Sphere Entertainment Co.
For the period ended Jun 30, 2025. Filed Aug 11, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2025 · Filed Aug 11, 2025
SPHR$120.02+6.8%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-05-08.
0001795250-25-000029
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-08-11.
0001628280-25-039390
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 210 previous paragraphs and 227 current paragraphs.
113 unchanged; 61 reworded; 52 added; 33 removed; 3 previous and 1 current paragraphs rearranged.
Tables are not compared: 12 previous and 17 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (52)
Current report
MSG Networks Debt Restructuring
Current report
MSGN Term Loan Facility
Current report
Garden Corp.” and, collectively with MSG Networks, MSGN Eden and Regional MSGN, the “MSGN Holdings Entities”), and certain subsidiaries of MSGN L.P. entered into a second amended and restated credit agreement (the “A&R MSGN Credit Agreement”) with JPMorgan Chase Bank, N.A., as administrative agent, and the lenders party thereto (the “MSGN Lenders”). Pursuant to the A&R MSGN Credit Agreement, MSGN L.P.’s prior credit facility was replaced with a $210,000 term loan facility (the “MSGN Term Loan Facility”), which matures on December 31, 2029. See Note 10. Credit Facilities and Convertible Notes to the condensed consolidated financial statements included in Part I — Item 1. of this Form 10-Q for a more detailed discussion of the MSGN Term Loan Facility.
Current report
Investor Agreement
Current report
The Company, the MSGN Holdings Entities and MSGN L.P. entered into an investor agreement, pursuant to which, among other matters, (i) the Company made a capital contribution to MSG Networks in an amount equal to $15,000 and (ii) the parties thereto agreed that MSGN L.P. will be a part of the same affiliated group of which the Company is the common parent that files U.S. federal income tax returns on a consolidated basis.
Current report
Limited Partnership Agreement of MSGN L.P.
Current report
The Limited Partnership Agreement of MSGN L.P. was amended to provide for the issuance of contingent interest units (the “Contingent Interest Units”) to the MSGN Lenders. Beginning with the fiscal calendar year-end following the repayment in full of the MSGN Term Loan Facility, the Contingent Interest Units entitle the MSGN Lenders to receive annual payments in an amount equal to 50% of the difference between MSGN L.P.’s balance sheet cash (subject to certain exclusions) and certain minimum cash balances, specified with respect to the applicable measurement date, until the earlier of (i) December 31, 2029 and (ii) payment of $100,000 in the aggregate to the MSGN Lenders. The Contingent Interest Units are also entitled to receive 50% of the proceeds of a merger and/or acquisition event related to MSG Networks and its subsidiaries occurring prior to December 31, 2029, subject to an aggregate cap of $100,000 considered together with the annual payments of excess cash described in the previous sentence.
Current report
Amendments to Media Rights Agreements
Current report
The media rights agreements between subsidiaries of MSG Networks, on the one hand, and New York Knicks, LLC and New York Rangers, LLC, on the other hand, were amended to provide for (among other things):
Current report
•a modification to the annual rights fee to effect a 28% reduction as of January 1, 2025;
Current report
•an elimination of the annual rights fee escalator; and
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•a change to the contract expiration date to the end of the 2028-29 season, subject to a right of first refusal in favor of MSG Networks; and
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•an elimination of the annual rights fee escalator; and
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•a change to the contract expiration date to the end of the 2028-29 season, subject to a right of first refusal in favor of MSG Networks.
Current report
MSG Networks also entered into amendments with certain other professional sports teams that provide for, among other matters, reductions in the annual rights fees payable to such teams.
Current report
Warrants for Common Stock of MSG Networks
Current report
Sphere Abu Dhabi
Current report
On July 25, 2025, Sphere Entertainment Group and DCT Abu Dhabi finalized and entered into a Franchise Agreement, a Joint Development and Partnership Agreement and a Pre-Opening Services Agreement relating to the construction, development and operation of Sphere Abu Dhabi.
Current report
Pursuant to the terms of the Franchise Agreement, Sphere Entertainment Group granted DCT Abu Dhabi the exclusive right to build and operate Sphere Abu Dhabi. Subject to the terms of the Franchise Agreement, DCT Abu Dhabi also has the exclusive right to build and operate additional Sphere venues in the geographic region spanning the Middle East and North Africa (the “Exclusive Region”)
Current report
for a period of at least 10 years after the opening date of Sphere Abu Dhabi, on terms and conditions to be negotiated in good faith and mutually agreed by Sphere Entertainment Group and DCT Abu Dhabi.
Current report
Sphere Entertainment Group has also granted DCT Abu Dhabi licenses for the relevant technology, patents, trademarks, The Sphere Experience content and other ancillary content for the development and operation of Sphere Abu Dhabi. DCT Abu Dhabi’s use of Sphere Entertainment Group’s intellectual property is subject to customary guidelines, restrictions and approvals, as well as quality control procedures.
Current report
In consideration for the grants of the franchise rights and licenses described above, DCT Abu Dhabi has agreed to pay Sphere Entertainment Group a franchise initiation fee and royalties for the use of Sphere Entertainment Group’s intellectual property (including The Sphere Experience content and other creative content), in each case, in accordance with the terms of the Franchise Agreement. A portion of the franchise initiation fee was previously paid to Sphere Entertainment Group and an additional portion of the franchise initiation fee will be paid to Sphere Entertainment Group in connection with the execution of the agreements. The remainder of the franchise initiation fee will be paid in a series of installments in connection with the achievement of specified milestones prior to the opening date of Sphere Abu Dhabi. The royalties will be payable in quarterly installments from and after the opening date of Sphere Abu Dhabi. The intellectual property royalty will be an annual fee based on a specified percentage of Sphere Abu Dhabi’s total revenues (other than total ticket sales for The Sphere Experience content licensed to DCT Abu Dhabi by Sphere Entertainment Group) for that year, subject to a specified minimum annual payment. The Sphere Experience content royalty will be an annual fee based on a specified percentage of total ticket sales for The Sphere Experience content licensed to DCT Abu Dhabi by Sphere Entertainment Group for that year, subject to a specified minimum annual payment. The royalty for ancillary content will be based on an initial annual fee that is increased by a fixed percentage annually. The Franchise Agreement has an initial term of 25 years from the opening of Sphere Abu Dhabi, with up to two 10-year renewal terms at DCT Abu Dhabi’s option.
Current report
Pursuant to the terms of the Pre-Opening Services Agreement, Sphere Entertainment Group will also receive fees in connection with the provision of pre-construction and construction related services to DCT Abu Dhabi. In addition, prior to the opening of Sphere Abu Dhabi, Sphere Entertainment Group and DCT Abu Dhabi expect to enter into an Operational Services Agreement, pursuant to which Sphere Entertainment Group will provide to be agreed upon operational services to DCT Abu Dhabi following the opening of Sphere Abu Dhabi.
Current report
Other Matters:
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On July 4, 2025, President Trump signed into law the reconciliation bill commonly known as the “One Big Beautiful Bill Act” (the “OBBBA”). OBBBA includes a broad range of tax reform provisions affecting businesses, including extending and modifying certain key Tax Cuts & Jobs Act provisions (both domestic and international), expanding certain Inflation Reduction Act incentives, and accelerating the phase-out of other incentives. The Company is currently evaluating the impact of these provisions on the Company’s consolidated financial statements.
