Jordan might’ve retired more than a decade ago, but his hold on America’s collective consciousness is still unparalleled among athletes.
In fact, according to Forbes’ Kurt Badenhausen, he earned more last year than any current or retired athlete besides Floyd Mayweather.
But how exactly did he achieve such an astounding sum? Some sources might be predictable, but others might surprise you.
The Man, The Brand
The largest part of Jordan’s wealth stems from his incredible Jordan Brand and the huge income it generates for Nike.
Accordingly, that’s where the majority of his incredible paycheck comes from.
Nike just released the Air Jordan 10 “Powder Blue” sneaker on Feb. 22, with first-day sales reaching $35 million, so it shouldn’t come as a shock that Jordan earns so much.
In fact, Badenhausen estimates that the brand has been downright invaluable to Nike:
Retail shoe sales for the Jordan Brand in the U.S. grew 11% last year to $2.7 billion, with basketball making up 84% of that, according to Powell. Roughly 50% to 55% of that goes to Nike. If you factor in sales of Jordan apparel, the international Jordan business and sales at Nike stores, the Jordan brand is contributing roughly $2 billion of revenue to Nike, which posted sales of $26 billion over the last 12 months. Jordan, the man, gets a cut of every shoe, hoodie or pair of shorts sold by Nike under the Jordan Brand. We estimate MJ’s take from Nike was at least $75 million last year.
The more incredible fact might be that Jordan could be losing out on millions more in the secondary market.
Roberto Ferdman of Quartz.com found that one of every three dollars spent on sneaker on eBay goes toward purchasing Air Jordans.
“You still have the Jordan 1, 2, and 15-28, and others,” Josh Luber, founder of sneaker data site Campless, told Ferdman. ”Many Air Jordan shoes sell at enormous premiums on eBay.”
If anything, Jordan’s monstrous take should be even higher, but luckily for Michael, he has got plenty of other revenue sources.
Anyone who’s flipped on the TV recently knows that Jordan isn’t afraid of lending his face to promote a product.
He might not be as omnipresent as he once was, but he still has plenty of corporate partners.
Jordan has pared his list down to Gatorade, Hanes, Upper Deck and Five Star Fragrances (through which he was his own cologne line), but he did also recently add 2K Sports and Novant Health to the list.
Even with the relatively short list of official sponsors, he still seems to be appearing on the small screen more often than not. His Hanes spots are particularly inescapable.
But there’s one source of income that many people might not have predicted.
Jordan has taken a lot of flak over the years for his skills—or lack thereof—as an NBA owner, but it seems as if he’s about to succeed financially in this venue as well.
His Charlotte Bobcats might still be a mess on the court, as they’re currently sitting four games under .500 in the abominable Eastern conference, but they’re about to provide a big payday for Jordan.
He might’ve started out propping them up with his wealth, but Badenhausen explains that it’s about to change:
Jordan became majority owner of the Bobcats in 2010 in a deal that valued the team at just $175 million. Jordan also agreed to put up cash to cover operating losses the team was piling up. But after five straight years of heavy losses, the Bobcats turned an operating profit (earnings before interest, taxes and depreciation) of $7 million last season. The team benefits from the new collective bargaining agreement that reduced the players’ cut of revenues from 57% to 50%. The CBA also tripled the revenue sharing going from the NBA’s haves to have-nots. Charlotte is one of the biggest beneficiaries with revenue sharing that should reach $18 million a year.
NBA teams are also on the verge of a massive cash infusion with new TV deals set to be negotiated this year. The current pacts with ESPN/ABC and TNT are worth $930 million annually and insiders think the next round of agreements will be worth at least twice as much. The value of the Bobcats, which Jordan owns 80% of, was up 30% over the last year to $410 million in Forbes’ latest look at the business of basketball. Mark Cuban thinks every NBA team will be worth $1 billion within 10 years. We estimate Jordan’s current net worth at $750 million. His earnings prowess shows no sign of letting up and should land him a spot on Forbes billionaire list in the coming years.
When combined with the fact that Jordan is about to rebrand the franchise by returning it to its roots as the “Charlotte Hornets,” with all the boosts in merchandise that goes with it, Jordan should be doing just fine as an owner.
He might have a lot to learn when it comes to player management, but if there’s one thing Michael Jordan knows how to do, it’s turn a profit.
We probably shouldn’t still be stunned by how effectively the man markets himself given his history, but the numbers are still mind-numbing.
Given his business acumen up to this point, there’s no reason to believe he has anywhere to go but up.
Perhaps IndyCar’s Graham Rahal puts it best:
He probably does have the money to spare to make it happen.