Sean McAdam of MassLive indicated the Red Sox are willing to spend beyond the first CBT threshold ($244 million) in 2026, “which would translate to them absorbing a modest financial loss. But with anything beyond that, there’s a reluctance to incur bigger deficits”. Cot’s Contracts estimates that the team’s 2026 payroll is currently $27.13 million below the first CBT threshold. Claiming that the Red Sox, who generated the fourth-highest revenue in baseball and have a dedicated national fanbase, are in financial distress is a tough pill to swallow. The Red Sox own majority stakes (80%) in New England Sports Network (NESN) and have one of the more lucrative local TV deals in the sport, further allowing them to mitigate revenue sharing protocols.
Last week, when asked if the New York Yankees operated at a profit in 2025, owner Hal Steinbrenner responded, “I don’t want to get into. But that’s not a fair statement or an accurate statement.” The timing of McAdam’s statement about the Red Sox and Steinbrenner’s comments isn’t a coincidence; if anything, it’s posturing ahead of the next CBA negotiations.
Yes, free-agent contracts carry risk. Players typically enter free agency between the ages of 30-32, sometimes with their best years behind them. Teams pay for future performance with the uncertainty of injury risks and potential performance decline. However, spending money for the sake of spending limits roster and payroll flexibility for future needs. Sustainable competitiveness requires balancing homegrown talent with select free agent and trade acquisitions. The Red Sox’s young core of Ceddanne Rafaela, Roman Anthony, and Garrett Crochet are signed to long-term extensions. They just traded for Sonny Gray (and Johan Oviedo), which helps strengthen their rotation, but the team still has room to upgrade in the lineup and pitching staff.
The AL East is currently in the midst of an arms race. After almost winning the World Series, the Blue Jays are eager to carry their momentum into next season, signing Dylan Cease to a seven-year $210 million contract. Despite injuries to key players, the Red Sox fielded a competitive team in 2025. They ended their three-year playoff drought but were overmatched by the Yankees in the AL Wild Card series, a team that spent $139 million more in luxury tax payroll. This disparity was evident in their pitching rotations. While the Yankees were led by aces Max Fried and Carlos Rodón, the Red Sox only had Garrett Crochet and had to turn to Brayan Bello and newcomer Connelly Early in Games 2 and 3.
Granted, it’s only December, and top free agent targets like Pete Alonso, Alex Bregman, and Kyle Schwarber remain on the market. The Red Sox’s future is bright, but failing to make significant upgrades through free agency will make it more challenging for the team to compete should they reach the playoffs.