Sphere Entertainment Co. Reports Fourth Quarter and Full Year 2025 Results

Sphere Entertainment Co. Reports Fourth Quarter and Full Year 2025 Results 02/12/2026 Sphere Entertainment Co. (NYSE: SPHR) (“Sphere Entertainment” or the “Company”) today reported financial results for the fourth quarter and full-year ended December 31, 2025. Recent highlights for the Company’s Sphere segment include: In January, the Company announced with the State of Maryland, Prince George’s County, and Peterson Companies the intent to develop a new Sphere venue – which would be the second in the U.S. and first to utilize a smaller-scale design model – at National Harbor, a premier destination in the Washington, D.C. metropolitan area;The Wizard of Oz at Sphere, the Sphere Experience that opened in Las Vegas on August 28, 2025, surpassed two million tickets sold in mid-January;Lenovo held its Tech World event at Sphere during the Consumer Electronics Show (“CES”) in January, marking the venue’s second consecutive year as a CES keynote destination; andThe Company announced multi-year sponsorship and advertising partnerships, including with Anheuser-Busch and Delta Air Lines, and debuted the first live interactive game experience on the Exosphere, in collaboration with the LEGO Group and Lucasfilm’s Star Wars. For the three months ended December 31, 2025, the Company reported revenues of $394.3 million, an increase of $86.0 million, or 28%, as compared to the prior year quarter. In addition, the Company reported operating income of $28.9 million, an increase of $171.9 million, and adjusted operating income of $128.0 million, an increase of $95.2 million, both as compared to the prior year quarter.(1) For the twelve months ended December 31, 2025, the Company reported revenues of $1,220.0 million, an increase of $89.1 million, or 8%, as compared to the prior year period. In addition, the Company reported an operating loss of $229.6 million, an improvement of $142.8 million, or 38%, and adjusted operating income of $261.8 million, an increase of $152.0 million, or 138%, both as compared to the prior year period.(1) Executive Chairman and CEO James L. Dolan said, “Today’s results serve as continued validation of the business model behind Sphere. As we begin 2026, we remain focused on expanding Sphere’s global footprint, including advancing our plans to bring Sphere to Abu Dhabi and National Harbor, and believe the Company is well-positioned for long-term growth.” Segment Results for the Three and Twelve Months Ended December 31, 2025 and 2024: (In millions) Three Months Ended Twelve Months Ended December 31, Change December 31, Change 2025 2024 $ % 2025 2024 $ % Revenues: Sphere $ 274.2 $ 169.0 $ 105.2 62 % $ 781.4 $ 617.7 $ 163.7 27 % MSG Networks 120.1 139.3 (19.2 ) (14 )% 438.6 513.3 (74.6 ) (15 )% Total Revenues $ 394.3 $ 308.3 $ 86.0 28 % $ 1,220.0 $ 1,130.9 $ 89.1 8 % Operating Income (Loss): Sphere $ (6.5 ) $ (107.9 ) $ 101.4 94 % $ (268.2 ) $ (421.0 ) $ 152.9 36 % MSG Networks 35.4 (35.0 ) 70.5 NM 38.6 48.7 (10.1 ) (21 )% Total Operating Income (Loss) $ 28.9 $ (142.9 ) $ 171.9 NM $ (229.6 ) $ (372.3 ) $ 142.8 38 % Adjusted Operating Income (Loss):(1) Sphere $ 89.4 $ (0.8 ) $ 90.2 NM $ 144.6 $ (19.7 ) $ 164.2 NM MSG Networks 38.6 33.7 5.0 15 % 117.3 129.5 (12.2 ) (9 )% Total Adjusted Operating Income $ 128.0 $ 32.9 $ 95.2 NM $ 261.8 $ 109.8 $ 152.0 138 % Note: Does not foot due to rounding. NM — Absolute percentages greater than 200% and comparisons from positive to negative values or to zero values are considered not meaningful. 