It’s fair to say that these have not been the best of times for Manchester United, as chief executive Omar Berrada admitted, when describing their performances on the pitch in 2024/25, “We had a difficult season in the Premier League, which we all know fell below our standards.”
Indeed, United’s 15th place last season was the club’s worst finish in the Premier League era and the lowest in 25 years. Performances on the pitch had been declining ever since Sir Alex Ferguson retired in 2013, but things have got even worse since Sir Jim Ratcliffe’s INEOS acquired a significant stake in the club.
Although this was only a minority shareholding, Ratcliffe is in charge of the football operations and has made several changes in the leadership team, including hiring Ruben Amorim from Sporting as head coach in November 2024 as a replacement for the hapless Erik ten Hag.
Transfer Window Summer 2025
In an attempt to restore former glories, United once again spent big this summer, splashing out more than £250m on player purchases, making three big signings: Benjamin Sesko from RB Leipzig, Bryan Mbeumo from Brentford and Matheus Cunha from Wolves.
In addition, Senne Lammens and Diego Leon arrived from Royal Antwerp and Paraguayan club Cerro Porteno respectively.
There has understandably been a lot of focus on Liverpool’s massive £459m outlay, but United’s gross spend was the fifth highest in the Premier League.
In fact, their £183m net spend was the third highest in England’s top flight (and indeed the world), only surpassed by Arsenal £282m and Liverpool £268m, so United weren’t exactly pulling any punches.
The obvious question is how United could afford this level of extravagance, given all the issues around their finances, many of which have been pointed out by the club itself.
Financial Challenges
At one stage, Ratcliffe claimed that the club would have ”run out of cash” by the end of 2025 without the billionaire pushing forward a series of decisions to reduce the cost base, including making up to 450 employees redundant.
A penny for their thoughts as they watched their “cash-strapped” club go on to spend a quarter of a billion Pounds, but still end up being humiliated by fourth tier Grimsby Town in the Carabao Cup.
It’s almost like Sir Jim needed some kind of justification to apply the “slash and burn” tactics employed in his other companies.
PSR Challenges
There have been some legitimate concerns about United’s compliance with PSR, as shown by the club sending a letter to fan groups earlier this year warning them about a risk of breaching the limits.
The club wrote, “We are currently making a significant loss each year totaling over £300m in the past three years. This is not sustainable and if we do not act now we are in danger of failing to comply with PSR/FFP requirements in future years and significantly impacting our ability to compete on the pitch.”
No Europe
Berrada said, “We were proud to reach the final of the UEFA Europa League, but ultimately, we were disappointed to finish as runner-up in Bilbao.”
Losing to Tottenham Hotspur also had a financial price, not only costing United the additional prize money paid to the winners, but, more importantly, it meant that they had missed out on qualifying for the lucrative Champions League.
In fact, United will not be in Europe at all this season, which will impact all three of their revenue streams.
What’s up, doc?
Given the apparent contradiction between the club’s various struggles and this summer’s high transfer spend, what is the truth of United’s financial position?
Well, we can get a good idea by analysing United’s financial results for last season, which were issued last week. These will provide a good understanding of the effect of their worsening performances on the pitch, as well as the impact of Ratcliffe’s actions since he took hold of the reins.
United are the first Premier League club to publish accounts for 2024/25, so any comparisons with other clubs will be based on their latest available figures from the previous 2023/24 season.
Profit/(Loss) 2024/25
Manchester United’s results will have given some comfort to their executives, as the pre-tax loss significantly reduced from £131m to £40m.
However, the reality is that they still lost money, despite revenue rising £5m (1%) from £662m to a new club record of £667m and profit from player sales increasing by £12m from £37m to £49m, their best result for 16 years.
In addition, operating expenses were cut by £24m (3%) from £721m to £697m, exceptional charges fell £11m (23%) from £48m to £37m and net interest payable reduced by £40m (65%) from £61m to £21m.
The loss after tax decreased by £80m from £113m to £33m, as the tax credit reduced from £18m to £6m.
The net revenue growth was driven by new club highs in both match day, up £23m (17%) from £137m to £160m, and commercial, up £30m (10%) from £303m to £333m.
This was enough to offset a large decrease in broadcasting, which fell £49m (22%) from £222m to £173m, due to the poor performances on the pitch.
There was a substantial reduction in wages, which dropped £52m (14%) from £365m to £313m, mainly due to lower performance bonuses and the impact of Sir Jim’s restructuring, though player amortisation continued to rise, increasing by £6m (3%) from £187m to £193m.
Other expenses were also significantly higher, up £21m (14%) from £149m to £170m.