Current report
Impairments and other losses, net
Current report
During the three and six months ended June 30, 2025, the Company recognized impairments and other losses, net of $3,641 and $4,162 respectively. The recorded losses were primarily due to $3,741 from the sale of the Company’s land in Stratford, London. During the three and six months ended June 30, 2024, the Company recognized a loss resulting from the purchase accounting related to the acquisition of Holoplot GmbH (“Holoplot”) in April 2024, which was a previously held equity method investment.
Current report
Gain on Debt Extinguishment
Current report
For the three and six months ended June 30, 2025, the Company recorded a gain on extinguishment of debt of$346,092, reflecting the net impact of the restructuring of the the Prior MSGN Credit Facilities (as defined below). Refer to Note 10. Credit Facilities and Convertible Notes to the condensed consolidated financial statements included in “—Item 1. Financial Statements” of this Form 10-Q for additional information.
Current report
Income tax expense
Current report
For US income tax purposes, the Company is required to recognize cancellation of debt income (“CODI”) on the difference between the face value of debt exchanged and the fair market value of new debt issued. On June 27, 2025, in connection with the execution of the A&R MSGN Credit Agreement, the Company recognized CODI of approximately $614 million, all of which was excluded from taxable income under the insolvency provisions of Internal Revenue Code Section 108.
Current report
Income tax expense for the three and six months ended June 30, 2025 of $121,939 and $101,616, respectively, reflects an effective tax rate of 45% and 59%, respectively. The effective tax rate is higher than statutory federal tax rate of 21% primarily due to discrete income tax expense related to the impact of CODI, partially offset by discrete income tax benefits from the reversal of the US GAAP gain on extinguishment of debt and income tax benefits due to a decrease in the valuation allowance and state and local taxes.
Current report
For the six months ended June 30, 2025, the decrease in revenues for The Sphere Experience primarily reflects a decrease in the number of overall performances and lower average per-show revenues as compared to the prior year period. In the current year period, The Sphere Experience included 364 performances of Postcard From Earth and 51 performances of V-U2 An Immersive Concert Film (with combined average revenues per performance of approximately $342), as compared to 465 performances of Postcard from Earth (with average revenues per performance of approximately $376) in the prior year period.
Current report
For the three months ended June 30, 2025, selling, general, and administrative expenses decreased $5,720 as compared to the prior year period, primarily due to lower employee compensation and related benefits of $8,656 and lower professional fees of $1,899, partially offset by other cost increases.
Current report
For the six months ended June 30, 2025, selling, general, and administrative expenses decreased $18,292 as compared to the prior year period, primarily due to lower employee compensation and related benefits of $13,157 and lower professional fees of $11,572, partially offset by other cost increases.
Current report
Impairments and other losses, net
Current report
During the three and six months ended June 30, 2025, the Company recognized a loss resulting from the sale of its land in Stratford, London. During the three and six months ended June 30, 2024, the Company recognized a loss resulting from the purchase accounting related to the acquisition of Holoplot in April 2024, which was a previously held equity method investment.
Current report
For the three months ended June 30, 2025, adjusted operating income improved $30,422 as compared to the prior year period, primarily due to an increase in revenue and a decrease in selling, general and administrative expenses, partially offset by an increase in direct operating expenses. For the six months ended June 30, 2025, adjusted operating income improved $30,660 as compared to the prior year period, primarily due to a decrease in selling, general and administrative expenses and an increase in revenue, partially offset by an increase in direct operating expenses.
Current report
For the three months ended June 30, 2025, selling, general and administrative expenses increased $11,703 as compared to the prior year period, primarily due to (i) higher advertising and marketing costs of $6,030 and (ii) higher professional fees of $5,500, mainly due to the absence of litigation-related insurance recoveries recognized as an offset to professional fees in the prior year period. For thesix months ended June 30, 2025, selling, general and administrative expenses increased $15,395, primarily due to (i) higher professional fees of $9,895, mainly reflecting the absence of litigation-related insurance recoveries recognized as an offset to professional fees in the prior year period andthe impact of costs associated with pursuing a work-out of the Prior MSGN Credit Facilities with its syndicate of lenders in the current year period, and (ii) higher advertising and marketing costs of $8,859, partially offset by (iii) lower employee compensation and related benefits of $2,269.
Current report
For the three months ended June 30, 2025, operating income increased by $136 as compared to the prior year period, primarily due to the decrease in direct operating expenses, mostly offset by the decrease in revenues and higher selling, general and administrative expenses.
Showing the first 40 of 52 passages. Open the source sections for the rest.
Removed paragraphs (33)
Previous report
Rangers, LLC (collectively, the “Teams”), each an indirect subsidiary of MSG Sports, respectively (the “Proposed Transactions”).
Previous report
The Transaction Support Agreement is among MSG Networks Inc., MSGN L.P., certain of MSG Networks Inc.’s other subsidiaries (together with MSG Networks Inc. and MSGN Holdings, L.P.’s (“MSGN L.P.”), the “MSGN Parties”), the lenders under MSGN L.P.’s existing credit facilities identified therein (the “Consenting Lenders”), the Teams and the Company (together with the Consenting Lenders and the Teams, the “Consenting Stakeholders”), pursuant to which the Consenting Stakeholders agreed to support the Proposed Transactions on the terms set forth in the Transaction Support Agreement and in the term sheet attached thereto as Exhibit A (the “Term Sheet”).
Previous report
The Term Sheet sets forth the principal terms of the Transactions that will be consummated upon the execution of definitive documents containing terms consistent with those set forth in the Term Sheet and such other terms as agreed to by the MSGN Parties and the Consenting Stakeholders. The Term Sheet contemplates, among other things:
Previous report
•that the Company will make a $15 million capital contribution to MSGN L.P.;
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•that MSGN L.P.’s existing credit facilities will be replaced with a new $210 million term loan facility (the “New Term Loan Facility”), which will mature in December 2029, have a fixed amortization of $10 million per quarter and require 100% of the MSGN L.P.’s excess free cash flow generated through operating activities to be used to repay the principal amount outstanding under the New Term Loan Facility until fully repaid, subject to limited exceptions set forth in the Term Sheet and otherwise to be agreed;
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•that outstanding borrowings under the New Term Loan Facility will bear interest at a rate per annum equal to SOFR plus 5.00%;
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•that MSGN L.P. will make a minimum cash payment of $80 million (including the $15 million capital contribution from the Company to MSGN L.P.) to the Consenting Lenders upon the closing of the New Term Loan Facility;
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•amendments to media rights agreements, effective as of January 1, 2025, as follows:
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▪a reduction of 28% in the annual rights fee;
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•the entry into a mutual release agreement by and among the parties to the Transaction Support Agreement providing for a customary mutual release of claims among the parties thereto.
Previous report
The Transaction Support Agreement contains certain covenants on the part of each of the Consenting Stakeholders, including, among other things, (i) commitments to support, and to use commercially reasonable efforts and timely take all reasonable actions necessary to support, implement and consummate the Transactions and (ii) commitments to negotiate in good faith and use commercially reasonable efforts to execute and implement definitive documents that are consistent with the Transaction Support Agreement.
