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Zuffa Finances: Examining the UFC’s PPV business

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Since its launch under Art Davies, Rorion Gracie and the Semaphore Entertainment Group, the Ultimate Fighting Championship has been a pay-per-view company. And through the Zuffa era of ownership, it has remained their most important and lucrative source of revenue. But as the UFC has been privately owned for the entirety of its history, very little outside some well educated guesses has ever been disclosed about their pay-per-view sales. This is no longer the case thanks to recent events.

Over the last few years, and even more so the last few weeks, a host of sources using internal Zuffa numbers have become available. This is mostly due to the 2016 sale of the promotion and the current antitrust lawsuit, which has resulted in once sealed information becoming public. For this article I make extensive use of a 2007 Deutsche Bank Memorandum that I managed to attain while previously working on the UFC’s finances, a 2016 Lender’s Presentation that was shared with me shortly after WME-IMG purchased the company, and a wide range of reports and exhibits from the Le et al v. Zuffa, LLC antitrust lawsuit. Unfortunately, most of these sources are limited to the time when the UFC was under the management of Lorenzo and Frank Fertitta (2001-2016) so more recent figures are not available to us.


UFC 111 Hosted By Dana White, Lorenzo Fertitta and Frank Fertitta III

When looking at the number of pay-per-view buys per year the most attention-grabbing detail (besides the fact I am missing data for 2007 and 2008) is the rapid growth in sales between 2004-2006. This is obviously due in large part to The Ultimate Fighter reality show which debuted in early 2005, although I am not sure the show should exclusively get credit. According to the 2007 Deutsche Bank Memorandum, events headlined by Chuck Liddell, Tito Ortiz, Ken Shamrock, Randy Couture, Royce Gracie, and Matt Hughes were all ranked within the top 10 highest sports PPVs of 2006, suggesting that specific top fighters played a key part in the turning the promotion around. From the earliest days it’s evident that star power makes a difference.

As an example, while we don’t have individual sales numbers for UFC 40: Vengeance – Ken Shamrock vs Tito Ortiz, a show headlined by Zuffa’s biggest fight to date, we do know according to the Deutsche Bank Memorandum that it “generated a 300% increase over any prior UFC event.”

Total PPV Buys Per Year

Year PPV Buys
Year PPV Buys
2001 145,588
2002 284,214
2003 264,890
2004 388,324
2005 1,096,954
2006 4,984,204
2007
2008
2009 6,457,737
2010 7,707,123
2011 6,848,000
2012 4,826,147
2013 5,843,173
2014 2,844,591
2015 6,412,699

Sources: for 2001-2006, the May 2007 Deutsche Bank Memorandum. For 2009-2015, Exhibit 31 in Oct 27, 2017 Redacted Expert Report of Professor Robert Topel


Sources: for 2001-2006, the May 2007 Deutsche Bank Memorandum, for other year “Project Basquiat” WME-IMG report.

Following the success of The Ultimate Fighter UFC revenues from PPV continued to climb, peaking in 2010. This was as much due to the increases in PPV price, improved splits with the PPV providers, and increasing commercial PPV revenue, as it was due to an increase in residential PPV buys.

The May 2007 Deutsche Bank Memorandum reports that the average pay-per-view price in 2006 was $39.68 of which the UFC got to keep 44% of the sale. This comes out to approximately $17.45 a buy for Zuffa in 2006. As the PPV price increased and the split improved, the average amount they received per PPV sold would grow to $24.65 by 2010, and to $30.41 by 2015. And according to the 2016 Lender’s Presentation, every 1 million incremental increase in PPV buys, drives the UFC’s EBITDA up $25+ million, a margin of at least 82%.

Commercial PPV buys, which includes theaters and bars, and excludes sales to homes, also rose dramatically after the ultimate fighter. In 2006, total commercial PPV revenues were $4.1 million — an almost tenfold increase from 2005 — growing to $53 million by 2010. The last year we have commercial PPV revenues, 2015, shows that it has decreased to $42 million.

Residential PPV revenues for those same three years was approximately $87 million in 2006, $190 million in 2010, and $195 million in 2015. For the other years we only have total PPV revenues and thus can’t distinguish between commercial and residential buys.

These amounts include both domestic and international PPV revenues. According to the 2016 Lender’s Presentation, international PPV made up approximately 15% of all PPV revenues in 2015. This, unfortunately, is the only year in which we know the split.


In Million (000,00s) of US Dollars ($). Compiled using the May 2007 Deutsche Bank Memorandum, 2016 Lender’s Presentation, and the Expert Report of Hal J. Singer, PHD

It’s also interesting to note how PPV revenues were consistently 50+% of revenues during the SPIKE TV years, but decreased as contractual television revenues increased with the FOX television deal. While 2015 PPV revenues was only 3% lower than their previous best, it represented less than 40% of the total revenues versus the 55% of total revenue for PPV in 2010-2011.


Source: 2016 Lender’s Presentation, except for 2006 which was calculated using the May 2007 Deutsche BanK Memorandum

The May 2007 Deutsche Bank Memorandum, the 2016 Lender’s Presentation, and the “Project Basquiat” Exhibit included the buy rates for select PPV events. From the Lender’s Presentation I have included the buys for six events held in 2016. The report also included all the PPV’s held in 2014 and 2015, but I decided not to include them after it became apparent they were incorrect. The amounts given for those two years not only did not equal the yearly totals found elsewhere but they also matched exactly what was to be found in MMAPayout’s Blue Book around the date of the report’s release. It seems almost certain that whomever had prepared the report for the UFC, instead of using Zuffa’s internal documents for those PPV events, they chose to cut corners and instead to copy MMA Payout’s estimates.

