Yale University Financial Report 2023-2024
- 1 Highlights
- 2 Message from the Senior Vice President for Operations and the Vice President for Finance
- 4 Financial Results
- 4 Overview
- 8 Operating Revenue
- 11 Operating Expenses
- 13 Physical Capital
- 15 Endowment
- 18 Management’s Responsibility for Financial Statements
- 19 Report of Independent Auditors
- 21 Consolidated Statements of Financial Position
- 22 Consolidated Statement of Activities
- 23 Consolidated Statements of Cash Flows
- 24 Notes to Consolidated Financial Statements
- 60 The President and Fellows of Yale University
- 60 The Officers of Yale University
Front cover
The newly revamped 65-foot-long Brontosaurus exhibit at the Yale Peabody Museum. Photo by Peter Aaron, courtesy of Centerbrook Architects and Planners and Yale University
Back cover (from top left, moving clockwise)
A life-sized model of a Pteranodon welcomes visitors in the Peabody’s main lobby. Photo courtesy of the Yale Peabody Museum
Handsome Dan greets visitors at the opening of the Yale Peabody Museum. Photo courtesy of the Yale Peabody Museum
A Mosasaur chases an Archelon in the rafters of the Peabody’s new Central Gallery. Photo courtesy of the Yale Peabody Museum
The 7,350-pound bronze sculpture of a Torosaurus in front of the Yale Peabody Museum. Photo by Kai Nip
Former Yale President Peter Salovey speaks at the opening celebration of the renovated Yale Peabody Museum. Photo courtesy of the Yale Peabody Museum
Copyright ©2024 Yale University
Highlights
| Five-Year Financial Overview ($ in millions) |
2024 Fiscal Year |
2023 Fiscal Year |
2022 Fiscal Year |
2021 Fiscal Year |
2020 Fiscal Year |
|---|---|---|---|---|---|
| Net Operating Results - Management View | $211 | $147 | $167 | $276 | $125 |
| Financial Position Highlights: | |||||
| Total assets | $55,315 | $54,426 | $54,719 | $56,223 | $44,696 |
| Total liabilities | $9,278 | $9,698 | $10,025 | $11,931 | $12,964 |
| Total net assets | $46,037 | $44,728 | $44,694 | $44,292 | $31,732 |
| Endowment: | |||||
| Net investments, at fair value | $41,290 | $40,504 | $41,122 | $41,913 | $30,957 |
| Total return on investments | 5.7% | 1.8% | 0.8% | 40.2% | 6.8% |
| Spending from endowment | 4.8% | 4.3% | 3.8% | 5.0% | 4.8% |
| Facilities: | |||||
| Land, buildings and equipment, net of accumulated depreciation | $6,011 | $5,748 | $5,598 | $5,508 | $5,438 |
| Disbursements for building projects | $614 | $448 | $378 | $380 | $437 |
| Debt | $4,847 | $5,138 | $5,164 | $5,200 | $5,242 |
| Statement of Activities Highlights: | |||||
| Operating revenues | $5,755 | $5,104 | $4,810 | $4,579 | $4,247 |
| Operating expenses | $5,412 | $4,936 | $4,540 | $4,201 | $4,044 |
| Increase in net assets from operating activities | $343 | $168 | $270 | $378 | $203 |
| Five-Year Enrollment Statistics |
2024 Fiscal Year |
2023 Fiscal Year |
2022 Fiscal Year |
2021 Fiscal Year |
2020 Fiscal Year |
|---|---|---|---|---|---|
| First-Year Enrollment Class of: | 2027 | 2026 | 2025 | 2024 | 2023 |
| First-Year applications | 51,803 | 50,060 | 47,240 | 35,220 | 36,844 |
| First-Year admitted | 2,332 | 2,289 | 2,509 | 2,299 | 2,269 |
| Admissions rate | 4.5% | 4.6% | 5.3% | 6.5% | 6.2% |
| First-Year enrollment | 1,641 | 1,554 | 1,786 | 1,264 | 1,550 |
| Yield | 70.4% | 67.9% | 71.2% | 55.0% | 68.3% |
| Total Enrollment: | |||||
| Yale College | 6,818 | 6,645 | 6,536 | 4,703 | 6,092 |
| Graduate and professional schools | 8,263 | 8,161 | 8,031 | 7,357 | 7,517 |
| Total | 15,081 | 14,806 | 14,567 | 12,060 | 13,609 |
| Yale College Term Bill and Financial Aid: | |||||
| Yale College term bill | $83,880 | $80,700 | $77,750 | $74,900 | $72,100 |
| Average grant award for students receiving aid | $65,195 | $64,686 | $59,944 | $58,340 | $59,205 |
Message from the Senior Vice President for Operations and the Vice President for Finance
Financial Results
Yale finished the year ended June 30, 2024, with a surplus from operations on both a generally accepted accounting principles (GAAP) and a Management View basis - the way Yale looks at financial information for internal discussion and decision-making purposes (see page 4 for additional information). The surplus from operations on a GAAP basis was $343 million and $211 million on a Management View basis.