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 three months ended December 31, 2025, the Sphere segment reported revenues of $274.2 million, an increase of $105.2 million, or 62%, as compared to the prior year quarter. Revenues related to The Sphere Experience increased $108.5 million as compared to the prior year quarter, which reflected higher per-show revenue due to the impact of The Wizard of Oz at Sphere and, to a lesser extent, an increase in the number of overall performances. In the current year quarter, The Sphere Experience included 245 performances of The Wizard of Oz at Sphere as compared to 190 performances of Postcard from Earth and V-U2 An Immersive Concert Film in the prior year quarter. Revenues from sponsorship, Exosphere advertising and suite license fees increased $4.2 million as compared to the prior year quarter, reflecting an increase in Exosphere advertising and sponsorship revenues, as well as higher suite license fee revenues. Other revenues decreased $4.4 million as compared to the prior year quarter. Event-related revenues decreased $3.1 million as compared to the prior year quarter, primarily due to the absence of one brand event (formerly referred to as corporate events) held in the prior year quarter. This decrease was partially offset by two additional concert residency shows held at Sphere as compared to the prior year quarter and, to a lesser extent, higher per-concert revenue as compared to the prior year quarter. For the three months ended December 31, 2025, the Sphere segment had direct operating expenses of $92.6 million, an increase of $20.0 million, or 27%, as compared to the prior year quarter. Expenses associated with The Sphere Experience increased $21.9 million as compared to the prior year quarter due to higher per-show expenses for The Wizard of Oz at Sphere and an increase in the number of overall performances. This was partially offset by other cost decreases. For the three months ended December 31, 2025, selling, general and administrative expenses of $104.1 million decreased $14.9 million, or 13%, as compared to the prior year quarter, primarily due to lower employee compensation and related benefits of $14.4 million, including the impact of executive management transition costs of $4.2 million recorded in the current year quarter as compared to executive management transition costs of $8.3 million recorded in the prior year quarter. For the three months ended December 31, 2025, operating loss of $6.5 million improved by $101.4 million and adjusted operating income of $89.4 million increased by $90.2 million, both as compared to the prior year quarter, primarily due to the increase in revenues and, to a lesser extent, lower selling, general and administrative expenses, partially offset by higher direct operating expenses. MSG Networks For the three months ended December 31, 2025, the MSG Networks segment reported total revenues of $120.1 million, a decrease of $19.2 million, or 14%, as compared to the prior year quarter. Distribution revenue decreased $19.7 million, primarily due to a decrease in total subscribers of approximately 14.5% and the impact of lower affiliation rates in the current year quarter. For the three months ended December 31, 2025, direct operating expenses of $70.7 million decreased $23.8 million, or 25%, as compared to the prior year quarter. Rights fees expense decreased $19.5 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 and other rights fees decreases. Other programming and production costs decreased $4.3 million as compared to the prior year quarter, primarily due to lower costs related to MSG+ as well as other cost decreases. For the three months ended December 31, 2025, selling, general and administrative expenses of $10.8 million decreased $5.5 million, or 33%, as compared to the prior year quarter. This decrease was primarily due to (i) lower employee compensation and related benefits of $3.2 million and (ii) lower professional fees of $3.2 million, mainly due to the absence of costs associated with pursuing a work-out of MSG Networks’ credit facilities with its syndicate of lenders recorded in the prior year quarter, partially offset by higher advertising and marketing costs of $1.0 million. In addition, results for the three months ended December 31, 2025 had no impairment and other losses, net, as compared to a non-cash