Luka Dončić contract extension winners, losers: Lakers star in both categories; hope dashed for Heat, Clippers

It’s been a wild six months for Luka Dončić. At the beginning of February, he was dealt to the Los Angeles Lakers in one of the most stunning trades in NBA history. Everything that has happened since has been a whirlwind of change and instability. The Lakers caught fire upon his acquisition… and then lost in the first round of the playoffs. They traded for his long-term center in Mark Williams… then nixed the deal over health concerns. He got to join LeBron James… but James is seemingly unhappy with the direction of the team.

All the while, Dončić has been left to adjust to a new team, one that, unlike most players of his ilk, he did not choose to join. That created a bit of uncertainty surrounding his long-term status. Dončić was initially set to become a free agent in the summer of 2026. That gave the Lakers only 18 months or so of team control. Functionally, it was less. Dončić became eligible to sign a long-term extension on August 2. Had he elected against doing so, that likely would have meant he planned to leave Los Angeles at his first chance.

However, the six months Dončić has spent in Hollywood have seemingly sold him on a future in purple and gold. Dončić has reportedly agreed to a three-year contract extension worth $165 million. The deal will keep him with the Lakers for the foreseeable future, giving them every opportunity to build a championship roster around them and, sadly, breaking the hearts of several teams that surely would have liked to pursue him as a free agent. So, in that spirit, let’s look at the winners and losers of the Dončić extension.

Winner: Luka Dončić

Well, there’s the obvious financial component of this. Dončić guaranteed himself a lot of money. While he’d already earned generational wealth playing professional basketball, he continued to add to an already lucrative career with yet another well-deserved max contract. Any player signing for this much money with any team is going to be a winner in that arrangement.

But of course, this isn’t just any team. These are the Lakers. Given the sheer shock of the move and the on-the-fly nature of integrating him during the season, the Dončić acquisition certainly felt a little tenuous. He was playing with the remnants of a roster designed for other players. He could have left in 2026 — perhaps earlier if he’d forced the issue. The last six months were more of a “getting to know you” period than anything else.

That period went well enough to warrant a commitment, and that commitment puts Dončić in rarified air. Really think of what it means to be the face of the Lakers. For almost 80 years, with very limited interruptions, the Lakers have basically always had an all-time great leading their roster. The transition from George Mikan to Elgin Baylor to Jerry West to Kareem Abdul-Jabbar to Magic Johnson to Shaquille O’Neal to Kobe Bryant to LeBron James has mostly been seamless. The best player on the Lakers is, almost always, one of the faces of the league and his entire generation. Now, Dončić has set himself up to truly grab that baton, to be the next great Laker. If you’re going to get traded against your will, well, you could do far worse.

Loser: Luka Dončić

All of this being said, Dončić still actually comes out a financial loser in this arrangement, at least for the time being. As a Laker, Dončić was eligible to sign an extension for up to four years, starting at 30% of the salary cap in the first year of the deal. Not bad. Not what he was set to make mere months ago.

The supermax is available only to players who are on either the team that drafted them or one that traded for them within the first four years of their career. The Mavericks drafted Dončić, and by virtue of his consecutive All-NBA selections in 2023 and 2024, he was eligible to sign for the supermax. Such an extension, had he signed it, could have lasted five years and started at 35% of the salary cap. Based on the current projection of 7% growth in next year’s cap, that extension would have paid out roughly $335.9 million, obviously more than he wound up securing with the Lakers. Adding to those financial losses is the fact that he went from a state without income taxes in Texas to one with very high income taxes in California.

Dončić did use the structure of this contract to set himself up to recoup some of these of losses. By signing a two-plus-one deal, he set himself up to become a free agent in 2028, after his 10th NBA season. At that point, he will be able to sign for 35% of the cap no matter what. ESPN projects that he will be eligible at that point for a five-year, $417 million contract which would pay him more than $1 million per game. However, Dončić obviously has to wait three years to secure such a contract, and should he experience injury or age-related decline, it is not guaranteed.

Dončić has a lot of basketball ahead of him, and being the face of the Lakers comes with its own financial possibilities. Perhaps he makes this money up over time with endorsements. Maybe he winds up commanding higher salaries in the long haul because of whatever he winds up doing as a Laker. Regardless, this is a nine-figure contractual loss for the time being, 

Winner: Los Angeles Lakers

Only the Lakers could pull off one of the most shocking star acquisitions in NBA history… and then get that player on a discount. It’s not as though Dončić had a choice in the matter, but he is ironically exactly the sort of player the supermax was intended to reward: a homegrown star clearly worth more than even his most exalted peers. Dallas could have and should have given it to him. But the Lakers can’t. Their hands are tied. So Dončić chose to remain in Los Angeles on a standard max, the most they could give him, which will only help in their quest to give him a championship roster.