The balance sheet finished the year in a strong financial position, with $46.0 billion in net assets as of June 30, 2024, up from $44.7 billion as of June 30, 2023.
Revenues and Expenses
Operating revenues increased to $5.8 billion or 13% above the prior year. The university’s largest source of income, spending from the endowment, increased by 11% over the prior year to $1.9 billion as a result of the continued impact of the extraordinary investment return in fiscal year 2021, the highest rate of revenue growth since the 1980s. Medical services income, the second largest source of operating revenue, increased by 12% over the prior year to $1.6 billion, driven by an increase in patient volumes and physician productivity. Grant and contract income, the third largest source of operating revenue, increased by 15% over the prior year to $1.2 billion as a result of increased research activity across campus, particularly in the School of Medicine. Tuition, room and board, net of financial aid, was $472 million which was 3% higher due to increased enrollment, while tuition rate increases were more than offset by increases in financial aid.
Operating expenses increased by 10% over the prior year. Personnel costs - salaries, wages, and benefits grew by 9% from the previous year, largely as the result of increased headcount and compensation necessary to support the expansion in clinical services, research, and student enrollment. Other operating expenditures increased by 12% due to inflation and to support the increased activity on campus.
Yale Endowment
The Yale Endowment investment return for the year was 5.7%, and this followed annual returns of 1.8% and 0.8% in the two preceding years. Despite these modest returns in absolute terms (though healthy relative to benchmarks), the university increased its spending from the endowment over this same threeyear period by 24%. This increased level of spending - from $1.5 billion in fiscal year 2021 to $1.9 billion this past year - has left the market value of the endowment lower in both nominal and inflation-adjusted terms versus three years ago from $42 billion in fiscal year 2021 to $41 billion in fiscal year 2024. This higher level of spending was intentional and appropriate because of the large return in fiscal year 2021 (40.2%), which through the smoothing component of the Endowment Spending Policy, continued to transfer a robust flow of income into the operating budget to be spent. The policy, which adjusts spending gradually upward after high returns and gradually downward after lower returns, remains one of the most important financial policies at the university, and one that is highly aligned with supporting the mission in an effective and responsible manner.
Capital Spending Highlights
Capital spending for fiscal year 2024 totaled $614 million, a 37% increase over fiscal year 2023. Several major projects are underway, including one of the largest capital commitments in university history, the Upper Science Hill Development (‘USHD’). The USHD is expected to total more than 600,000 gross square feet and will include the new Physical Sciences and Engineering Building, as well as a new Chemical Safety Building, an addition to Wright Lab, and a new parking garage. The USHD also supports and furthers Yale’s commitment to achieve net zero carbon emissions on campus by including a thermal utilities plant to provide electrified thermal energy to upper Science Hill.
Other exciting developments in the capital program during the year include the purchase of the 520,000 square foot life science laboratory and office building acquisition at 300 George Street in New Haven, and the comprehensive renovation of Lapham Field House. Work also progressed on the School of Divinity’s Living Village for graduate housing and the restoration of the Yale Golf Course, both scheduled for completion in 2025.
The Legacy of the Salovey Presidency
We wish to convey our heartfelt gratitude to Peter Salovey for his service as Yale University’s president from 2013-2024. His leadership underscored the university’s commitment to academic excellence and global engagement, and he created a profound and lasting impact on Yale’s financial and physical profile that will position the university well for decades to come. With President Salovey at the helm, Yale nearly doubled its endowment, from $20.8 billion in 2013 to more than $41.4 billion by 2024, while spending a cumulative $16.4 billion from the endowment to advance the university’s mission. Total university operating revenue grew to $5.8 billion in fiscal year 2024 which was nearly double the revenue at the beginning of his presidency. During his tenure, Yale also undertook a historic capital fundraising campaign that generated more than $7 billion for infrastructure expansion, enabling the addition of 2.2 million square feet of academic and research facility space and the opening of two new residential colleges, which increased undergraduate student enrollment by more than 15%. We offer our deep appreciation and congratulations to President Salovey for his exemplary service.
