Madison Square Garden Entertainment Corp. Reports Fiscal 2026 Third Quarter Results

Madison Square Garden Entertainment Corp. Reports Fiscal 2026 Third Quarter Results May 7, 2026 Madison Square Garden Entertainment Corp. (NYSE: MSGE) (“MSG Entertainment” or the “Company”) today reported financial results for the fiscal third quarter ended March 31, 2026. The fiscal 2026 third quarter was highlighted by a diverse mix of live entertainment and sporting events across the Company’s portfolio of venues. That included significant growth in the number of concerts at the Madison Square Garden Arena (“The Garden”) and the last performances in this year's record-setting Christmas Spectacular run. It also included the continuation of the New York Knicks (“Knicks”) and the New York Rangers (“Rangers”) 2025-26 regular seasons at The Garden. For the fiscal 2026 third quarter, the Company reported revenues of $246.3 million, an increase of $3.8 million, or 2%, as compared to the prior year quarter. In addition, the Company reported operating income of $16.1 million, a decrease of $11.2 million, or 41%, and adjusted operating income of $46.0 million, a decrease of $11.8 million, or 20%, both as compared to the prior year quarter.(1) Executive Chairman and CEO James L. Dolan said, “We continue to bring an array of live events to our venues, and demand for those entertainment offerings remains strong. As we approach the end of the fiscal year, we remain on track to deliver robust growth in revenue and adjusted operating income in fiscal 2026.” Results for the Three and Nine Months Ended March 31, 2026 and 2025: Three Months Ended Nine Months Ended March 31, Change March 31, Change $ millions 2026 2025 $ % 2026 2025 $ % Revenues $ 246.3 $ 242.5 $ 3.8 2 % $ 864.5 $ 788.6 $ 75.9 10 % Operating Income $ 16.1 $ 27.3 $ (11.2 ) (41 )% $ 150.2 $ 147.8 $ 2.3 2 % Adjusted Operating Income(1) $ 46.0 $ 57.9 $ (11.8 ) (20 )% $ 243.5 $ 223.8 $ 19.8 9 % Note: Amounts may not foot due to rounding. (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. Entertainment Offerings, Arena License Fees and Other Leasing Fiscal 2026 third quarter revenues from entertainment offerings of $165.7 million increased $5.5 million, or 3%, as compared to the prior year quarter. Revenues subject to the sharing of economics with Madison Square Garden Sports Corp. ("MSG Sports") pursuant to the Arena License Agreements increased $5.4 million, primarily due to higher suite license fee revenues (excluding those retained by the Company).Revenues from concerts increased $3.7 million, primarily reflecting an increase in the number of concerts at The Garden, partially offset by a decrease in the number of concerts at the Company's theaters.Revenues from venue-related sponsorship, signage, and suite license fees increased $3.1 million due to higher suite license fee revenues (excluding those shared with MSG Sports pursuant to the Arena License Agreements) and higher sponsorship and signage revenues.Revenues from the presentation of the Christmas Spectacular production increased $1.3 million, primarily due to an increase in ticket-related revenue, which reflected higher per-show revenue and one additional performance as compared to the prior year quarter.Revenues from other live entertainment and sporting events decreased $7.7 million due to a decrease in the number of events at the Company's venues (including the absence of a multi-day special event held at Radio City Music Hall in the prior year quarter), partially offset by higher per-event revenue. Fiscal 2026 third quarter arena license fees and other leasing revenues of $35.5 million decreased $1.0 million, or 3%, as compared to the prior year quarter, due to fewer Knicks and Rangers games played at The Garden in the current year quarter, partially offset by higher other leasing revenues. Fiscal 2026 third quarter direct operating expenses associated with entertainment offerings, arena license fees and other leasing of $118.3 million increased $10.3 million, or 10%, as compared to the prior year quarter. Expenses subject to the sharing of economics with MSG Sports pursuant to the Arena