(Bloomberg) -- The National Collegiate Athletic Association earned $1.06 billion in revenue last year, eclipsing the $1 billion mark for the first time as the governing body defends its business model in court.
It's a 6.6 percent jump from fiscal 2016, in which the Indianapolis-based organization made $996 million, according to audited statements released Wednesday. The NCAA turned a $105 million profit.
The milestone comes as the NCAA faces unprecedented scrutiny over its business model, in which some university athletic departments make more than $100 million annually while student-athletes are compensated solely with scholarships. The NCAA is defending that structure in court while the U.S. Department of Justice is in the middle of a multiyear investigation into bribery in college basketball recruiting, an underground economy that critics contend wouldn't be necessary if students were appropriately compensated. NCAA President Mark Emmert has said "systemic changes" are needed to overhaul the system.
The vast majority of the NCAA's revenue comes from the organization's television deal for its annual men's basketball tournament -- rights that CBS Corp. and Time Warner Inc.'s Turner Sports have locked up through 2032. The NCAA made $761 million from that contract in 2017. The NCAA doesn't own the top-tier college football playoffs.
The revenue growth comes from built-in escalations in that CBS/Turner deal, and the August sale of the NCAA's majority interest in a company called ArbiterSports LLC, which provides back-end management for athletic departments.
To contact the reporter on this story: Eben Novy-Williams in New York at enovywilliam@bloomberg.net.
To contact the editors responsible for this story: Kevin Miller at kmiller@bloomberg.net, David E. Rovella
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