Loading...
•
Mar 31, 2023
Sphere Entertainment Co Q3 2023 Earnings Report
Reported a modest revenue increase but posted a net loss for the quarter
Key Takeaways
Sphere Entertainment Co. delivered higher revenues in Q3 2023 driven by growth in the Entertainment segment, but recorded a net loss due to higher operating expenses and merger-related costs.
Revenues rose 3% year-over-year to $363.3 million.
Entertainment segment revenues increased by 4%, boosted by higher arena-related revenues and event sales.
MSG Networks revenues declined 4% due to lower subscription fees despite higher advertising sales.
Net loss widened to $56.8 million driven by higher SG&A expenses and restructuring costs.
Sphere Entertainment Co
Sphere Entertainment Co
Sphere Entertainment Co Revenue by Segment
Revenue by Segment
MSG Networks Revenue
CapyFin.com Forward Guidance
The company remains focused on the launch of Sphere in Las Vegas, with events planned for late 2023, and anticipates long-term value creation.
Positive Outlook
- Sphere Las Vegas construction in final phases with opening scheduled for September 2023.
- U2 residency to launch Sphere's debut events.
- Postcard from Earth immersive production set to run year-round starting October 2023.
- Formula 1 Las Vegas Grand Prix will feature a multi-day takeover of Sphere.
- Company holds significant liquidity including $230M in cash and valuable equity stakes.
Challenges Ahead
- Increased construction cost estimates for Sphere to $2.3 billion due to project complexity.
- Higher SG&A expenses driven by spin-off and Sphere-related costs.
- Ongoing operating losses in the Entertainment segment.
- Declining subscriber base for MSG Networks affecting affiliation fee revenues.
- Restructuring charges continue to impact profitability.