Previous report
Pursuant to the Transaction Support Agreement, the Consenting Stakeholders have agreed to implement the Transactions by June 27, 2025, which date may be extended or waived in writing by each of the Consenting Stakeholders and MSG Networks. The Company expects to record a non-cash gain in connection with the completion of the refinancing transaction contemplated by the Transaction
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Support Agreement. Such refinancing would also result in adverse tax consequences to the Company, including the elimination of approximately half of the Company’s net operating losses as a result of the debt extinguishment.
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Income tax benefit
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For the three months ended March 31, 2025, selling, general, and administrative expenses decreased $12,572 as compared to the prior year period primarily due to a decrease in professional fees of $9,673 and lower employee compensation and related benefits of $4,232.
Previous report
For the three months ended March 31, 2025, adjusted operating income improved $238 as compared to the prior year period, primarily due to a decrease in selling, general and administrative expenses (excluding share-based compensation expense, amortization for capitalized cloud computing arrangement costs, and merger, debt work-out, and acquisition related costs, net of insurance recoveries), partially offset by a decrease in revenues and an increase in direct operating expenses.
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For the three months ended March 31, 2025, other programming and production content costs decreased by $1,438, primarily due to lower costs related to MSG+.
Previous report
For the three months ended March 31, 2025, selling, general and administrative expenses of $17,865 increased $3,692 as compared to the prior year period, primarily due to higher professional fees of $4,400, mainly reflecting professional fees recorded in the current year period associated with pursuing a work-out of the MSG Networks Credit Facilities with its syndicate of lenders, partially offset by other cost decreases.
Previous report
The principal balance of the Company’s total debt outstanding as of March 31, 2025 was $1,337,875, including $804,125 of debt under the MSGN Term Loan Facility (as defined below) which matured without repayment on October 11, 2024 (the “Maturity Date”), and is classified as short-term on the condensed consolidated balance sheets. In anticipation of the Maturity Date, MSG Networks began to pursue the refinancing of the MSGN Term Loan Facility through a work-out with its syndicate of lenders. An event of default occurred under the MSGN Credit Agreement due to MSGN L.P.’s failure to make payment on the outstanding principal amount. On the Maturity Date, and on October 11, 2024, MSGN L.P. and the MSGN Guarantors (as defined below) entered into a Forbearance Agreement (as amended or supplemented from time to time, the “Forbearance Agreement”) with JPMorgan Chase Bank, N.A., as administrative agent, and certain lenders (the “Supporting Lenders”) under the MSG Networks Credit Facilities. Subject to the terms of the Forbearance Agreement, the Supporting Lenders agreed to forbear, during the forbearance period, from exercising certain of their available remedies under the MSGN Credit Agreement, including with respect to or arising out of MSGN L.P.’s failure to make payment on the outstanding principal amount under the MSGN Term Loan Facility on the Maturity Date. The Forbearance Agreement was superseded by the Transaction Support Agreement and the forbearance period expired on April 24, 2025.
Previous report
Under the Transaction Support Agreement, the Consenting Lenders have agreed to forbear from exercising certain of their available remedies under the MSGN Credit Agreement with respect to or arising out of (i) MSGN L.P.’s failure to make payment on the outstanding principal amount of the MSGN Term Loan Facility on the Maturity Date, (ii) the failure to deliver the budget of the MSG Networks Inc. and its subsidiaries for the following year by March 31, 2025 (which, if not cured by April 30, 2025, would have resulted in an event of default), (iii) a failure to maintain a total leverage ratio of less than 5.50:1.00 for the MSGN Holdings Entities (as defined under Note 10. Credit Facilities and Convertible Notes) and MSGN L.P. and its restricted subsidiaries on a consolidated basis and (iv) a failure to maintain an interest coverage ratio of not less than 2.00:1.00 for the MSGN Holdings Entities and MSGN L.P. and its restricted subsidiaries on a consolidated basis, in each case, until the earlier of the date on which the termination of the Transaction Support Agreement is effective with respect to the Consenting Lenders and the date on which the Proposed Transactions are consummated.
Previous report
As disclosed in Note 10, Credit Facilities and Convertible Notes to the condensed consolidated financial statements, all of the outstanding principal amount under the MSG Networks Credit Facilities is guaranteed by the MSGN Guarantors and secured by the MSGN Collateral (each as defined below). In the event MSG Networks is unable to successfully refinance or achieve a work-out of the MSGN Term Loan Facility as contemplated by the Transaction Support Agreement, the lenders could exercise their remedies under the MSGN Credit Agreement, which would include, but not be limited to, foreclosing on the MSGN Collateral. If MSG Networks is not able to achieve a refinancing or work-out of its indebtedness (including as contemplated by the Transaction Support Agreement), the Company believes it is probable that MSG Networks Inc. and/or its subsidiaries would seek bankruptcy protection or the lenders would foreclose on the MSGN Collateral.
Previous report
In the event of an MSG Networks bankruptcy, the MSG Networks entities whose operations represent the entirety of the Company’s MSG Networks segment, would be deconsolidated from the Company’s consolidated financial statements effective as of the bankruptcy filing date. See “Part I —Item 1A. Risk Factors — Risks Related to Our MSG Networks Business —If MSG Networks Is Unable to Achieve a Refinancing or Work-Out of the MSGN Term Loan Facility, the Lenders Could Foreclose Upon the MSG Networks Business.” In the event of bankruptcy proceedings, MSG Networks Inc. and/or its subsidiaries (and in certain circumstances, its creditors) may elect to investigate and potentially assert claims against the Company and certain of its directors and officers, including for potential claims related to fraudulent transfers, unlawful distributions and payments, veil piercing, alter ego theories, breaches of contracts and unjust enrichment. If such claims are brought, the claimants could seek, among other relief, avoidance of alleged fraudulent transfers and/or unlawful distributions, and monetary damages. In addition, the Company’s stockholders may assert claims against the Company and its directors and officers for breaches of fiduciary duties relating to the Company’s ownership of MSG Networks Inc. and its subsidiaries. Further, the Company would incur legal fees and other expenses in connection with defending any claims. The ultimate court-approved structure and organization of MSG Networks post-bankruptcy could also result in adverse tax consequences to the Company, including the loss of Net Operating Losses (“NOLs”) as a result of any debt extinguishment. Sphere Entertainment Co., Sphere Entertainment Group and the subsidiaries of Sphere Entertainment Group (collectively, the “Non-Credit Parties”) are not legally obligated to fund the outstanding amounts under the MSG Networks Credit Facilities, nor are the assets of the Non-Credit Parties pledged as security under the MSG Networks Credit Facilities. In the event of an exercise of post-default rights and remedies, the Company believes the lenders would have no remedies or recourse against the Non-Credit Parties pursuant to the terms of the MSGN Credit Agreement. In the absence of a refinancing or the achievement of a work-out, management believes it is probable that MSG Networks Inc. and/or its subsidiaries will seek bankruptcy protection or the lenders would foreclose on the MSGN Collateral. While this condition raises substantial doubt about the Company’s ability to continue as a going concern, for the reasons stated above, we have concluded that our plans have effectively alleviated substantial doubt about the Company’s ability to continue as a going concern as of the issuance date.
