Manchester City have reached a new level of "commercial maturity" after announcing club record revenues of £391.8m for last season, according to chairman Khaldoon Al Mubarak.
Despite their worst Premier League campaign since 2010, City scored a second consecutive year of profitability as the bottom line almost doubled from £10.5m to £20.5m.
The club's 11.4 per cent rise in revenue to £391.8m puts them ahead of Arsenal, who announced revenues of £353.6m last season, but some way behind local rivals Manchester United who became the first club to break £500m in turnover.
Yet City, who remain debt free and enjoy a healthy wages to turnover ratio of 50 per cent that only Burnley could better a season earlier, believe they are now entering "a critical new phase" under new manager Pep Guardiola, propelled by the state-of-the-art football academy and investment from China.
"Importantly, Manchester City has now reached a level of sporting and commercial maturity that allows one to feed the other," said Al Mubarak.
"That is the vision for success and sustainability that we have been working towards since 2008 under the guidance of HH Sheikh Mansour bin Zayed Al Nahyan, and its achievement represents another important breakthrough in the long-term development of the club."
He added: "I believe the 2016/17 season represents the beginning of a critical new phase in the evolution of Manchester City.
"We know that we have the playing, coaching and off-field capabilities at our disposal to achieve great things in English and European football in the years ahead."
Matchday income rose last season by £9.2m to £52.5m after the club added a 6,000-seat third tier to the Etihad Stadium's south stand while the team reached the semi-finals of the Champions League for the first time.
Broadcast revenue jumped from £135.5m to £161.4m, again thanks to the impressive Champions League run, while commercial revenue rose more narrowly from £173m to £177.9m.