Morgan Stanley forecast that Formula 1 "will burn up" $216.1M of net losses over the next three years, according to Christian Sylt for FORBES. The "grim outlook" was disclosed in a recent report from the bank. It follows the news that F1's revenue in '17 "crashed" by $18M to $1.8B fueled by the loss of the German Grand Prix and several sponsors including insurance firm Allianz and financial services company UBS. It was the first year F1 owner Liberty Media was "in the driving seat" and the fall was the "biggest of the past decade." Despite "promising to give a boost to the business," Liberty failed to sign any new races or major sponsorship deals to "compensate for the ones it lost." Morgan Stanley’s report forecast that an increase in fees from broadcasters will "drive growth in F1’s revenue" but one of the bank’s own sources contradicted this. F1’s "biggest single cost" is the payment of prize money to the 10 teams, which equates to 68% of its underlying profit. This profit share is expected to come to $1B this year followed by $1.1B in '19 and $1.2B the year after (FORBES, 2/12).
