Imola GP’s cancellation spurs financial woes for Liberty Media and Formula One

Amid extreme weather conditions the 2023 Imola Grand Prix was called off.

Imola GP’s cancellation spurs financial woes for Liberty Media and Formula One

Red Bull vs Aston Martin (Credits: autocar.co.uk)

The last-minute cancellation of the Imola Grand Prix dealt a significant blow to Liberty Media, Formula 1’s parent company. The exact financial loss remains undisclosed, but quarterly figures revealed a $20 million drop in revenue compared to the previous year. This unexpected setback underscores the financial challenges posed by disruptions in the racing calendar.

In 2023’s second quarter, Formula 1 held six Grands Prix compared to seven in ’22. The Emilia-Romagna race’s cancellation due to flooding didn’t stop overall revenue growth from fees and sponsorships. However, one less Grand Prix led to reduced media rights income. Additionally, inflation, high transport costs, and lower hospitality revenues further impacted the finances.

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Formula 1’s overall revenues declined from $744 million to $724 million (-2.7%), with operating profit slowing from $146 million to $141 million (-3.4%). Teams received $344 million, down from $368 million in 2022. Cancellations of China and Imola races led to increased promoter revenue but reduced team payments.

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The reduction in races affected F1’s media rights revenue, partly offset by F1TV subscription growth. Expenses of $7 million were incurred for the upcoming Las Vegas Grand Prix in November. F1’s income for the period was $141 million (£110 million), down $5 million from the second quarter of 2022.

Also read: Liberty Media names three drivers they consider a ‘blessing’ to F1 in their tenure, snubs Fernando Alonso

Las Vegas GP to be F1’s first-ever in-house race

Stefano Domenicali (Image credit: Motorsport.com)

Formula One Management, owned by Liberty Media, traditionally receives fees from Grands Prix organizers for hosting races. For the first time, Liberty Media will host a Grand Prix entirely in-house in Las Vegas GP later this year. Although expenses for other races are usually kept confidential, being listed on the stock exchange obligates Liberty Media to disclose some costs. Thus, it’s clear that $7 million was spent in the second quarter for organizing the GP in the US city.

Stefano Domenicali, Formula 1 President, commented on the figures and stated that the sport is capitalizing on growth momentum, with fans engaging across various media platforms. He congratulated Red Bull on their record-breaking season and expressed excitement about the intense rivalries on track. Domenicali revealed plans for 24 global races next year. 2024 will feature back-to-back events to enhance operational efficiency for F1 and the teams.

“Formula 1 is capitalizing on our growth momentum and our fans are engaging with the sport across traditional, digital and social media platforms. We congratulate Red Bull on their record-breaking performance season-to-date and are thrilled to see the gaps closing across the rest of the grid. Next year we will host 24 races around the globe, with back-to-back races,” Domenicali said.

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