goodwill impairment charge of $61.2 million in the prior year quarter. For the three months ended December 31, 2025, operating income of $35.4 million increased by $70.5 million from an operating loss of $35.0 million in the prior year quarter, primarily due to the absence of impairment and other losses, net, recorded in the prior year quarter, lower direct operating expenses and, to a lesser extent, lower selling, general and administrative expenses, partially offset by the decrease in revenues. Adjusted operating income of $38.6 million increased $5.0 million, or 15%, as compared to the prior year quarter, primarily due to lower direct operating expenses, partially offset by the decrease in revenues. 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 a second venue planned for Abu Dhabi. 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 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 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 February 19, 2026 SPHERE ENTERTAINMENT CO. CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) (Unaudited) Three Months Ended Twelve Months Ended December 31, December 31, 2025 2024 2025 2024 Revenues $ 394,283 $ 308,290 $ 1,220,045 $ 1,130,928 Direct operating expenses (163,354 ) (167,175 ) (589,979 ) (610,430 ) Selling, general and administrative expenses (114,934 ) (135,286 ) (441,918 ) (484,452 ) Depreciation and amortization (84,173 ) (83,319 ) (336,411 ) (327,436 ) Impairment and other losses, net (162 ) (61,200 ) (69,781 ) (70,968 ) Restructuring charges (2,739 ) (4,251 ) (11,520 ) (9,972 ) Operating income (loss) 28,921 (142,941 ) (229,564 ) (372,330 ) Other income (expense): Gain on extinguishment of debt — — 346,092 — Interest income 2,799 4,374 13,498 26,796 Interest expense (9,079 ) (30,414 ) (70,546 ) (111,428 ) Other (expense) income, net (197 ) 651 (2,265 ) (5,913 ) Income (loss) from continuing operations before income taxes 22,444 (168,330 ) 57,215 (462,875 ) Income tax benefit (expense) 42,295 42,380 (23,810 ) 113,185 Income (loss) from continuing operations 64,739 (125,950 ) 33,405 (349,690 ) Income from discontinued operations, net of taxes — — — 24,631 Less: Net income attributable to participating securities 7,092 — — — Net income (loss) attributable to Sphere Entertainment Co.’s stockholders $ 57,647 $ (125,950 ) $ 33,405 $ (325,059 ) Basic income (loss) per common share Continuing operations $ 1.62 $ (3.49 ) $ 0.93 $ (9.77 ) Discontinued operations — — — 0.69 Basic income (loss) per common share attributable to Sphere Entertainment Co.’s stockholders $ 1.62 $ (3.49 ) $ 0.93 $ (9.09 ) Diluted income (loss) per common share Continuing operations $ 1.23 $ (3.49 ) $ 0.74 $ (9.77 ) Discontinued operations — — — 0.69 Diluted income (loss) per common share attributable to Sphere Entertainment Co.’s stockholders $ 1.23 $ (3.49 ) $ 0.74 $ (9.09 ) Weighted-average number of common shares outstanding: Basic 35,687 36,054 36,069 35,775 Diluted 46,859 36,054 45,298 35,775 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: Share-based compensation. This adjustment eliminates the compensation expense relating to restricted stock units, performance stock units and stock options granted under the Sphere Entertainment Employee Stock Plan, MSG Sports Employee Stock Plan, MSG Networks Employee Stock Plan, as amended and assumed by Sphere Entertainment, and Sphere Entertainment Non-Employee Director Plan.Depreciation and amortization. This adjustment eliminates depreciation and amortization of property and equipment and intangible assets.Restructuring charges. This adjustment eliminates costs related to termination benefits provided to employees as part of the Company's full-time workforce reductions.Impairment and other losses (gains), net. This adjustment eliminates non-cash impairment charges and the impact of gains or losses from the disposition of assets or businesses.Merger, debt work-out, and acquisition-related costs, including merger-related