Previous report
In October 2024, the Company and DCT Abu Dhabi announced that they will work together to bring the world’s second Sphere to Abu Dhabi, United Arab Emirates. Under the terms of the partnership, which is subject to finalization of definitive agreements, the Company receives a franchise initiation fee (a portion of which has been received) in connection with providing DCT Abu Dhabi the right to build the venue and utilize our proprietary designs, technology, and intellectual property. Construction will be funded by DCT Abu Dhabi, with the Company’s team of experts providing services related to development, construction, and pre-opening of the venue. Following the venue’s opening, the Company plans to maintain ongoing arrangements with DCT Abu Dhabi that are expected to include annual fees for creative and artistic content licensed by the Company, such as Sphere Experiences; use of Sphere’s brand, patents, proprietary technology, and intellectual property; and operational services related to venue operations and technology, as well as commercial and strategic advisory support.
Previous report
MSG Networks Credit Facilities
Previous report
The MSGN Credit Agreement matured on October 11, 2024. On the Maturity Date, MSGN L.P. failed to repay the principal amount of $829,125 outstanding under the MSGN Term Loan Facility and an event of default occurred pursuant to the MSGN Credit Agreement. On the Maturity Date, there were no borrowings or letters of credit issued and outstanding under the MSGN Revolving Credit Facility and all revolving credit commitments under the MSGN Revolving Credit Facility terminated.
Previous report
On October 11, 2024, MSGN L.P. entered into the Forbearance Agreement. Subject to the terms of the Forbearance Agreement, the Supporting Lenders agreed to forbear, during the forbearance period, from exercising certain of their available remedies under the MSGN Credit Agreement with respect to or arising out of MSGN L.P.’s failure to make payment on the outstanding principal amount under the MSGN Term Loan Facility on the Maturity Date. The Forbearance Agreement was superseded by the Transaction Support Agreement and the forbearance period expired on April 24, 2025.
Previous report
Under the Transaction Support Agreement, the Consenting Lenders have agreed to forbear from exercising certain of their available remedies under the MSGN Credit Agreement with respect to or arising out of (i) MSGN L.P.’s failure to make payment on the outstanding principal amount of the MSGN Term Loan Facility on the Maturity Date, (ii) the failure to deliver the budget of MSG Networks Inc. and its subsidiaries for the following year by March 31, 2025 (which, if not cured by April 30, 2025, would have resulted in an event of default), (iii) a failure to maintain a total leverage ratio of less than 5.50:1.00 for the MSGN Holdings Entities and MSGN L.P. and its restricted subsidiaries on a consolidated basis and (iv) a failure to maintain an interest coverage ratio of not less than 2.00:1.00 for the MSGN Holdings Entities and MSGN L.P. and its restricted subsidiaries on a consolidated basis, in each case, until the earlier of the date on which the termination of the Transaction Support Agreement is effective with respect to the Consenting Lenders and the date on which the Proposed Transactions are consummated.
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Interest Rates. After the Maturity Date, borrowings under the MSGN Credit Agreement bear interest at the default rate consisting of (i) adjusted Term SOFR (i.e., Term SOFR plus 0.10%) plus an additional rate ranging from 1.25% to 2.25% per annum (determined based on a total leverage ratio), plus (ii) the additional rate of 2.00% per annum. The default rate on the MSGN Term Loan Facility as of March 31, 2025 was 8.42%.
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Covenants. The MSGN Credit Agreement generally requires the MSGN Holdings Entities and MSGN L.P. and its restricted subsidiaries on a consolidated basis to comply with a maximum total leverage ratio of 5.50:1.00 and a minimum interest coverage ratio of 2.00:1.00. The MSGN Holdings Entities and MSGN L.P. and its restricted subsidiaries were not in compliance with the financial covenants on a consolidated basis as of March 31, 2025. Under the Transaction Support Agreement, the Consenting Lenders have agreed to forbear from exercising their available remedies under the MSGN Credit Agreement with respect to or arising out of the failure to maintain compliance with the maximum total leverage ratio and the minimum interest coverage ratio described above until the earlier of the date on which the termination of the Transaction Support Agreement is effective with respect to the Consenting Lenders and the date on which the Proposed Transactions are consummated.
Previous report
During the three months ended March 31, 2025, the Company did not have any material changes in its non-cancelable contractual obligations (other than activities in the ordinary course of business).
Previous report
Net cash provided by operating activities for the three months ended March 31, 2025 decreased by $94,670 to $6,348 as compared to the three months ended March 31, 2024.
Previous report
The changes in net cash provided by assets and liabilities were primarily driven by (i) a decrease in net cash provided by operating activities related to Accounts receivable, net of $8,988, primarily due to the timing of cash collections from revenue generating activities; (ii) an increase in net cash used for Prepaid expenses and other current and non-current assets of $42,315, primarily for the development of the Company’s original immersive productions content and other related assets, which are capitalized within Other non-current assets in the accompanying consolidated balance sheet; (iii) a decrease in net cash used for operating activities related to
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Net cash used in investing activities for the three months ended March 31, 2025 decreased by $3,643 as compared to the prior year period, primarily due a decrease in capital expenditures for Sphere in Las Vegas after the opening on September 29, 2023.
