Ever watched Lewis Hamilton and Max Verstappen battle it out on the track and wondered, “How exactly does Formula 1 make all that money?” Spoiler alert: it’s not just about selling race-day tickets. Behind the racing, podium ceremonies, and champagne-soaked celebrations lies a finely-tuned financial machine that generates billions of dollars every year. Curious how your favourite motorsport transforms passion into profit?
What To Know?
- Race Promotion Fees: Stable, escalating fees from global race promoters (29.3% of revenue).
- Media Rights: Largest income source driven by major broadcast deals and digital growth (32.8%).
- Sponsorships: Premium brands attracted by F1’s global historic prestige and tech innovation (18.6%).
- Other Revenue: High-margin hospitality (Paddock Club), support series, and merchandise (19.3%).
How Much Money Does F1 Make?
Formula 1’s revenue streams are as diverse and strategic as the races. From lucrative global media rights and glamorous brand sponsorships to elite hospitality experiences like the exclusive Paddock Club—F1’s finances are engineered for maximum performance, hitting a significant revenue milestone in 2024. According to SportsPro, F1 achieved total revenues of $3.2 billion in 2024, representing a substantial 25% increase year-over-year.
In our latest post to celebrate the 2025 F1 World Championship, the sport’s 75th season, we’ll explore the economics behind F1’s impressive financial performance.
Race Promotion Fees: A Pillar of Formula 1 Revenue
Race promotion fees are a cornerstone of Formula 1’s financial model, contributing approximately 29.3% of the organisation’s total revenue. Promoters worldwide pay substantial sums to host prestigious Grands Prix events. These fees reflect the global appeal and significant economic benefits associated with Formula 1 races, including increased tourism, international exposure, and local economic stimulation.
Formula 1’s self-owned Las Vegas Grand Prix is unique, as it does not pay a conventional promotion fee. Instead, F1 directly manages and profits from the event, an alternative revenue strategy that contrasts with traditional promoter-driven races.
Standard contracts between Formula 1 and race promoters typically include built-in annual escalators. These clauses are designed to ensure that F1’s revenue stream remains predictable and grows steadily year-over-year, enhancing financial stability and allowing long-term forecasting.
Singapore Grand Prix
The Singapore Grand Prix demonstrates this model. As of writing this in 2025, it pays approximately $35 million annually to Formula 1. Embedded within the agreement are annual escalations, incrementally increasing the fee each year. This structure creates a predictable income for Formula 1 and shows Singapore’s long-term commitment to hosting the race, benefiting both parties through international exposure and economic impact.
Formula 1 has built a resilient financial foundation by creating structured and escalating fee arrangements, allowing it to navigate economic fluctuations. This was highlighted during the COVID pandemic in 2020 when F1 could remain buoyant and help struggling teams. Not only that but with the huge sums it generates, this money is continuously re-invested in the sport’s global expansion and technological innovation—something F1 has been known for decades.
Media Rights: Formula 1’s Largest Revenue Source
Media rights constitute the most significant revenue stream for Formula 1, accounting for roughly 32.8% of its total annual income. These rights include lucrative broadcasting agreements negotiated with major global networks, which significantly amplify Formula 1’s global visibility and audience engagement. The substantial revenues generated through media rights underscore Formula 1’s position as a leading international sporting brand.
Formula 1 has strategically aligned itself with prominent broadcasting partners such as ESPN in the United States and Sky Sports in the United Kingdom, thereby ensuring broad coverage and maximum viewer access. In addition to traditional broadcast platforms, Formula 1 has increasingly leveraged the rise of digital streaming services, from the Netflix Drive to Survive (DTS) series to its own F1 TV, which appeals to younger, tech-savvy demographics and offers customisable viewing experiences. This change has played a crucial role in expanding Formula 1’s global fanbase and has increased the value of its media rights contracts—many credit DTS for this shift.
ESPN Investment
ESPN’s decision to renew its Formula 1 broadcasting rights through 2025 illustrates the significant growth in the sport’s value and global appeal. Reports indicate a substantial increase in ESPN’s annual fee compared to its previous agreement, reflecting Formula 1’s growing popularity in the U.S. market. The success of Netflix’s documentary series “Drive to Survive” notably contributed to this surge, which has attracted new audiences and revitalised interest in Formula 1, particularly among younger demographics.
This amplified interest has translated into higher viewership numbers, increased advertising revenue, and further bolstered Formula 1’s bargaining power in negotiating media rights deals. ESPN’s commitment exemplifies how Formula 1 successfully leverages media partnerships to strengthen its financial standing and global appeal, ensuring continued growth and sustainability for the sport.