Looking Ahead
This coming fiscal year marks a new chapter for the university in more ways than one as we say farewell and thank you to President Salovey for his impactful tenure, and welcome Yale University’s 24 th President, Maurie McInnis (‘90 M.A., ‘96 Ph.D.), to the start of her presidency. A distinguished scholar and fourthgeneration educator, President McInnis has an exemplary career in higher education spanning the last three decades. Welcome, President McInnis.
As we close another successful fiscal year and reflect on Yale’s financial results, we look confidently to the future and our commitment to supporting the Yale community and advancing the university’s strategic academic priorities. We are grateful to all of Yale’s faculty, students, staff, alumni, and friends who strive to make Yale, and the world, a better place through a shared commitment to excellence in pursuit of the university’s mission.
Jack F. Callahan, Jr. Senior Vice President for Operations and Chief Operating Officer
Stephen C. Murphy Vice President for Finance and Chief Financial Officer
Financial Results
Overview
Yale University (‘Yale’ or the ‘university’) manages its operations to achieve long-term financial equilibrium. It is committed to sustaining both the programs and the capital assets (endowment and facilities) supporting those programs over multiple generations. Endowment allocation, Yale’s largest source of revenue, is allocated to the operating budget based on a spending policy that preserves the endowment asset values for future generations, while providing a robust revenue stream for current programs. Similarly, Yale’s operating budget provides the major portion of the funds needed, through the capital replacement charge (‘CRC’), to replenish the capital base necessary to ensure that buildings are maintained to support current and future programs.
The consolidated statement of activities in the audited financial statements is presented in accordance with accounting principles generally accepted in the United States of America (‘GAAP’). GAAP generally recognizes revenue when earned and expenses when incurred. The Management View, used for internal decision-making, is focused more on resources available and used in the fiscal period presented. Some of the more significant differences between the two views are as follows:
- The Management View does not include certain revenue that will not be received within the next fiscal year, such as pledged contribution revenue.
- The Management View recognizes capital maintenance through a Capital Replacement Cost (‘CRC’) and recognizes equipment purchases as expense in the year acquired versus the historical cost depreciation expense in the consolidated statement of activities.
- The Management View includes the realized gains and losses on interest rate swaps used to manage exposure to interest rate fluctuations in net operating results while the GAAP financial statements present these gains and losses in non-operating.
- The Management View presents the expenses related to the defined benefit plans differently as compared to GAAP.
- The GAAP financial statements do not present fund balance transfers between the operating, physical, and financial categories as the Management View does.
The Management View presentation, along with a summary of the differences between the university’s net operating results from the Management View to the GAAP View, is presented on the following page.
Yale University Operating Results - Management View
for the years ended June 30, 2024 and 2023 ($ in thousands)
| June 30, 2024 | June 30, 2023 | |
|---|---|---|
| Revenues: | ||
| Tuition, room and board - gross | $959,005 | $918,415 |
| Tuition discount | $(490,970) | $(453,959) |
| Tuition, room and board - net | $468,035 | $464,456 |
| Grants and contract income | $1,192,352 | $1,037,423 |
| Medical services income, net | $1,648,301 | $1,476,743 |
| Contributions | $182,854 | $148,681 |
| Endowment income | $1,943,853 | $1,751,461 |
| Investment and other income | $445,650 | $345,126 |
| Total external income | $5,881,045 | $5,223,890 |
| Expenses: | ||
| Faculty salaries | $1,415,977 | $1,303,295 |
| All other salaries | $1,238,656 | $1,114,796 |
| Employee benefits | $843,667 | $775,948 |
| Total salaries and benefits | $3,498,300 | $3,194,039 |
| Stipends and fellowships | $152,742 | $135,167 |
| Non-salary expenses | $1,456,501 | $1,270,464 |
| Interest, CRC and other amortization | $403,464 | $391,001 |
| Total expenses | $5,511,007 | $4,990,671 |
| Transfers | $(159,006) | $(86,404) |
| TOTAL NET OPERATING RESULTS (MANAGEMENT VIEW) | $211,032 | $146,815 |
| Summary of differences between the Management View and GAAP presentation of net operating results: | ||
| Operating pledge activity | $(13,674) | $(14,442) |
| Changes in other receivables | - | $(17,424) |
| Expenses related to long-term liabilities | $(459) | $(31,865) |
| Capital funding, depreciation and disposals | $23,926 | $(10,428) |
| Lease activity | $2,268 | $2,343 |
| Interest rate swaps | $(42,592) | $(1,700) |
| Equity investment | $3,500 | - |
| Deferred investment income | - | $7,795 |
| Funding transfers | $159,006 | $86,404 |
| INCREASE IN NET ASSETS FROM OPERATIONS PER THE CONSOLIDATED STATEMENT OF ACTIVITIES (GAAP VIEW) | $343,007 | $167,498 |
Fiscal Year 2024 Management View Results
The university budget structure is managed through 50 separate budget units that are combined into five categories for reporting purposes.
