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

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; and

• The 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:

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.

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.

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Ari Danes, CFA

Investor Relations and Financial Communications

(212) 465-6072



Grace Kaminer

Investor Relations

(212) 631-5076



Sarah Rothschild

Investor Relations

(212) 631-5345