Sphere Entertainment (SPHR) investor relations material

Executive summary

• Revenues for Q1 2026 increased 38% year-over-year to $386.4 million, driven by strong performance at Sphere Las Vegas, immersive productions, and event-related revenues.

• Adjusted operating income reached $110 million, up from $36 million year-over-year, with both Sphere and MSG Networks segments contributing.

• Net income was $4.5 million, a turnaround from a net loss of $82 million in Q1 2025, reflecting improved operating results and lower interest expense.

• Sphere Experience in Las Vegas surpassed 500 showings, with new residencies and sponsorships announced.

• Progressing with global expansion plans, including projects in Abu Dhabi and National Harbor, with financing and design advancing as scheduled.

Financial highlights

• Operating income was $7.2 million, compared to a loss of $78.6 million in the prior year period.

• Sphere segment revenues grew 69% year-over-year to $266 million, driven by The Wizard of Oz, increased event activity, and sponsorships.

• MSG Networks segment generated $120.4 million in revenues, down 2% year-over-year, mainly due to lower advertising and subscriber losses.

• Adjusted operating income for Sphere rose to $74.3 million from $13.1 million; MSG Networks AOI increased to $35.7 million from $22.8 million.

• Cash and cash equivalents increased to $630.2 million as of March 31, 2026.

Outlook and guidance

• Management expects substantial annual revenue and AOI from Sphere Las Vegas, but notes uncertainty around new immersive productions.

• Expansion plans for Sphere venues in Abu Dhabi and National Harbor are progressing, with additional global markets under discussion.

• Anticipate continued robust demand for residencies and Sphere Experiences, with expansion into new markets and venues.

• MSG Networks is expected to face continued subscriber declines, which may negatively impact future revenue and operating income.

• SG&A expenses expected to fluctuate quarter-over-quarter due to mark-to-market impacts from share-based compensation, with ongoing focus on cost savings.