| Management View Operating Revenue by Source in Fiscal Year 2024 | |
|---|---|
| Source | Operating Revenue ($ in millions) |
| Total University | $5,881 |
| School of Medicine | $2,899 |
| Arts & Sciences and Engineering | $1,141 |
| Professional Schools | $582 |
| Institutes/Collections | $310 |
| Other | $949 |
School of Medicine
The largest unit is the School of Medicine, representing 49% of university total operating revenue. The School of Medicine engages in research, teaching, and clinical practice. Revenues for patient care services, net of contractual adjustments, are primarily based on negotiated contracts with managed care companies, BlueCross BlueShield, Medicare, Medicaid, commercial insurance and others. Additionally, approximately 39% of the School of Medicine’s net medical services income in 2024 represents revenue recognized as a result of the university’s affiliation with Yale New Haven Hospital (the ‘Hospital’). Yale Medicine (‘YM’) is one of the largest academic multi-specialty practices in the country and the largest in Connecticut. As of June 30, 2024, YM included 1,765 full-time and 207 part-time physicians providing services in over 100 specialty and subspecialty areas organized into 20 departments, engaging in research, and participating in teaching 1,383 total students (excluding Ph.D. students) and 923 residents. The School of Medicine performs significant research for federal and state governments, foundations, and corporate entities. Research funded by the federal government represents 78% of total research performed at the School of Medicine, with the National Institutes of Health (‘NIH’) providing 91% of that funding. The university has established policies and procedures to manage and monitor compliance with these important agreements. School of Public Health revenues are included in the figures reported for the School of Medicine.
Arts & Sciences and Engineering
Arts & Sciences and Engineering includes Yale’s undergraduate and graduate programs in the arts, humanities, social sciences, sciences, and engineering. During the 2023-2024 academic year, 6,818 undergraduate students were enrolled at Yale College. The undergraduate population is a diverse group attracted from across the United States and from many foreign countries. International students account for approximately 11% of the undergraduate population. Yale College is dedicated to providing undergraduates with a liberal arts education that fosters intellectual curiosity, independent thinking, and leadership abilities. Students learn to think critically and independently and to write, reason, and communicate clearly in preparation for a spectrum of careers and vocations. During the 2023-2024 academic year, 3,475 students were pursuing their studies at the Graduate School of Arts and Sciences. Yale Graduate School of Arts and Sciences considers learning to teach to be an integral part of doctoral education and incorporates training and teaching opportunities into every program. Throughout the unique program of study crafted by graduate students and their faculty advisers, the university provides support that allows Ph.D. students to focus on their scholarship, successfully complete their degrees, and pursue rewarding careers.
Professional Schools
The Professional Schools include the Divinity School, the School of Medicine, the School of Public Health, the Law School, the School of Art, the School of Music, the School of the Environment, the School of Nursing, the David Geffen School of Drama, the School of Architecture, the School of Management, the School of Engineering & Applied Science and the Jackson School of Global Affairs. During the 2023-2024 academic year, 3,553 students were pursuing their studies at one of Yale’s professional schools.
Institutes/Collections and Other
Institutes and Collections includes the libraries, museums and galleries, and large institutes with significant programmatic and financial activity across multiple academic units. First-hand encounters with Yale’s collections are an integral part of teaching and learning across the university, helping students forge creative connections and inspiring tomorrow’s leaders. The Other category includes Athletics and various administrative and support units.
The university ended the year with a surplus from operations of $211 million on the Management View basis. Operating revenues increased 13 % and operating expenses, excluding transfers, increased 10% compared to 2023.
