Cover
Cover - shares | 9 Months Ended | |
Mar. 31, 2024 | Apr. 30, 2024 | |
Document [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2024 | |
Document Transition Report | false | |
Entity File Number | 001-39245 | |
Entity Registrant Name | SPHERE ENTERTAINMENT CO. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 84-3755666 | |
Entity Address, Address Line One | Two Penn Plaza | |
Entity Address, City or Town | New York | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 10121 | |
City Area Code | 725 | |
Local Phone Number | 258-0001 | |
Title of 12(b) Security | Class A Common Stock | |
Trading Symbol | SPHR | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Central Index Key | 0001795250 | |
Current Fiscal Year End Date | --06-30 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false | |
Common Class A | ||
Document [Line Items] | ||
Entity Common Stock, Shares Outstanding | 28,461,121 | |
Common Class B | ||
Document [Line Items] | ||
Entity Common Stock, Shares Outstanding | 6,866,754 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) - USD ($) $ in Thousands | Mar. 31, 2024 | Jun. 30, 2023 | |
Current Assets: | |||
Cash, cash equivalents, and restricted cash | $ 693,946 | $ 429,114 | |
Prepaid expenses and other current assets | 30,216 | 56,085 | |
Total current assets | 916,059 | 623,913 | |
Non-Current Assets: | |||
Investments | 51,849 | 395,606 | |
Property and equipment, net | 3,219,889 | 3,307,161 | |
Right-of-use lease assets | 109,663 | 84,912 | |
Goodwill | 456,807 | 456,807 | |
Intangible assets, net | 15,574 | 17,910 | |
Other non-current assets | 98,971 | 86,706 | |
Total assets | 4,868,812 | 4,973,015 | |
Current Liabilities: | |||
Accounts payable, accrued and other current liabilities | 423,113 | 515,731 | |
Current portion of long-term debt, net | 869,776 | 82,500 | |
Operating lease liabilities, current | 17,748 | 10,127 | |
Deferred revenue | 76,712 | 27,337 | |
Total current liabilities | 1,398,612 | 692,141 | |
Non-Current Liabilities: | |||
Long-term debt, net | 522,057 | 1,118,387 | |
Operating lease liabilities, non-current | 130,419 | 110,259 | |
Deferred tax liabilities, net | 254,995 | 379,552 | |
Other non-current liabilities | 119,130 | 88,811 | |
Total liabilities | 2,425,213 | 2,389,150 | |
Commitments and contingencies (see Note 10) | |||
Equity: | |||
Additional paid-in capital | 2,392,247 | 2,376,420 | |
Retained earnings | 57,973 | 212,036 | |
Accumulated other comprehensive loss | (6,974) | (4,938) | |
Total stockholders’ equity | 2,443,599 | 2,583,865 | |
Total liabilities and equity | 4,868,812 | 4,973,015 | |
Nonrelated Party | |||
Current Assets: | |||
Accounts receivable, net | 178,702 | 112,309 | |
Related Party | |||
Current Assets: | |||
Accounts receivable, net | 13,195 | 26,405 | |
Current Liabilities: | |||
Related party payables, current | 11,263 | 56,446 | |
Common Class A | |||
Equity: | |||
Common stock | [1] | 284 | 278 |
Common Class B | |||
Equity: | |||
Common stock | [2] | $ 69 | $ 69 |
[1]Class A Common Stock, $0.01 par value per share, 120,000 shares authorized; 28,461 and 27,812 shares issued and outstanding as of March 31, 2024 and June 30, 2023, respectively.[2]Class B Common Stock, $0.01 par value per share, 30,000 shares authorized; 6,867 shares issued and outstanding as of March 31, 2024 and June 30, 2023. |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Parenthetical) - $ / shares shares in Thousands | Mar. 31, 2024 | Jun. 30, 2023 |
Common Class A | ||
Common stock, par or stated value per share (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 120,000 | 120,000 |
Common stock, shares, outstanding (in shares) | 28,461 | 27,812 |
Common stock, shares, issued (in shares) | 28,461 | 27,812 |
Common Class B | ||
Common stock, par or stated value per share (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 30,000 | 30,000 |
Common stock, shares, outstanding (in shares) | 6,867 | 6,867 |
Common stock, shares, issued (in shares) | 6,867 | 6,867 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | ||
Revenues | $ 321,330 | $ 162,062 | $ 753,494 | $ 444,732 | |
Depreciation and amortization | (174,157) | (89,234) | |||
Impairment and other losses, net | (115,738) | 7,834 | |||
Restructuring charges | (4,667) | (18,670) | (9,345) | (26,745) | |
Other (expense) income, net | (3,256) | (4,182) | 37,810 | (5,952) | |
Loss from continuing operations | (47,240) | (113,998) | (153,416) | (187,609) | |
Income (loss) from discontinued operations, net of taxes | 0 | 55,443 | (647) | 155,568 | |
Net loss | (47,240) | (58,555) | (154,063) | (32,041) | |
Less: Net (loss) income attributable to redeemable noncontrolling interests from discontinued operations | (1,492) | 2,661 | |||
Net loss attributable to Sphere Entertainment Co.’s stockholders | $ (47,240) | $ (56,847) | $ (154,063) | $ (34,020) | |
Basic loss per common share | |||||
Continuing operations (in dollars per share) | $ (1.33) | $ (3.28) | $ (4.36) | $ (5.42) | |
Discontinued operations (in dollars per share) | 0 | 1.65 | (0.02) | 4.44 | |
Basic loss per common share attributable to Sphere Entertainment Co.'s stockholders (in dollars per share) | (1.33) | (1.64) | (4.38) | (0.98) | |
Diluted loss per common share | |||||
Continuing operations (in dollars per share) | (1.33) | (3.28) | (4.36) | (5.42) | |
Discontinued operations (in dollars per share) | 0 | 1.65 | (0.02) | 4.44 | |
Diluted loss per common share attributable to Sphere Entertainment Co.'s stockholders (in dollars per share) | $ (1.33) | $ (1.64) | $ (4.38) | $ (0.98) | |
Weighted-average number of common shares outstanding: | |||||
Basic (in shares) | 35,418 | 34,727 | 35,212 | 34,604 | |
Diluted (in shares) | 35,418 | 34,727 | 35,212 | 34,604 | |
Continuing Operations | |||||
Revenues | [1] | $ 321,330 | $ 162,062 | $ 753,494 | $ 444,732 |
Direct operating expenses | [1] | (154,040) | (93,665) | (398,305) | (259,485) |
Selling, general and administrative expenses | [1] | (123,149) | (143,433) | (325,813) | (342,479) |
Depreciation and amortization | (79,867) | (8,200) | (174,157) | (21,719) | |
Impairment and other losses, net | 0 | 0 | (115,738) | 3,000 | |
Restructuring charges | (4,667) | (18,670) | (9,345) | (26,745) | |
Operating loss | (40,393) | (101,906) | (269,864) | (202,696) | |
Interest income | 7,654 | 3,374 | 17,958 | 9,376 | |
Interest expense | (27,119) | 0 | (52,947) | 0 | |
Other (expense) income, net | (3,256) | (4,182) | 37,810 | (5,952) | |
Loss from continuing operations before income taxes | (63,114) | (102,714) | (267,043) | (199,272) | |
Income tax benefit (expense) | 15,874 | (11,284) | 113,627 | 11,663 | |
Net loss | (47,240) | (58,555) | (154,063) | (32,041) | |
Discontinued Operations | |||||
