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The 2013 Formula 1 movie, Rush, showed the intense rivalry between McLaren’s James Hunt and Ferrari’s Niki Lauda. Directed by Ron Howard, the movie became an international box office success, earning nearly $100 million worldwide.
But the movie just showed a part of the story. Formula 1 is more than fast cars, celebrity drivers, and their fierce rivalries. It’s a billion-dollar enterprise. With an expanding fan base, high-value sponsors, and an international racing schedule, F1 has become a major sporting event.
So, who owns F1? What is the Formula 1 business model, and how F1 teams make money? All about F1 economics in this article.
What Is Formula 1?
Formula 1 is the highest level of single-seater car racing. Unlike rally racing or endurance events, which have two people- a driver and co-driver- F1 features only one driver in each car. This makes the sport a pure test of individual driving skill, speed, and precision.
Like we see in other sports, F1 racing also has a structured hierarchy. To compete in F1 racing, one has to prove his mettle in Formula 3, which is the entry level, and then in Formula 2. Only the best drivers make it to the F1, as the stakes are very high and the performance gaps are razor thin.
Formula 1 cars are some of the fastest and most advanced machines ever built. They use aerodynamically shaped bodies to reduce air drag, custom-built parts for weight reduction, and powerful hybrid engines. No two cars in the race are exactly the same, but they have to be within the rules of F1 racing.
While motor sporting events had been taking place for quite a long time, 1950 marked the start of the official F1 championship in the UK.
Who Owns Formula 1 Today?
The evolution of Formula 1 racing into a billion-dollar enterprise is nothing short of remarkable. Earlier, the sport was organized by Fédération Internationale de l’Automobile (FIA), which still governs F1 today. But its role is now limited to defining the technical aspects and rules of the game.
Post 1970, British businessman Bernie Ecclestone changed the fate of the game. Initially, a racing driver and team owner of Brabham Formula 1, his involvement with the Formula One Constructors Association (FOCA) was the turning point.
As an executive of FOCA, he fought for the F1 commercial rights with FIA and negotiated TV contracts, which led to commercial success. Building on this success, Eccestone founded Formula One Group in 1987, controlling the commercial rights to Formula 1.
Formula One Group effectively became the sport’s commercial supremo, controlling TV rights, advertisement, race promotions, and much of the F1 team earnings.
In 2017, CVC Partners, then the controlling shareholder of the Formula One Group, sold their stake to Liberty Media, a US-based entertainment company, for $4.4 billion.
The complete Formula 1 ownership now lies with Liberty Media Corp.
Liberty Media’s Stake in F1: Business Strategy & Vision
One of the primary reasons why CVC Partners had to sell their stake was the growing concerns around the game’s declining appeal among young people. Also, as a PE firm, CVC Partners lacked the technical expertise to increase the game’s popularity in the face of changing viewer trends.
To grow the game’s popularity, Liberty Media focused on expanding to new markets, digital transformation, and a revised content and entertainment strategy.
Their strategy included the introduction of new race circuits in the US, the Miami and Las Vegas Grands Prix. Focusing on social media expansion, launching F1 TV, and a direct-to-consumer streaming platform.
In 2019, Liberty Media, in association with Netflix, released a documentary, Formula 1: Drive to Survive, to engage with the younger audience. It showcased the fast-paced life behind the race. About the drivers, managers, and team owners
Each of these factors contributed to a big surge in viewership. By 2024, it increased to 1.6 billion cumulative TV viewers and 97 million social media followers, from 490 TV viewers in 2018.
During the period, aggregate attendance grew from 4.1 million in 2018 to 6.5 million in 2024.
Liberty Media’s primary F1 revenue increased from $1.8 billion in 2018 to $3.4 billion in 2024, an increase of nearly 86%.
How Formula 1 Makes Money: Revenue Breakdown
F1 economics has multiple revenue streams:
- Race Promotion Revenue: Race circuits pay F1 significant fees to host races.
- Media Rights Fees: Includes global media deals and other broadcasting rights.
- Sponsorship Fees: F1 secures sponsorship deals with global brands like Rolex, Aramco, DHL, Heineken, etc.
- Licensing & Merchandise: Includes F1-branded products like T-shirts, games, and digital content.
- Subscription-based Income: It includes subscription income from F1 TV and a direct-to-consumer streaming platform.
In 2024, the Race Promotion Fees contributed 29.3% to the total F1 revenue, 32.8% from F1 Media Rights Fees, and 18.6% from Sponsorship Fees.
How F1 Teams Make Money?
F1 team profits from prize money, sponsorship deals, share of revenue from broadcasting rights and tickets, merchandise, and investments.
The Concorde Agreement dictates the Formula 1 prize money distribution, which centers around sharing 50% of the F1 profits among the teams. In 2024, Liberty Media distributed $1.26 billion to the teams. This is the primary source of revenue for all F1 teams.
In 2024, McLaren won $140 million for making a podium finish, while Sauber received $60 million for finishing at the very bottom of the standings, according to Motorsport Magazine.
Driven by steady performance, the McLaren F1 team earned $577 million in revenue in 2023 on the back of strong F1 sponsorship deals.
Formula 1’s Financial Growth Under Liberty Media
Since Liberty Media took over the commercial operation of F1, revenues and popularity have surged.
Formula 1 Financials
Source: Earnings Report
Liberty Media F1 revenue increased from $1.78 billion in 2017 to over $3.4 billion in 2025, marking a jump of nearly 91% in seven years.
The increase in Formula 1= revenue is attributed to significant growth in the US market and among younger people.
The number of races per calendar year increased from 20 in the 2017 season to 24 in the 2024 season.
Also, a strong social media presence and F1 TV boosted overall Formula 1 earnings.
Improved earnings have boosted the Formula One Group share price in the last one year.
Liberty Media Corp Series A (FWONA) stock gained nearly 26% during the period, as of 2nd June 2025.
The Future of Formula 1: Business Expansion Outlook
From a niche motorsport to a global entertainment powerhouse- the transformation journey of F1 continues. Liberty Media is strategically positioning F1 racing for sustained growth through market expansion, digital innovation, and diversified revenue streams.
- Liberty Media plans to expand F1 racing in China and India, thus expanding global reach.
- Strategic sponsorship deals with LVMH and Amex to enhance the sponsorship base.
- Grow the fan base through media partnerships. Will release an F1 movie starring Brad Pitt to attract new audiences.
- Licensing partnership with multiple brands, such as Lego, to enhance brand visibility.
- The acquisition of MotoGP will help to cross-leverage the fan base of both sports and replicate commercial success.
Conclusion
Liberty Media has transformed F1 into a global commercial powerhouse. Formula 1 has modernized its image, expanded to new markets, and embraced digital innovation. With growing revenues, a loyal fan base, and rising global appeal, Formula 1 stands at the intersection of sport, business, and entertainment. It is the most successful and exciting business stories in global sports today.
