| 25 July 2011
The UFC has a license to print money. The company's (Zuffa) rise from the ashes is legendary - five years ago, when attempting to sell the money-losing UFC, they could only get offers in the $4 to $2 million range. Now the company is valued at over a billion dollars (Flash Entertainment paid $120 million for 10% of the company in 2010, which would make it's valuation at $1.2 billion).
But how is the UFC doing so far in 2011 compared to last year? While Zuffa isn't a public company and therefore don't have to disclose their financial records, several of the company's key financial info is out there in the public for us to analyze. These would be the UFC's pay-per-view buyrates, its live gate and its fighter salaries. And taking a look at those stats, Dana White and the Fertitta boys probably wish it was 2010 again.
Pay-Per-View Buyrates
A large chunk of the UFC's profit comes from the plethora of events they offer on pay-per-view every year. And the UFC's PPV buyrates have increased every year without exception. But, as the following chart shows, the streak might be snapped this year:
| 2010 | 2011 | |||
| PPV | Buyrate | PPV | Buyrate | |
| 108 | 300,000 | 125 | 270,000 | |
| 109 | 275,000 | 126 | 725,000 | |
| 110 | 240,000 | 127 | 260,000 | |
| 111 | 850,000 | 128 | 445,000 | |
| 112 | 500,000 | 129 | 850,000 | |
| 113 | 520,000 | 130 | 312,500 | |
| 114 | 1,050,000 | 131 | 330,000 | |
| 115 | 520,000 | |||
| Total | 4,255,000 | 3,192,500 | ||
| Average | 531,875 | 456,071 | ||
| PPV $ | $ 106,375,000 | $79,812,500 | ||
| Difference | $ (26,562,500) |
Through the midway point of 2011, the UFC's total buyrate and average buyrate of its PPVs has dropped considerably. And, based on the approximately $25/sale the UFC gets to keep, the drop in sales results in over $26.5 million less in PPV profits in 2011 than 2010 through the first six months. Why the dropoff? Injuries are the main culprit, as hardly a PPV has gone by without one (or both) of the main event participants having to withdraw due to health issues. Particular troubling for the company's bottom line has been the absence of Brock Lesnar due to a recurrence of his diverticulitis. The only fighter on the roster who guarantees a million selling PPV, Lesnar's absence from UFC 131 cost the company probably a minimum of 670,000 additional PPVs sold, which works out to be around $16,750,000 in additional profits. That's a lot of scrilla.
Live Gate
One revenue stream that has increased this year for the UFC is its live gate proceeds. And this despite the fact that they earned no gate receipts from the Fight For The Troops event. Through the first six months of 2011, the UFC has taken in about $3.5 million more from the live gate receipts of its events. UFC 129's record haul of $12 million certainly went a long way in helping the cause.
| 2010 | 2011 | |||
| 108 | $ 1,969,670 | 125 | $ 2,174,780 | |
| UFN 20 | $ 753,962 | UFN 23 | $ - | |
| 109 | $ 2,273,000 | 126 | $ 3,600,000 | |
| 110 | $ 2,500,000 | 127 | $ 3,500,000 | |
| Live 1 | $ 568,125 | Sanchez | $ 471,450 | |
| 111 | $ 4,000,000 | 128 | $ 2,140,000 | |
| UFN 21 | $ 590,685 | UFN 24 | $ 1,182,850 | |
| 112 | $ 3,500,000 | 129 | $ 12,075,000 | |
| 113 | $ 3,270,000 | 130 | $ 2,580,000 | |
| 114 | $ 3,895,000 | TUF 13 | $ 440,150 | |
| 115 | $ 4,221,787 | 131 | $ 2,800,000 | |
| TUF 11 | $ 430,000 | Live-Kongo | $ 562,000 | |
| Total | $ 27,972,229 | $ 31,526,230 | ||
| Difference | $ 3,554,001 |
Fighter Salaries
For the most part, the UFC is paying their fighters the same in 2011 as they did in 2010, with less than a million additional dollars going to the combatants than it did in 2010. But, remember, this is only reported pay and end of night bonuses - it doesn't include any undisclosed bonuses or PPV profits that some fighters get.
| 2010 | 2011 | |
| $ 13,333,000 | $12,490,000 | |
| Difference: | $843,000 |
When you add up the PPV revenues, live gate receipts and subtract the amount paid to fighters, the UFC is down about $24 million from what it had earned after six months in 2010. But we're still not going to feel sorry for billionaires, are we?
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