While the past few years have seen a huge rush of professional athletes creating production companies, gaining major investment, and launching notable projects, the long-term value of many of those companies remains somewhat unproven. One of the most prominent companies there is the SpringHill Company, founded by LeBron James and Maverick Carter in 2020. And Bloomberg’s Lucas Shaw broke some news about its 2023 financials Sunday:
SpringHill, the media company co-founded by LeBron , lost $28 million last year. It’s never made $$.
A look at how the Hollywood recession is impacting production companies — even those led by the world’s most famous people — in this week’s newsletter.https://t.co/VG0gIjoGzh
— Lucas Shaw (@Lucas_Shaw) December 1, 2024
Here are some key parts of that piece:
The company lost $28 million on sales of $104 million last year, according to documents obtained by Bloomberg News. SpringHill lost $17 million in 2022 and is on pace to lose millions more in 2024.
…“The entertainment market shift in 2022/2023 toward profitability brought rising costs, slower buyer decisions, and impacts from industry strikes, prompting us to recalibrate, including writing off underperforming projects to position ourselves for future growth,” SpringHill Chief Executive Officer Maverick Carter said via email, adding that the company is expected to exceed projections this year.
As Shaw notes, SpringHill (which is the parent of several notable sports projects, from The Shop to Uninterrupted) is far from the only celebrity production company to not produce major returns yet. Some of that relates to pandemic-era production challenges, while pandemic- and post-pandemic cuts from streaming services are also a factor, as are the impacts of last year’s writers’ and actors’ strikes and ongoing corporate shifts and consolidations. And there are major changes ahead for SpringHill, which recently merged with British company Fulwell 73 (known for the Kardashians’ shows and the Grammys, amongst other things), has cuts ahead to get to 250 employees across the new company, and is targeting profitability by the end of 2025. So this may not be immediately dire.
Still, it’s definitely interesting to see some financials on SpringHill. And it’s perhaps particularly notable that all the big projects they’ve had so far, and the star power they have from James and Carter, has not yet been enough to make them profitable.
Granted, that’s not always crucial in sports media, especially for those viewing the long game. The New York Times bought The Athletic for $550 million in 2022 despite it never making a profit, and it only announced its first profitable quarter last month, although it also enabled that paper to disband its union sports desk. And SpringHill may yet pay off for its investors; if they can actually hit profitability by the end of 2025, as Carter projects, that’s a big step.
SpringHill might also get some further personal boosts from James once he decides to retire from the NBA. That could give him more time for work with this company, and in a company so focused on him, that might matter a lot. (For the record, Carter told Shaw “We built this business with LeBron, not around him” and “[James remains deeply engaged in driving the vision and mission he helped shape, focusing more actively on certain passion projects”). So this certainly isn’t a business disaster yet. But perhaps the larger takeaway here is that if even SpringHill, one of the largest, most-funded, and highest-profile athlete media companies with a long roster of completed and ongoing projects, isn’t yet profitable, making a go of an athlete production company may be harder than many had thought.
