OWINGS MILLS, Md. — The Baltimore Ravens have restructured quarterback Lamar Jackson‘s contract to create nearly $40 million in salary cap space, a source told ESPN’s Adam Schefter on Wednesday.
The Ravens are still working on a contract extension with Jackson, a two-time NFL MVP who has two years left on his current deal. Without an extension, Jackson can be an unrestricted free agent after the 2027 season.
Baltimore needed the cap room to fit Trey Hendrickson‘s four-year, $112 million contract under the salary cap by the start of the new league year at 4 p.m. ET Wednesday. The Ravens reached an agreement with Hendrickson, a four-time Pro Bowl pass rusher, on Wednesday, less than 24 hours after backing out of a trade for Maxx Crosby.
By triggering a clause that automatically restructures Jackson’s deal, Baltimore reduced his 2026 cap figure of $74.5 million, which was the second highest in the NFL entering March, to $34.54 million. This freed up $39.96 million in cap space.
The restructuring increases Jackson’s cap number in 2027 from $74.5 million to $84.49 million, which would be the third highest in the league.
At the end of the 2025 season, Ravens owner Steve Bisciotti spoke with Jackson about the urgency to get a contract extension completed before the start of free agency. Baltimore wanted to lower Jackson’s cap number and extend his deal beyond 2027.
Without a new deal by Wednesday, the Ravens had to restructure Jackson’s current contract, which converted most of his $51.25 million salary into a bonus and spread the cap hit over four years (which includes two void years).
Jackson, 29, is one of the most dynamic playmakers ever at quarterback, beating teams with his arm and his legs. He is tied with Aaron Rodgers for the best passer rating (102.2) in NFL history and holds the record for most career rushing yards by a quarterback (6,522).
The 2025 season was a disappointing one for Jackson and the Ravens, who entered as Super Bowl favorites and failed to make the playoffs. Jackson missed four games due to a hamstring injury and a back contusion and recorded his first losing season as an NFL starter (6-7). Struggling with consistency through an injury-filled season, he threw for 2,549 yards and 21 touchdowns — both of which were his fewest in three seasons — and recorded a career-low 349 rushing yards.
Jackson enters the 2026 season with a new head coach in Jesse Minter and a new offensive coordinator in Declan Doyle. In eight NFL seasons, Jackson has led Baltimore to the postseason five times, including two No. 1 seeds in the AFC, and won four AFC North titles.