Reworded paragraphs (61)
Previous wording
This Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In this MD&A, there are statements concerning the future operating and future financial performance of Sphere Entertainment Co. and its direct and indirect subsidiaries (collectively, “we,” “us,” “our,” “Sphere Entertainment,” or the “Company”), including (i) the ability of MSG Networks to refinance or work-out its indebtedness and the Company’s expectation that if MSG Networks is not able to achieve a work-out, it is probable that MSG Networks Inc. and/or its subsidiaries (“MSG Networks”) would seek bankruptcy protection, (ii) the success of Sphere and The Sphere Experience and development of newimmersive productions content, (iii) our plans to bring Sphere to Abu Dhabi, United Arab Emirates under a franchise model, (iv) our ability to reduce or defer certain discretionary capital projects, (v) our plans for possible additional debt financing and (vi) our execution of the strategy for and the success of MSG Networks’ direct-to-consumer (“DTC”) and authenticated streaming offering, MSG+ (which is now included in the Gotham Sports streaming product). Words such as “expects,” “anticipates,” “believes,” “estimates,” “may,” “will,” “should,” “could,” “potential,” “continue,” “intends,” “plans,” and similar words and terms used in the discussion of future operating and future financial performance identify forward-looking statements. Investors are cautioned that such forward-looking statements are not guarantees of future performance, results or events and involve risks and uncertainties and that actual results or developments may differ materially from the forward-looking statements as a result of various factors. Factors that may cause such differences to occur include, but are not limited to:
Current wording
This Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. In this MD&A, there are statements concerning the future operating and future financial performance of Sphere Entertainment Co. and its direct and indirect subsidiaries (collectively, “we,” “us,” “our,” “Sphere Entertainment,” or the “Company”), including (i) the success of Sphere and The Sphere Experience and development of newimmersive productions content, (ii) our plans to bring Sphere to Abu Dhabi, United Arab Emirates under a franchise model, (iii) our ability to reduce or defer certain discretionary capital projects, (iv) our plans for possible additional debt financing and (v) MSG Networks subscriber declines. Words such as “expects,” “anticipates,” “believes,” “estimates,” “may,” “will,” “should,” “could,” “potential,” “continue,” “intends,” “plans,” and similar words and terms used in the discussion of future operating and future financial performance identify forward-looking statements. Investors are cautioned that such forward-looking statements are not guarantees of future performance, results or events and involve risks and uncertainties and that actual results or developments may differ materially from the forward-looking statements as a result of various factors. Factors that may cause such differences to occur include, but are not limited to:
Previous wording
•the substantial amount of debt we have incurred, the ability of our subsidiaries to make payments on, or repay or refinance, such debt under their respective credit facilities (including MSG Networks’ ability to complete the Proposed Transactions contemplated by the Transaction Support Agreement (as defined below)), and, if unsuccessful, the implications thereof, including the Company’s belief that it would then be probable that MSG Networks Inc. and/or its subsidiaries would seek bankruptcy protection or the lenders would foreclose on the MSGN Collateral (as defined below), the implications of a default under those credit facilities (including the existing events of default under the MSGN Credit Agreement (as defined below)) and the terms of the Transaction Support Agreement and any other agreements entered into in connection therewith;
Current wording
•the substantial amount of debt we have incurred, the ability of our subsidiaries to make payments on, or repay or refinance, such debt under their respective credit facilities (including MSG Networks’ ability to make its quarterly principal amortization payments pursuant to its term loan facility), and, if unsuccessful, the implications thereof;
Previous wording
•our ability to successfully provide design, construction and pre- and post-opening services to Sphere partners, including DCT Abu Dhabi, as well as our ability to construct, finance and operate new Sphere venues, and the investments, costs and timing associated with those efforts, including obtaining financing, the impact of inflation and tariffs and any construction delays and/or cost overruns;
Current wording
•our ability to successfully provide design, construction and pre- and post-opening services to Sphere partners, including the Department of Culture and Tourism – Abu Dhabi (“DCT Abu Dhabi”) in connection with Sphere Abu Dhabi TM, as well as our ability to construct, finance and operate new Sphere venues, and the investments, costs and timing associated with those efforts, including obtaining financing, the impact of inflation and tariffs and any construction delays and/or cost overruns;
Previous wording
•our ability to finalize definitive agreements for a Sphere venue in Abu Dhabi with the Department of Culture and Tourism – Abu Dhabi (“DCT Abu Dhabi”) and DCT Abu Dhabi’s ability to complete construction of that Sphere venue;
Current wording
•DCT Abu Dhabi’s ability to complete construction of Sphere Abu Dhabi;
Previous wording
•our ability to successfully execute MSG Networks’ strategy for its DTC and authenticated streaming offering, MSG+ (which is now included in the Gotham Sports streaming product), the success of such offering and our ability to adapt to new content distribution platforms or changes in consumer behavior resulting from emerging technologies;
Current wording
•our ability to successfully execute MSG Networks’ strategy for its DTC and authenticated streaming offering, MSG+ (which is included in the Gotham Sports streaming product), the success of such offering and our ability to adapt to new content distribution platforms or changes in consumer behavior resulting from emerging technologies;
Previous wording
This MD&A is provided as a supplement to, and should be read in conjunction with, the Company’s unaudited condensed consolidated financial statements (the “financial statements”) and accompanying notes thereto included in “— Item 1. Financial Statements” of this Form 10-Q, as well as the Company’s audited consolidated financial statements and notes thereto as of and for the period ended December 31, 2024 (the “Audited Consolidated Financial Statements”) included in the Form 10-KT, to help provide an understanding of our financial condition, changes in financial condition and results of operations.
Current wording
This MD&A is provided as a supplement to, and should be read in conjunction with, the Company’s unaudited condensed consolidated financial statements (the “financial statements”) and accompanying notes thereto included in “— Item 1. Financial Statements” of this Form 10-Q, as well as the Company’s audited consolidated financial statements and notes thereto as of and for the period ended December 31, 2024 (the “Audited Consolidated Financial Statements”) included in the Form 10-KT, to help provide an understanding of our financial condition, changes in financial condition and results of operations. The Company conducts substantially all of its business activities presented in the financial statements through Sphere Entertainment Group, LLC (“Sphere Entertainment Group”) and MSG Networks Inc. (together with its subsidiaries, “MSG Networks”), and each of their direct and indirect subsidiaries.
Previous wording
The Company is a premier live entertainment and media company comprised of two reportable segments, Sphere and MSG Networks. Sphere is a next-generation entertainment medium, and MSG Networks operates two regional sports and entertainment networks, as well as a DTC and authenticated streaming product.
Current wording
The Company is a premier live entertainment and media company comprised of two reportable segments, Sphere and MSG Networks. Sphere is a next-generation entertainment medium, and MSG Networks operates two regional sports and entertainment networks, as well as a direct-to-consumer (“DTC”) and authenticated streaming product.
Previous wording
Sphere: This segment reflects Sphere, a next-generation entertainment medium powered by cutting-edge technologies to create multi-sensory experiences at an unparalleled scale. The Company’s first Sphere opened in Las Vegas in September 2023. The venue can accommodate up to 20,000 guests and can host a wide variety of events year-round, including The Sphere Experience, which features original immersive productions, as well as concerts and residencies from renowned artists, and marquee sports and corporate events. Production efforts are supported by Sphere Studios, an immersive content studio dedicated to creating multi-sensory entertainment experiences exclusively for Sphere. Sphere Studios is home to a team of creative, production, technology and software experts who provide full in-house creative and production services. The studio campus in Burbank includes a 68,000-square-foot development facility, as well as Big Dome, a 28,000-square-foot, 100-foot high custom dome, with a quarter-sized version of the interior display plane at Sphere in Las Vegas, that serves as a specialized screening, production facility, and lab for content at Sphere. The entire exterior surface of Sphere, referred to as the Exosphere, is covered with nearly 580,000 square feet of fully programmable LED paneling, creating the largest LED screen in the world — and an impactful display for artists, brands and partners. In October 2024, the Company and DCT Abu Dhabi announced that they will work together to bring the world’s second Sphere to Abu Dhabi, United Arab Emirates.
Current wording
Sphere: This segment reflects Sphere, a next-generation entertainment medium powered by cutting-edge technologies to create multi-sensory experiences at an unparalleled scale. The Company’s first Sphere opened in Las Vegas in September 2023. The venue can accommodate up to 20,000 guests and can host a wide variety of events year-round, including The Sphere Experience, which features original immersive productions, as well as concerts and residencies from renowned artists, and marquee sports and corporate events. Production efforts are supported by Sphere Studios, an immersive content studio dedicated to creating multi-sensory entertainment experiences exclusively for Sphere. Sphere Studios is home to a team of creative, production, technology and software experts who provide full in-house creative and production services. The studio campus in Burbank includes a 68,000-square-foot development facility, as well as Big Dome, a 28,000-square-foot, 100-foot high custom dome, with a quarter-sized version of the interior display plane at Sphere in Las Vegas, that serves as a specialized screening, production facility, and lab for content at Sphere. The entire exterior surface of Sphere, referred to as the Exosphere, is covered with nearly 580,000 square feet of fully programmable LED paneling, creating the largest LED screen in the world — and an impactful display for artists, brands and partners. In October 2024, the Company and DCT Abu Dhabi announced plans to work together to bring the world’s second Sphere to Abu Dhabi, United Arab Emirates.