Fiscal Year 2024 GAAP Results
Operating Revenue
The university derives its operating revenue from the following sources: tuition, room and board (net of certain scholarships and fellowships), grant and contract income, medical services income (net of contractual discounts from third-party payors and implicit price concessions to uninsured patients), allocation of endowment spending from financial capital, contributions, investment income, and other income.
Net Tuition, Room and Board
Net tuition, room and board totaled $472 million in fiscal year 2024, an increase of 3% from 2023, and represented 8% of the university’s total operating revenue. Gross tuition, room and board totaled $959 million in 2024, an increase of 4% from 2023 which totaled $918 million. Of this amount, $841 million represents tuition, a 5% increase over 2023, and $118 million represents revenue from room and board, which increased 3% from 2023. The gross tuition, room and board increases are primarily due to an increase in enrollment and rates. In accordance with GAAP, student income is presented net of certain scholarships and fellowships, which totaled $487 million and $460 million for 2024 and 2023, respectively, representing a 6% increase in 2024. Scholarships and fellowships as a percentage of gross tuition, room and board were 51% and 50% for 2024 and 2023, respectively. These amounts fluctuate based on the needs of enrolled students.
Tuition for students enrolled in Yale College was $64,700, and room and board was $19,180, bringing the total term bill to $83,880 for the 2023-2024 academic year. The increase in the Yale College term bill was 4% over the 2022-2023 academic year.
The university maintains a policy of offering Yale College admission to qualified applicants without regard to family financial circumstances. This ‘need-blind’ admission policy is supported with a commitment to meet the full demonstrated financial need of all students throughout their undergraduate years.
During the 2023-2024 academic year, 56% of Yale College undergraduates received financial aid. In the Graduate School of Arts and Sciences, 99% received financial aid in the form of tuition discounts, stipends, and health insurance. In the professional schools, 86% received financial aid. In all, 75% of total eligible university students enrolled received some form of university-administered student aid in the form of scholarships, loans, or a combination of both scholarships and loans.
Grant and Contract Income
Grant and contract income totaled $1.2 billion in fiscal year 2024, an increase of 15% from 2023, and represented 21% of the university’s total operating revenue. The Yale School of Medicine, which recorded 83% of the university’s grant and contract income in fiscal year 2024, reported an increase of 16% for 2024, while the remaining university schools and units increased by 9%.
Revenue recognized on grants and contracts from the federal government was $899 million, or 75% of 2024 grant and contract income, supporting Yale’s research and training programs. Included in the $899 million is Department of Health and Human Services (‘DHHS’) funding of $663 million, primarily through the NIH, an increase of 13% compared to the prior year. The university also receives
significant research funding from the National Science Foundation, the Department of Energy, and student aid awards from the Department of Education. Non-federal sources, which include foundations, voluntary health agencies, corporations, and the State of Connecticut, provided an additional $293 million in funding for research, training, clinical, and other sponsored agreements during 2024.
In addition to the reimbursement of direct costs charged to sponsored awards, sponsoring agencies reimburse the university for a portion of its facilities and administrative costs, which include costs related to research laboratory space, facilities, and utilities, as well as administrative and support costs incurred for sponsored activities. These reimbursements for facility and administrative costs amounted to $297 million in 2024 and $265 million in 2023. Recovery of facility and administrative costs associated with federally sponsored awards is recorded at rates negotiated with DHHS, the university’s cognizant agency. Yale’s current rate agreement is effective through June 30, 2028, and the base year for the university’s next facilities and administrative calculation is fiscal year 2027.
Grant and Contract Income
Figure: Ten-Year Trend in Grant and Contract Income by Funding Source (FY15–FY24)
This stacked bar chart shows Yale’s grant and contract income from FY15 to FY24, with the x-axis representing fiscal years and the y-axis indicating total income. Each bar is divided by funding source—Federal-DHHS (dark blue), Federal-Other (light blue), and Non-Federal (green)—with total income generally increasing over time.
Medical Services Income, Net
Medical services income, net totaled $1.6 billion in fiscal year 2024, an increase of $165 million or 12% from 2023, and represented 28% of the university’s operating revenue. The largest portion of this revenue stream is derived from medical services provided by Yale Medicine (‘YM’), which increased by $163 million over 2023, or 12%.
