University of Michigan athletic department: $4 million surplus for 2023 fiscal year

The University of Michigan athletic department reported a $4 million operating surplus for the 2022-23 fiscal year, according to a financial report obtained by USA TODAY.

The department created $229,561,279 in operating revenues compared to $225,548,280 in expenses for the fiscal year from July 1, 2022, to June 30, 2023., the most in a single year.

It's the second time U-M has exceed $200 million (without adjusting for inflation) in annual operating revenue in one year — the only other occasion was last year, when U-M set a previous high at $210,652,287.

It's certainly not the largest department in terms of revenue; for example Ohio State ($279,549,337), Texas A&M ($279,188,344) and Texas ($271,129,326) were all more than 15% larger, however it is significantly more than some other Big Ten programs like Penn State ($202,200,023), Michigan State ($170,654,025) and other athletic powers like Tennessee ($202,097,305) and LSU ($200,476,979).

U-M's total revenue increased by $18.9 million year-over-year, more than half of that increase came from an increase ticket sales. It was the high water mark on last year's revenue stream ($55,266,135) but it jumped another $9.84 million to $65,106,623 in FY23.

In fact, just the football ticket sales alone at $56,986,870 was more than the previous year across all sports.

The next largest three revenue streams for the department came from media rights contracts ($47,879,025) which does include the portion from the Big Ten, contributions ($42,691,08, which is down approximately $845,000 from the year before) and Royalties, Licensing, Advertisement and Sponsorships ($33,027,615), which was a jump slightly more than $5.6 million from the year prior.

A few other notable contributors to the surplus were other operating revenue ($9,311,048), Athletics restricted endowment and investment income ($9,006,804), NCAA distributions ($5,117,665) and Football Bowl revenue ($3,179,195).

The reason U-M didn't see a larger surplus after generating its most revenue of all time, is expenses also went up by $32 million year-over-year; and while there was no one major culprit, there were a number of significant expenses that went up in nearly every category, which ultimately made the difference.

Support staff and administrative compensation, benefits and bonuses was the most significant expense ($41,757,257, up more than $3.8 million from FY22) followed by coaching salaries, benefits and bonuses ($39,445,730, up more than $2.9 million), athletic student aid ($32,509,072, up more than $4.2 million or 15%), direct overhead and administrative expenses ($25,158,954, up $2 million), athletic facilities debt service, leases and rental fee ($17,546,592), team travel ($16,523,956, which made the largest single leap year over year at more than $5.4 million), other operating expenses ($11,807,743, up $3.3 million from the year prior), Game expenses ($5,981,777), sports equipment, uniforms and supplies ($5,694,554), Football bowl expenses ($4,915,346) and recruiting ($4,839,530).

USA TODAY Sports' Steve Berkowitz contributed to this report.

Contact Tony Garcia: apgarcia@freepress.com. Follow him at @realtonygarcia.

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