PPV Buys for select UFC events

Event Buys
Event Buys
57 382,685
59 391,292
60 657,675
61 765,875
62 470,017
63 382,828
65 487,624
66 892,586
81 519,399
87 527,445
91 743,627
100 1,299,118
116 900,266
121 820,698
141 550,730
195 230,000
196 1,317,000
197 322,000
198 217,000
199 283,000
200 1,009,000

Sources: May 2007 Deusche Bank Report, 2016 Lender’s Presentation, “Project Basquiat” Exhibit

This is not the only source of individual UFC event PPV buy rates. Last year Dana White was quoted by Yahoo as saying that UFC 47 “did 106,000 buys” and that UFC 66 had sold “929,000 buys” a slightly larger amount than what Zuffa reported in their May 2007 Deutsche Bank report. White’s number for UFC 66 is probably correct, as the event’s buys likely increased between now and the time the Memorandum was written, which was a few months after the event had been held.


UFC: The Time Is Now

In the 2016 Lender’s Presentation, it was reported that up to and including UFC 200, the promotion had seen 5 PPVs that sold 1 million buys or more. Two of these were headlined by Brock Lesnar (UFC 100 and 200), two by Conor McGregor (UFC 194 and 196), and one by Anderson Silva.

In the previously mentioned Yahoo interview, White said that since 2001 “the company has promoted nine shows that did 1 million or more pay-per-view sales.” This would mean that four additional PPVs have apparently crossed the one million buy threshold since UFC 200.

The importance of specific fighters for PPV buys becomes readily apparent when comparing buy rates. A handful of fighters seem responsible for the vast majority of sales. A chart within the Lender’s Presentation lists the top fighters for the UFC (up to UFC 200) and lists the number of times events they were credited with headlining sold 500,000 PPVs, 750,000 PPVs, or 1 million PPVs or more.

PPV Performance by Fighter

Fighter 500k-750k 750k-1,000k 1,000k+
Fighter 500k-750k 750k-1,000k 1,000k+
Randy Couture 3
Rampage Jackson 2 2
Jon Jones 3 1
Brock Lesnar 2 2 2
Chuck Liddell 2
Conor McGregor 1 2
BJ Penn 5
Ronda Rousey 2 2
Anderson Silva 4 2 1
Georges St-Pierre 6 4

Source: 2016 Lender’s Presentation

The Lender’s Presentation also breaks down how much the top 5 athletes are responsible for total PPVs (although it doesn’t say if it’s referring to buys or revenue).

  • From 2006-2008, the Top 5 athletes (Randy Couture, Rashad Evans, Matt Hughes, Chuck Liddell, and Georges St-Pierre) were responsible for 66.6% of Total PPVs.
  • From 2009-2011, the Top 5 (Quinton Jackson, Brock Lesnar, BJ Penn, Anderson Silva, and Georges St-Pierre) were responsible for 66.9% of Total PPVs.
  • From 2012-2015, the Top 5 (Daniel Cormier, Jon Jones, Conor McGregor, Ronda Rousey, and Anderson Silva) were responsible for 56.1% of Total PPVs.

The difference in sales between the lowest selling PPVs and the highest can therefore be in the hundreds of thousands of buys or more, meaning the star power of the fighters headlining the event have a great deal of influence over how much an it will sell.

PPV Buy Average by Quarter

Year Top 3 #4-6 #7-9 Bottom 4
Year Top 3 #4-6 #7-9 Bottom 4
2012 703 388 312 155
2015 947 603 363 162

In thousands (000s) Source: “Project Basquiat” Exhibit

The “Project Basquait” Exhibit, includes average number of buys for events in the Top 3 of sales, the 4th-6th highest selling, the 7th-9th highest selling, and the bottom 4 selling. Multiplied by the average amount the UFC receives for a PPV, and it becomes incredibly apparent how much revenues can be dependent on the top fighters.

In 2015:

  • the bottom 4 selling PPVs would have averaged approximately $4.9 million each in residential PPV revenue
  • the 7th-9th selling PPVs would have averaged approximately $11.0 million each in residential PPV revenue
  • the 4th-6th selling PPVs would have averaged approximately $18.3 million in residential PPV revenue
  • and the top 3 highest selling PPVs would have averaged approximately $28.8 million in residential PPV revenue

The top 3 highest selling PPVs average $23.9 million more in PPV revenue than those at the bottom. The top 3 also average $17.8 million more than 7th-9th and $10.5 million more than 4th-6th. Thus a top fighter or highly desired fight is worth 10s of millions more the UFC.

But even the difference between middle selling PPVs and the bottom are noteworthy, as the 7th-9th events average $6.1 million more than the bottom, and the 4th-6th average $13.4 million more than those at the bottom.

As mentioned earlier, “1 million incremental increase in PPV buys drives the UFC’s EBITDA up $25+ million.” So perhaps even more importantly for the UFC, since very little of the PPV revenue seems to be split with the fighters, the higher sales represent an enormous increase in the promotion’s earnings.


For my next two posts, I will be looking at the finances of some of the UFC’s potential “yardsticks”, namely Strikeforce, Bellator, and professional boxing.


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