How Revenue Was Spent at PGA Tour, Inc. (2024)

The PGA Tour, Inc. is a tax-exempt, non-profit 501 (c) 6 – a membership organization for touring professional golfers – up to a maximum of 156 who participate in 47 events (44 regular events and 3 playoff events). The exact number of members is difficult to determine since there are various exemptions and player status (the top 125 ranked players have their card renewed annually but players ranked between 126-150 can retain their card and play when other golfers are not playing, and winning certain tournaments also guarantees a tour card).

There are 16 related organizations taxed as a corporation or trust, 4 related organizations taxed as a partnership, and 1 related tax-exempt organization (see the Form 990, Schedule R for details).

The PGA Tour, Inc is overseen by 12 voting members of the governing body, 6 of whom are independent (although the 990 shows 13 due to timing differences, 12 of whom are male while 1 is a female).

In what appears to be in response to the LIV Golf Partnership and the Public Investment Fund, PGA Tour, Inc. created PGA Tour Enterprises LLC to transition its commercial businesses into a for-profit entity (the LLC).  This recent restructuring was largely driven by a $3 billion investment from the Strategic Sports Group (SSG), a private equity group. The move allows the Tour to compete with rival leagues by commercializing its assets, and grants nearly 200 Tour members over $1.5 billion in equity, turning players into actual owners of their league.

In 2024, the PGA Tour, Inc reported total revenue of $761 million (compared to $1.8 billion in 2023, $1.9 billion in 2022 and $1.6 billion in 2021) – with the drop in revenue attributable to the creation of the PGA Tour Enterprises, LLC – most of which came from 5 sources:

• $ 44 million:  Media Rights (compared to $731 million in 2023)
• $ 48 million:  Sponsorship (compared to $422 million in 2023)
• $ 29 million:  Royalties (compared to $302 million in 2023)
• $280 million;  Tournament Management (compared to $204 million in 2023)
• $294 million:  Investment Income and Gains (compared to $130 million in 2023)

Expenses totaled $1.2 billion with expenses categorized as follows:

• $818 million (107% of revenue):  Fees for Services (primarily player prize and other benefits)
• $152 million (20% of revenue):  Player Retirement Earnings
• $104 million (14% 0f revenue):  Compensation
• $ 37 million (5% of revenue):  Grants
• $ 35 million (5% of revenue):  Board Designated Funds
• $ 22 million (3% of revenue):   Interest and Other Expenses
• $ 14 million (2% of revenue):  Travel and Conferences
• $ 14 million (2% of revenue):  TV Production and Broadcasting
• $ 10 million (1% of revenue):  Tournament Allocations
• $  4 million (less than 1% of revenue):  Office-Related Expenses
• $  2 million (less than 1% of revenue):  Advertising and Promotion

As illustrated above, the organization spent significantly more than revenue reported – $452 million – in 2024, and was able to do this because they had more than $1.2 billion in net assets. and because there was an $806 million adjustment in net assets which is not explained.

The largest expense was for Fees for Services which is primarily player prize and other benefits and yet it is unclear how these allocations are made to members as there is not enough information on the Form 990 (fees for services is generally fees paid to non-employees which technically the members (who do not pay membership fees) could be considered non-employees).  Player prize  earnings in 2024 totaled $818 million among the 47 tournament with purses averaging $17 million.

The next largest expense is for compensation: 375 employees (about 900 less than in 2023) received $104 million in compensation, or an average of $277,000 (compared to $225,000 in 2023).  119 employees received more than $100,000 in compensation with the most highly compensated employee reported to be Tiger Woods, a Player/Director who received $29 million followed by Joseph Monahan, the commissioner who received $19 million in compensation in 2024.

Using the above information, every $100 in revenue was spent as follows:

$100:  Revenue

-$107 :  Fees for Services (primarily player prize and other benefits)\

-$ 20:  Player Retirement Earnings

-$  5:  Grants

-$132:  Subtotal Fees and Player Retirement Earnings

-$  2:  TV Production and Broadcasting

-$ 14:  Compensation

-$  5:  Board Designated Funds

-$  1:  Tournament Allocations

-$  3:  Interest and Other Expenses

-$  3:  Office-Related Expenses, Travel and Conferences, and Advertising

-$ 28:  Subtotal: TV, Comp, Tournaments, Interest, Office, Equipment, Travel, Advertising

 -$  60:  Excess Expenses 

As illustrated above the PGA Tour, Inc. spent $132 out of every $100 on fees for services (primarily player prize and other benefits), player retirement earnings, and grants (326 grants of $5,000 or more were made).  $28 out of every $100 was spent on organizational expenses.  In other words, PGA Tour, Inc. spent $160 for every $100 in revenue, which equates to spending $452 million more than the organization received.

Finally, it is important to note the PGA Tour, Inc started the year with $1.2 billion in net assets. Alth0ugh they spent $452 million more than they received, there was an $806 million adjustment to net assets (no detail provided) resulting in the organization reporting $1.6 billion in net assets at year-end

To read the IRS form 990 (2024), click here.