litigation expenses, net of insurance recoveries. This adjustment eliminates costs related to mergers, debt work-outs and acquisitions, including 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 Company's executive deferred compensation plan. Three Months Ended Twelve Months Ended December 31, December 31, 2025 2024 2025 2024 Operating income (loss) $ 28,921 $ (142,941 ) $ (229,564 ) $ (372,330 ) Share-based compensation 10,027 17,827 59,005 63,439 Depreciation and amortization 84,173 83,319 336,411 327,436 Restructuring charges 2,739 4,251 11,520 9,972 Impairment and other losses, net 162 61,200 69,781 70,968 Merger, debt work-out, and acquisition-related costs, including merger-related litigation expenses, net of insurance recoveries 358 7,557 7,888 8,322 Amortization for capitalized cloud computing costs 1,579 1,709 6,316 1,774 Remeasurement of deferred compensation plan liabilities 67 (66 ) 467 259 Adjusted operating income $ 128,026 $ 32,856 $ 261,824 $ 109,840 SPHERE ENTERTAINMENT CO. SEGMENT RESULTS (In thousands) (Unaudited) BUSINESS SEGMENT RESULTS Three Months Ended December 31, 2025 Sphere MSG Networks Total Revenues $ 274,190 $ 120,093 $ 394,283 Direct operating expenses (92,645 ) (70,709 ) (163,354 ) Selling, general and administrative expenses (104,104 ) (10,830 ) (114,934 ) Depreciation and amortization (82,061 ) (2,112 ) (84,173 ) Impairment and other losses, net (162 ) — (162 ) Restructuring charges (1,731 ) (1,008 ) (2,739 ) Operating (loss) income $ (6,513 ) $ 35,434 $ 28,921 Reconciliation to adjusted operating income: Share-based compensation 9,956 71 10,027 Depreciation and amortization 82,061 2,112 84,173 Restructuring charges 1,731 1,008 2,739 Impairment and other losses, net 162 — 162 Merger, debt work-out, and acquisition-related costs, including merger-related litigation expenses, net of insurance recoveries 358 — 358 Amortization for capitalized cloud computing costs 1,579 — 1,579 Remeasurement of deferred compensation plan liabilities 67 — 67 Adjusted operating income $ 89,401 $ 38,625 $ 128,026 Three Months Ended December 31, 2024 Sphere MSG Networks Total Revenues $ 169,020 $ 139,270 $ 308,290 Direct operating expenses (72,665 ) (94,510 ) (167,175 ) Selling, general and administrative expenses (119,003 ) (16,283 ) (135,286 ) Depreciation and amortization (81,002 ) (2,317 ) (83,319 ) Impairment and other losses, net — (61,200 ) (61,200 ) Restructuring charges (4,251 ) — (4,251 ) Operating loss $ (107,901 ) $ (35,040 ) $ (142,941 ) Reconciliation to adjusted operating (loss) income: Share-based compensation 16,183 1,644 17,827 Depreciation and amortization 81,002 2,317 83,319 Restructuring charges 4,251 — 4,251 Impairment and other losses, net — 61,200 61,200 Merger, debt work-out, and acquisition-related costs, including merger-related litigation expenses, net of insurance recoveries 4,151 3,406 7,557 Amortization for capitalized cloud computing costs 1,579 130 1,709 Remeasurement of deferred compensation plan liabilities (66 ) — (66 ) Adjusted operating (loss) income $ (801 ) $ 33,657 $ 32,856 SPHERE ENTERTAINMENT CO. SEGMENT RESULTS (Continued) (In thousands) (Unaudited) Twelve Months Ended December 31, 2025 Sphere MSG Networks Total Revenues $ 781,412 $ 438,633 $ 1,220,045 Direct operating expenses (318,265 ) (271,714 ) (589,979 ) Selling, general and administrative expenses (389,594 ) (52,324 ) (441,918 ) Depreciation and amortization (327,769 ) (8,642 ) (336,411 ) Impairment and other losses, net (4,381 ) (65,400 ) (69,781 ) Restructuring charges (9,560 ) (1,960 ) (11,520 ) Operating (loss) income $ (268,157 ) $ 38,593 $ (229,564 ) Reconciliation to adjusted operating income: Share-based compensation 60,272 (1,267 ) 59,005 Depreciation and amortization 327,769 8,642 336,411 Restructuring charges. 