This just in: Earning big and spending big doesn’t guarantee winning big.
Just ask Manchester United, which for the third straight year has reported record revenues and on the field has already lost three straight games. Three times the managerial chair has spun since the end of the 2013 season.
Competitive stumbles haven’t shut off the cash spigot. For the fiscal year that ended last June, the club’s recent financial filing cited $683.5 million in revenue. It reported a profit of $91.7 million that set a new club record. United is the most valuable publicly-held team. Market value: $2.8 billion.
United even spends big when it fesses up to failure. According to its financial report, it paid off former manager Louis Van Gaal and his staff a combined $11.1 million. It listed an $8.9 million write-off, which is about the same amount that it paid to sign Bastian Schweinsteiger, who has been excluded from first-team training by manager Jose Mourinho. “The Special One” was hired in desperation when the club decided to cut loose Van Gaal after two seasons despite capturing the FA Cup.
Said executive vice-chairman Ed Woodward, “Our record fiscal 2016 financial performance reflects the continued underlying strength of the business and the club is on target to achieve record revenues in 2017, even without a contribution from the Champions League.”
How can United project such revenues with dipping into the seemingly bottomless European pot? Two years ago, United signed a sponsorship deal with Adidas worth $1.28 billion, a sports-licensing record. Its commercial revenue added up to about $351 million for the 2016 fiscal year, a staggering increase of 36.3 percent from the prior year. It signed 14 new sponsorship deals. A sharp increase in television rights fees for Premier League games will add to its coffers as well.
“This strong financial performance has enabled us to invest in our squad, team management and facilities to position us to challenge for, and win, trophies in the coming years,” said Woodward.
Trophies is why Mourinho was hired and United paid a fee of $116.4 million for Paul Pogba, who left the team four years ago as a youth player frustrated by lack of opportunities in the first team. He flourished at Juventus, which balked at dealing him but eventually took a nice profit off the $1.1 million it paid for him.
In a list of the highest paid managers compiled by The Mirror, Mourinho ranked third at 15 million pounds ($19.45 million). “Jose Mourinho's appointment is a reflection of our determination to return to the pinnacle of our sport,” said Woodward. “We are writing the next chapter in our history.”
In its long history,United has won 64 trophies, but that FA Cup under Van Gaal is the only hardware claimed – other than Community Shields – since Sir Alex Ferguson ended his 27-year managerial tenure three and a half years ago. After about a month of play, there’s little indication of any dramatic transformation in place.
As bitter rival Manchester City has steamed off to five straight league wins and a 2-0 defeat victory in its Champions’ League opener, United has hit a rough stretch after opening with league victories over Bournemouth, Southampton and Hull City. A 3-1 defeat of Northampton Town (League One, i.e. the third division) in the EFL Cup is its only victory this month.
A home loss in league play to City, a stumble against Feyenoord in the Champions League, and a humbling defeat at Watford belie the vast wealth generated annually at Old Trafford. Any great team can sputter and wheeze occasionally, but there’s widespread consensus that United’s climb back to greatness is long and steep. City and Chelsea and Arsenal can also spend staggering sums, and so can at least half a dozen European foes. Leicester City’s shocking Premier League title run last season reminded us all that money isn’t everything when it comes to winning.
As the richest team in the world’s richest league, United has yet to prove it has spent wisely.