Patient care income, which accounts for 53% of net medical services income, was up $68 million or 9% due to growth in various specialties across the clinical practice. Physician productivity metrics commonly referred to as work RVUs grew 9% in fiscal year 2024 from 2023. The Hospital continued to invest in YM in fiscal year 2024 with support increasing by 14% to a total of $608 million for clinical services, investment in faculty recruitment, and new clinical programs.
Other contributors to the clinical growth include the partnering of Yale New Haven Health System (‘YNHHS’) affiliates with YM to continue practice expansion outside of New Haven County through delivery network hospitals. YNHHS income increased 26% in fiscal year 2024 from 2023.
Figure: Ten-Year Trend in Medical Services Income by Source (FY15–FY24)
This stacked bar chart shows Yale’s medical services income from FY15 to FY24, with the x-axis representing fiscal years and the y-axis showing income levels. Each bar is divided into YM Patient Care Fees (dark blue), YNHHS Income to YSM (light blue), and Yale Health Medical Services (green), with overall income steadily increasing over the period.
Contributions
Donations from individuals, corporations, and foundations represent a vitally important source of revenue for the university. Gifts to the university provide necessary funding for current operations, for long-term investments in the university’s physical infrastructure, and, in the case of gifts to the endowment, provide permanent resources for core activities for current and future generations. Gifts of $169 million in 2024 and $134 million in 2023, made by donors to support the operations of the university, are reflected as contribution revenue in the operating section of the consolidated statement of activities, whereas gifts to the university’s endowment and for building, construction, and renovation are reflected as contribution revenue in the non-operating section of the consolidated statement of activities. In aggregate, contributions included in the university consolidated financial statements total $424 million in 2024 compared to $459 million in 2023.
Certain gifts commonly reported in fundraising results are not recognized as contributions in the university’s consolidated financial statements. For example, ‘in-kind’ gifts such as works of art and books that will be maintained as part of the university’s collections are not recognized as financial transactions in the consolidated financial statements. Grants from private, non-governmental sources (i.e., corporations and foundations) reported as gifts for fundraising purposes are included in the consolidated statement of activities as grant and contract income.
Allocation of Endowment Spending
Each year a portion of the endowment’s market value is allocated to support operational activity. This important source of revenue represents 34% of total operating revenue in fiscal year 2024, and is the largest source of operating revenue for the university. The level of spending is computed in accordance
with an endowment spending policy that has the effect of smoothing year-to-year market value swings. Endowment investment returns allocated to operating activities increased by 11% in 2024 to $1.9 billion. The 40% investment return recognized in fiscal year 2021 drove the notable increase in endowment spending this year, which represents the highest year-over-year growth in two decades.
Additional information on Yale’s endowment spending policy is provided in the endowment section of this report and in the Notes to Consolidated Financial Statements.
Figure: Ten-Year Trend in Allocation of Endowment Spending (FY15–FY24)
This chart displays Yale’s endowment spending from FY15 to FY24, with green bars showing the dollar allocation (left y-axis) and a black line indicating the percentage of total revenues (right y-axis); the x-axis represents fiscal years. The allocation amount rises over time, while the percentage of total revenues remains relatively steady.
Other Investment Income
Other investment income includes interest, dividends, and gains on non-endowment investments.
Other Income
Other income primarily includes publications income, income from executive education and other nondegree granting programs, royalty income, admissions revenue relating to athletic events and drama productions, parking revenue, special event and seminar fees, and application and enrollment fees.
Operating Expenses
Operating expenses totaled $5.4 billion for 2024, representing a 10% increase over 2023. Personnel costs are the single largest component (62%) of the university’s total operating expenses, with 5,492 faculty, 1,812 postdoctoral and postgraduate associates, 5,923 managerial and professional staff (‘M&P’), and 5,476 clerical, technical, service, and maintenance personnel (counts represent headcount as of fall 2023).
Personnel costs were $3.3 billion in 2024, a 9% increase over 2023. Faculty salary expenses increased 9% which is partly attributable to an increased headcount to support growth in clinical
activities. Staff salaries and wages increased 10% from 2023 to 2024, largely due to increased headcount and salary and wage increases. The cost of providing employee benefits, including various pension, postretirement health, and insurance plans in addition to Social Security and other statutory benefits, totaled $799 million for 2024, an increase of 7% from 2023.
Depreciation, amortization, and interest expense increased 7% from 2023, primarily as a result of higher depreciation and interest costs in fiscal year 2024.
Other operating expenditures, including services, materials and supplies, and other expenses, increased 12% from 2023, primarily due to an increase in non-salary expenses in most schools and units, driven by increased activity in support of the university’s revenue growth and increases in general expenses due to inflation.
