NYSE$SPHR

Sphere Entertainment Co · Q2 2023 earnings

Q2 2023 earnings · · Investor relations

Briefing

MSG Entertainment posted strong Q2 FY2023 results with double-digit revenue growth and significant operating income gains.

MSG Entertainment reported Q2 FY2023 revenue of $642.2 million, up 24% year-over-year, driven by strong performances in its Entertainment and Tao Group Hospitality segments. Operating income more than doubled, and adjusted operating income rose 63%, reflecting robust holiday season events and increased sponsorships.

  • Revenue grew 24% year-over-year to $642.2 million.
  • Operating income increased 109% to $74.0 million.
  • Adjusted operating income rose 63% to $124.1 million.
  • Entertainment segment revenue jumped 44%, driven by the Christmas Spectacular and higher event-related revenues.

Headline financials

Total Revenue

$642M

Previous: $516M+24.4%
EPS (adj)

$1.95

Previous: $0.07+2685.7%
Adjusted Operating Income

$124M

Previous: $76.1M+63.1%
Capital Expenditures

-$290M

Previous: -$176M-64.8%
Free Cash Flow

-$222M

Previous: -$174M-28.0%
Net Income

$67.6M

Previous: $2.27M+2876.0%
Operating Income

$74M

Previous: $35.4M+109.2%
Gross Profit

$293M

Previous: $219M+33.9%
Cash & Equivalents

$432M

Previous: $1.26B-65.6%
Total Assets

$5.85B

Previous: $5.52B+5.9%
Stock-Based Comp

$20.5M

Previous: $24.2M-15.3%

Revenue & EPS history

Sphere Entertainment Co · Revenue · Quarterly

$642M

Q2 2023+24.4%vs Q2 2022
Beat estimate in 8 of 14 quarters(57%)
ActualEstimate

Revenue by segment

Sphere Entertainment Co · $515M total across 2 segments · Q2 2023

  • Sphere
    $357M+44.0%
  • MSG Networks
    $159M-0.7%

Forward guidance

The company anticipates completing the spin-off of its live entertainment business by March 2023 and expects MSG Sphere in Las Vegas to open in September 2023, positioning it for long-term growth.

Tailwinds

  • Spin-off of live entertainment business expected to close by March 2023.
  • Opening of MSG Sphere in Las Vegas set for September 2023.
  • Continued strong demand for live events.
  • Positive momentum in sports bookings and sponsorships.
  • Expansion of Tao Group Hospitality's global footprint.

Headwinds

  • Decline in MSG Networks revenue due to lower subscribers.
  • Higher operating expenses in Entertainment and Tao segments.
  • Increased professional fees related to spin-off costs.
  • Higher employee compensation costs.
  • Ongoing restructuring charges from cost reduction programs.

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q2 2023

Historical avgQ2 2023

+1.5%

Avg return

Earnings day

+2.6%

Avg return

5 days after

+2.7%

Avg return

30 days after

46%

12 / 26 earnings

Positive

+22.1%

Q4 2025

Best reaction

-15.1%

Q3 2023

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q4 2025+22.1%+21.0%+11.5%
Q3 2026+4.7%+16.2%+24.8%
Q1 2026+4.7%+16.2%+24.8%
Q1 2025+9.2%+26.1%+26.5%
Q2 2026-2.0%-18.8%-23.3%
Q4 2024+0.7%+21.5%+3.6%
Q3 2024+0.9%-8.4%-11.0%
Q2 2024-0.3%+13.8%+35.9%
Q1 2024+2.2%+2.9%-2.2%
Q4 2023+4.0%-7.9%-1.1%
Q3 2023-15.1%-25.9%-11.3%
Q2 2023+8.3%+13.8%+6.6%
Q1 2023-2.2%-4.0%-9.3%
Q4 2022-7.1%-3.3%-12.3%
Q2 2022-7.1%-3.3%-12.3%
Q3 2022-11.3%-11.9%-5.0%
Q1 2022-8.5%-9.8%-17.3%
Q4 2021+17.9%+26.7%+21.7%
Q2 2021+17.9%+26.7%+21.7%
Q3 2021+5.2%-3.2%+4.2%
Q1 2021-1.2%-4.3%+0.1%
Q1 2020-1.2%-4.3%+0.1%
Q2 2020-0.3%+4.8%-8.8%
Q4 2020-0.3%-8.3%+6.1%
Q4 2019-1.6%-3.9%-2.2%
Q3 2020-1.6%-3.9%-2.2%
Q3 2019

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