Sphere Entertainment Co. Reports First Quarter 2026 Results
SPHR
Published on 05/05/2026 at 07:31 am EDT
Sphere Entertainment Co. (NYSE: SPHR) (“Sphere Entertainment” or the “Company”) today reported financial results for the first quarter ended March 31, 2026.
Recent highlights for the Company’s Sphere segment include:
For the three months ended March 31, 2026, the Company reported revenues of $386.4 million, an increase of $105.8 million, or 38%, as compared to the prior year quarter. In addition, the Company reported operating income of $7.2 million, an increase of $85.8 million, and adjusted operating income of $110.0 million, an increase of $74.0 million, both as compared to the prior year quarter.(1)
Executive Chairman and CEO James L. Dolan said, “Today’s results demonstrate our continued success proving out Sphere’s business model. Looking ahead, we remain focused on maximizing that model’s full potential in Las Vegas, while executing on our long-term vision for a global network of Sphere venues.”
Segment Results for the Three Months Ended March 31, 2026 and 2025:
(In millions)
Three Months Ended
March 31,
Change
2026
2025
$
%
Revenues:
Sphere
$
266.0
$
157.5
$
108.4
69
%
MSG Networks
120.4
123.0
(2.6
)
(2
)%
Total Revenues
$
386.4
$
280.6
$
105.8
38
%
Operating Income (Loss):
Sphere
$
(24.9
)
$
(93.8
)
$
68.9
73
%
MSG Networks
32.1
15.2
16.9
112
%
Total Operating Income (Loss)
$
7.2
$
(78.6
)
$
85.8
NM
Adjusted Operating Income:(1)
Sphere
$
74.3
$
13.1
$
61.1
NM
MSG Networks
35.7
22.8
12.9
56
%
Total Adjusted Operating Income
$
110.0
$
36.0
$
74.0
NM
(1)
See page 3 of this earnings release for the definition of adjusted operating income (loss) included in the discussion of non-GAAP financial measures.
Sphere
For the first quarter 2026, the Sphere segment reported revenues of $266.0 million, an increase of $108.4 million, or 69%, as compared to the prior year quarter.
Revenues related to The Sphere Experience increased $81.7 million as compared to the prior year quarter, which primarily reflected higher per-show revenue for The Wizard of Oz at Sphere. In the current year quarter, The Sphere Experience reflected 209 performances of The Wizard of Oz at Sphere as compared to 200 performances of Postcard from Earth and V-U2 An Immersive Concert Film in the prior year quarter.
Event-related revenues increased $24.4 million as compared to the prior year quarter, primarily due to (i) higher revenues from brand events, due to one additional brand event held in the current year quarter and higher per-event revenue, and (ii) higher revenues from concerts, primarily due to six additional concert residency shows held at Sphere in Las Vegas during the current year period.
Revenues from sponsorship, Exosphere advertising and suite license fees increased $1.6 million as compared to the prior year quarter, primarily reflecting an increase in sponsorship revenues and higher suite license fee revenues.
Other revenues increased $0.7 million as compared to the prior year quarter.
For the first quarter 2026, the Sphere segment had direct operating expenses of $99.2 million, an increase of $28.7 million, or 41%, as compared to the prior year quarter. Expenses associated with The Sphere Experience increased $18.1 million as compared to the prior year quarter, primarily due to higher per-show expenses for The Wizard of Oz at Sphere. Event-related expenses increased $10.8 million as compared to the prior year quarter, primarily due to (i) higher expenses from brand events, due to higher per-event expenses and an increase in the number of brand events held in the current year quarter, and (ii) higher expenses from concerts, due to an increase in the number of concert residency shows held at Sphere in Las Vegas, partially offset by lower per-concert expenses.
For the first quarter 2026, selling, general and administrative expenses of $106.6 million increased $10.2 million, or 11%, as compared to the prior year quarter, primarily due to the impact of mark-to-market adjustments on certain share-based compensation awards as a result of the appreciation in the Company’s stock price during the current year quarter.
For the first quarter 2026, operating loss of $24.9 million improved by $68.9 million, or 73%, and adjusted operating income of $74.3 million increased $61.1 million, both as compared to the prior year quarter, primarily due to the increase in revenues, partially offset by higher direct operating expenses and higher selling, general and administrative expenses.
MSG Networks
For the first quarter 2026, the MSG Networks segment reported total revenues of $120.4 million, a decrease of $2.6 million, or 2%, as compared to the prior year quarter.
