Brazil’s richest club enters dangerous new era | OneFootball

Flamengo remain at the forefront of Brazil’s football economy, closing 2024 with national-best revenues surpassing R$ 1.3 billion. The club's financial results, detailed in the latest Convocados 2025 Report, reflect another year of impressive growth, but also highlight important warning signs as Flamengo lay out ambitious investment plans.

Matchday success and on-pitch achievements have played a notable role in boosting revenue streams. The Copa do Brasil triumph fueled prize money and stadium income, while commercial operations brought in R$ 323 million—more than double closest rival Palmeiras—reinforcing their commercial dominance in sponsorships and kit deals. Player sales also contributed over R$ 100 million in transfer income, despite a relatively subdued year in outbound transfers.

In terms of core profitability, Flamengo report a positive EBITDA of R$ 329 million, providing financial stability with room to invest in the squad and service existing debt. Operationally, the club continues to outperform domestic peers, with a model built around sustained high earnings.

Yet, 2024 also saw increased financial pressures. Investments in player acquisitions and the new stadium project have caused debt to rise considerably. Flamengo posted a transfer market deficit, spending R$ 382 million on new signings against R$ 107 million in sales, a gap offset by strong cash generation—at least for now. However, these outflows have tightened liquidity, reducing the club’s cash reserves.

A significant change for 2025 is the loss of guaranteed minimum revenue from pay-per-view television rights. Under the new Libra contract, a greater portion of broadcast income is directly tied to competitive results. With wage expenses already the highest in the league, due to elevated salaries and post-Copa do Brasil bonuses, Flamengo's financial stability is increasingly reliant on continued sporting success.

Ticket pricing strategy, though profitable, has not been without controversy among supporters. Flamengo lead attendance income and perform robustly with their membership scheme, even without the country’s largest contingent of club members, though fan criticism of rising prices is growing.

Despite a turbulent election year and internal changes, the report assesses Flamengo as fundamentally sound, able to meet both short- and long-term obligations. Nonetheless, the club enters 2025 with less room for error. Financial equilibrium will depend more on results from the pitch than in previous seasons.

If Flamengo’s ambitions are matched by footballing success, balance should be maintained. If not, the pressure on their finances could intensify quickly.

Source: Lance