Sports Business Outlook to Improve in 2025, Fitch Says

The financial outlook for sports is expected to improve in 2025 as global expansion, interest in women’s sports and lower U.S. interest rates are combining to make for a more favorable market, Fitch Ratings said in a report released Monday.

Fitch, which rates the investment-worthiness of leagues, teams and related businesses like stadium owners and media businesses, said the main drivers of credit ratings in sports are contractually obligated income streams like premium seating, naming rights, sponsorship and media rights. The agency expects all of those to remain robust due to increased demand for sports content in 2025, supplemented by a stronger concert tour season which provides secondary usage of pro facilities.

“The sports industry is further buoyed by the major leagues’ continued global expansion and increased popularity of women’s sports,” Ben Munguia, director of infrastructure and finance at Fitch, said in the report. “Rising attendance for women’s sports and higher levels of fan engagement over the last year could unlock new revenue opportunities.”

The analysis, titled “Global Sports Outlook 2025,” took a largely bullish stance on the sports business, listing its outlook for 10 metrics for facilities, teams and leagues as either moderately improving or neutral, with no deterioration in any category expected. The agency says 5% of the global sports businesses it rates have a positive outlook, 91% a stable outlook and 4% have a negative outlook at this point in the year–all unchanged from 2023.

The outlook for media rights is a somewhat mixed bag, depending on what side of the partnership is considered, according to Fitch. Strong league deals like the NBA’s 11-year, $75.9 billion package bode well for rights for other leagues expected to be up for bidding in years beyond 2025, but the fragmentation of how fans watch sports and cable cord-cutting suggest some caution is in order.

“The fragmentation and exclusivity of media rights across multiple platforms and partners may lead to fan disinterest if the desired content becomes unavailable to the original broadcast platforms,” the report states. “Franchises in leagues that rely more on local media revenues may face challenges during the transition period,” away from regional sports networks to streaming platforms and potentially centralized league rights, such as what MLB is exploring.

The macro-economic outlook should benefit U.S. sports leagues as well. The Federal Reserve Bank has cut interest rates twice this year and Fitch anticipates another five cuts in 2025. That reduces borrowing costs for new projects, like stadiums, and opens the door for the potential reduction of debt service by refinancing existing debt.

In Europe, the report sounds a tentatively optimistic note on UEFA’s continued implementation of cost control regulations. By June, clubs have to limit spending on players, coaches, transfer and agent fees to 80% of revenue, with a move to 70% to follow. Financial discipline probably helps clubs, though the spending system may reinforce the financial advantage of the traditionally stronger clubs, Fitch said.