Luis Severino and the Yankees agreed to a four-year, $40 million contract extension to avoid arbitration and cover his remaining years of team control, SNY.tv's Andy Martino confirmed.
Severino, whose contract also includes a fifth-year option, will receive a $2 million signing bonus and earn $4 million in salary in 2019. He will make $10 million in 2020, $10.25 million in 2021 and $11 million in 2022.
He also has a $15 million club option that covers his first year of free agency in 2023. The Yankees could buy that out for $2.75 million, which is included in the guaranteed money, meaning Severino's contract could max out at $52.25 million.
Heading into arbitration, the 24-year-old Severino initially filed for a $5.25 million salary in 2019, while New York countered at $4.4 million.
Severino went 19-8 with a 3.39 ERA in 32 starts with the Yankees last season, but his stats were essentially split between two halves.
Through his first 18 starts of the year, he went 13-2 with a dominant 1.98 ERA. Afterward, however, his production fell off, going 6-6 with a 5.67 ERA over his last 14 starts of the year.
"It was tough," Severino recently said about his second half. "I had a great first half and then all that happened. I just struggled a little bit. I know the pitcher I am. I know I'll come back and pitch well again."
Severino made his Yankees debut as a 21-year-old in 2015 and has gone 41-25 with a 3.51 ERA.
After a disastrous 2016 season in which he was bumped from the rotation and demoted to the minors, he rebounded in 2017 to go 14-6 with a 2.98 ERA, finishing third in the American League Cy Young voting.