of its quarterly figures, Liberty Media announced that the F1 group recorded 84 percent less revenue compared to last year.
It comes as no surprise that revenue has fallen sharply compared to last year, but the figures continue to hit hard. In 2019, the Formula 1 group saw a revenue of $246 million between January and March, but this year it plummeted to $39 million. This is due to the cancellation of the Grand Prix of Australia and Bahrain.
The actual income for Liberty Media will be slightly higher. For example, the organizations of the Grands Prix have already paid organizational costs in advance, but the company does not recognize that as income. The same goes for television deals and most sponsorship contracts.
Red figures for F1
As a result, operating income for the Formula 1 group plummeted to 137 million losses in the first quarter. Last year, operating income in the same period stood at a loss of $47 million.
"Since no events were held during the first quarter of 2020, F1's main income consists only of elements of sponsorship contracts that apply to non-race related rights. Other income for F1 has dropped to zero, such as the Paddock Club and other activities organized at events and television productions," Liberty Media said at the presentation of the quarterly figures.
The teams in Formula 1 have also received no income, because the money is paid out on the basis of races. According to Liberty Media, this is not going to change for the time being. "We don't expect races to take place in the second quarter of 2020 at the moment."