Less: Net loss attributable to nonredeemable noncontrolling interests from discontinued operations | 0 | (216) | 0 | (682) | |
Less: Net (loss) income attributable to redeemable noncontrolling interests from discontinued operations | $ 0 | $ (1,492) | $ 0 | $ 2,661 | |
[1]See Note 15. Related Party Transactions, for further information on related party revenues and expenses. |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS (UNAUDITED) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
Net loss | $ (47,240) | $ (58,555) | $ (154,063) | $ (32,041) |
Other comprehensive (loss) income, before income taxes: | ||||
Other comprehensive (loss) income, net of income taxes | (660) | 2,124 | (2,036) | 1,916 |
Less: Net (loss) income attributable to redeemable noncontrolling interests from discontinued operations | (1,492) | 2,661 | ||
Comprehensive loss attributable to Sphere Entertainment Co.’s stockholders | (47,900) | (54,723) | (156,099) | (32,104) |
Continuing Operations | ||||
Net loss | (47,240) | (58,555) | (154,063) | (32,041) |
Other comprehensive (loss) income, before income taxes: | ||||
Amortization of net actuarial loss (gain) included in net periodic benefit cost | 77 | 464 | (61) | 1,484 |
Cumulative translation adjustments | (968) | 2,071 | (2,688) | 794 |
Other comprehensive (loss) income, before income taxes | (891) | 2,535 | (2,749) | 2,278 |
Income tax benefit (expense) | 231 | (411) | 713 | (362) |
Other comprehensive (loss) income, net of income taxes | (660) | 2,124 | (2,036) | 1,916 |
Comprehensive loss | (47,900) | (56,431) | (156,099) | (30,125) |
Discontinued Operations | ||||
Other comprehensive (loss) income, before income taxes: | ||||
Less: Net loss attributable to nonredeemable noncontrolling interests from discontinued operations | 0 | (216) | 0 | (682) |
Less: Net (loss) income attributable to redeemable noncontrolling interests from discontinued operations | $ 0 | $ (1,492) | $ 0 | $ 2,661 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Thousands | 9 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
OPERATING ACTIVITIES: | ||
Net loss | $ (154,063) | $ (32,041) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation and amortization | 174,157 | 89,234 |
Impairment and other losses (gains), net | 115,738 | (7,834) |
Amortization of debt discount and deferred financing costs | 2,216 | 4,186 |
Amortization of deferred production content | 13,334 | 0 |
Deferred income tax benefit | (123,844) | (5,031) |
Share-based compensation expense | 34,742 | 56,092 |
Net unrealized and realized loss (gains) on equity investments with readily determinable fair value and loss in nonconsolidated affiliates | 20,805 | (1,723) |
Other non-cash adjustments | 433 | 390 |
Change in assets and liabilities: | ||
Accounts receivable, net | (66,108) | (24,081) |
Related party receivables and payables, net | (31,973) | 9,030 |
Prepaid expenses and other current and non-current assets | 270 | (77,020) |
Accounts payable, accrued and other current and non-current liabilities | (1,939) | 68,650 |
Deferred revenue | 66,656 | 53,688 |
Right-of-use lease assets and operating lease liabilities | 2,356 | 4,284 |
Net cash provided by operating activities | 52,780 | 137,824 |
INVESTING ACTIVITIES: | ||
Proceeds from sale of MSGE Retained Interest | 256,501 | 0 |
Capital expenditures, net | (249,939) | (764,513) |
Capitalized interest | (25,053) | (88,450) |
Investments in nonconsolidated affiliates | (51) | (7,750) |
Proceeds from dispositions, net | 0 | 29,104 |
Proceeds from sale of equity securities | 0 | 4,369 |
Other investing activities | (1,698) | 1,756 |
Net cash used in investing activities | (20,240) | (825,484) |
FINANCING ACTIVITIES: | ||
Proceeds from issuance of 3.50% Convertible Senior Notes due 2028 | 251,634 | 0 |
Borrowings under Delayed Draw Term Loan Facility | 65,000 | 0 |
Proceeds from exercise of stock options | 8,827 | 0 |
Principal repayments on long-term debt | (61,875) | (52,250) |
Taxes paid in lieu of shares issued for equity-based compensation | (15,238) | (14,980) |
Purchase of capped call related to 3.50% Convertible Senior Notes due 2028 | (14,309) | 0 |
Payments for financing costs | (1,029) | (5,131) |
Proceeds from issuance of term loan | 0 | 275,168 |
Noncontrolling interest holders’ capital contributions | 0 | 3,000 |
Distributions to related parties associated with the settlement of certain share-based awards | 0 | (2,388) |
Repayments of revolving credit facility | 0 | (2,000) |
Distributions to noncontrolling interest holders | 0 | (1,722) |
Other financing activities | 0 | 788 |
Net cash provided by financing activities | 233,010 | 200,485 |
Effect of exchange rates on cash, cash equivalents, and restricted cash | (718) | (729) |
Net increase (decrease) in cash, cash equivalents, and restricted cash | 264,832 | (487,904) |
Cash, cash equivalents, and restricted cash at beginning of period | 429,114 | 846,010 |
Cash, cash equivalents, and restricted cash at end of period | 693,946 | 358,106 |
NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||
Capital expenditures incurred but not yet paid | 55,806 | 104,004 |
Non-cash repayment of the Delayed Draw Term Loan Facility | 65,512 | 0 |
Share-based compensation capitalized in property and equipment | 1,811 | 2,887 |
Investments and loans to nonconsolidated affiliates | 0 | 12,859 |
Continuing Operations | ||
OPERATING ACTIVITIES: | ||
Net loss | (154,063) | (32,041) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation and amortization | 174,157 | 21,719 |
Impairment and other losses (gains), net | 115,738 | (3,000) |
FINANCING ACTIVITIES: | ||
Cash, cash equivalents, and restricted cash at beginning of period | 429,114 | 760,312 |
Cash, cash equivalents, and restricted cash at end of period | 693,946 | 204,264 |
Discontinued Operations | ||
FINANCING ACTIVITIES: | ||
Cash, cash equivalents, and restricted cash at beginning of period | 0 | 85,698 |
Cash, cash equivalents, and restricted cash at end of period | $ 0 | $ 153,842 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (Parenthetical) | Mar. 31, 2024 | Dec. 08, 2023 |
3.50% Convertible Senior Notes | Senior Notes | ||
Interest rate | 3.50% | 3.50% |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY AND REDEEMABLE NONCONTROLLING INTERESTS (UNAUDITED) - USD ($) $ in Thousands | Total | Total Sphere Entertainment Co. Stockholders’ Equity | Common Stock Issued | Additional Paid-In Capital | Retained Earnings (Accumulated Deficit) | Accumulated Other Comprehensive Loss | Non - redeemable Noncontrolling Interests |
Balance at the beginning of the period at Jun. 30, 2022 | $ 1,975,384 | $ 1,963,221 | $ 342 | $ 2,301,970 | $ (290,736) | $ (48,355) | $ 12,163 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net loss | (34,702) | (34,020) | (34,020) | (682) | |||
