Kansas City Chiefs quarterback Patrick Mahomes got the most lucrative contract in American team sports history last July. The 2018 NFL MVP signed a 10-year, $450 million contract extension worth up to $500 million with incentives. Mahomes didn't let his newfound riches affect his performance. The NFL's highest-paid player had an outstanding 2020 season by putting the Chiefs in a position to become the first team to win back-to-back Super Bowls since the 2004 Patriots.
Bucks forward Giannis Antetokounmpo followed suit with the richest contract in NBA history. The two-time reigning NBA MVP signed a fully guaranteed five-year, $228,200,800 extension several weeks ago during the middle of December. Mahomes becoming the NFL's highest-paid player was expected. The size of the contract took practically everybody by surprise. Extremely long quarterback deals had fallen out of favor around the league by the middle of the 2000s.
However, It wasn't a certainty that Antetokounmpo would take the Bucks extension. NBA players have been abandoning smaller markets like Milwaukee. Instead, contracts are typically played out where players go to major cities in free agency even though the NBA system is financially stacked in favor of staying with the same team.
NBA vs. NFL Contracts
NBA and NFL contracts differ in a variety of ways. The most significant difference is fully guaranteed contracts are the norm in the NBA. Fully guaranteed contracts with the exception of most of the first round in the NFL Draft are a rarity for football. The five-year, $150 million extension Falcons quarterback Matt Ryan signed in 2018 has the most money ever fully guaranteed in an NFL contract at $94.5 million.
Signing bonuses, which are prorated or spread out evenly over the life of a contract for a maximum of five years, are commonplace in the NFL because of the lack of fully guaranteed contracts. A big signing bonus can keep salary cap numbers low in the early years of a deal while making it more difficult for a team to cut a player because signing bonus proration accelerates into a team's current salary cap upon release in most instances.
The NBA has strict limitations on contract length and annual salary increases as well as salary maximums. These types of restrictions don't exist in the NFL.
There's a ceiling on player salaries with veteran contracts depending on years of service. The first year of a contract for players who have no more than six years of service can't exceed 25 percent of the salary cap. For players with seven to nine years of service, the maximum is 30 percent of the salary cap. Players with 10 or more years of service are restricted to 35 percent of the salary cap.
There are limited exceptions that allow a player to qualify for a higher salary maximum. For example, Antetokounmpo, who is in his eighth NBA season, is getting 35 percent of the salary cap with his new contract extension in what is referred to as a supermax contract. This is because Antetokounmpo was named MVP in any of the previous three seasons, earned either All-NBA or NBA Defensive Player of the Year honors in the previous season or two of the three previous seasons. It's officially known as a Designated Veteran Player Extension. Antetokounmpo qualified on all fronts as the two-time reigning MVP and reigning Defensive Player of the Year who has earned All-NBA honors for four straight seasons.
In the NBA, extensions are tacked on to the end of existing contracts. Players typically get some sort of salary increase in the remaining contract years with extensions in the NFL because some of the new money is allocated to those years usually as a signing bonus.
Mahomes had two years left on his rookie contract when he signed his new deal. He gets $6 million of the $450 million, which is a low amount by high-end NFL contract standards, before the first extension year of 2022. Antetokounmpo's 2020-2021 salary remains at $27,528,088. Since the 2021-22 NBA salary cap projects to $112,414,200, 35 percent equates to $39,344,970. That's Antetokounmpo expected salary in the first year of his extension. The number will be adjusted upwards or downwards based on where the 2021-22 salary cap is actually set.
The standard maximum contract length is four years in the NBA. The standard maximum annual raise is five percent of the first-year salary of a contract or extension. There are a couple of exceptions to this rule. Players who re-sign with their own teams in free agency can sign five-year contracts where the maximum annual raise is eight percent of the first-year salary. The same applies to contract extensions except players can be under contract for up to five years. Those who sign Designated Veteran Player Extensions, like Antetokounmpo, can be under contract for a total of six years. Antetokounmpo's annual increase is $3,147,597.
Mahomes vs. Antetokounmpo
Mahomes' extension dwarfs Antetokounmpo's in overall dollars because of its length. The two extensions have almost the same average yearly salary but Antetokounmpo tops Mahomes. Antetokounmpo is at $45,640,164 per year while Mahomes' is $45 million.
Typically, in lengthy NFL contracts, the later years are essentially a series of one-year options where teams can release players when it best suits them because the contracts aren't fully guaranteed. Mahomes has protections that aren't usually in the later years of deals.
A significant amount of Mahomes' compensation in these years is in unsecured March roster bonuses that become fully guaranteed at least one year early. For example, Mahomes' 2027 compensation consists of a $10 million base salary, a $49.4 million third day of the league roster bonuses and a $550,000 workout bonus. The $49.4 million roster bonus becomes fully guaranteed on the third day of the 2026 league year. The base salary and workout bonus are fully guaranteed on the third day of the 2027 league year. The Chiefs would have to buy Mahomes out for $49.4 million to exit his deal in 2027 before the remaining $10.55 million became secure.
A direct comparison of the cumulative new money in the common new years is revealing. The chart below illustrates the difference. Since Mahomes had two years left on his existing contract while Antetokounmpo had one, the first new year for Mahomes is 2022 and 2021-2022 for Antetokounmpo.
|Common New Years||Patrick Mahomes||Giannis Antetokounmpo|
1st New Year
2nd New Year
3rd New Year
4th New Year
5th New Year
The average yearly salary difference of the two deals for the common years is pronounced since Mahomes' extension is backloaded. Mahomes is at $39.55 million per year. High-end NFL contracts are usually frontloaded because of the lack of full guarantees. Backloading is unavoidable with Antetokounmpo because of the NBA's restrictive rules on first-year salaries and salary increases.
43.9 percent of Mahomes' new money is in the first five new contract years (2022 through 2026). $252.25 million of the $450 million (56.1 percent) is in the final five new years for an average of $50.45 million per year.
NFL money still has a ways to go to catch up to NBA money despite the enormity of Mahomes' contract. Mahomes is the only NFL player with a $40 million per year contract. There are nine NBA players at or above the $40 million per year mark.
The financial discrepancy between the Mahomes and Antetokounmpo will continue to grow over time unless Mahomes' contract is renegotiated at some point in the latter half when it will surely become outdated by quarterback salary standards.
Antetokounmpo will be eligible to sign another extension on the third anniversary after his new contract under NBA rules. In December 2023, Antetokounmpo could add two years to his deal to be under contract for a total of five years.
By Antetokounmpo taking the same approach as this time around and extending in his 2025-2026 contract year, a four-year extension when on the cusp of turning 31 could be signed. Assuming the rules don't change in the next NBA Collective Bargaining Agreement, Antetokounmpo would receive a five percent raise on his expected $51,935,358 2025-2026 salary for 2026-2027 in a worst-case scenario. This would give Antetokounmpo a $54,532,126 salary in the first year of the extension with a maximum eight percent annual increase of that amount ($4,362,570). The four-year extension running through the 2029-30 season would total $244,303,924 for a $61,075,981 average per year.
Antetokounmpo would make $472,504,744 over the nine seasons from 2021-2022 through 2029-30. Mahomes' new money in the first nine new contract years is $397.55 million.