Previous wording
MSG Networks: This segment is comprised of the Company’s regional sports and entertainment networks, MSG Network and MSG Sportsnet, as well as its DTC and authenticated streaming offering, MSG+ (which is now included in the Gotham Sports streaming product). MSG Networks serves the New York designated market area, as well as other portions of New York, New Jersey, Connecticut and Pennsylvania and features a wide range of sports content, including exclusive live local games and other programming of the New York Knicks (the “Knicks”) of the NBA and the New York Rangers (the “Rangers”), New York Islanders, New Jersey Devils and Buffalo Sabres of the NHL, as well as significant coverage of the New York Giants and the Buffalo Bills of the National Football League.
Current wording
MSG Networks: This segment is comprised of the Company’s regional sports and entertainment networks, MSG Network and MSG Sportsnet, as well as its DTC and authenticated streaming offering, MSG+ (which is included in the Gotham Sports streaming product). MSG Networks serves the New York designated market area, as well as other portions of New York, New Jersey, Connecticut and Pennsylvania and features a wide range of sports content, including exclusive live local games and other programming of the New York Knicks (the “Knicks”) of the NBA and the New York Rangers (the “Rangers”), New York Islanders, New Jersey Devils and Buffalo Sabres of the NHL, as well as significant coverage of the New York Giants and the Buffalo Bills of the National Football League.
Previous wording
Results of Operations. This section provides an analysis of our unaudited results of operations for the three months ended March 31, 2025 and 2024 on both a (i) consolidated basis and (ii) segment basis.
Current wording
Results of Operations. This section provides an analysis of our unaudited results of operations for the three and six months ended June 30, 2025 and 2024 on both a (i) consolidated basis and (ii) segment basis.
Previous wording
Liquidity and Capital Resources. This section provides a discussion of our financial condition and liquidity, an analysis of our cash flows for the three months ended March 31, 2025 and 2024, as well as certain contractual obligations and off-balance sheet arrangements.
Current wording
Liquidity and Capital Resources. This section provides a discussion of our financial condition and liquidity, an analysis of our cash flows for the six months ended June 30, 2025 and 2024, as well as certain contractual obligations and off-balance sheet arrangements.
Previous wording
The operating results of our Sphere segment are largely dependent on our ability to continue to attract (i) audiences to The Sphere Experience, (ii) advertisers and marketing partners, and (iii) guests to attend, and artists to perform at, residencies, concerts and other events at our venue. The operating results of our MSG Networks segment are largely dependent on (i) the terms of MSG Networks’ affiliation agreements with Distributors (including renewals thereof), (ii) the number of subscribers of MSG Networks’ Distributors, (iii) the terms of MSG Networks’ media rights agreements (including renewals thereof), (iv) the terms of the new term loan facility with respect to MSG Networks’ indebtedness, (v) the success of MSG+, MSG Networks’ DTC and authenticated streaming offering (which is now available through the Gotham Sports streaming product), and (vi) the advertising rates we charge advertisers. Certain of these factors in turn depend on the popularity and/or performance of the professional sports teams whose games we broadcast on our networks.
Current wording
The operating results of our Sphere segment are largely dependent on our ability to continue to attract (i) audiences to The Sphere Experience, (ii) advertisers and marketing partners, and (iii) guests to attend, and artists to perform at, residencies, concerts and other events at our venue. The operating results of our MSG Networks segment are largely dependent on (i) the terms of MSG Networks’ affiliation agreements with Distributors (including renewals thereof), (ii) the number of subscribers of MSG Networks’ Distributors, (iii) the terms of MSG Networks’ media rights agreements (including renewals thereof), (iv) the ability of MSG Networks to make its required debt service payments, including quarterly principal amortization payments pursuant to the terms of its term loan facility, (v) the success of MSG+, MSG Networks’ DTC and authenticated streaming offering (which is available through the Gotham Sports streaming product), and (vi) the advertising rates MSG Networks charges advertisers. Certain of these factors in turn depend on the popularity and/or performance of the professional sports teams whose games MSG Networks broadcasts on its networks.
Previous wording
Our Company’s future performance is dependent in part on general economic conditions and the effect of these conditions on our customers. Weak economic conditions may lead to lower demand for our entertainment offerings (including The Sphere Experience) and programming content, which would also negatively affect concession and merchandise sales, and could lead to lower levels of advertising, sponsorship and venue signage. Recent developments relating to tariffs have intensified concerns over the global macroeconomic environment, which has resulted in a rise in volatility across financial markets and concerns over the prospect of a U.S. recession. These conditions may also affect the number of immersive productions, concerts, residencies and other events that take place in the future. An economic downturn could adversely affect our business and results of operations. The Company continues to explore additional opportunities to expand our presence in the entertainment industry both domestically and internationally. Any new investment may not initially contribute to operating income, but is intended to contribute to the success of the Company over time. Our results will also be affected by investments in, and the success of, new immersive productions.
Current wording
Our Company’s future performance is dependent in part on general economic conditions and the effect of these conditions on our customers. Weak economic conditions may lead to lower tourism and lower demand for our entertainment offerings (including The Sphere Experience) and programming content, which would also negatively affect concession and merchandise sales, and could lead to lower levels of advertising, sponsorship and venue signage. Recent developments relating to tariffs have intensified concerns over the global macroeconomic environment, which has resulted in a rise in volatility across financial markets and concerns over the prospect of a U.S. recession. These conditions may also affect the number of immersive productions, concerts, residencies and other events that take place in the future. An economic downturn could adversely affect our business and results of operations. The Company continues to explore additional opportunities to expand our presence in the entertainment industry both domestically and internationally. Any new investment may not initially contribute to operating income, but is intended to contribute to the success of the Company over time. Our results will also be affected by investments in, and the success of, new immersive productions.
Previous wording
On April 24, 2025, the Company, MSG Networks Inc. and certain subsidiaries of MSG Networks Inc. entered into a Transaction Support Agreement (the “Transaction Support Agreement”) with respect to the restructuring of the debt of subsidiaries of MSG Networks Inc. and amendments to the media rights agreements between MSG Networks and New York Knicks, LLC and New York
Current wording
On April 24, 2025, the Company, MSG Networks and certain subsidiaries of MSG Networks entered into a Transaction Support Agreement (the “Transaction Support Agreement”) with the other parties thereto with respect to the restructuring of the debt of subsidiaries of MSG Networks, amendments to the media rights agreements between subsidiaries of MSG Networks, on the one hand, and New York Knicks, LLC and New York Rangers, LLC, each a wholly-owned subsidiary of MSG Sports, on the other hand, and certain other matters. On June 27, 2025, the transactions contemplated by the Transaction Support Agreement were consummated, as further described below.