It’s an enormous swing when you consider the alternative. Had Dončić elected not to extend with the Lakers, at the very least, that would have meant a miserable season of in-house recruiting. Recent NBA history suggests that a swift trade request would have been the likelier outcome. They might have been able to get more for Dončić than they gave, just considering the widely panned deal Dallas ultimately made, but losing such a bright young star so early after acquiring him would have still been a disaster for a Laker team that badly needed a post-James identity. Now they have one that they can rely on for the next several years.

Loser: Clippers, Heat and the rest of the cap-space field

Who was going to pursue Dončić as a 2026 free agent had he elected to explore the market? Well… the short answer is, probably, everyone. Had Dončić expressed interest in literally any other team, that team likely would have been prepared to take the necessary steps to acquire him. Take San Antonio, the team Laker critics (myself included!) most frequently raised as a free agency alternative. The Spurs are in Texas, a state Dončić is obviously familiar with. They have Victor Wembanyama as a running mate. There’s just the small matter of De’Aaron Fox, expected to sign his own extension shortly, taking up their cap space. The Spurs are happy to have him. They traded for him for a reason. If Dončić was interested in playing for them, they’d still re-trade Fox to create the needed space without hesitation.

You could say the same about any number of other high-level teams, but the two obvious, destination markets with the ability to create significant cap space next summer are the Clippers and Heat. Both have lured MVP-caliber free agents in the past. Both appear to have prioritized the flexibility to do so again. But both will now have to wait a little bit longer to try to do so. Dončić is now off of the market. Fellow 2026 free agency candidate Jaren Jackson Jr. already re-signed with Memphis as well, and Fox is also obviously expected to extend with the Spurs. That leaves James (more on him shortly!) and Trae Young as the biggest names slated to become available next offseason. Not bad. Not Luka.

Winner: A star to be named later

We know how the Lakers operate. Step 1 is to get the first star. Step 2 is to use that first star to lure the second, the Anthony Davis to Dončić’s LeBron James. The Lakers had to divide Step 1 into two parts this time around. After all, they weren’t going to be able to recruit a co-star for Dončić if that player had any fear whatsoever about Dončić ultimately leaving the Lakers. So they had to get him, wait six months, and then secure his signature before the hunt for star No. 2 could begin in earnest.

It will likely be a little while before they actually get that player. There are two key points on the calendar to watch here. Next offseason, they go from having one tradable first-round pick to three, as their 2033 first-round pick opens up once the calendar flips and their 2026 pick becomes tradable once it’s made. At that point, they can go into the trade market in earnest. A year later, in 2027, Giannis Antetokounmpo and Nikola Jokić are currently slated to become free agents. Either or both could extend before then, but the Lakers, for the time being, are keeping their cap space in case they get the chance to pursue either.

We don’t know who Dončić’s co-star will be. We just know he exists out there somewhere. James had Davis. O’Neal and Bryant had each other, and when O’Neal got moved, Pau Gasol eventually replaced him. Abdul-Jabbar had Johnson. West had Baylor and later Wilt Chamberlain. Laker star tandems come in two. The first one is now locked down. The second is presumably coming. And if the success those previous tandems had is any indication, this hypothetical second star will compete for quite a few championships in Los Angeles.

Loser: LeBron James

If a young LeBron James had been in Dončić’s shoes, there is a good chance he would not have signed this extension. James frequently signed short-term deals in his prime in order to maintain flexibility. When he wasn’t happy with the direction of a team he was playing for, he left it. The Lakers just lost in the first round. The James playbook, where he is still as young and valuable as Dončić, likely would have been to refuse to re-sign in an effort to convince the Lakers to trade future draft capital and hand out long-term deals for a win-now push.

Obviously, Dončić is not James. He is giving the Lakers trust that a younger James may not have because he understands he has a long runway with which to compete for championships. But James, obviously, does not. He wants to win here and now, and he is seemingly frustrated that the Lakers do not share his sense of urgency.

Had Dončić acted as we suspect James might have, James might have gotten what he’d wanted. If Dončić had expressed skepticism with the plan the Lakers presented him with, they may have had no choice but to throw caution to the wind, start trading draft picks, and desperately hope that would be enough to convince him to re-sign. Doing so might have increased Dončić’s championship odds this season, and by extension, James’ as well, but it would have cost his team long-term flexibility. That doesn’t matter to James. Clearly, it does to Dončić, so any hope James might have had of his younger teammate exerting leverage he no longer has is seemingly now gone with this extension.