One Direction Is Showing Record-Breaking Boy Band Profits

One Direction made the rich list and much has been made of that, but how much money do they make compared to others celebrities? The short answer is a lot more than most, but they are all millionaires, not billionaires like Bill Gates. The boys have done very well for themselves in terms of earnings but could possibly benefit from saving and investing a bit more.

One Direction earned $130 million in net profit in 2015, according to Forbes. Comparatively, they ranked fourth among all other celebrities on the Forbes Celebrity 100. Their profits are way up from last year. In 2014, they were only No. 28 on the list.

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Forbes believes their income will continue to rise. Inversely, Money Nation advises the boys need a transition and should reinvent their sound to keep their income growing.

“It may be difficult for a ‘boy band’ to transition beyond their early 20’s. If the band can reinvent themselves as something other than a sensation for teens, they’ll have a strong case for continuing to pull in big money well into the future.”

One Direction realizes this, and that is why they are on a break. They need to mature their sound to continue to appeal to their fans. It isn’t about abandoning their young fans — it is about preparing the right sound to carry their current audience through their teens and beyond.

So who were the top three celebrities who made more than 1D? Floyd Mayweather, the American boxer, is the highest-earning celebrity, according to Forbes, earning $300 million last year. The second is another boxer, Manny Pacquiao.

Katy Perry is the celebrity making the most money without the risk of getting punched in the face. Katy earned $135 million last year, making her No. 3 on the Forbes list of celebrities. For comparison, Kim Kardashian, the highest-paid among her clan, is No. 33 with $52.5 million earned last year. Her total net worth is $85 million.

One Direction has outperformed all other boy bands in terms of gross receipts. Bands looking for a business plan should examine this information carefully. One can learn quite a bit about the music business and profits related to that by considering these earnings and scaling them down for smaller bands. Streams of revenue would be similar in ratio.

One Direction has earned a total gross of $820 million since 2011. The main money maker is their concerts, which have earned them $544 million in total receipts. Hats, T-shirts, and other merchandise contributed $135 million. The band has made another $74 million in product endorsements. Income from YouTube alone was an amazing $34.8 million. At $7.60 per 1,000 views, that’s about 5.4 billion views.

Album sales profits can be disappointing. The band has grossed $310,687,300 in total album sales in the past five years. Sadly, bands only make 7.73 percent of gross sales, but if they write all their own songs with no outside help, they earn 11.1 percent. Harry Styles and the others to a lesser extent have been saving the band a little money by writing songs.

The One Direction boys took home only $27,191,678 in album profits over the length of their career. Remember that is also split five ways. That is about $5.44 million each. The band’s singles took in another $3.3 million for the band. While that sounds like a lot, recording is one of the least profitable aspects of the music industry, at least for the musicians, because of the small percent of total sales, called royalties, they receive for their work.

Making albums is time-consuming, and the profits are much lower than touring, so as with any other business, there is a slow season. When recording, the boys do not make as much money as when they are touring.

Unfortunately, the One Direction guys don’t get to keep all that money. Gross means total before taxes and expenses. They had to pay out $367 million in UK income taxes since they are in the highest UK tax bracket and automatically owe 45 percent. Their total expenses came to another 82 million, including the cost of concerts, staff, and agency fees.

Individual One Direction members are said to have about $30 million in personal net worth each. That is exactly how much money Kris Jenner has as an individual. It is also just a little bit more than the band netted last year, divided five ways.

One Direction is doing well, and they are trying to create new music so they can continue to perform in the future.

[Photo by Rick Kern/Getty Images for iHeartMedia]