One deal confirmed and another imminent as Arsenal set to smash £173m record
09/12/2024 02:00 PM
Arsenal are hoping break 21-year Premier League title duck in 2024-25 and may well have another record to shout about once the season is done.
Financially, the Gunners have suffered as a result of their absence from the very upper reaches of the Premier League table in recent years.
Until last season, Arsenal had not qualified for the Champions League for seven years, which saw £40m wiped from their revenue every season.
Their run to the quarter-finals, where they were knocked out by Bayern Munich, is expected to have yielded around £65m in prize money alone.
However, the benefits are not just rewards for the sporting performance delivered by Mikel Arteta and Edu Gaspar.
There is a huge commercial upside too, with Arsenal able to negotiate with sponsors on the basis of being in the most watched club competition on the planet.
Since their renaissance under Arteta, Arsenal have renewed their biggest sponsorship deals with Adidas and Emirates, worth £60m-a-year and £50m-a-year respectively.
Arsenal owner Stan Kroenke has loosened the purse strings in the transfer market in recent windows as a result.
And while Arsenal have plenty of breathing space in terms of PSR (Profit and Sustainability Rules), the self-funding approach advocated by Kroenke means the club needs to continue to increase revenue.
And there is good news on that front, with Arsenal set to rake it in from two new deals.
Two new lucrative sponsorships for Arsenal
In 2022-23, the last year for which full financial data is available, Arsenal generated a club-record £173m in commercial income. That’s revenue sponsorship, merchandise and events.
The return to the Champions League in 2023-24, the continuing success of their relationship with Adidas, and the new training ground naming rights deal with Sobha Reality mean that record will not stand long.
Arsenal are projected to hit perhaps as high as £250m in commercial income in 2024-25 and the latest sponsorship deal with NTT DATA is set to help further boost the bottom line.
The deal, which was announced on Tuesday, will see the Japanese firm become Arsenal’s ‘Official Digital Transformation Partner’ and supply their services to the club for the next four years.
According to football finance journalist Łukasz Bączek, the deal is worth £4m per year, or £12m over the total course of the contract length.
What’s more, Bączek stated that Arsenal are set to announce a new commercial deal in September.
Arsenal’s commercial income and its impact on Arteta’s transfer budget
Mirroring the rest of the so-called Big Six, Arsenal are attempting to pluralise and diversify their sponsorship inventory in order to extract maximum value from the commercial market.
The two new commercial deals take Arsenal’s total number of official partners to 29.
The Gunners’ spent modestly in the summer, ending the window with a negative spend of around £20m.
Some analysts have suggested that this is the Kroenke regime attempting to prove their business strategy, showing that they can control costs, be profitable, and enjoy success on the pitch.
As one of the three core pillars of their business model alongside matchday and broadcast revenue, commercial income is absolutely central to how Arsenal operate in the transfer market.