Sponsorships: Aligning Global Brands with F1’s Glamorous Image
Sponsorship revenue accounts for approximately 18.6% of its total income. The sport’s blend of glamour, global visibility, and technology creates an attractive proposition for international brands seeking high-impact marketing opportunities. Formula 1’s luxurious and globally recognised image draws prestigious sponsors. For the 2025 season, luxury conglomerate LVMH has taken the place of Rolex in a 10-year agreement said to be worth more than $1 billion with annual sponsorship fees topping $100 million, while technology leader Salesforce and energy giant Aramco also contribute huge sums of money to the sport.
Formula 1 sponsorship agreements offer opportunities, including extensive trackside branding, team-specific partnerships, and high-profile activations designed to maximise brand visibility. These partnerships not only enhance brand recognition for sponsors but also offer unique platforms for engaging directly with diverse and affluent global audiences.
Salesforce Partnership
Salesforce’s partnership with Formula 1 means that F1 can leverage the brands’ technological expertise, using advanced data analytics, cloud computing, and customer relationship management (CRM) services to enhance its fan experience.
In return, Salesforce’s real-time data visualisation, predictive analytics, and personalised fan engagement platforms mean the brand has effectively positioned itself between technology and sport. These activations have driven considerable value back to Salesforce by associating its brand with the cutting-edge and gained a new global appeal.
Other Revenue Streams: Premium Experiences and Support Series
Approximately 19.3% of Formula 1’s total revenue is generated through diverse sources outside the traditional categories of media rights, sponsorships, and race promotion fees. These additional streams include premium hospitality experiences, such as the prestigious F1 Paddock Club, and revenues from ancillary racing series, merchandise sales, licensing agreements, and digital service offerings.
The F1 Paddock Club is a flagship premium experience, offering fans unparalleled access to Formula 1’s luxurious and exclusive side. This includes prime trackside viewing locations, gourmet dining, premium beverages, and unique behind-the-scenes interactions with drivers, teams, and key figures within the sport. While general ticket sales revenue predominantly benefits local race promoters, Formula 1 directly capitalises on these high-margin hospitality packages.
In addition to hospitality services, Formula 1 generates substantial revenue through ancillary racing series, including FIA Formula 2, FIA Formula 3, and the F1 ACADEMY. These feeder series not only nurture emerging talent and enhance fan engagement but also create additional media and sponsorship opportunities, further diversifying and bolstering the overall revenue model.
Merchandising and digital service offerings are becoming increasingly critical components of Formula 1’s financial strategy. Official merchandise sales, both trackside and through digital storefronts, combined with interactive digital services such as F1 TV subscriptions, gaming, and virtual experiences, appeal directly to fans seeking deeper engagement with the sport. These revenue channels enable the sport to monetise its vast and passionate global fanbase effectively.
The Economic Impact of the Las Vegas Grand Prix
The 2023 Las Vegas Grand Prix signalled a significant evolution in Formula 1’s approach to hosting races, shifting from a traditional promoter-driven model to direct ownership and operational control by Formula 1 itself. This pivot allowed F1 to directly capitalise on its global brand equity while simultaneously deepening its economic integration with host cities.
By owning and operating the Las Vegas event directly, Formula 1 aims to maximise economic benefits, enhance local engagement, and take total control of the event’s brand, commercial partnerships, and fan experience. This direct management model is expected to set a new benchmark for future event strategies, offering Formula 1 greater control over event quality, profitability, and long-term sustainability.
Projected Economic Impact
The Las Vegas Grand Prix is projected to generate an annual economic impact beyond $1 billion, significantly beating the revenue generated by major events such as the Super Bowl. This remarkable financial forecast underscores Formula 1’s potential to leverage its prestigious global brand directly, driving substantial revenue for itself and generating considerable economic growth for the Las Vegas region.
This billion-dollar-plus economic boost will come from a multitude of sources, including tourism, hospitality, increased consumer spending, local business stimulation, and extensive international media exposure. By positioning the Grand Prix within one of the world’s leading entertainment and tourism hubs, Formula 1 gains huge visibility and commercial opportunities, attracting diverse demographics and substantial global investment.
The choice of Las Vegas hinted to Formula 1’s new focus on combining sport with entertainment, lifestyle, and luxury. As such, the event is not only a showcase of the series but also a platform that F1 controls the narrative of, promoting Formula 1’s marketing strategy, aimed at showing off what brands might get in return of a lucrative sponsorship deal.
Formula 1’s Financial Future
From the lucrative race promotion fees, expansive global media rights agreements, strategic sponsorships, and premium hospitality offerings—F1 is in a strong position for the next decade. Its sustained financial health and growth trajectory and Formula 1’s proactive approach to expanding its global footprint, using digital media, and directly managing events such as the Las Vegas Grand Prix will help with the continued growth of the sport. And not one to shy away from the latest in technological advancements, digital and experiential offerings, and brand partnerships, the sport’s financial landscape promises to remain vibrant, going from strength to strength.
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