Advertising revenue decreased $4.9 million as compared to the prior year quarter, primarily due to a lower number of live regular season professional sports telecasts. This decrease was partially offset by an increase in distribution revenue of $1.8 million, primarily reflecting the absence of revenues from Altice during MSG Networks’ non-carriage period from January 1, 2025 through February 21, 2025 in the prior year quarter, partially offset by a decrease in total subscribers of approximately 16.0% (excluding the impact of the Altice non-carriage period in the prior year quarter).
For the first quarter 2026, direct operating expenses of $70.4 million decreased $17.4 million, or 20%, as compared to the prior year quarter. Rights fees expense decreased $16.5 million as compared to the prior year quarter, primarily reflecting reductions in media rights fees as a result of the amendments to MSG Networks’ media rights agreements with certain professional sports teams.
For the first quarter 2026, selling, general and administrative expenses of $15.1 million decreased $2.8 million, or 15%, as compared to the prior year quarter. This decrease was primarily due to (i) lower professional fees of $3.6 million, mainly due to the absence of costs associated with pursuing a work-out of MSG Networks’ credit facilities recorded in the prior year quarter, and (ii) lower employee compensation and related benefits of $2.3 million, partially offset by (iii) higher advertising and marketing costs of $3.0 million.
For the first quarter 2026, operating income of $32.1 million increased $16.9 million as compared to the prior year quarter, primarily due to lower direct operating expenses and, to a lesser extent, lower selling, general and administrative expenses (including merger, debt work-out and acquisition related costs), partially offset by the decrease in revenues. Adjusted operating income of $35.7 million increased $12.9 million, or 56%, as compared to the prior year quarter, primarily due to lower direct operating expenses, partially offset by the decrease in revenues and higher selling, general and administrative expenses (excluding merger, debt work-out and acquisition related costs).
About Sphere Entertainment Co.
Sphere Entertainment Co. is a leader in immersive experiences, technology and media. The Company includes Sphere, an experiential medium powered by advanced technologies. The first Sphere opened in Las Vegas, with plans also announced for Sphere venues in Abu Dhabi and National Harbor. In addition, the Company includes MSG Networks, which operates two regional sports and entertainment networks, MSG Network and MSG Sportsnet, as well as a direct-to-consumer and authenticated streaming product, MSG+, delivering a wide range of live sports content and other programming. More information is available at www.sphereentertainmentco.com.
Non-GAAP Financial Measures
We define adjusted operating income (loss), which is a non-GAAP financial measure, as operating income (loss) before (i) depreciation, amortization and impairments of property and equipment, goodwill and intangible assets, (ii) amortization for capitalized cloud computing arrangement costs, (iii) share-based compensation expense, (iv) restructuring charges or credits, (v) merger, debt work-out and acquisition-related costs, including merger-related litigation expenses, net of insurance recoveries, (vi) gains or losses on sales or dispositions of businesses and associated settlements, (vii) the impact of purchase accounting adjustments related to business acquisitions, and (viii) gains and losses related to the remeasurement of liabilities under the Company’s Executive Deferred Compensation Plan. We believe that the exclusion of share-based compensation expense or benefit allows investors to better track the performance of our business without regard to the settlement of an obligation that is not expected to be made in cash. We eliminate merger, debt work-out and acquisition-related costs, including merger related litigation expenses, net of insurance recoveries, when applicable, because the Company does not consider such costs to be indicative of the ongoing operating performance of the Company as they result from an event that is of a non-recurring nature, thereby enhancing comparability. In addition, management believes that the exclusion of gains and losses related to the remeasurement of liabilities under the Company’s Executive Deferred Compensation Plan, provides investors with a clearer picture of the Company’s operating performance given that, in accordance with U.S. generally accepted accounting principles (“GAAP”), gains and losses related to the remeasurement of liabilities under the Company’s Executive Deferred Compensation Plan are recognized in operating income (loss) whereas gains and losses related to the remeasurement of the assets under the Company’s Executive Deferred Compensation Plan, which are equal to and therefore fully offset the gains and losses related to the remeasurement of liabilities, are recognized in other income (expense), net, which is not reflected in operating income (loss).