Other comprehensive income (loss) | 1,916 | 1,916 | 1,916 | ||||
Share-based compensation | 57,009 | 57,009 | 57,009 | ||||
Tax withholding associated with shares issued for equity-based compensation | (14,980) | (14,980) | 4 | (14,984) | |||
BCE disposition | 667 | 667 | |||||
Redeemable noncontrolling interest adjustment to redemption fair value | 50,045 | 50,045 | 50,045 | ||||
Accretion of put options and adjustments | (895) | (895) | (895) | ||||
Contributions | 3,000 | 3,000 | |||||
Distributions | (3,458) | (1,736) | (1,736) | (1,722) | |||
Balance at the end of the period at Mar. 31, 2023 | 2,033,986 | 2,020,560 | 346 | 2,391,409 | (324,756) | (46,439) | 13,426 |
Balance at the beginning of the period at Jun. 30, 2022 | 184,192 | ||||||
Increase (Decrease) in Redeemable Noncontrolling Interests [Roll Forward] | |||||||
Net income (loss) attributable to redeemable noncontrolling interest | 2,661 | ||||||
Redeemable noncontrolling interest adjustment to redemption fair value | (50,045) | ||||||
Noncontrolling interest non-cash acquisition attributable to redeemable noncontrolling interests | 2,656 | ||||||
Noncontrolling interest, decrease from distributions to noncontrolling interest holders | (652) | ||||||
Balance at the end of the period at Mar. 31, 2023 | 138,812 | ||||||
Balance at the beginning of the period at Dec. 31, 2022 | 2,018,920 | 2,005,881 | 346 | 2,322,007 | (267,909) | (48,563) | 13,039 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net loss | (57,063) | (56,847) | (56,847) | (216) | |||
Other comprehensive income (loss) | 2,124 | 2,124 | 2,124 | ||||
Share-based compensation | 20,714 | 20,714 | 20,714 | ||||
Redeemable noncontrolling interest adjustment to redemption fair value | 50,045 | 50,045 | 50,045 | ||||
Contributions | 1,000 | 1,000 | |||||
Distributions | (1,754) | (1,357) | (1,357) | (397) | |||
Balance at the end of the period at Mar. 31, 2023 | 2,033,986 | 2,020,560 | 346 | 2,391,409 | (324,756) | (46,439) | 13,426 |
Balance at the beginning of the period at Dec. 31, 2022 | 190,222 | ||||||
Increase (Decrease) in Redeemable Noncontrolling Interests [Roll Forward] | |||||||
Net income (loss) attributable to redeemable noncontrolling interest | (1,492) | ||||||
Redeemable noncontrolling interest adjustment to redemption fair value | (50,045) | ||||||
Noncontrolling interest non-cash acquisition attributable to redeemable noncontrolling interests | 587 | ||||||
Noncontrolling interest, decrease from distributions to noncontrolling interest holders | (460) | ||||||
Balance at the end of the period at Mar. 31, 2023 | 138,812 | ||||||
Balance at the beginning of the period at Jun. 30, 2023 | 2,583,865 | 2,583,865 | 347 | 2,376,420 | 212,036 | (4,938) | 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net loss | (154,063) | (154,063) | (154,063) | ||||
Other comprehensive income (loss) | (2,036) | (2,036) | (2,036) | ||||
Share-based compensation | 36,500 | 36,500 | 36,500 | ||||
Purchase of capped call related to 3.50% Convertible Senior Notes due 2028 | (14,309) | (14,309) | (14,309) | ||||
Exercise of stock options | 8,827 | 8,827 | 1 | 8,826 | |||
Tax withholding associated with shares issued for equity-based compensation | (15,185) | (15,185) | 5 | (15,190) | |||
Balance at the end of the period at Mar. 31, 2024 | 2,443,599 | 2,443,599 | 353 | 2,392,247 | 57,973 | (6,974) | 0 |
Balance at the end of the period at Mar. 31, 2024 | 0 | ||||||
Balance at the beginning of the period at Dec. 31, 2023 | 2,465,164 | 2,465,164 | 352 | 2,365,913 | 105,213 | (6,314) | 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net loss | (47,240) | (47,240) | (47,240) | ||||
Other comprehensive income (loss) | (660) | (660) | (660) | ||||
Share-based compensation | 18,075 | 18,075 | 18,075 | ||||
Exercise of stock options | 8,827 | 8,827 | 1 | 8,826 | |||
Tax withholding associated with shares issued for equity-based compensation | (567) | (567) | (567) | ||||
Balance at the end of the period at Mar. 31, 2024 | 2,443,599 | $ 2,443,599 | $ 353 | $ 2,392,247 | $ 57,973 | $ (6,974) | $ 0 |
Balance at the end of the period at Mar. 31, 2024 | $ 0 |
CONDENSED CONSOLIDATED STATEM_6
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY AND REDEEMABLE NONCONTROLLING INTERESTS (UNAUDITED) (Parenthetical) | Mar. 31, 2024 | Dec. 08, 2023 |
3.50% Convertible Senior Notes | Senior Notes | ||
Interest rate | 3.50% | 3.50% |
Description of Business and Bas
Description of Business and Basis of Presentation | 9 Months Ended |
Mar. 31, 2024 | |
Description Of Business And Basis Of Presentation [Abstract] | |
Description of Business and Basis of Presentation | Description of Business and Basis of Presentation Description of Business Sphere Entertainment Co. (together with its subsidiaries, the “Company” or “Sphere Entertainment”) is a premier live entertainment and media company comprised of two reportable segments, Sphere and MSG Networks. Sphere is a next-generation entertainment medium, and MSG Networks operates two regional sports and entertainment networks, as well as a direct-to-consumer (“DTC”) and authenticated streaming product. Sphere : This segment reflects Sphere TM , a next-generation entertainment medium powered by cutting-edge technologies that enable multi-sensory storytelling at an unparalleled scale. The Company’s first Sphere opened in Las Vegas in September 2023. The venue can accommodate up to 20,000 guests and can host a wide variety of events year-round, including The Sphere Experience TM , which features original immersive productions, as well as concerts and residencies from renowned artists, and marquee sporting and corporate events. Supporting this strategy is Sphere Studios TM , which is home to a team of creative, production, technology and software experts who provide full in-house creative and production services. The studio campus in Burbank includes a 68,000-square-foot development facility, as well as Big Dome, a 28,000-square-foot, 100-foot high custom dome, with a quarter-sized version of the interior display plane at Sphere in Las Vegas, that serves as a specialized screening, production facility, and lab for content at Sphere. MSG Networks: This segment is comprised of the Company’s regional sports and entertainment networks, MSG Network and MSG Sportsnet, as well as its DTC and authenticated streaming product, MSG+. MSG Networks serves the New York designated market area, as well as other portions of New York, New Jersey, Connecticut and Pennsylvania and features a wide range of sports content, including exclusive live local games and other programming of the New York Knicks (the “Knicks”) of the National Basketball Association (the “NBA”) and the New York Rangers (the “Rangers”), New York Islanders (the “Islanders”), New Jersey Devils (the “Devils”) and Buffalo Sabres (the “Sabres”) of the National Hockey League (the “NHL”), as well as significant coverage of the New York Giants (the “Giants”) and the Buffalo Bills (the “Bills”) of the National Football League (the “NFL”). The Company (formerly Madison Square Garden Entertainment Corp.) was incorporated on November 21, 2019 as a direct, wholly-owned subsidiary of Madison Square Garden Sports Corp. (“MSG Sports”). On April 17, 2020, MSG Sports distributed all outstanding common stock of the Company to MSG Sports’ stockholders (the “2020 Entertainment Distribution”). MSG Entertainment Distribution On April 20, 2023 (the “MSGE Distribution Date”), the Company distributed approximately 67% of the outstanding common stock of Madison Square Garden Entertainment Corp. (formerly MSGE Spinco, Inc.) (“MSG Entertainment”) to its stockholders (the “MSGE Distribution”), with the Company retaining approximately 33% of the outstanding common stock of MSG Entertainment (in the form of MSG Entertainment Class A common stock) immediately following the MSGE Distribution (the “MSGE Retained Interest”). Following the MSGE Distribution Date, the Company retained the Sphere and MSG Networks businesses and MSG Entertainment now owns the traditional live entertainment business previously owned and operated by the Company through its Entertainment business segment, excluding the Sphere business. In the MSGE Distribution, stockholders of the Company received (a) one share of MSG Entertainment’s Class A common stock, par value $0.01 per share, for every share of the Company’s Class A common stock, par value $0.01 per share (“Class A Common Stock”), held of record as of the close of business, New York City time, on April 14, 2023 (the “Record Date”), and (b) one share of MSG Entertainment’s Class B common stock, par value $0.01 per share, for every share of the Company’s Class B common stock, par value $0.01 per share (“Class B Common Stock”), held of record as of the close of business, New York City time, on the Record Date. See Note 1. Description of Business and Basis of Presentation, to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2023 (the “2023 Form 10-K”), for more information. As of March 31, 2024, following the sales of portions of the MSGE Retained Interest and the repayment of the delayed draw term loan with MSG Entertainment using a portion of the MSGE Retained Interest, the Company no longer holds any of the outstanding common stock of MSG Entertainment. See Note 6. Investments in Nonconsolidated Affiliates and Note 11. Credit Facilities and Convertible Notes for more information about the MSGE Retained Interest. As of April 20, 2023, the MSG Entertainment business met the criteria for discontinued operations. See Note 3. Discontinued Operations, for more information about the MSGE Distribution. Tao Group Hospitality Disposition On May 3, 2023, the Company completed the sale of its 66.9% majority interest in TAO Group Sub-Holdings LLC (“Tao Group Hospitality”) to a subsidiary of Mohari Hospitality Limited, a global investment company focused on the luxury lifestyle and hospitality sectors (the “Tao Group Hospitality Disposition”). Since March 31, 2023, the Tao Group Hospitality segment met the criteria for discontinued operations and was classified as a discontinued operation. See Note 3. Discontinued Operations, for more information about the Tao Group Hospitality Disposition. Basis of Presentation The Company reports on a fiscal year basis ending on June 30 th (“Fiscal Year”). In these unaudited condensed consolidated financial statements, the fiscal year ending on June 30, 2024 and the fiscal year ended on June 30, 2023 are referred to as “Fiscal Year 2024” and “Fiscal Year 2023,” respectively. The Company has presented both the MSG Entertainment business and Tao Group Hospitality as discontinued operations for all periods presented. See Note 3. Discontinued Operations, for further discussion on accounting for the MSGE Distribution and Tao Group Hospitality Disposition. The accompanying condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and the instructions of Rule 10-01 of Regulation S-X of the Securities and Exchange Commission (the “SEC”), and should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto as of June 30, 2023 and 2022 and for the three years ended June 30, 2023, 2022 and 2021 (the “Audited Consolidated Annual Financial Statements”) included in the 2023 Form 10-K. In the opinion of the Company, the accompanying condensed consolidated financial statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of the Company’s financial position as of March 31, 2024 and its results of operations for the three and nine months ended March 31, 2024 and 2023, and cash flows for the nine months ended March 31, 2024 and 2023. The condensed consolidated financial statements and the accompanying notes as of March 31, 2024 were derived from audited annual consolidated financial statements but do not contain all of the footnote disclosures from the audited annual consolidated financial statements. The results of operations for the periods presented are not necessarily indicative of the results that might be expected for future interim periods or for the full year. Our MSG Networks segment earns a higher share of its annual revenues in the second and third quarters of its fiscal year as a result of MSG Networks’ advertising revenue being largely derived from the sale of inventory in its live NBA and NHL professional sports programming. Reclassifications For purposes of comparability, certain prior period amounts have been reclassified to conform to the current year presentation in accordance with GAAP. |
Accounting Policies
Accounting Policies | 9 Months Ended |
Mar. 31, 2024 | |
Accounting Policies [Abstract] | |
