Red Bull ends 2023 with 360 million euros in revenue for "only" 1.5 million euros in profit

The 2023 Formula 1 season has been one of all records for Red Bull Racing, the team won 14 consecutive victories with Max Verstappen and Sergio Pérez, showing a win rate of 95.45%. This domination was confirmed with the conquest of their sixth Constructors' title in Suzuka, with still 6 races left to be disputed.

At the end of the season, Red Bull Racing had accumulated a total of 860 points, double that of their nearest rival. The team's brilliance was also evident in the pit stops, with the team winning the DHL Fastest Pit Stop Award for the 6th time, a testament to the culture of high performance that prevails within the team. It is in this context of resounding sporting success that Red Bull Racing Ltd unveiled its financial report for 2023.

Revenue growth in a context of victories

The Austrian team saw a strong growth in its turnover in 2023, reaching 359.74 million euros, compared to 325.29 million euros in 2022, an increase of 10.6%. This result reflects the appeal of Red Bull Racing to sponsors, strengthened by its ability to capitalize on its track performance. The report attributes these revenues, notably to « sponsorship, promotion, prizes, bonuses, and contributions to the race program ».

On the business side, the year 2023 was marked by the conclusion of seven new partnerships, including five in the United States, a booming market for Formula 1, notably with the addition of the Las Vegas Grand Prix in 2023.

Furthermore, Red Bull Racing has renewed four key partnerships, two of them being contracts of more than four years, thus highlighting their sponsors' long-term commitment.

Financial challenges despite sporting success.

Despite this increase in income, Red Bull Racing's after-tax profits fell by 37%, dropping from 2.41 million euros in 2022 to 1.52 million euros in 2023. To put it into perspective, this profit is lower than that of Haas Formula One Team, which recorded a profit of 6.44 million euros in 2023.

Red Bull Racing's operating expenses have increased to 336.70 million euros, compared to 296.16 million euros in 2022, representing a 13.7% rise. The report specifies that « the cost increases are mainly due to performance-based rewards stemming from the team's on-track performances in 2023 ». This explanation suggests that sporting success leads to additional costs related to performance bonuses and increased operational expenses.

Sustained investment in innovation

The balance sheet also reports a significant increase in research and development expenses, which almost doubled. Indeed, in 2023, Red Bull Racing allocated 30.31 million euros to research and development, compared to 13 million spent in 2022. This represents an increase of 99.2% and demonstrates the team's commitment to continue to invest in its technological edge in a sport where excellence often comes down to the smallest details.

In parallel, Red Bull Racing's parent company, Red Bull GmbH, continues to invest in the team's technology campus in Milton Keynes, thus strengthening its infrastructure to ensure long-term competitiveness.

Compliance with regulatory constraints.

Red Bull Racing's financial report also mentions compliance with financial regulations imposed by the FIA, particularly regarding the budget cap. Thus, the team states that the management regularly evaluates costs against the cap and forecasts to ensure compliance. An essential adherence to avoid potential sanctions and preserve its sporting performances.

However, on the environmental side, it is worth noting that Red Bull Racing did not disclose its greenhouse gas emissions in its report. This comes at a time when Formula 1 is placing increasing emphasis on sustainable development and ecological responsibility. Indeed, many teams and the sport itself are setting ambitious goals for reducing carbon emissions.

Perspectives and challenges to be addressed

Despite solid revenue growth and expanding commercial partnerships, especially in the American market, the profit decline reflects cost pressures in Formula 1. The recent on-track performances of McLaren, which have allowed them to take the lead in the team standings, and Ferrari's consistency in this ranking, could have a significant impact on Red Bull Racing's finances in the future.

The Austrian team has also faced several key uncertainties and risks which are competitive, legislative, financial, and cybersecurity risks. However, despite these challenges, they remain optimistic about the future. They continue to establish and strengthen strong technical business partnerships, and even with complex global economic prospects, Red Bull Racing Ltd is confident in its ability to generate solid revenues.