2022 financial report: Formula E revenue & audience grow again, "Vancouver sting" sits deep

After Formula E was still busy cushioning the economic impact of the coronavirus pandemic in 2021, the series has now started investing in its business future again. In its annual financial report for the year ending September 30, 2022, Formula E Operations (FEO) noted higher losses than before, but at least cracked its revenue record: the championship took in 181 million euros in its eighth season.

As is customary for companies registered in the UK, Formula E's annual reports are open to public scrutiny. In 2020, the series had shifted the end of its fiscal year by two months to September 30 - since then, the reports have always covered full racing seasons, which usually run from January to July/August of a calendar year. However, the validity of comparisons with previous annual reports is limited by the change.

In 2022, Formula E once again hosted more races than in any previous season, with 16 E-Prix taking place at ten venues. Thus, it comes as little surprise that revenues (more races = more sponsorship money) and losses (higher travel costs, etc.) increased. In total, the series took in 181.5 million euros (2021: 168.7 million euros), and the loss was around 15.2 million euros (2021: 12.6 million euros). These figures refer to the previous season (season 8), which ended in August 2022 with the Seoul E-Prix.

* Deviations possible due to exchange rates
** unofficial numbers

Race licenses flush €100m into Formula E coffers

As in 2021, the organization of racing events accounted for the largest share of expenditures - around half of all investments went into the events of Season 8 (often via subsidiary Formula E Race Operations, FERO). At the same time, however, racing events were also the most important source of revenue for FEO, with the series generating around 55 percent of its profit (99.8 million euros, 2021: 100.9 million euros) through the awarding of racing licenses and promoter contracts.

Difficult to separate from this profit are FERO's incomes not generated from intercompany recharges. The subsidiary also generated a profit of €22.3m from race promotions, sponsorship, services and other sources. These are also part of the Formula E cosmos, but are not included in FEO's financial report. That makes it difficult to accurately track and separate the financial performance of the two companies.

TV & social media audiences are growing

On the other hand, a good indicator of the series growth is the development of the TV audience: According to the championship's data, the races reached 381 million TV viewers worldwide, an increase of 20 percent compared to the 2021 season. The global social media fan base grew by 15 percent to a cumulative 5.0 million followers, while online video views increased to 189 million views (2021: 126 million views).

"As a principal risk of the company, the directors consider the potential creation of a similar electric car racing championship that could limit sponsorship interest and audience, and therefore limit the growth of the championship," Formula E's management assesses in their annual report. In previous years, this was already identified as the biggest threat to Formula E. However, since the ETCR and Electric GT are struggling with startup problems, that risk is currently considered "partially mitigated."

Vancouver repeat a major risk to Formula E growth

The chief executives of Formula E, since June 2023 under the leadership of Jeff Dodds, also worry about calendar stability. "Organizing races on city streets brings its own challenges," they say, "but as city street racing is part of the DNA of the series and holds appeal to a broad market audience, the group continues to pursue effecticve city/promoter agreements."

"This is critical to ensure close cooperation and management of such races to avoid a repeat of Vancouver, where the event had to be cancelled at last minute due to the promoter failing to obtain all the local licences/permits on time," Formula E writes. Clearly, the sting from the debacle surrounding the championship's return to Canada also sits deep with the series' bosses.

The full financial report of the FEO und FERO is available online.