Falcons to Create Significant Salary Cap Space with Latest Contract Move

FLOWERY BRANCH – The Atlanta Falcons have reportedly cleared up $9 million in additional cap space after a restructure of cornerback A.J. Terrell Jr.’s contract. Ian Cunningham will convert $12 million of salary to a signing bonus by shifting his salary to $3 million for 2026. The money will spread to the rest of Terrell’s deal, increasing his cap hit by $3 million in each subsequent year.

Terrell signed a four-year, $81 million contract extension with the Falcons in August of 2024. The Falcons’ defender received $65.844 million in guarantees, of which $42.3 million was guaranteed at signing. He is signed with the team through 2028, but carries a $5.5 million void year in 2029.

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The Falcons have leaned heavily on Terrell since selecting him No. 16 overall in the 2020 NFL Draft. In the time since, the cornerback has started 93 of a possible 101 games. He has accounted for 381 tackles, 14 tackles for loss, 61 passes defended, and six interceptions. Terrell has made one All-Pro team (2022).

He was outstanding for Atlanta in coverage last season. According to NextGenStats, Terrell allowed receivers to get three or more yards of separation on just 17.7% of targets, the 3rd-lowest rate among defensive backs. Terrell's tight coverage has helped him to allow 0.7 yards per snap, the 9th-fewest among outside cornerbacks with at least 250 coverage snaps this season.

He was targeted 65 times over the course of the season, allowing 35 receptions for 396 yards and three touchdowns. The quarterback rating allowed (87.7) was the second-lowest mark of his career.

This contract move will open up some breathing room for Cunningham and the Falcons’ front office as free agency negotiations continue over the next several weeks.

The Falcons are seven days into this period for the 2026 offseason, but have been relatively conservative with their moves. They have not made several high-priced additions thus far, with their most lucrative contract going to wide receiver Jahan Dotson on a two-year deal worth up to $17 million.

Over The Cap projects the Falcons to get a fifth- and two sixth-round picks for losing Kaden Elliss, Dee Alford, and Tyler Allgeier. Cunningham probably doesn't want to make a move in the next few days to cancel those out. He said at the NFL Combine that they'd never have just five draft picks again, and it looks like he meant it.

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