We believe adjusted operating income (loss) is an appropriate measure for evaluating the operating performance of our business segments and the Company on a consolidated basis. Adjusted operating income (loss) and similar measures with similar titles are common performance measures used by investors and analysts to analyze our performance. Internally, we use revenues and adjusted operating income (loss) as the most important indicators of our business performance, and evaluate management’s effectiveness with specific reference to these indicators. Adjusted operating income (loss) should be viewed as a supplement to and not a substitute for operating income (loss), net income (loss), cash flows from operating activities, and other measures of performance and/or liquidity presented in accordance with GAAP. Since adjusted operating income (loss) is not a measure of performance calculated in accordance with GAAP, this measure may not be comparable to similar measures with similar titles used by other companies. For a reconciliation of operating income (loss) to adjusted operating income (loss), please see page 5 of this release.
Forward-Looking Statements
This press release may contain statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that any such forward-looking statements are not guarantees of future performance or results and involve risks and uncertainties, and that actual results, developments or events may differ materially from those in the forward-looking statements as a result of various factors, including financial community perceptions of the Company and its business, operations, financial condition and the industries in which it operates and the factors described in the Company’s filings with the Securities and Exchange Commission, including the sections titled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” contained therein. The Company disclaims any obligation to update any forward-looking statements contained herein.
Conference Call Information: The conference call will be Webcast live today at 10:00 a.m. ET at investor.sphereentertainmentco.com Conference call dial-in number is 888-800-3155 / Conference ID Number 8089430 Conference call replay number is 800-770-2030 / Conference ID Number 8089430 until May 12, 2026
SPHERE ENTERTAINMENT CO.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
Three Months Ended
March 31,
2026
2025
Revenues
$
386,412
$
280,574
Operating expenses:
Direct operating expenses
169,647
158,323
Selling, general, and administrative expenses
121,703
114,269
Depreciation and amortization
84,367
84,229
Impairment and other losses, net
79
521
Restructuring charges
3,414
1,841
Operating income (loss)
7,202
(78,609
)
Other income (expense):
Loss on extinguishment of debt
(2,071
)
—
Interest income
3,951
3,878
Interest expense
(8,039
)
(26,206
)
Other expense, net
(1,424
)
(1,340
)
Loss from continuing operations before income taxes
(381
)
(102,277
)
Income tax benefit
4,841
20,323
Net income (loss)
$
4,460
$
(81,954
)
Less: Net income attributable to participating securities
6,053
—
Net loss attributable to Sphere Entertainment Co.’s stockholders
$
(1,593
)
$
(81,954
)
Basic loss per common share attributable to Sphere Entertainment Co.’s stockholders
$
(0.04
)
$
(2.27
)
Diluted loss per common share attributable to Sphere Entertainment Co.’s stockholders
$
(0.04
)
$
(2.27
)
Weighted-average number of common shares outstanding:
Basic
35,878
36,110
Diluted
35,878
36,110
SPHERE ENTERTAINMENT CO. ADJUSTMENTS TO RECONCILE OPERATING INCOME (LOSS) TO ADJUSTED OPERATING INCOME (LOSS) (In thousands) (Unaudited)
The following is a description of the adjustments to operating income (loss) in arriving at adjusted operating income as described in this earnings release:
Three Months Ended
March 31,
2026
2025
Operating income (loss)
$
7,202
$
(78,609
)
Share-based compensation
13,910
21,595
Depreciation and amortization
84,367
84,229
Restructuring charges
3,414
1,841
Impairment and other losses, net
79
521
Merger, debt work-out, and acquisition related costs, net of insurance recoveries
87
4,791
Amortization for capitalized cloud computing arrangement costs
917
1,579
Remeasurement of deferred compensation plan liabilities
—
21
Adjusted operating income
$
109,976
$
35,968
SPHERE ENTERTAINMENT CO.
