The Charlotte Hornets are an American professional basketball team based in Charlotte, North Carolina. The Hornets compete in the National Basketball Association (NBA) as a member of the league’s Eastern Conference Southeast Division. The team plays its home games at the Spectrum Center in Uptown Charlotte.
Current Team Value
According to Forbes’ NBA Team Valuations 2022, the Charlotte Hornets are currently valued at $1.5 billion as of 2022. This makes them the 25th most valuable team in the NBA.
Here is a table showing the Hornets’ value over the past 5 years:
Year | Value |
---|---|
2022 | $1.5 billion |
2021 | $1.4 billion |
2020 | $1.3 billion |
2019 | $1.2 billion |
2018 | $1.05 billion |
As you can see, the Hornets’ value has steadily increased over the past 5 years. From 2018 to 2022, their value has gone up by about $450 million.
Revenue
For the 2021-22 season, the Hornets had an estimated revenue of $234 million according to Forbes. This was a 16% increase from the previous season’s revenue of $202 million.
The majority of the Hornets’ revenue comes from media rights deals (about 40%), while gate receipts account for about 34%. Sponsorships and other streams make up the remainder of their revenue.
Here is a breakdown of the Hornets’ revenue sources for 2021-22:
Revenue Stream | Amount |
---|---|
Media Rights | $93 million |
Gate Receipts | $79 million |
Sponsorships | $44 million |
Other | $18 million |
Operating Income
In 2021-22, the Hornets had an operating income (earnings before interest, taxes, depreciation and amortization) of $10 million according to Forbes estimates. This was down from $15 million the previous season.
The main factors affecting the Hornets’ operating income are revenue, which was up, and expenses. While revenue rose 16% in 2021-22, expenses rose at an even faster rate of 26%. This caused the drop in operating income despite the revenue increase.
Here is a table showing the Hornets’ operating income over the past 5 years:
Year | Operating Income |
---|---|
2022 | $10 million |
2021 | $15 million |
2020 | $13 million |
2019 | $11 million |
2018 | $13 million |
Ownership
The Charlotte Hornets are owned by Michael Jordan. Jordan purchased the team in 2010 for $275 million from former owner Bob Johnson.
As of October 2022, Forbes estimates Michael Jordan’s net worth to be around $1.7 billion. Apart from being majority owner of the Hornets, Jordan also owns some other businesses including:
- The Jordan Brand
- Car dealerships
- Restaurants
- A NASCAR team
Jordan first became involved with the Hornets in 2006 when he became a minority investor in the team. He steadily increased his stake over the years until he became the majority owner in 2010.
Other Major Owners
In addition to Michael Jordan, there are some other individuals and companies that own minority stakes in the Charlotte Hornets:
- Gabe Plotkin – Hedge fund manager, owns less than 5% of the team
- Novant Health – Healthcare company based in North Carolina, owns less than 5%
- SEEDS Corp – Investment firm, owns around 4%
Financial Performance
In terms of financial performance, the Hornets have generally been in the middle of the pack among NBA teams over the past decade. They have not lost money in any season over the past 10 years which is a positive sign.
Some key financial performance metrics for the Hornets:
- Earnings before interest, taxes, depreciation and amortization (EBITDA) has averaged around $10-15 million the past few years.
- Revenue has grown from $114 million in 2012 to $234 million in 2022.
- Gate receipts have risen from $18 million to $79 million over the past decade.
- Forbes valued the team at $152 million in 2012 compared to $1.5 billion in 2022, showcasing tremendous growth in franchise value.
Under Jordan’s ownership, the team has become profitable after previously losing money most seasons under prior owner Bob Johnson. So overall the Hornets’ financial performance under Jordan has been reasonably strong compared to some other small-market NBA franchises.
Future Outlook
The future outlook for the Charlotte Hornets appears generally positive, with a few key factors working in their favor:
- They have a popular owner in Michael Jordan which boosts the team’s brand and marketability.
- Charlotte is a growing market, with the metro population expected to continue expanding over the next decade.
- The team has managed to keep payroll under control, spending less than the NBA average on player salaries.
- Young talent like LaMelo Ball and Miles Bridges provides hope for improving on-court performance.
Challenges that could impact future value and profitability include the team’s limited national following, a relatively small market size compared to other NBA cities, and the need to consistently make the playoffs to boost revenue.
However, under Jordan’s leadership the franchise appears headed in the right direction. With the team’s young core developing and franchise value rapidly increasing, the long-term outlook for the Charlotte Hornets is quite positive.
Conclusion
In summary, the Charlotte Hornets are currently worth $1.5 billion and are owned by NBA legend Michael Jordan. The team has become consistently profitable over the past decade after previously struggling financially. With revenue and franchise value increasing, and young talent emerging, the future looks bright for Jordan’s Hornets, cementing their place as a valuable NBA franchise.