The U.S. Open welcomed 216,029 fans over the past seven days to take in performances, practice rounds and qualifying, a 37% jump over the pre-tournament benchmark it set last year, as the tennis tournament enjoys a wave of big crowds and growing revenues.
The record attendance for “Fan Week” reflects a business priority for the United States Tennis Association (USTA), which operates the season’s fourth Grand Slam and has been looking for ways to expand its reach beyond the 14 days of singles competition. It also bodes well for an event that has taken off financially in the past few years.
Last year drew a record 957,000 fans during the fan week and the two weeks of the tournament, with the USTA targeting 1 million this year. In its audited financial statements from 2023, the USTA reported record revenue in three of its four main income streams: ticket sales ($185.4 million), sponsorships ($122.5 million) and corporate hospitality ($71 million). The fourth, media rights ($142.9 million), was just below last year’s record. The vast majority of that money comes directly from the U.S. Open.
“[2023] was extraordinary for us,” USTA CEO Lew Sherr said last week. “It was record-breaking in so many ways, in almost every possible regard. We saw the highest number of fans on-site we had ever experienced. We saw the highest broadcast viewership. We saw the highest digital engagement. We are absolutely expecting that trend to continue.”
In total, the USTA reported a record $580.7 million in revenue in 2023. The U.S. Open, which featured singles titles for Novak Djokovic and Coco Gauff, brought in $514.1 million, nearly 89% of the organization’s total. The event reported $259.2 million in costs, which equates to an operating profit of about $254.9 million. That money is used to fund many of the nonprofit governing body’s other annual programs, including community tennis support, high-performance development and lower-level national tournaments. (USTA executives were unavailable to comment in the run-up to this story.)
It’s a return to normalcy for the USTA, which lost roughly $200 million from the 2020 U.S. Open when it was held without fans due to the COVID-19 pandemic. In response, the organization cut staff by 25%, liquidated as much as $85 million worth of investments and opened a $150 million revolving credit facility to meet operating cash needs. Now, the soaring revenue has helped right-size the USTA’s business. The group ended 2022 with $360 million in cash reserves, bolstered largely by the $270 million sale of the ATP’s Cincinnati event, and has begun prioritizing its investments once again.
The governing body purchased $189.8 million worth of investments in 2023, more than double its second highest annual total in at least 15 years. Much of that appears to be from a $100 million pool that the USTA board has designated to invest with the intention of using the returns to repay Series D debt when it comes due in June 2033. The board-approved investment policy, which was not in the 2022 financial statement, is targeting “at least 5% nominal annualized returns,” the filing says.
In total, the value of the USTA’s investments grew from $162.2 million at the end of 2022 to $368.3 million at the end of 2023. The portfolio’s returns went from a $12 million loss in 2022 to $28.4 million in 2023.
The 2023 financial report also provides updates on a few recent USTA-related transactions. In February 2023, the group sold its White Plains, N.Y., headquarters for $7.7 million. It also reported a $375,000 loss on its equity investment in Trident8, the group that organizes the Roger Federer-backed Laver Cup. The USTA paid $6 million total in 2016 and 2017 to for a 20% non-controlling interest in the group. That investment now has a net book value of $6.1 million, according to the filing.
With assistance from Brendan Coffey.
