According to Shams Charania of Yahoo Sports, the Magic and Gordon agreed to a four-year, $84 million deal.
Gordon confirmed he was re-signing on Twitter:
Gordon was a restricted free agent this summer and eligible to sign an offer sheet with other teams, but the Magic apparently presented their power forward with an offer too enticing to pass up.
Drafted fourth overall by the Magic in 2014, he has steadily improved his scoring output in each of his four seasons. The 22-year-old averaged a career-high 17.6 points per game last season and shot a career-best 33.6 percent from three-point range.
Gordon was one of the few bright spots in a frustrating and disappointing 2017-18 campaign for the Magic. Their 25-57 record was the fifth-worst in the NBA, and it marked the fifth time in the past six seasons they have lost at least 50 games.
Retaining Gordon is the first step in Orlando's plan for its next phase under new head coach Steve Clifford.
The Magic need a lot of retooling after years of being in the cellar. It won't be an easy fix, but this is the first time in a long while that there appears to be a plan in place.
In addition to Gordon's return, Evan Fournier, Bismack Biyombo, 2017 first-round pick Jonathan Isaac and 2018 first-round pick Mohamed Bamba are all promising players aged 25 or younger.
Orlando still has 27-year-old center Nikola Vucevic in place as well and no shortage of trade chips if it wants to further shake up the roster.
If the Magic are going to navigate out of the cellar and into playoff contention in the near future, Gordon figures to be a significant part of the equation.