Major League Baseball’s financial landscape has evolved significantly in recent years. Record revenues, soaring franchise values, and new revenue streams are shaping the game off the field. This in-depth five-part analysis will break down how MLB teams make money and spend it. It will also compare financial figures across the league, and zoom in on the New York Yankees, the sport’s most valuable franchise.
The financial state of MLB in 2025 is also influenced by several broader developments, from changes in the Collective Bargaining Agreement (CBA) to shifts in how fans consume games. Here are some key 2025 trends and changes that affect team finances league-wide.
Collective Bargaining Agreement (CBA) Changes
The current CBA (agreed in March 2022 after a brief lockout) introduced several financial structure tweaks that carry through 2025. The luxury tax thresholds are rising slightly each year. As noted, $237M in 2024 to about $241M in 2025, giving big spenders a bit more breathing room. However, the CBA also added a fourth, very punitive tax tier (unofficially dubbed the “Steve Cohen Tax”) to specifically hit teams exceeding the threshold by $60M+ with heavy fees. This was aimed at curbing runaway spending. In practice, it hasn’t stopped owners like the Mets’ Cohen or the Los Angeles Dodgers, but it certainly made their spending extremely costly. The CBA also raised the MLB minimum salary (to $720k in 2023, increasing each year thereafter) and created the pre-arbitration bonus pool ($50M pool to reward top young players). These changes increased expenses for all teams but particularly benefit players early in their careers. For example, young stars like Paul Skenes can earn sizable bonuses from the pool if they achieve awards or leaderboard honors. From a team perspective, those are centrally funded, but higher minimum salaries mean even teams filled with young players have higher payroll floors. Another outcome of the new CBA: teams can now advertise on uniforms (a revenue opportunity realized starting in 2023). Also, the amateur draft lottery (new in 2023) and limits on draft spending/international spending remain, which keep overall player acquisition costs predictable for owners. The next CBA will be negotiated in 2026, so owners and the Players Association are already eyeing those talks. Players feel franchise values and revenues are rising faster than salaries, so we may see pushback on things like the luxury tax acting as a “soft cap.” But in 2025, labor peace reigns, and the current CBA’s structures are largely set, providing cost certainty in areas like the luxury tax, revenue sharing, and salary floors.
Rules Changes and Attendance Boost
MLB made some highly publicized on-field rule changes in 2023 (pitch clock, banning extreme defensive shifts, larger bases, etc.) with the goal of improving the pace and action of games. These appear to have had a tremendously positive financial effect: game times dropped by ~30 minutes, and fans responded. Attendance in 2023 jumped about 9% (the largest year-over-year increase in decades), and that momentum carried into 2024. A faster, more exciting game keeps fans coming to the ballpark and watching on TV, which in turn boosts ticket revenue, concession sales, and advertising value. By 2025, teams are seeing the payoff from these changes: more sellouts, younger fans showing interest, and a generally positive buzz that baseball is more entertaining (and thus a good product for sponsors to align with). While it’s hard to assign a dollar figure to each new rule, MLB did report total attendance around 70.7 million in 2023 (up from ~64.5M in 2022), reversing a downward trend. Clubs like the Yankees benefitted: when the team is competitive, a slightly shorter, livelier game makes the fan experience better, likely contributing to the Yankees’ big attendance bump in 2024. Of course, on-field success is the biggest driver of attendance (and the Yankees, Rangers, Braves, etc. all had strong seasons drawing fans), but the league-wide uptick indicates even mid-tier teams saw gains. More fans through the gates means more revenue across the league. Additionally, the expanded postseason format (12 teams since 2022) means more teams are in the hunt later in the year, which also keeps attendance and local TV ratings higher in August/September (fans are engaged when their team has a shot at a wild card). And for owners, the playoffs are a financial bonus: while player shares and MLB take a cut, hosting playoff games is profitable and deep runs can net teams additional millions.