Yale reports its operating expenses by natural classification in the consolidated statement of activities and discloses these operating expenses across functional classification in the Notes to Consolidated Financial Statements in accordance with GAAP.
| Operating Expenses by Natural Classification | |
|---|---|
| Expense Category | Percentage (%) |
| Salaries and Wages | 47% |
| Other Operating Expenditures | 29% |
| Employee Benefits | 15% |
| Depreciation, Amortization, and Interest | 9% |
The university spent 69% of its operating resources on programmatic support, 23% on patient care and other related services, and 8% on administration and other institutional support.
Physical Capital
Capital spending on facilities in fiscal year 2024 totaled $614 million. This represents an increase of 37% from the 2023 spending level.
Figure: Ten-Year Trend in Capital Spending by Year (FY15–FY24)
This stacked bar chart presents Yale’s annual capital spending from FY15 to FY24, with the x-axis showing fiscal years and the y-axis representing spending in 2024 dollars. Each bar is divided into spending on Renovations (dark blue) and Acquisitions and New Construction (green), with total spending varying year to year.
The Yale School of Medicine (‘YSM’) accounted for approximately 40% of the university’s 2024 capital expenditures. The largest expenditure in this category was attributed to the purchase of a 520,000 square foot life science office and laboratory building at 300 George Street. Prior to the purchase, the school had been a long-term tenant. A major renovation of the 100 College Street building was also completed in 2024. It is one of the only buildings on campus that houses departments from both the School of Medicine and Arts & Sciences and Engineering, including YSM’s Department of Neuroscience and the Arts & Sciences and Engineering’s Department of Psychology, in addition to other scholars and scientists from across campus. It is also home to the Wu Tsai Institute, a university-wide initiative launched in 2021 to advance the study of human cognition. Construction began in early 2022 and completed in December 2023. In addition, work began to renovate three leased floors at 101 College Street to accommodate the relocation and expansion of the existing Endocrinology section of the Department of Internal Medicine, a vivarium and freezer farm, and a microscopy core for Cell Biology. The renovations will also create office space for the newly formed section of Biomedical Informatics and Data Science. The remaining expenditures are related to other programmatic renovation, clinical expansion and upgrades, and capital maintenance projects throughout YSM.
Twelve percent of the university’s capital spending was invested in the biological and physical sciences as work began on the Upper Science Hill Development (‘USHD’). USHD is a comprehensive reenvisioning of the Science Hill area of campus with the end goal of creating a new research-intense structure, the Physical Sciences and Engineering Building. Located at the northeastern section of Science Hill, USHD is one of the largest capital commitments in university history, totaling more than 600,000 gross square feet. The USHD will provide: new lab spaces for approximately fifty faculty across Arts & Sciences and Engineering, including those in physics, applied physics, and other quantum-focused
departments; convening space for affiliated departments, institutes, centers, and programs that will serve as a magnet for science and engineering at Yale; a shared university facility to support the design and development of custom instrumentation; and a large and modern cleanroom and core facilities for materials characterization and imaging in instrumentation facility. The project also includes a Thermal Utilities Plant that will provide electrified thermal energy to the upper Science Hill.
Eight percent of the university’s capital spending was invested in improvements to Athletic facilities. A targeted exterior and comprehensive interior renovation of the existing Lapham Field House at the Smilow Field Center for the men’s varsity football team and men’s and women’s varsity track teams was completed. The renovation scope included locker room upgrades, new meeting rooms, HVAC upgrades, and a new elevator. Work also began to complete a comprehensive restoration for the Yale Golf Course. The goal of the project is to restore the course to its original layout and design from a century ago. The work includes the teeing areas, greens, bunkers and fairways, as well as lengthening of the course and expansion of the driving range to accommodate championship play. The university also made capital investments in various areas throughout the campus to provide for programmatic renovations, capital maintenance projects, and infrastructure support.
The university’s renovation and building plans were funded by a combination of gifts, debt, and the operating budget. The university continues to rely heavily on the extraordinary generosity of its alumni and friends. Gifts designated for facilities in 2024 totaled $74 million, which includes gifts to support the comprehensive renovation of the Lapham Field House and construction on the new graduate student housing and physical plant buildings for the Yale Divinity School’s Living Village Project.