SEGMENT RESULTS
(In thousands)
(Unaudited)
BUSINESS SEGMENT RESULTS
Three Months Ended March 31, 2026
Sphere
MSG Networks
Total
Revenues
$
265,965
$
120,447
$
386,412
Operating expenses:
Direct operating expenses
99,226
70,421
169,647
Selling, general and administrative expenses
106,596
15,107
121,703
Depreciation and amortization
82,274
2,093
84,367
Impairment and other losses, net
79
—
79
Restructuring charges
2,673
741
3,414
Operating (loss) income
$
(24,883
)
$
32,085
$
7,202
Reconciliation to adjusted operating income:
Share-based compensation
13,143
767
13,910
Depreciation and amortization
82,274
2,093
84,367
Restructuring charges
2,673
741
3,414
Impairment and other losses, net
79
—
79
Merger, debt work-out, and acquisition related costs, net of insurance recoveries
87
—
87
Amortization for capitalized cloud computing arrangement costs
917
—
917
Adjusted operating income
$
74,290
$
35,686
$
109,976
Three Months Ended March 31, 2025
Sphere
MSG Networks
Total
Revenues
$
157,545
$
123,029
$
280,574
Operating expenses:
Direct operating expenses
70,536
87,787
158,323
Selling, general and administrative expenses
96,404
17,865
114,269
Depreciation and amortization
82,005
2,224
84,229
Impairment and other losses, net
521
—
521
Restructuring charges
1,841
—
1,841
Operating (loss) income
$
(93,762
)
$
15,153
$
(78,609
)
Reconciliation to adjusted operating income:
Share-based compensation
19,954
1,641
21,595
Depreciation and amortization
82,005
2,224
84,229
Restructuring charges
1,841
—
1,841
Impairment and other losses, net
521
—
521
Merger, debt work-out, and acquisition related costs, net of insurance recoveries
988
3,803
4,791
Amortization for capitalized cloud computing arrangement costs
1,579
—
1,579
Remeasurement of deferred compensation plan liabilities
21
—
21
Adjusted operating income
$
13,147
$
22,821
$
35,968
SPHERE ENTERTAINMENT CO.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except per share data)
(Unaudited)
As of
March 31,
December 31,
2026
2025
ASSETS
Current Assets:
Cash, cash equivalents, and restricted cash
$
630,151
$
521,264
Accounts receivable, net
181,549
171,630
Related party receivables, current
20,215
24,457
Prepaid expenses and other current assets
71,655
92,824
Total current assets
903,570
810,175
Non-Current Assets:
Investments
37,650
38,725
Property and equipment, net
2,629,439
2,710,643
Right-of-use lease assets
88,851
91,372
Goodwill
344,772
344,772
Intangible assets, net
20,161
21,817
Other non-current assets
198,243
192,404
Total assets
$
4,222,686
$
4,209,908
LIABILITIES AND EQUITY
Current Liabilities:
Accounts payable
$
36,484
$
24,593
Accrued expenses and other current liabilities
427,060
431,477
Related party payables, current
11,404
14,301
Current portion of long-term debt, net
57,690
63,009
Operating lease liabilities, current
16,515
17,186
Deferred revenue
193,510
192,808
Total current liabilities
742,663
743,374
Non-Current Liabilities:
Long-term debt, net
752,700
767,439
Operating lease liabilities, non-current
111,463
113,824
Deferred tax liabilities, net
166,661
172,111
Other non-current liabilities
201,272
179,921
Total liabilities
1,974,759
1,976,669
Commitments and contingencies
Equity:
Class A Common Stock (a)
299
297
Class B Common Stock (b)
69
69
Additional paid-in capital
2,480,705
2,470,120
Treasury stock, at cost, 1,054 shares as of March 31, 2026 and December 31, 2025, respectively
(50,024
)
(50,024
)
Accumulated deficit
(181,981
)
(186,441
)
Accumulated other comprehensive loss
(1,141
)
(782
)
Total stockholders’ equity
2,247,927
2,233,239
Total liabilities and equity
$
4,222,686
$
4,209,908
(a)
Class A Common Stock, $0.01 par value per share, 120,000 shares authorized; 29,921 and 28,629 shares issued and outstanding as of March 31, 2026 and December 31, 2025, respectively.
(b)
Class B Common Stock, $0.01 par value per share, 30,000 shares authorized; 6,867 shares issued and outstanding as of March 31, 2026 and December 31, 2025.
SPHERE ENTERTAINMENT CO.
SELECTED CASH FLOW INFORMATION
(In thousands)
(Unaudited)
Three Months Ended
March 31,
2026
2025
Net cash provided by operating activities
$
136,241
$
6,348
Net cash used in investing activities
(5,005
)
(17,570
)
Net cash used in financing activities
(22,263
)
(26,307
)
Effect of exchange rates on cash, cash equivalents, and restricted cash
(86
)
98
Net increase (decrease) in cash, cash equivalents, and restricted cash
108,887
(37,431
)
Cash, cash equivalents, and restricted cash at beginning of period
521,264
515,633
Cash, cash equivalents, and restricted cash at end of period
$
630,151
$
478,202
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