License Agreements increased $5.0 million, primarily due to expenses incurred as a result of the increase in suite license fee revenues.Expenses for concerts increased $2.6 million, primarily due to an increase in the number of concerts at The Garden, partially offset by a decrease in the number of concerts at the Company’s theaters.Venue operating costs increased $2.4 million, primarily due to higher employee compensation and benefits, as well as higher repairs and maintenance expenses.Expenses for other live entertainment and sporting events decreased $2.0 million due to a decrease in the number of events at the Company's venues (including the absence of a multi-day special event held at Radio City Music Hall in the prior year quarter), partially offset by higher per-event expenses. Food, Beverage and Merchandise Fiscal 2026 third quarter food, beverage and merchandise revenues of $45.1 million decreased $0.7 million, or 2%, as compared to the prior year quarter. The decrease primarily reflected (i) lower food and beverage sales at Knicks and Rangers games of $2.8 million, primarily due to the impact of a combined five fewer Knicks and Rangers games played at The Garden, partially offset by (ii) higher food and beverage sales at concerts held at the Company's venues of $2.4 million, primarily due to an increase in the number of concerts at The Garden, partially offset by a decrease in the number of concerts at the Company's theaters. Fiscal 2026 third quarter food, beverage and merchandise direct operating expenses of $28.5 million decreased $2.4 million, or 8%, as compared to the prior year quarter. The decrease was primarily due to lower food and beverage costs related to Knicks and Rangers games at The Garden, partially offset by higher food and beverage costs related to concerts, both as compared to the prior year quarter. Selling, General and Administrative Expenses Fiscal 2026 third quarter selling, general and administrative expenses of $61.0 million increased $8.8 million, or 17%, as compared to the prior year quarter. This increase was primarily due to (i) an increase in employee compensation and benefits, (ii) higher rent expense, and (iii) other cost increases. Operating Income and Adjusted Operating Income Fiscal 2026 third quarter operating income of $16.1 million decreased $11.2 million, or 41%, as compared to the prior year quarter, primarily due to higher selling, general and administrative expenses, restructuring charges and direct operating expenses, partially offset by the absence of impairment of long-lived assets recognized in the prior year quarter and the increase in revenues. Fiscal 2026 third quarter adjusted operating income of $46.0 million decreased $11.8 million, or 20%, as compared to the prior year quarter, primarily due to higher direct operating expenses and higher selling, general and administrative expenses, partially offset by the increase in revenues. About Madison Square Garden Entertainment Corp. Madison Square Garden Entertainment Corp. (MSG Entertainment) is a leader in live entertainment, delivering unforgettable experiences while forging deep connections with diverse and passionate audiences. The Company’s portfolio includes a collection of world-renowned venues – New York’s Madison Square Garden, Infosys Theater at Madison Square Garden, Radio City Music Hall, and Beacon Theatre; and The Chicago Theatre – that showcase a broad array of sporting events, concerts, family shows, and special events for millions of guests annually. In addition, the Company features the original production, the Christmas Spectacular Starring the Radio City Rockettes, which has been a holiday tradition for more than 90 years. More information is available at www.msgentertainment.com. Non-GAAP Financial Measures We define adjusted operating income (loss), which is a non-GAAP financial measure, as operating income (loss) excluding (i) depreciation, amortization and impairments of property and equipment, goodwill and other long-lived assets, including right of use assets and related lease costs, (ii) share-based compensation expense or benefit, (iii) restructuring charges