Capital Spending by Campus Area |
|
|---|---|
| Campus Area | Spending (%) |
| School of Medicine | 40% |
| Biological & Physical Science | 12% |
| Administration & All Other | 11% |
| Athletics | 8% |
| West Campus | 5% |
| Resident/Student | 5% |
| Divinity | 4% |
| Utilities | 4% |
| Social Science | 4% |
| Engineering/Applied Science | 4% |
| Libraries & Collections | 3% |
A major source of funding for the capital program is debt provided through the Connecticut Health and Facilities Authority (‘CHEFA’), which allows the university to borrow at tax-exempt rates. This funding source is critical to keep the cost of funding at low levels, which allows the university to maximize the use of its resources and further advance the fulfillment of its mission of teaching and research. The university
continues to receive the highest bond ratings available: AAA from Standard and Poor’s Global Rating and Aaa from Moody’s Investors Service.
Recognizing the critical importance of maintaining its physical capital over many generations, the university allocates funds directly from the operating budget to a capital maintenance account. The annual equilibrium funding target for internal purposes is an estimate of the amount needed to maintain Yale’s facilities in good condition on a consistent basis, thus avoiding deferred maintenance. While not an exact science, an estimate of the full capital replacement equilibrium level for 2024 was $340 million.
Endowment
The endowment provides the largest source of support for the academic programs of the university. To balance current and future needs, Yale employs investment and spending policies designed to preserve endowment asset values while providing a substantial flow of income to the operating budget. At June 30, 2024, net assets in the endowment totaled approximately $41.4 billion, after the allocation of endowment spending of $1.9 billion to the operating budget during the year.
Investment Performance
For the fiscal year ended June 30, 2024, the endowment earned a 5.7% investment return. During the past decade, the endowment earned an annualized 9.5% return, which added $15.4 billion of value relative to a composite passive benchmark and $9.7 billion relative to the mean return of a broad universe of colleges and universities.
Figure: Growth of $1,000 Invested in the Yale Endowment (2014–2024)
This line chart tracks the growth of a $1,000 investment from FY14 to FY24, comparing Yale’s endowment (blue line), the mean of a broad universe of colleges and universities (green line), and inflation (dark blue area). Yale’s endowment outpaces both inflation and peer institutions over the ten-year period.
Endowment Spending
The endowment spending policy, which allocates endowment earnings to operations, balances the competing objectives of providing a stable flow of income to the operating budget and protecting the real value of the endowment over time. The spending policy manages the trade-off between these two
objectives by using a long-term target spending rate combined with a smoothing rule, which adjusts spending in any given year gradually in response to changes in endowment market value.
The target spending rate approved by the Yale Corporation currently stands at 5.25%. According to the smoothing rule, endowment spending in a given year represents the sum of 80% of the previous year’s spending and 20% of the target long-term spending rate applied to the market value at the start of the prior year. The spending amount determined by the formula is adjusted for inflation and an allowance for taxes and constrained so that the calculated rate is at least 4.0% and not more than 6.5% of the endowment’s inflation adjusted market value at the start of the prior year. The smoothing rule and the diversified nature of the endowment mitigate the impact of short-term market volatility on the flow of funds to support Yale’s operations.
The majority of endowment spending is allocated across multiple purposes, including financial aid and professorships, based on donor restrictions or internal designations by the university. Endowment spending that is neither restricted nor designated provides additional support for budgetary priorities that carry out the university’s mission.
| Endowment Spending Category | Allocation (%) |
|---|---|
| Teaching and Research | 25% |
| Undesignated | 22% |
| Facilities and Operations | 18% |
| Financial Aid | 18% |
| Other Specific Purposes | 17% |
Asset Allocation
Asset allocation proves critical to successful endowment performance. Yale’s asset allocation policy combines tested theory and informed market judgment to balance investment risks with the desire for high returns.
Both the need to provide resources for current operations and the desire to preserve the purchasing power of assets dictate investing for high returns, which leads the endowment to be weighted toward equities. In addition, the endowment’s vulnerability to inflation directs the university away from fixed income instruments. Hence, roughly 95% of the endowment pool is invested in assets expected to produce equity-like returns, through domestic and international securities, real assets, and private equity.
Endowment Summary
Yale continues to rely on the principles of equity orientation and diversification. These principles guide Yale’s investment strategy, as equity orientation makes sense for investors with long time horizons and diversification allows the construction of portfolios with superior risk and return characteristics. The university’s equity-oriented, well-diversified portfolio positions the endowment for long-term investment success.