Accounting Policies | Accounting Policies Principles of Consolidation The condensed consolidated financial statements of the Company include the accounts of Sphere Entertainment Co. and its subsidiaries. They also historically included accounts of Tao Group Hospitality, MSG Entertainment, and Boston Calling Events, LLC (“BCE”) until their dispositions on May 3, 2023, April 20, 2023, and December 2, 2022, respectively. All significant intercompany transactions and balances have been eliminated in consolidation. Prior to their dispositions, Tao Group Hospitality and BCE were consolidated with the equity owned by other stockholders shown as redeemable or nonredeemable noncontrolling interests of discontinued operations in the accompanying condensed consolidated balance sheets, and the other stockholders’ portion of net earnings (loss) and other comprehensive income (loss) shown as net income (loss) or comprehensive income (loss) attributable to redeemable or nonredeemable noncontrolling interests from discontinued operations in the accompanying consolidated statements of operations and consolidated statements of comprehensive income (loss), respectively. See Note 3. Discontinued Operations, for details regarding the Tao Group Hospitality Disposition, and MSGE Distribution. See Note 2. Summary of Significant Accounting Policies, to the Audited Consolidated Annual Financial Statements included in the 2023 Form 10-K, regarding the classification of redeemable noncontrolling interests of Tao Group Hospitality. Use of Estimates The preparation of the accompanying condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions about future events. These estimates and the underlying assumptions affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities, and reported amounts of revenues and expenses. Such estimates include the provision for credit losses, valuation of investments, goodwill, intangible assets, deferred production content costs, other long-lived assets, deferred tax assets, pension and other postretirement benefit obligations and the related net periodic benefit cost, ultimate revenue (as described below), and other liabilities. In addition, estimates are used in revenue recognition, rights fees, performance and share-based compensation, depreciation and amortization, litigation matters and other matters. Management believes its use of estimates in the condensed consolidated financial statements to be reasonable. Management evaluates its estimates on an ongoing basis using historical experience and other factors, including the general economic environment and actions it may take in the future. The Company adjusts such estimates when facts and circumstances dictate. However, these estimates may involve significant uncertainties and judgments and cannot be determined with precision. In addition, these estimates are based on management’s best judgment at a point in time and, as such, these estimates may ultimately differ from actual results. Changes in estimates resulting from weakness in the economic environment or other factors beyond the Company’s control could be material and would be reflected in the Company’s condensed consolidated financial statements in future periods. Production Costs for the Company’s Original Immersive Productions The Company debuted its first original immersive production, Postcard From Earth TM , on October 6, 2023, which resulted in the amortization of the related production costs. The following reflects the Company’s complete policies with respect to immersive production costs. The Company defers certain costs during the production phase of its original immersive productions for Sphere that are directly related to production activities. Such costs include, but are not limited to, fees paid to writers, directors and producers as well as video and music production costs and production-specific overhead. For purposes of evaluating the recognition of amortization and any potential impairment, deferred immersive production costs are classified based on their predominant monetization strategy. The determination of the predominant monetization strategy is made at the commencement of production and is based on the means by which the Company expects to derive third-party revenues from use of the content. The Company’s primary monetization strategy and classification for its current content is on an individual production basis, which the Company defines as content where the lifetime value is predominantly derived from third-party revenues that are directly attributable to the specific production. The classification of content only changes if there is a significant change to the production’s monetization strategy relative to management’s initial assessment. Deferred immersive production costs are amortized beginning in the month the production debuts, in the same ratio that current period actual revenue bears to estimated remaining unrecognized ultimate revenue as of the beginning of the current fiscal year. Estimates of ultimate revenues are prepared on an individual production basis and reviewed regularly by management and revised where necessary to reflect the most current information. Ultimate revenues reflect management’s estimates of future revenue over a period not to exceed ten years following the premiere of the production. Deferred immersive production costs are subject to recoverability assessments whenever there is an indication of potential impairment. Liquidity and Going Concern As of the date the accompanying unaudited condensed consolidated financial statements were issued (the “issuance date”), management evaluated the presence of the following conditions and events at the Company in accordance with Accounting Standards Update (“ASU”) No. 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern (Subtopic 205-40): As of March 31, 2024, the Company’s unrestricted cash and cash equivalents balance was $680,575, as compared to $614,549 as of December 31, 2023. Included in unrestricted cash and cash equivalents as of March 31, 2024 was (1) $125,252 in advance cash proceeds primarily from ticket sales, a majority of which the Company expects to pay to artists and promoters, and (2) $102,825 of cash and cash equivalents at MSG Networks, which is not available for distribution to the Company in order to maintain compliance with the covenants under the MSG Networks Credit Facilities (as defined below) (which, for the avoidance of doubt, remain available to be used in connection with the refinancing of such facilities as discussed below). In addition, as of March 31, 2024, the Company had $423,113 of accounts payable, accrued and other current liabilities, including $155,352 of capital expenditure accruals primarily related to Sphere construction (a significant portion of which is in dispute and which the Company does not expect to pay). The principal balance of the Company’s total debt outstanding as of March 31, 2024 was $1,404,125, including $870,375 of debt under the MSG Networks Credit Facilities which is classified as short-term on the condensed consolidated balance sheets. Our primary sources of liquidity are cash and cash equivalents and cash flows from the operations of our businesses. The Company’s uses of cash over the next 12 months beyond the issuance date are expected to be substantial and include working capital-related items (including funding our operations), capital spending (including the creation of additional original content for Sphere), required debt service payments, payments we expect to be made in connection with the refinancing of our indebtedness, and investments and related loans and advances that we may fund from time