One of the time-honored traditions of the Olympics is NBC losing money to broadcast the event to the world. But the company has been working hard to change that dynamic, and it seems likely that it actually turned a profit at the 2014 Sochi games.
Comcast, which owns NBCUniversal, has said for several years that it expected the Sochi games to be profitable. While it hasn’t definitely declared success, the company did say Tuesday that it made $1.1 billion in revenue from the games. It spent about $775 million to acquire the rights to the games, and its total investment was $875 million, according to Bloomberg News.
Calculating profit isn’t as straightforward as subtracting NBC’s investment from the revenue it made at the Olympics. Some of the companies who bought Olympic ads would have spent that money on ads on other NBC shows. But the numbers compare favorably to past Olympics. General Electric, which owned NBC in 2010, said it made $800 million in revenue from the Vancouver games, but lost $223 million overall. Comcast said the 2012 games earned slightly more–$1.2 billion in revenue–but it also spent significantly more for the broadcast rights, because basketball is more popular than curling.
NBC bet big on the Olympics in 2011, when it spent $4.4 billion for the rights to the games through 2020. At the time, the decision was met with skepticism in some corners. But the impact of the Olympics has always been tricky to measure because the benefits are largely indirect.
Comcast likely sees any profit it makes from the Olympics as gravy, according to Neal Pilson, the former head of CBS Sports who served as a consultant on television rights to the International Olympic Committee. “There are good corporate reasons to stay with a major sports property even if it’s a borderline profit generator,” he told Bloomberg TV in 2011. Retaining the Olympics, he said, “is a very important part of their corporate psyche.” Who can put a price on that?
