The Houston Rockets just pulled off one of the most talked-about moves in NBA Free Agency — and it’s not just because of the $122 million price tag.
Star forward Jabari Smith Jr. inked a five-year rookie-scale extension that appears straightforward at first glance. But a closer look reveals a surprising twist in the deal’s structure: it starts at $23.64 million, dips to $21.75 million in Year 2, and then climbs sharply to $27.43 million by the end of the contract.
That unusual arc is raising eyebrows — and for good reason.
“It’s a non-traditional salary arc,” as reported by The Athletic, one that could “pay big dividends for Houston down the road.”
Why the sudden drop in Year 2?
That’s where Houston’s front office gets clever. The 2027–28 season, when Smith takes a temporary pay cut, is shaping up to be a cap-crunching moment. That’s expected to be the second year of Kevin Durant’s rumored contract — should he stay in Houston — and the first year of Amen Thompson’s rookie extension.
By reducing Smith’s salary just when the cap tightens, Houston gives itself a strategic cushion to manage big contracts without tripping into tax territory.
And this isn’t the first time they’ve played the long game.
Just recently, the Rockets signed veteran Dorian Finney-Smith to a four-year deal, but only the first two years are fully guaranteed. It’s another smart, flexible move designed to balance experience with rising talent.
Since being drafted No. 3 overall in 2022, Smith has evolved into a key two-way player and foundational piece of Houston’s rebuild. Locking him in now shows confidence — and caution.
In today’s NBA, managing the cap is just as important as collecting stars.
“The Rockets are proving they can handle both,” noted one insider, “making them one of the teams to watch this NBA Free Agency.”