to time. We may also use cash to repurchase our common stock. Our decisions as to the use of our available liquidity will be based upon the ongoing review of the funding needs of our businesses, the optimal allocation of cash resources, and the timing of cash flow generation. To the extent that we desire to access alternative sources of funding through the capital and credit markets, market conditions could adversely impact our ability to do so at that time. Our ability to have sufficient liquidity to fund our operations and refinance our indebtedness is dependent on the ability of Sphere to generate significant positive cash flow. Although Sphere has been embraced by guests, artists, promoters, advertisers and marketing partners, and we anticipate that Sphere will generate substantial revenue and adjusted operating income on an annual basis over time, there can be no assurance that guests, artists, promoters, advertisers and marketing partners will continue to embrace this new platform. Original immersive productions, such as Postcard From Earth , have not been previously pursued on the scale of Sphere, which increases the uncertainty of our operating expectations. To the extent that our efforts do not result in viable shows, or to the extent that any such productions do not achieve expected levels of popularity among audiences, we may not generate the cash flows from operations necessary to fund our operations. To the extent we do not realize expected cash flows from operations from Sphere, we would have to take several actions to improve our financial flexibility and preserve liquidity, including significant reductions in both labor and non-labor expenses as well as reductions and/or deferrals in capital spending. Therefore, while we currently believe we will have sufficient liquidity from cash and cash equivalents and cash flows from operations (including expected cash flows from operations from Sphere) to fund our operations and, at a minimum, make required aggregate quarterly amortization payments of $41,250 on the MSG Networks Credit Facilities, as described below, no assurance can be provided that our liquidity will be sufficient in the event any of the preceding uncertainties facing Sphere are realized over the next 12 months beyond the issuance date. The Company also anticipates MSG Networks will pay down a portion of the outstanding term loan under the MSG Networks Credit Facilities prior to its maturity in October 2024, as discussed below, (including as a result of an equity contribution to MSG Networks by Sphere Entertainment Group, LLC (“Sphere Entertainment Group”)). As disclosed in Note 11. Credit Facilities and Convertible Notes, a ll of the outstanding borrowings under the MSG Networks Credit Facilities are guaranteed by the MSGN Guarantors (as defined under Note 11. Credit Facilities and Convertible Notes ) and secured by the MSGN Collateral (as defined under Note 11. Credit Facilities and Convertible Notes ) . Sphere Entertainment Co., Sphere Entertainment Group and the subsidiaries of Sphere Entertainment Group (collectively, the “Non-Credit Parties”) are not legally obligated to fund the outstanding borrowings under the MSG Networks Credit Facilities, nor are the assets of the Non-Credit Parties pledged as security under the MSG Networks Credit Facilities. Prior to maturity of the MSG Networks Credit Facilities in October 2024, MSG Networks expects to make $41,250 in required quarterly amortization payments on the MSG Networks Credit Facilities. The remaining outstanding borrowings under the MSG Networks Credit Facilities of $829,125 are scheduled to mature in October 2024, which is within one year of the issuance date of the accompanying unaudited condensed consolidated financial statements. However, MSG Networks will be unable to generate sufficient operating cash flows prior to the maturity to settle the remaining outstanding borrowings under the MSG Networks Credit Facilities when they become due absent action taken by management to refinance the outstanding borrowings. As of the issuance date of the Company’s unaudited condensed consolidated financial statements for the quarter ended March 31, 2024, management is in the advanced stages of negotiating a refinancing of the MSG Networks Credit Facilities with a syndicate of its lenders. In this regard, the Company has had advanced discussions with a number of its lenders to participate in the refinancing and amend and extend the MSG Networks Credit Facilities with agreed upon preliminary terms and provisions. The proposed refinancing is subject to finalization of the syndicate, completion of the loan closing documentation and other closing procedures. The proposed refinancing and amendment to the MSG Networks Credit Facilities would include, among other things, (1) a reduction in the amount of the existing term loan, as a result of a partial repayment of the existing term loan by MSG Networks, a portion of the cash associated with the repayment is expected to be funded through a cash equity contribution from Sphere Entertainment Group to MSG Networks, for which such contribution is not expected to adversely impact Sphere Entertainment’s ability to fund its operations and growth initiatives, (2) a reduction in the size of the existing senior secured revolving credit facility, (3) an extension of the maturity date by one year to October 10, 2025, and (4) amendments to certain terms, including adding MSG Networks Inc. and Rainbow Garden Corp. as guarantors, and including a higher amortization rate, higher interest rates, more restrictive covenants (including prohibiting restricted payments to Sphere Entertainment) and adding additional events of default. Management believes it is probable that (1) the refinancing will be completed or (2) if the refinancing is not completed, MSG Networks would decide to enter into a work-out or seek bankruptcy protection prior to the lenders exercising their rights under the MSG Networks Credit Facilities. While MSG Networks has historically been able to refinance its indebtedness, management can provide no assurance that MSG Networks will be able to refinance the MSG Networks Credit Facilities, or that such refinancing will be secured on terms that are acceptable to MSG Networks. In the event MSG Networks is unable to refinance the amount scheduled to mature under the MSG Networks Credit Facilities or secure alternative sources of funding through the capital and credit markets on acceptable terms, the lenders could exercise their remedies under the MSG Networks Credit Facilities, which would include, but not be limited to, declaring an event of default and foreclosing on the MSGN Collateral. In the event of an exercise of post-default rights and remedies, the Company