[News] NHL and NHLPA release salary cap estimates for next 3 years

[Samonadreau]

Whatch these numbers get floated, teams completely blow their wad on mortgaging the future and throwing money around and then it not go up to nearly those numbers in 2027/28.

[BigThief]

Originally Posted by Enoch Root

It's going to be a wild summer though - somebody is going to pay a guy like Boeser $10M+. And then regret it for a long time.

Said that a month back and got roasted for it by a couple people but you're absolutely right. The cap is skyrocketing and GMs always go bonkers on free agent day. The split second Dustin Wolf can accept a new deal Conroy should throw a deal that surprises him and gets it done.

[Enoch Root]

Originally Posted by BigThief

Said that a month back and got roasted for it by a couple people but you're absolutely right. The cap is skyrocketing and GMs always go bonkers on free agent day. The split second Dustin Wolf can accept a new deal Conroy should throw a deal that surprises him and gets it done.

Yeah, if the cap is going to skyrocket, better to pay the young guys whatever it takes ($8M kind of numbers), than to blow your brains out paying a UFA $12M.

In a few years, when the cap is $120M, paying Zary and Coronato and Wolf $8M will be looking like a brilliant move.

[Finger Cookin]

Originally Posted by BigThief

Said that a month back and got roasted for it by a couple people but you're absolutely right. The cap is skyrocketing and GMs always go bonkers on free agent day. The split second Dustin Wolf can accept a new deal Conroy should throw a deal that surprises him and gets it done.

That's really the biggest opportunity of a rising cap. Some GMs will have absolutely no idea what to do with it and will inevitably shoot themselves in the foot if they're lucky, in the face if they're not.

[Locke]

Originally Posted by Finger Cookin

That's really the biggest opportunity of a rising cap. Some GMs will have absolutely no idea what to do with it and will inevitably shoot themselves in the foot if they're luck, in the face if they're not.

Honestly? Its no wonder the PA signed off on this release, they know it just means that cash is going to pour in to their members.

At the same time, I am personally astonished at how fast and how high the Cap is rising, but hey, its not my business and its not my money. I thought the COVID/Escrow recovery was going to take a lot longer, but I'm not in that business.

The PA wants cash going to it's members and the NHL wants to grow their business and increase their value...so it does look like wins all around.

I'll say it now though...I think Auston Matthews is going to be one of the highest earning players ever at this rate.

[McG]

It will be interesting to see if salary cap escalations lead to delays in signing contracts to get to next season’s salary level, instead of extending on July 1 with a year remaining. Delays of course open up the possibility of players moving more to teams with cap flexibility.

Or does it mean shorter contracts to get to the max every year?

Or no change at all.

I’m guessing that most players will take guaranteed contracts and term over shorter deals. I’m thinking that players know that they age, and with UFA contracts nearer the end of their careers, they take the security.

It does feel like ticket prices increasing though.

Edit: perfect example in klingberg

[getbak]

Originally Posted by Samonadreau

Whatch these numbers get floated, teams completely blow their wad on mortgaging the future and throwing money around and then it not go up to nearly those numbers in 2027/28.

Leaguewide revenue would need to drop considerably for these numbers to not hold.

Using the formula that's currently in place, next year's cap should be over $111 million. The only reason it isn't is because they agreed to limit year-over-year growth to 5%.


Since the post-COVID extension of the CBA, the formula for calculating the cap is:

1. Start with the final HRR for the season two years prior (i.e., for 2025-26, use HRR from 2023-24).
2. Divide that in half to get the players' share.
3. Divide that by the total number of teams in the league to get the per team average share.
4. This is the "midpoint" of the salary range. The cap is set to 115% of the midpoint and the floor is 85% of the midpoint.

There are few small other variables that come into play, but those are the broad strokes that work for understanding how it works.


Using that formula, the cap for 2025-26 should be:

1. 2023-24 HRR = $6.2 billion (roughly)
2. Players' share = $3.1 billion
3. Per team share = $96.875 million

• Cap = $111.4 million
• Floor = $82.3 million

This year's revenue is projected to be $6.6 billion, which would lead to a cap of $118.6 million for 2026-27.

If they hadn't agreed to limit growth of the cap, we'd be looking at these projected numbers for three years from now next season.

[getbak]

Whenever there's a suggestion the cap is going to rise considerably, Friedman or someone like him always seems to bring up that some teams are going to need to implement internal caps as if that's a bad thing.

The whole salary cap was built with a range for a reason. It was never designed to have 80% of the teams within a couple million of the cap.

The reason they talk about the midpoint of the salary range is because that is supposed to be the average team payroll with roughly half the teams above the midpoint and the other half below.

The problem is that since the cap was introduced 20 years ago, that has basically never come close to happening.

If you put the cap, floor, and midpoint on a line, with the floor at 0, the cap at 100, and the midpoint at 50, there should be about 4-6 teams between 0 and 25, 10-12 teams between 25 and 50, 10-12 teams between 50 and 75, and 4-6 teams between 75 and 100.

In reality, most seasons, there are fewer than 5 teams below 50, hardly any between 50 and 75, a large number between 75 and 100, and quite a few over 100 from day one of the season, never dropping below it.



For example, this season, the floor is $65 million and the cap is $88 million, which puts the midpoint at $76.5 million.

Right now, there are only 3 teams in the league below the midpoint (Anaheim, Calgary, Columbus -- and if you were to include Johnny's cap hit, Columbus would have been over). There are an additional 4 teams with more than $5 million in cap space. 25 of 32 teams are within $5 million of the cap (actually, all 25 are within $3.61 million, and 24 are within $2.7 million). 7 teams have less than $1 million in cap space, and 11 are over the cap (using LTIR or bonus deferment to remain compliant).

More teams scaling back to be closer to the midpoint should be what happens. I'm skeptical if it actually will.

As the cap rises, I think fewer teams will be in LTIR from game 1 to game 82. I suspect that most teams will start the season with a few million in cap space but as the season progresses, that cap space will dwindle as players get injured and others are traded. Just like every year, when the deadline rolls around, the teams that think they can make some noise in the playoffs will still load up hoping to go over the top.