or credits, (iv) merger, spin-off, and acquisition-related costs, including merger-related litigation expenses, (v) gains or losses on sales or dispositions of businesses and associated settlements, (vi) the impact of purchase accounting adjustments related to business acquisitions, (vii) amortization for capitalized cloud computing arrangement costs and (viii) gains and losses related to the remeasurement of liabilities under the executive deferred compensation plan. We believe that the exclusion of share-based compensation expense or benefit allows investors to better track the performance of the various operating units of our business without regard to the settlement of an obligation that is not expected to be made in cash. We eliminate merger, spin-off, and acquisition-related transaction costs, 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 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, gains and losses related to the remeasurement of liabilities under the executive deferred compensation plan are recognized in operating income (loss) whereas gains and losses related to the remeasurement of the assets under the 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 exclude impairments of long-lived assets, including right-of-use assets and related lease costs, as these expenses do not represent core business operating results of the Company. We believe adjusted operating income (loss) is an appropriate measure for evaluating the operating performance of the Company on a consolidated and combined 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 earnings 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 8:30a.m. ET at investor.msgentertainment.com Conference call dial-in number is 833-461-5787 / Conference ID Number 814544945 Webcast replay available at investor.msgentertainment.com until May 14, 2026 Investor presentation available at investor.msgentertainment.com/events-and-presentations MADISON SQUARE GARDEN ENTERTAINMENT CORP. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data) (Unaudited) Three Months Ended March 31, Nine Months Ended March 31, 2026 2025 2026 2025 Revenues: Revenues from entertainment offerings $ 165,688 $ 160,214 $ 657,451 $ 593,571 Food, beverage, and merchandise revenues 45,081 45,808 132,242 124,104 Arena license fees and other leasing revenue 35,491 36,443 74,769 70,921 Total revenues 246,260 242,465 864,462 788,596 Direct operating expenses: Entertainment offerings, arena license fees, and other leasing direct operating expenses (118,340 ) (107,995 ) (382,960 ) (358,755 ) Food, beverage, and merchandise direct operating expenses (28,453 ) (30,875 ) (78,859 ) (74,898 ) Total direct operating expenses (146,793 ) (138,870 ) (461,819 ) (433,653 ) Selling, general, and administrative expenses (60,955 ) (52,112 ) (185,899 ) (155,047 ) Depreciation and amortization (13,788 ) (14,372 ) (41,846 ) (42,336 ) Impairment of long-lived assets — (9,700 ) (13,782 ) (9,700 ) Restructuring charges (8,623 ) (84 ) (10,939 ) (14 ) Operating income 16,101 27,327 150,177 147,846 Interest income 2,245 710 3,578 1,447 Interest expense (9,421 ) (11,800 ) (30,872 ) (38,798 ) Other expense, net (700 ) (949 ) (1,545 ) (2,763 ) Income from operations before income taxes 8,225 15,288 121,338 107,732 Income tax expense (3,115 ) (7,252 ) (45,167 ) (43,124 ) Net income $ 5,110 $ 8,036 $ 76,171 $ 64,608 Earnings per share: Basic $ 0.11 $ 0.17 $ 1.61 $ 1.34 Diluted $ 0.11 $ 0.17 $ 1.59 $ 1.33 Weighted-average number of shares of common stock: Basic 47,463 47,955 47,452 48,171 Diluted 48,132 48,271 47,893 48,445 MADISON SQUARE GARDEN ENTERTAINMENT CORP. 