believes the lenders would have no further remedies or recourse against the Non-Credit Parties pursuant to the terms of the MSG Networks Credit Facilities. While this condition raises substantial doubt about the Company’s ability to continue as a going concern , for the reasons stated above, we have concluded this condition has been effectively alleviated and the Company will be able to continue as a going concern for at least one year beyond the issuance date of the accompanying unaudited condensed consolidated financial statements. Recently Issued and Adopted Accounting Pronouncements Recently Issued Accounting Pronouncements In November 2023, the Financial Accounting Standards Board (the “FASB”) issued ASU No. 2023-07, Improvement to Reportable Segment Disclosures . This ASU aims to improve segment disclosures through enhanced disclosures about significant segment expenses. The standard requires disclosure of significant expense categories and amounts for such expenses, including those segment expenses that are regularly provided to the chief operating decision maker, easily computable from information that is regularly provided, or significant expenses that are expressed in a form other than actual amounts. This standard will be effective for the Company in Fiscal Year 2025 and is required to be applied retrospectively to all prior periods presented in the financial statements. The Company is currently evaluating the impact of the additional disclosure requirements on the Company’s condensed consolidated financial statements. In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures , a final standard on improvements to income tax disclosures which applies to all entities subject to income taxes. The standard requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. The standard is intended to benefit investors by providing more detailed income tax disclosures that would be useful in making capital allocation decisions. This standard will be effective for the Company in Fiscal Year 2026 and is required to be applied prospectively. The Company is currently evaluating the impact of the additional disclosure requirements on the Company’s condensed consolidated financial statements. |
Discontinued Operations
Discontinued Operations | 9 Months Ended |
Mar. 31, 2024 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | Discontinued Operations As a result of the MSGE Distribution and Tao Group Hospitality Disposition, the results of the traditional live entertainment business previously owned and operated by the Company through its MSG Entertainment business segment (excluding the Sphere business) and the entertainment dining and nightlife business previously owned and operated by the Company through its Tao Group Hospitality business segment, as well as transaction costs related to the MSGE Distribution and Tao Group Hospitality Disposition, have been classified in the accompanying condensed consolidated statements of operations as discontinued operations. See Note 3. Discontinued Operations, to the Audited Consolidated Annual Financial Statements included in the 2023 Form 10-K, for more information about the MSGE Distribution and Tao Group Hospitality Disposition. For the nine months ended March 31, 2024, the Company recognized a loss from discontinued operations of $647, net of $294 of income tax benefit, related to the final purchase price adjustment from the Tao Group Hospitality Disposition. For the three months ended March 31, 2024, the Company did not recognize any loss or income from discontinued operations. The table below sets forth operating results of discontinued operations for the three and nine months ended March 31, 2023. Amounts presented below differ from historically reported results for the MSG Entertainment and Tao Group Hospitality business segments due to reclassifications and adjustments made for purposes of discontinued operations. Three Months Ended March 31, 2023 MSG Entertainment Tao Group Hospitality Eliminations Total Revenues $ 200,043 $ 130,857 $ 1,190 $ 332,090 Direct operating expenses (114,298) (77,963) (1,247) (193,508) Selling, general and administrative expenses (37,367) (46,541) — (83,908) Depreciation and amortization (14,798) (7,421) — (22,219) Impairment and other losses, net (51) — — (51) Restructuring charges (1,828) — — (1,828) Operating income (loss) 31,701 (1,068) (57) 30,576 Interest income 313 49 (1,047) (685) Interest expense — (160) — (160) Other income (loss), net 9,180 (8) — 9,172 Income (loss) from operations before income taxes 41,194 (1,187) (1,104) 38,903 Income tax benefit 12,295 4,245 — 16,540 Net income 53,489 3,058 (1,104) 55,443 Less: Net loss attributable to nonredeemable noncontrolling interests — (216) — (216) Less: Net loss attributable to redeemable noncontrolling interests — (1,492) — (1,492) Net income from discontinued operations attributable to Sphere Entertainment Co.’s stockholders $ 53,489 $ 4,766 $ (1,104) $ 57,151 Nine Months Ended March 31, 2023 MSG Entertainment Tao Group Hospitality Eliminations Total Revenues $ 694,755 $ 398,078 $ 3 $ 1,092,836 Direct operating expenses (396,691) (232,029) — (628,720) Selling, general and administrative expenses (102,333) (131,200) — (233,533) Depreciation and amortization (46,370) (21,144) — (67,514) Impairment and other gains, net 4,361 473 — 4,834 Restructuring charges (7,435) — — (7,435) Operating income 146,287 14,178 3 160,468 Interest income 1,832 85 (1,047) 870 Interest expense (1,083) (2,138) — (3,221) Other income, net 7,895 719 — 8,614 Income from operations before income taxes 154,931 12,844 (1,044) 166,731 Income tax expense (9,120) (2,043) — (11,163) Net income 145,811 10,801 (1,044) 155,568 Less: Net loss attributable to nonredeemable noncontrolling interests (553) (129) — (682) Less: Net income attributable to redeemable noncontrolling interests — 2,661 — 2,661 Net income from discontinued operations attributable to Sphere Entertainment Co.’s stockholders $ 146,364 $ 8,269 $ (1,044) $ 153,589 As permitted under Accounting Standards Codification (“ASC”) Subtopic 205-20-50-5b(2), the Company has elected not to adjust the condensed consolidated statements of cash flows for the nine months ended March 31, 2023 to exclude cash flows attributable to discontinued operations. The table below sets forth, for the period presented, significant selected financial information related to discontinued activities included in the accompanying condensed consolidated financial statements: Three Months Ended Nine Months Ended March 31, 2023 March 31, 2023 MSG Entertainment Tao Group Hospitality MSG Entertainment Tao Group Hospitality Non-cash items included in net income: Depreciation and amortization $ 14,798 $ 7,421 $ 46,370 $ 21,144 Share-based compensation expense, net 1,792 2,144 2,896 6,570 Cash flows from investing activities: Capital expenditures, net $ 2,979 $ 4,962 $ 12,187 $ 16,417 |