Regional Sports Network (RSN) Shakeup and Media Rights
One of the biggest storm clouds in sports finance has been the deterioration of the regional sports network model due to cord-cutting. In 2023, Diamond Sports Group (which operated Bally Sports RSNs broadcasting 14 MLB teams) filed for bankruptcy protection. This threatened the local TV rights payments to teams such as the San Diego Padres, Arizona Diamondbacks, Cleveland Guardians, and others. MLB took the bold step of taking over Padres broadcasts in mid-2023 when Bally Sports stopped payments, producing the games in-house and streaming them locally while making them available on different distributors (with no local blackout on MLB.tv). By 2025, a few other teams have also had their contracts disrupted; for instance, the Diamondbacks negotiated to end their RSN deal and transitioned to a new distribution model. This is a double-edged sword financially: in the short term, some teams lost expected RSN revenue or had to scramble for new arrangements (which could mean lower rights fees). In the long term, MLB sees an opportunity to reshape local media rights, perhaps by centralizing more of the broadcasting and offering a direct-to-consumer streaming option for all teams. If MLB can eventually bundle all team streams in-market, it might unlock new revenue (imagine a future where a Yankees fan could pay MLB directly to stream YES Network content without cable. The technology and demand are there). But the transition is delicate. Teams like the Yankees and Boston Red Sox, who own stakes in successful RSNs (YES and NESN), are in great shape, as those networks still have strong subscriber bases in their markets. Teams that were on Bally networks, especially in smaller markets, face more uncertainty. The league in 2025 has been propping up or facilitating new deals for some of those clubs to ensure fans can see games and teams get at least partial rights fees. Commissioner Manfred has indicated that fixing the local media model is a priority, which could mean more centralized media rights in the next few years. For now, national media money is locked in (the current national TV deals run through 2028), so every team knows they’ll get their slice of those billions. It’s the local media where fortunes could change: a team with a soon-to-expire RSN deal might not get as rich a contract as teams did 5–10 years ago at the peak of cable. The optimistic view is that broader streaming reach can make up the gap (and attract younger viewers who never had cable). The pessimistic view is that the days of $8 billion mega-TV deals (like the Dodgers’ in 2013) are over, and teams may have to adjust to more modest local media revenue. In any case, the RSN upheaval is a 2025 storyline to watch for its impact on team finances. It affects some teams more than others, but collectively the league is adapting its revenue models.
Sports Betting and New Revenue Streams
Since the Supreme Court struck down the federal ban on sports betting in 2018, many states (including New York and others with MLB teams) have legalized sports gambling. MLB as a league has embraced this cautiously but earnestly as a revenue source. By 2025, most teams have official sports betting partners (for example, the Washington Nationals opened a sportsbook at their stadium, the Yankees and New York Mets have betting sponsorships, etc.). These deals can bring several million per year to a team in sponsorship fees. Additionally, increased fan engagement through betting (and daily fantasy) can drive up TV ratings and attendance, indirectly boosting revenue. Another area is international growth: MLB has been hosting games abroad (London series, etc.), which can open new markets for merchandise and media deals. While not a huge line item yet, the globalization of baseball could be important in the coming decade (the Yankees and Red Sox, for instance, played in London in 2023, generating buzz and income).
Expansion and Relocation
Though not happening in 2025 yet, MLB is laying groundwork for potential expansion to 32 teams in the near future (Manfred has mentioned cities like Nashville, Portland, Montreal, Charlotte, or others as contenders once the A’s stadium issue is resolved with the Tampa Bay Rays resolution on the horizon). Expansion would mean hefty expansion fees, possibly on the order of $2 billion per new team, which would be split among the existing owners as a windfall. The possibility of this may already be implicitly inflating franchise valuations (owners know a big cash influx could come). The Athletics’ planned move to Las Vegas (targeted by 2028 after a new stadium is built) is the first franchise relocation in over 50 years and is a reminder that location and facilities significantly impact finances. In Vegas, the A’s expect far greater revenue streams (new stadium with lots of premium seating, a growing market, and likely plenty of tourist attendance) than they had in Oakland, hence their value jumped despite current struggles. Teams in older or smaller venues (e.g. the Kansas City Royals or Milwaukee Brewers) are pushing for new or renovated facilities to boost revenue potential. For Yankees fans, expansion or other teams moving doesn’t directly change the Yankees’ situation, but it does grow the league overall pie (more markets, more TV viewers). The Yankees typically get a smaller relative slice of things like national revenue when more teams join, but if expansion grows total revenue, it can still be positive for everyone.
In essence, 2025 finds MLB at an interesting juncture: financially prosperous yet facing evolving challenges. The game on the field is improving in fan appeal (helping the bottom line), and teams like the Yankees are raking in money even while spending aggressively. But long-term media structures are in flux, and the league is trying to future-proof its revenue streams (through streaming, betting, global outreach). The new CBA changes have been absorbed, and now both owners and players are eyeing how the financial pie might grow or be reallocated in the next agreement.
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