Previous wording
General. In September 2019, MSGN L.P., MSGN Eden, LLC, an indirect subsidiary of the Company and the general partner of MSGN L.P., Regional MSGN Holdings LLC, an indirect subsidiary of the Company and the limited partner of MSGN L.P. (collectively with MSGN Eden, LLC, the “MSGN Holdings Entities”), and certain subsidiaries of MSGN L.P. entered into a credit agreement (as amended and restated on October 11, 2019, and as further amended through May 30, 2023, the “MSGN Credit Agreement”) providing for (i) an initial $1,100,000 term loan facility (the “MSGN Term Loan Facility”) and (ii) a $250,000 revolving credit facility (the “MSGN Revolving Credit Facility” and, together with the MSGN Term Loan Facility, the “MSG Networks Credit Facilities”), each with a term of five years.
Current wording
MSGN Holdings, L.P. (“MSGN L.P.”), MSG Networks, MSGN Eden, LLC, an indirect subsidiary of the Company and the general partner of MSGN L.P. (“MSGN Eden”), Regional MSGN Holdings LLC, an indirect subsidiary of the Company and the limited partner of MSGN L.P. (“Regional MSGN”), Rainbow Garden Corp., a wholly-owned subsidiary of MSG Networks (“Rainbow
Previous wording
▪a reduction of 18% in the annual rights fee;
Current wording
◦a modification to the annual rights fee to effect a reduction of 18% as of January 1, 2025;
Previous wording
•the issuance by MSG Networks Inc. of penny warrants to MSG Sports exercisable for 19.9% of the equity interests in MSG Networks Inc.;
Current wording
MSG Networks issued penny warrants to MSG Sports exercisable for 19.9% of the common stock of MSG Networks.
Previous wording
Comparison of the Three Months Ended March 31, 2025 versus the Three Months Ended March 31, 2024
Current wording
Comparison of the Three and Six Months Ended June 30, 2025 versus the Three and Six Months Ended June 30, 2024
Previous wording
The following is a summary of changes in our segments’ operating results for the three months ended March 31, 2025 as compared to the three months ended March 31, 2024, which are discussed below under “Business Segment Results.”
Current wording
The following is a summary of changes in our segments’ operating results for the three and six months ended June 30, 2025 as compared to the three and six months ended June 30, 2024, which are discussed below under “—Business Segment Results.”
Previous wording
For the three months ended March 31, 2025, depreciation and amortization increased $4,362, as compared to the prior year period due to the increase in total property and equipment, gross in the first quarter of 2025 as compared to the first quarter of 2024.
Current wording
For the three and six months ended June 30, 2025, depreciation and amortization increased $1,570 and $5,932, respectively, as compared to the prior year periods due to the increase in total property and equipment, gross in the first and second quarters of 2025 as compared to the first and second quarters in 2024.
Previous wording
For the three months ended March 31, 2025 and 2024, the Company recorded restructuring charges of $1,841 and $4,667, respectively, related to termination benefits provided for certain executives and employees.
Current wording
For the three and six months ended June 30, 2025, the Company recorded restructuring charges of $947 and $2,788, respectively, as compared to restructuring charges of $141 and $4,808 in the three and six months ended June 30, 2024, respectively, related to termination benefits provided for certain executives and employees.
Previous wording
For the three months ended March 31, 2025, interest income of $3,878 decreased $3,776 as compared to the prior year period, primarily due to lower average cash and cash equivalent balances.
Current wording
For the three and six months ended June 30, 2025, interest income decreased $3,645 and $7,421, respectively, as compared to the prior year period, primarily due to lower average cash and cash equivalent balances.
Previous wording
For the three months ended March 31, 2025, interest expense decreased $913 as compared to the prior year period due to a reduction in the average outstanding principal balance of the MSGN Term Loan Facility (as defined below) as compared to the prior year period and a reduction in commitment charges resulting from the termination of the MSGN Revolving Credit Facility (as defined below) on October 11, 2024.
Current wording
For the three and six months ended June 30, 2025, interest expense decreased $1,059 and $1,972, respectively, as compared to the prior year period due to a reduction in the average outstanding principal balance of the MSGN Term Loan Facility (as defined below) as compared to the prior year period and a reduction in commitment charges resulting from the termination of the revolving credit facility under the Prior MSGN Credit Agreement (as defined below) on October 11, 2024.
Previous wording
For the three months ended March 31, 2025, other expense, net decreased $1,916 as compared to the prior year period, primarily due to smaller losses on equity method investments and foreign exchange.
Current wording
For the three and six months ended June 30, 2025, other expense, net decreased $2,213 and $4,129, respectively, compared to the prior year period, primarily due to smaller losses on equity method investments and foreign exchange.
Previous wording
Income tax benefit for the three months ended March 31, 2025 of $20,323, reflects an effective tax rate of 20%. The effective tax rate is lower than statutory federal tax rate of 21% primarily due to income tax expense related to nondeductible officer’s compensation, partially offset by income tax benefit from state and local taxes.
Current wording
Income tax benefit for the three and six months ended June 30, 2024 of $21,965 and $37,839, respectively, reflects an effective tax rate of 24% for both periods. The effective tax rate exceeds the statutory federal tax rate of 21% primarily due to income tax benefit related to state and local taxes, partially offset by income tax expense from nondeductible officer’s compensation.
Previous wording
The following is a reconciliation of operating loss to adjusted operating income (as defined in Note 15. Segment Information to the condensed consolidated financial statements included in “— Item 1. Financial Statements” of this Form 10-Q) for the three months ended March 31, 2025 as compared to the prior year period:
Current wording
The following is a reconciliation of operating loss to adjusted operating income (as defined in Note 15. Segment Information to the condensed consolidated financial statements included in “— Item 1. Financial Statements” of this Form 10-Q) for the three and six months ended June 30, 2025 as compared to the prior year period:
Previous wording
Adjusted operating income for the three months ended March 31, 2025 decreased $25,553 as compared to the prior year period to $35,968. The changes in adjusted operating income were attributable to the following:
Current wording
Adjusted operating income for the three months ended June 30, 2025 increased $35,809 as compared to the prior year period to $61,466. Adjusted operating income for the six months ended June 30, 2025 increased $10,256 as compared to the prior year period to $97,434. The changes in adjusted operating income were attributable to the following:
Previous wording
The tables below set forth, for the periods presented, certain historical financial information and a reconciliation of operating loss to adjusted operating income for the Company’s Sphere segment.
Current wording
The tables below set forth, for the periods presented, certain historical financial information and a reconciliation of operating loss to adjusted operating income (loss) for the Company’s Sphere segment.
Previous wording
For the three months ended March 31, 2025, revenues decreased $27,937 as compared to the prior year period. The changes in revenues were attributable to the following:
Current wording
For the three and six months ended June 30, 2025, revenues increased $24,370 and $11,551, respectively, as compared to the prior year period. The changes in revenues were attributable to the following:
Previous wording
For the three months ended March 31, 2025, the increase in event-related revenues reflects (i) higher revenues from concerts, primarily due to an increase of 10 concerts held at Sphere in Las Vegas as compared to the prior year period, partially offset by lower average per-event revenues, and, to a lesser extent, (ii) revenues from one corporate takeover event held at Sphere in Las Vegas during the current year period as compared to none in the prior year period.
