Welcome to our deep-dive series on the business of baseball. In this five-part series, we’ll break down how Major League Baseball (MLB) teams generate revenue, which clubs are turning profits (or bleeding cash), why franchise ownership is such a lucrative long-term play, how market size impacts team finances, and finally provide a financial snapshot of all 30 teams. Whether you’re an MLB insider or a casual fan, we’ve got you covered with relatable examples and the latest numbers from the 2024 season. Let’s play ball (financially speaking)!
Even though MLB overall is raking in cash, not every team’s balance sheet looks rosy. Some owners are smiling at healthy profits, while others are operating in the red (at least on paper). Let’s explore which teams made money in 2024 and which did not, and why.
The Big Winners
Typically, teams that keep costs (especially player salaries) in check while benefiting from decent revenue are the ones that show the largest operating incomes (basically profit before interest/taxes). In 2024, several mid-and small-market clubs quietly turned hefty profits. For example, the Baltimore Orioles had an estimated $64 million operating income for 2024. Not surprising since they had one of the league’s lowest payrolls but saw a big uptick in attendance as the team surged on the field. Other likely winners include teams like the Seattle Mariners and San Francisco Giants, which in 2022 led MLB with $86M and $75M profits respectively. These clubs draw solid revenue (good fan support, decent local TV deals) but don’t spend at the level of the big boys, resulting in a nice surplus. The Pittsburgh Pirates are another notable case, despite perennially low payrolls, they had around a $55 million profit in 2022 and likely remained very profitable in 2024, frustrating fans who wonder why more of that money isn’t reinvested in the team. Generally, if you see a team with a bottom-tier payroll but middle-of-the-pack revenue (thanks to revenue sharing), you’re looking at a profit machine. The Marlins, for instance, had the lowest payroll and managed a small profit (~$0.5M in 2022), essentially breaking even, which for them is actually an achievement.
The Big Losers
On the flip side, some owners have shown they’re willing to lose money in the short run in hopes of winning on the field. The poster child here is the New York Mets. Owner Steve Cohen spent with wild abandon in 2023 and 2024, leading to astronomical payrolls (paying luxury tax penalties on top). The result? Forbes estimated the Mets lost a staggering $138 million in operating income for 2022, and that ballooned to an even larger loss of around $292 million in 2023. It’s likely the Mets were still deep in the red for 2024 after an expensive but disappointing season. Another money-losing club was the San Diego Padres, who famously ramped up payroll into the top five league-wide in pursuit of a title. They posted a $53 million operating loss in 2022 and reportedly around $113 million in 2023. High spending, combined with missing the postseason in 2024, likely means San Diego’s books were awash in red ink again. Even the mighty Yankees have had years where they lose money operationally (Forbes estimated a $25M loss back in 2006 when they led payroll by a mile). Why would a rich team lose money on purpose? Often, it’s a strategic choice. Invest in talent now, eat the losses, and hope success brings future revenue. Owners like Cohen (Mets) seemingly view those losses as the “cost of doing business” to chase a championship, a luxury smaller franchises can’t afford.
What Drives Profitability
The biggest factor is the gap between revenue and expenses, especially player salaries. Teams with modest payrolls and good attendance/media deals (say, the Milwaukee Brewers, who earned ~$294M revenue vs. a ~$120M payroll) tend to bank profits. Teams that overspend on players relative to their income (like the Mets, Padres, or 2023 Los Angeles Angels) will show losses. Other factors include stadium debt and revenue sharing. For example, some teams pay hefty stadium expenses or loans that eat into operating income. Revenue sharing means high-revenue teams give up some money to the pool, while low-revenue teams receive a boost. Effectively, the Yankees and Dodgers are subsidizing the Pirates and Rays. That evens out profits across clubs a bit, but clearly some teams still choose to outspend their means. Interestingly, league averages can be misleading: the average MLB operating profit in 2023 was about $17 million, but that was dragged down by outlier losses in New York and San Diego. The median profit was a healthier $33 million, meaning most teams did make money.
It’s worth noting that owners have accounting levers that can make “profit” blurry. Many have other businesses tied to the team (real estate, regional networks) where they can shift revenues or expenses. Also, owners benefit from tax strategies, for instance they can depreciate player contracts as assets, which can turn an operating profit into a paper loss (handy at tax time). So, when you hear an owner claim they “can’t afford” a higher payroll, take it with a grain of salt.
Conclusion
In 2024, most MLB teams were profitable, with a handful of low-spending clubs (Orioles, Pirates, Guardians, etc.) leading the pack in operating income. The biggest losses were concentrated in a few high-roller teams (Mets, Padres) that spent beyond their means in search of wins. Profitability is largely a function of payroll vs. revenue, spending much less than you earn, you’ll make a profit; spend more, you’ll lose. However, many owners are content to break even or even lose money year-to-year, knowing that the real payoff of MLB ownership often lies elsewhere… which leads us to Part III.
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