According to Forbes, the Cleveland Cavaliers lost $40 million USD last season “in the sense of earnings before interest, taxes, depreciation and amortization.” For the 2015-2016 season, Cavs Owner Dan Gilbert racked up a $115 million USD payroll that triggered a $54 million USD luxury tax bill. Add in benefits, cash involved in trades and more, and Gilbert spent roughly $185 million USD last season on his roster.
Gilbert has been committed to doing whatever’s necessary to bring championships to the city of Cleveland, from signing LeBron James to a league-high contract this summer worth $64 million USD over two years, to Tyronn Lue’s agressive five-year, $35 million USD contract. Even then, LeBron thinks much more should be done this season, as the superstar forward has been in the news quite a bit lately suggesting the team needs new bodies if they want to compete for the title once again.
“It was the second biggest outlay in the history of the sport behind only the Brooklyn Nets’ ill-fated $205 million USD 2013-14 season, which included a $90.6 million USD luxury tax,” said Forbes. The Nets lost $99 million USD and eventually fell out of the playoffs that year, and have since been at the bottom of the Eastern Conference standings.
Even with the new, lucrative television deals in place this season, the Cavs are likely headed for another huge operating loss. Luckily for them, their owner is worth $5.1 billion USD and can absorb the financial losses, but can his spending buy another ‘chip is the question.