Plenty of good news in Newcastle accounts

It’s a long way from Zurich to Newcastle but the Swiss Ramble provides his usual forensic analysis of the club’s 2024/25 accounts.  More depth and detail is available on his Substack page, but here are some highlights.

This was Newcastle’s third full set of accounts under the ownership of the consortium led by Saudi Arabia’s Public Investment Fund (PIF) after Mike Ashley’s long reign came to an end.

In the period since that acquisition in October 2021, there has been much progress both on and off the pitch, as the club has benefited from significant investment from the new owners.

Newcastle reported a £35m pre-tax profit, compared to an £11m loss the previous year, though this owed a great deal to a £133m gain on exceptional asset sales to other group companies, primarily their famous St James’ Park stadium. If these were excluded, the club would have posted a substantial £98m loss.

Revenue rose £15m (5%) from £320m to a club record £335m, though this was more than offset by a steep increase in operating expenses, which shot up £56m (14%) from £389m to £445m.

In addition, profit on player sales dropped £50m (72%) from £70m to £20m, though net interest payable fell £3m (28%) from £12m to £9m.

The cost base once again significantly grew, as the new owners continued to invest in the squad and club infrastructure, as Newcastle strived to challenge at the top of the table, as well as compensating for the many years of austerity under Ashley.  Wages rose £24m (11%) from £219m to £243m.

Dramatic revenue increase

Newcastle’s revenue has dramatically increased in the last three years, rising £155m (86%) from £180m to £335m with good growth across the board, though commercial was the star of the show, up £94m, followed by broadcasting £37m and match day £24m.  Nevertheless, broadcasting still has the highest share of total revenue with 48%, then commercial 37% and match day 15%.

However, even after this growth, Newcastle’s revenue is still dwarfed by the elite, only around half of the top four clubs, namely Liverpool £703m, Manchester City £694m, Arsenal £690m and Manchester United £667m. The gap to the Big Six has reduc ed, but was still a chunky £156m.

Newcastle again qualified for the Champions League this season, where the Swiss Ramble estimates they earned €65m (£55m) for reaching the last 16, where they were eliminated by Barcelona. This was split between participation fee €18.6m, prize money €30.3m and value pillar €16.3m.  That’s pretty good, but was still a lot lower than the other English representatives. For example, three clubs were knocked out at the same stage, but received much more, namely Manchester City €97m, Chelsea €92m and Tottenham €84m.

It is estimated that a new stadium would cost around £1.2 bln, which would be a huge commitment, though it would probably double match day revenue.  PIF have spent £58m on infrastructure in the last four years, compared to Ashley’s paltry £7m in the preceding 12 years. Improvements have been made at the training centre and the stadium, while land was purchased behind the Gallowgate End and there was also the fit-out of STACK.

Commercial success

Newcastle’s commercial revenue shot up £37m (42%) from £86m to £123m, mainly due to taking the retail & licensing operations in-house and a new deal with Adidas. In addition, the STACK fan zone “performed strongly” in its first year of operation, but there was no repeat of the previous season’s Amazon documentary.  There had been virtually no commercial growth in Mike Ashley’s time, but this has dramatically changed under the new ownership with revenue more than quadrupling in the last three years, rising almost £100m.

Following this huge growth, Newcastle’s £123m commercial income is seventh highest in the Premier League., though the gap to the Big Six clubs is still substantial with five clubs generating more than twice as much, led by Manchester City £340m, Manchester United £333m and Liverpool £323m.  Nevertheless, Newcastle are the only club outside the elite to earn more than £100m from commercial operations, so they are a fair way ahead of Aston Villa £70m and West Ham £56m.

Owner funding

Newcastle’s new ownership injected £352.9m of capital up to end-June 2025, including £50m last season, plus another £156.5m since these accounts closed. That takes their funding to more than half a billion (£509.4m to be precise).   As they stumped up £305m to purchase the club, that means that the current owners (mainly PIF) are now “in” to the tune of £814.4m.  Ashley put in £140m of loans in the early years of his ownership, but this was all subsequently repaid.

Looking at owner financing in the last four years (up to 2024/25 in most cases), Newcastle’s £353m owner funding was one of the highest in the Premier League.

It seems very likely that Newcastle will breach both elements of UEFA’s financial regulations.   The most likely outcome is that Newcastle will end up making a deal with UEFA, as many other clubs have done in the past, with a 3-year or 4-year settlement agreement.

There is plenty of good news in these accounts, especially the record revenue on the back of significant commercial growth, but the fact remains that Newcastle continue to make large losses, requiring substantial funding from their owners.

Newcastle have certainly come a long way since PIF’s arrival, but they are still at a major financial disadvantage to the traditional elite, so Eddie Howe’s view is probably more realistic for the time being.   The head coach recently said, “The long-term prospects for the football club are really strong, but not all the forces are with us and we’re going to have to act really smart and try to outperform the budget to try to hit the levels everyone wants.”