9,560 1,960 11,520 Impairment and other losses, net 4,381 65,400 69,781 Merger, debt work-out, and acquisition-related costs, including merger-related litigation expenses, net of insurance recoveries 3,954 3,934 7,888 Amortization for capitalized cloud computing costs 6,316 — 6,316 Remeasurement of deferred compensation plan liabilities 467 — 467 Adjusted operating income $ 144,562 $ 117,262 $ 261,824 Twelve Months Ended December 31, 2024 Sphere MSG Networks Total Revenues $ 617,673 $ 513,255 $ 1,130,928 Direct operating expenses (265,278 ) (345,152 ) (610,430 ) Selling, general and administrative expenses (435,038 ) (49,414 ) (484,452 ) Depreciation and amortization (318,667 ) (8,769 ) (327,436 ) Impairment and other losses, net (9,768 ) (61,200 ) (70,968 ) Restructuring charges (9,932 ) (40 ) (9,972 ) Operating (loss) income $ (421,010 ) $ 48,680 $ (372,330 ) Reconciliation to adjusted operating (loss) income: Share-based compensation 54,973 8,466 63,439 Depreciation and amortization 318,667 8,769 327,436 Restructuring charges 9,932 40 9,972 Impairment and other losses, net 9,768 61,200 70,968 Merger, debt work-out, and acquisition-related costs, including merger-related litigation expenses, net of insurance recoveries 6,169 2,153 8,322 Amortization for capitalized cloud computing costs 1,579 195 1,774 Remeasurement of deferred compensation plan liabilities 259 — 259 Adjusted operating (loss) income $ (19,663 ) $ 129,503 $ 109,840 SPHERE ENTERTAINMENT CO. CONSOLIDATED BALANCE SHEETS (In thousands, except per share data) (Unaudited) As of December 31, 2025 2024 ASSETS Current Assets: Cash, cash equivalents and restricted cash $ 521,264 $ 515,633 Accounts receivable, net 171,630 154,624 Related party receivables, current 24,457 25,729 Prepaid expenses and other current assets 92,824 65,007 Total current assets 810,175 760,993 Non-Current Assets: Investments 38,725 40,396 Property and equipment, net 2,710,643 3,035,730 Right-of-use lease assets 91,372 93,920 Goodwill 344,772 410,172 Intangible assets, net 21,817 28,383 Other non-current assets 192,404 145,706 Total assets $ 4,209,908 $ 4,515,300 LIABILITIES AND EQUITY Current Liabilities: Accounts payable $ 24,593 $ 33,606 Accrued expenses and other current liabilities 431,477 388,370 Related party payables, current 14,301 9,504 Current portion of long-term debt, net 63,009 829,125 Operating lease liabilities, current 17,186 19,268 Deferred revenue 192,808 91,794 Total current liabilities 743,374 1,371,667 Non-Current Liabilities: Long-term debt, net 767,439 524,010 Operating lease liabilities, non-current 113,824 116,668 Deferred tax liabilities, net 172,111 148,870 Other non-current liabilities 179,921 152,666 Total liabilities 1,976,669 2,313,881 Commitments and contingencies Equity: Class A Common Stock(a) 297 290 Class B Common Stock(b) 69 69 Additional paid-in capital 2,470,120 2,428,414 Treasury stock, at cost, 1,054 and 0 shares as of December 31, 2025 and 2024 (50,024 ) — Accumulated deficit (186,441 ) (219,846 ) Accumulated other comprehensive loss (782 ) (7,508 ) Total stockholders’ equity 2,233,239 2,201,419 Total liabilities and equity $ 4,209,908 $ 4,515,300 _________________ (a) Class A Common Stock, $0.01 par value per share, 120,000 shares authorized; 28,629 and 28,960 shares outstanding as of December 31, 2025 and 2024, respectively. (b) Class B Common Stock, $0.01 par value per share, 30,000 shares authorized; 6,867 shares outstanding as of December 31, 2025 and 2024. SPHERE ENTERTAINMENT CO. SELECTED CASH FLOW INFORMATION (In thousands) (Unaudited) Twelve Months Ended December 31, 2025 2024 Net cash provided by operating activities $ 243,346 $ 69,407 Net cash used in investing activities (3,901 ) (106,312 ) Net cash used in financing activities (233,345 ) (74,168 ) Effect of exchange rates on cash, cash equivalents and restricted cash (469 ) (1,121 ) Net increase (decrease) in cash, cash equivalents and restricted cash 5,631 (112,194 ) Cash, cash equivalents and restricted cash beginning of period 515,633 627,827 Cash, cash equivalents and restricted cash at end of period $ 521,264 $ 515,633 Source: Sphere Entertainment Co.