The Cowboys are worth $11 billion. Here’s how Dallas went from losing $1 million a month to topping the NFL in value

When Jerry Jones plunked down $150 million to buy the Dallas Cowboys in 1989, the team was losing $1 million a month, according to Jones.

Back then, there were plenty of empty seats and suites at Texas Stadium. The oilman had borrowed every nickel he could to buy the Cowboys, so he had to act fast — both on the field and off it — to make the team profitable.

And he did.

Thirty-five years later, the Cowboys are worth a staggering $11 billion, $3 billion more than any other team in the National Football League, according to CNBC’s Official 2024 NFL Team Valuations unveiled Thursday.

The Cowboys generated $1.2 billion in revenue in 2023, nearly $400 million more than the Los Angeles Rams, who were second in the league in revenue, according to CNBC’s rankings. The Cowboys are the most profitable in the NFL, posting EBITDA of $550 million last season, $300 million more than the New England Patriots, the second-most profitable NFL team, according to CNBC’s list.

On the path to profits, Jones made a series of bold moves that have set new standards for league ownership and delivered a massive return on his investment.

When Jones took over in 1989, he immediately fired legendary coach Tom Landry and hired his former teammate from his Arkansas college football days, Jimmy Johnson. In 1989, Jones traded his best player, Herschel Walker, in a deal that landed the Cowboys four players and several draft picks that would yield players such as Emmitt Smith and Darren Woodson.

By 1992, the Cowboys won the Super Bowl. The team won again in 1993 and then in 1995 with Barry Switzer as the coach.

Jones also innovated quickly off the field. He knew that while revenue from sponsorship deals with the NFL was split evenly among the teams, he could keep all stadium sponsorship money. Jones became the first NFL owner to get his own sponsorship deals at Texas Stadium, the Cowboys’ former home, in 1995.

He targeted brands such as American Express and Pepsi to be stadium sponsors — at the time, their respective rivals Visa and Coca-Cola had deals with the NFL. He also went after Nike, which did not have a deal with NFL Properties, the licensing arm of the league. In 1995, Jones signed a 10-year, $40 million deal with Pepsi-Cola and made a $2.5 million a year, 10-year deal with Nike.

Sponsorship agreements have been a huge boon to the Cowboys. This year, the franchise could hit $250 million in sponsorship revenue, at least $50 million more than any other team, according to people familiar with the teams’ finances.

The value of the Cowboys’ sponsorship deals has ballooned over the years. The Cowboys moved into their new stadium in 2009. In 2013, the building was renamed AT&T Stadium when Jones inked a long-term deal worth about $20 million a year. By 2021, Jones had announced a 10-year, $200 million extension of a deal with Molson Coors.

The city of Arlington owns AT&T Stadium, but Jones has operating rights, meaning he receives the revenue from the events. The busier it is, the more money he makes. Jones also has the right to purchase AT&T Stadium for just $10 at any point until the Cowboys’ lease expires in 2039, according to a person familiar with the team’s agreement with the city.

And although the Cowboys have not been to the Super Bowl in 29 years, they are a perennial playoff team, and seats and suites are almost always full.

Even outside football, the stadium is rarely vacant. This year, Jones will host Monster Jam; a professional boxing match with Mike Tyson; the Big 12 college football championship game; high school football; and Professional Bull Riders. Like with stadium sponsorships, Jones does not have to share any of this money with the league’s other 31 owners.

Jones, who is also the general manager of the Cowboys, gets plenty of criticism for not getting back to the Super Bowl since 1995. But there is no doubt he created the economic blueprint for an NFL team. The Cowboys, at $11 billion, are up 73-fold from the price Jones paid for the team to today, versus just an 18-fold increase in the S&P 500 during the same period.