Current wording
For the three and six months ended June 30, 2025, the increase in event-related revenues reflects (i) higher revenues from concerts, primarily due to 9 and 19 additional concert residency shows held at Sphere in Las Vegas during the three and six months ended June 30, 2025, respectively, both as compared to the prior year period, and (ii) higher revenues from corporate events held at Sphere in Las Vegas, primarily driven by an increase in the number of events as compared to the prior year periods. These increases were partially offset by a decrease in revenues from marquee events due to the absence of one marquee event held during the three and six months ended June 30, 2024.
Previous wording
For the three months ended March 31, 2025, the increase in other revenues primarily reflects the impact of revenues related to the Company’s plans to bring the world’s second Sphere to Abu Dhabi, United Arab Emirates.
Current wording
For the three and six months ended June 30, 2025, the increase in other revenues primarily reflects the impact of revenues related to bringing the world’s second Sphere to Abu Dhabi, United Arab Emirates.
Previous wording
For the three months ended March 31, 2025, the decrease in revenues from sponsorship, signage, Exosphere advertising and suite license fee revenues primarily reflects lower Exosphere advertising revenues, due to the absence of revenues from advertising campaigns around the Super Bowl which was held in Las Vegas in the prior year period, partially offset by higher sponsorship revenues due to increased sales of existing sponsorship inventory and higher suite license fee revenues.
Current wording
For the three and six months ended June 30, 2025, the decrease in revenues from sponsorship, signage, Exosphere advertising and suite license fees primarily reflects lower Exosphere advertising revenues, partially offset by higher sponsorship revenues due to increased sales of existing sponsorship inventory and higher suite license fee revenues. Exosphere advertising revenues in the six months ended June 30, 2024 included revenues from advertising campaigns around the Super Bowl which was held in Las Vegas in the prior year period.
Previous wording
For the three months ended March 31, 2025, The Sphere Experience included 166 performances of Postcard From Earth, and 34 performances of V-U2 An Immersive Concert Film, which debuted in September 2024, (with combined average revenues per performance of approximately $371) as compared to 257 performances of Postcard from Earth (with combined average revenues per performance of approximately $392) in the prior year period.
Current wording
For the three months ended June 30, 2025, the decrease in revenues for The Sphere Experience primarily reflects lower average per-show revenues, partially offset by an increase in the number of overall performances as compared to the prior year period. In the current year period, The Sphere Experience included 198 performances of Postcard From Earth and 17 performances of V-U2 An Immersive Concert Film(with combined average revenues per performance of approximately $315), as compared to 208 performances of Postcard from Earth (with average revenues per performance of approximately $358) in the prior year period.
Previous wording
For the three months ended March 31, 2025, direct operating expenses increased by $8,242 as compared to the prior year period. The changes in direct operating expenses were attributable to the following:
Current wording
For the three and six months ended June 30, 2025, direct operating expenses increased by $8,481 and $16,723, respectively, as compared to the prior year period. The changes in direct operating expenses were attributable to the following:
Previous wording
For the three months ended March 31, 2025, the increase in event-related direct operating expenses reflects (i) higher expenses from one corporate takeover event held at Sphere in Las Vegas during the current year period as compared to none in the prior year period, and (ii) higher expenses from concerts, primarily due to an increase in the number of concerts held at Sphere in Las Vegas as compared to the prior year period, partially offset by lower average per-show expenses.
Current wording
For the three and six months ended June 30, 2025, the increase in event-related direct operating expenses reflects (i) higher expenses from corporate events, primarily due to additional corporate events held at Sphere in Las Vegas as compared to the prior year periods and (ii) higher expenses from concerts, primarily due to an increase in the number of concert residency shows held at Sphere in Las Vegas as compared to the prior year periods, partially offset by lower average per-event expenses. These increases were partially offset by lower expenses from marquee events due to the absence of one marquee event held at the venue during the three and six months ended June 30, 2024.
Previous wording
For the three months ended March 31, 2025, the increase in other direct operating expenses primarily reflects the impact of consolidating Holoplot’s results following its acquisition by the Company in April 2024.
Current wording
For the three and six months ended June 30, 2025, the increase in direct operating expenses from Holoplot reflects the impact of consolidating Holoplot following its acquisition by the Company in April 2024.
Previous wording
For the three months ended March 31, 2025, the decrease in direct operating expenses for The Sphere Experience was primarily due to fewer performances held in the current year period as compared to the prior year period, partially offset by higher average per-show expenses (combined average direct operating expenses of $130 per show in the current year period as compared to $117 per show in the prior year period). The current year period reflects expenses associated with 166 performances of Postcard From Earthand 34 performances of V-U2 An Immersive Concert Film, which debuted in September 2024, as compared to 257 performances of Postcard from Earth in the prior year period.
Current wording
For the six months ended June 30, 2025, the decrease in direct operating expenses for The Sphere Experience was primarily due to a decrease in total performances held in the current year period as compared to the prior year period, partially offset by higher average per-show expenses (combined average direct operating expenses of $118 per show in the current year period as compared to $112 per show in the prior year period).
Previous wording
For the three months ended March 31, 2025, the increase in venue operating expenses was primarily related to an increase in employee compensation and related benefits.
Current wording
For the six months ended June 30, 2025, the increase in venue operating expenses was primarily related to an increase in employee compensation and related benefits.
Previous wording
For the three months ended March 31, 2025, depreciation and amortization increased $4,299 as compared to the prior year period primarily due to the increase in total property and equipment, gross in the first quarter of 2025 as compared to the first quarter of 2024.
Current wording
For the three and six months ended June 30, 2025, depreciation and amortization increased $1,586 and $5,885, respectively, as compared to the prior year periods primarily due to the increase in total property and equipment, gross.
Previous wording
For the three months ended March 31, 2025 and 2024, the Company recognized restructuring charges of $1,841 and $4,886, respectively, related to termination benefits provided for certain executives and employees.
Current wording
For the three and six months ended June 30, 2025, the Company recognized restructuring charges of $947 and $2,788, respectively, as compared to a net restructuring benefit of of $88 for the three months ended June 30, 2024 and restructuring charges of $4,798 in the six months ended June 30, 2024. Restructuring charges related to termination benefits provided for certain executives and employees.
Showing the first 40 of 61 pairs. Open the source sections for the rest.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
For the three months ended June 30, 2025, the increase in direct operating expenses for The Sphere Experience was primarily due to an increase in total performances held in the current year period as compared to the prior year period. Combined average direct operating expenses of $106 per show in the current year period were essentially unchanged as compared to $106 per show in the prior year period.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
Sphere Entertainment Co., Sphere Entertainment Group, LLC (“Sphere Entertainment Group”) and the subsidiaries of Sphere Entertainment Group (collectively, the “Non-Credit Parties”) will not be legally obligated to fund the outstanding borrowings under the New Term Loan Facility, nor will the assets of the Non-Credit Parties be pledged as security under the New Term Loan Facility.
Previous report — wording carried elsewhere
Income tax benefit for the three months ended March 31, 2024 of $15,874, reflects an effective tax rate of 25%. The effective tax rate exceeds the statutory federal tax rate of 21% primarily due to state and local taxes.
Previous report — wording carried elsewhere
For the three months ended March 31, 2025, the decrease in direct operating expenses from sponsorship, signage, Exosphere advertising and suite license fees primarily reflects lower expenses related to Exosphere advertising, mainly due to the absence of advertising campaigns around the Super Bowl which was held in Las Vegas in the prior year period.