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 in arriving at adjusted operating income as described in this earnings release: Depreciation and amortization. This adjustment eliminates depreciation and amortization of property and equipment and intangible assets.Impairment of long-lived assets and related lease costs. This adjustment eliminates the impairment of long-lived assets, including right of use assets and related lease costs.Share-based compensation. This adjustment eliminates the compensation expense relating to restricted stock units and stock options granted under the Company’s Employee Stock Plan and the Company’s Non-Employee Director Plan.Restructuring charges. This adjustment eliminates costs related to termination benefits provided to certain executives and employees.Merger, spin-off, and acquisition-related costs. This adjustment eliminates costs related to mergers, spin-offs and acquisitions, including merger-related litigation expenses.Amortization for capitalized cloud computing arrangement costs. This adjustment eliminates amortization of capitalized cloud computing arrangement costs.Remeasurement of deferred compensation plan liabilities. This adjustment eliminates the impact of gains and losses related to the remeasurement of liabilities under the executive deferred compensation plan. Three Months Ended March 31, Nine Months Ended March 31, $ thousands 2026 2025 2026 2025 Operating income $ 16,101 $ 27,327 $ 150,177 $ 147,846 Depreciation and amortization 13,788 14,372 41,846 42,336 Impairment of long-lived assets and related lease costs 938 9,700 16,016 9,700 Share-based compensation 6,689 6,250 24,019 21,834 Restructuring charges 8,623 84 10,939 14 Merger, spin-off, and acquisition-related costs — — — 1,361 Amortization for capitalized cloud computing arrangement costs 19 183 225 552 Remeasurement of deferred compensation plan liabilities (122 ) (45 ) 325 149 Adjusted operating income $ 46,036 $ 57,871 $ 243,547 $ 223,792 MADISON SQUARE GARDEN ENTERTAINMENT CORP. CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except per share data) (Unaudited) As of March 31, 2026 June 30, 2025 ASSETS Current Assets: Cash, cash equivalents, and restricted cash $ 323,653 $ 43,538 Accounts receivable, net 89,675 66,781 Related party receivables, current 31,863 22,487 Prepaid expenses and other current assets 93,434 104,326 Total current assets 538,625 237,132 Non-Current Assets: Property and equipment, net 598,549 621,075 Right-of-use lease assets 453,759 484,544 Goodwill 69,041 69,041 Indefinite-lived intangible assets 63,801 63,801 Deferred tax assets, net 47,767 54,072 Other non-current assets 185,731 140,177 Total assets $ 1,957,273 $ 1,669,842 LIABILITIES AND EQUITY (DEFICIT) Current Liabilities: Accounts payable, accrued and other current liabilities $ 340,087 $ 184,360 Related party payables, current 51,100 23,830 Long-term debt, current 30,469 30,469 Operating lease liabilities, current 44,336 35,100 Deferred revenue 287,218 228,642 Total current liabilities 753,210 502,401 Non-Current Liabilities: Long-term debt, net of deferred financing costs 547,450 568,780 Operating lease liabilities, non-current 564,936 566,484 Other non-current liabilities 43,672 45,477 Total liabilities 1,909,268 1,683,142 Commitments and contingencies Equity (deficit): Class A Common Stock(a) 465 461 Class B Common Stock(b) 69 69 Additional paid-in-capital 54,394 44,843 Treasury stock at cost (6,106 and 5,483 shares as of March 31, 2026 and June 30, 2025, respectively) (205,204 ) (180,204 ) Retained earnings 229,205 153,034 Accumulated other comprehensive loss (30,924 ) (31,503 ) Total equity (deficit) 48,005 (13,300 ) Total liabilities and equity (deficit) $ 1,957,273 $ 1,669,842 ____________________________ (a) Class A Common Stock, $0.01 par value per share, 120,000 shares authorized; 46,526 and 46,076 shares issued as of March 31, 2026 and June 30, 2025, respectively. (b) Class B Common Stock, $0.01 par value per share, 30,000 shares authorized; 6,867 shares issued as of March 31, 2026 and June 30, 2025. MADISON SQUARE GARDEN ENTERTAINMENT CORP. SELECTED CASH FLOW INFORMATION (in thousands) (Unaudited) Nine Months Ended March 31, 2026 2025 Net cash provided by operating activities $ 368,053 $ 142,308 Net cash used in investing activities (25,455 ) (19,379 ) Net cash used in financing activities (62,483 ) (67,010 ) Net increase in cash, cash equivalents, and restricted cash 280,115 55,919 Cash, cash equivalents, and restricted cash, beginning of period 43,538 33,555 Cash, cash equivalents, and restricted cash, end of period $ 323,653 $ 89,474 Source: Madison Square Garden Entertainment Corp.