Revenue Recognition
Revenue Recognition | 9 Months Ended |
Mar. 31, 2024 | |
Revenue Recognition [Abstract] | |
Revenue Recognition | Revenue Recognition Contracts with Customers See Note 2. Summary of Significant Accounting Policies and Note 4. Revenue Recognition, to the Audited Consolidated Annual Financial Statements included in the 2023 Form 10-K, for more information regarding the details of the Company’s revenue recognition policies. All revenue recognized in the condensed consolidated statements of operations is considered to be revenue from contracts with customers in accordance with ASC Topic 606, Revenue From Contracts with Customers, except for revenues from subleases that are accounted for in accordance with ASC Topic 842, Leases. Disaggregation of Revenue The following tables disaggregate the Company’s revenue by major source and reportable segment based upon the timing of transfer of goods or services to the customer for the three and nine months ended March 31, 2024 and 2023: Three Months Ended March 31, 2024 Sphere MSG Networks Total Event-related (a) $ 134,835 $ — $ 134,835 Sponsorship, signage, Exosphere TM advertising, and suite licenses revenues (b) 32,942 656 33,598 Media related, primarily from affiliation agreements (b) — 148,417 148,417 Other 1,864 1,893 3,757 Total revenues from contracts with customers 169,641 150,966 320,607 Revenues from subleases 723 — 723 Total revenues $ 170,364 $ 150,966 $ 321,330 Three Months Ended March 31, 2023 Sphere MSG Networks Total Sponsorship, signage, Exosphere advertising, and suite licenses (b) $ — $ 696 $ 696 Media related, primarily from affiliation agreements (b) — 158,526 158,526 Other — 2,214 2,214 Total revenues from contracts with customers — 161,436 161,436 Revenues from subleases 626 — 626 Total revenues $ 626 $ 161,436 $ 162,062 Nine Months Ended March 31, 2024 Sphere MSG Networks Total Event-related (a) $ 286,991 $ — $ 286,991 Sponsorship, signage, Exosphere TM advertising, and suite licenses revenues (b) 53,024 1,564 54,588 Media related, primarily from affiliation agreements (b) — 401,308 401,308 Other 3,713 4,680 8,393 Total revenues from contracts with customers 343,728 407,552 751,280 Revenues from subleases 2,214 — 2,214 Total revenues $ 345,942 $ 407,552 $ 753,494 Nine Months Ended March 31, 2023 Sphere MSG Networks Total Sponsorship, signage, Exosphere advertising, and suite licenses (b) $ — $ 1,453 $ 1,453 Media related, primarily from affiliation agreements (b) — 436,630 436,630 Other — 4,730 4,730 Total revenues from contracts with customers — 442,813 442,813 Revenues from subleases 1,919 — 1,919 Total revenues $ 1,919 $ 442,813 $ 444,732 _________________ (a) Event-related revenues consists of (i) the Sphere Experience, (ii) ticket sales and other ticket-related revenues, (iii) venue license fees from third-party promoters, and (iv) food, beverage and merchandise sales. Event-related revenues are recognized at a point in time. As such, these revenues have been included in the same category in the table above. (b) See Note 2. Summary of Significant Accounting Policies, Revenue Recognition, and Note 4. Revenue Recognition, to the Audited Consolidated Annual Financial Statements included in the 2023 Form 10-K, for further details on the pattern of recognition of sponsorship, signage, Exosphere advertising, suite licenses, and media related revenue. In addition to the disaggregation of the Company’s revenue by major source based upon the timing of transfer of goods or services to the customer disclosed above, the following tables disaggregate the Company’s consolidated revenues by type of goods or services in accordance with the required entity-wide disclosure requirements of ASC Subtopic 280-10-50-38 to 40 and the disaggregation of revenue required disclosures in accordance with ASC Subtopic 606-10-50-5 for the three and nine months ended March 31, 2024 and 2023: Three Months Ended March 31, 2024 Sphere MSG Networks Total Ticketing and venue license fee revenues (a) $ 110,655 $ — $ 110,655 Sponsorship, signage, Exosphere advertising, and suite revenues 40,511 — 40,511 Food, beverage, and merchandise revenues 18,475 — 18,475 Media networks revenues (b) — 150,966 150,966 Total revenues from contracts with customers 169,641 150,966 320,607 Revenues from subleases 723 — 723 Total revenues $ 170,364 $ 150,966 $ 321,330 Three Months Ended March 31, 2023 Sphere MSG Networks Total Media networks revenues (b) $ — $ 161,436 $ 161,436 Revenues from subleases 626 — 626 Total revenues $ 626 $ 161,436 $ 162,062 Nine Months Ended March 31, 2024 Sphere MSG Networks Total Ticketing and venue license fee revenues (a) $ 235,283 $ — $ 235,283 Sponsorship, signage, Exosphere advertising, and suite revenues 66,817 — 66,817 Food, beverage, and merchandise revenues 41,628 — 41,628 Media networks revenues (b) — 407,552 407,552 Total revenues from contracts with customers 343,728 407,552 751,280 Revenues from subleases 2,214 — 2,214 Total revenues $ 345,942 $ 407,552 $ 753,494 Nine Months Ended March 31, 2023 Sphere MSG Networks Total Media networks revenues (b) $ — $ 442,813 $ 442,813 Revenues from subleases 1,919 — 1,919 Total revenues $ 1,919 $ 442,813 $ 444,732 _________________ (a) Amounts include ticket sales, other ticket-related revenue, and venue license fees from the Company’s events such as (i) concerts, (ii) The Sphere Experience and (iii) other live entertainment and sporting events. (b) Primarily consists of affiliation fees from Distributors (as defined below) and, to a lesser extent, advertising revenues through the sale of commercial time and other advertising inventory during MSG Networks programming. Contract Balances The following table provides information about contract balances from the Company’s contracts with customers as of March 31, 2024 and June 30, 2023: As of March 31, June 30, 2024 2023 Receivables from contracts with customers, net (a) $ 179,022 $ 115,039 Contract assets, current (b) 1,500 314 Deferred revenue, including non-current portion (c) 76,712 27,397 _________________ (a) Receivables from contracts with customers, net, which are reported in Accounts receivable, net in the Company’s condensed consolidated balance sheets, represent the Company’s unconditional rights to consideration under its contracts with customers. As of March 31, 2024 and June 30, 2023, the Company’s receivables from contracts with customers above included $320 and $2,730, respectively, related to various related parties. See Note 15. Related Party Transactions, for further details on these related party arrangements. (b) Contract assets current, which are reported as Prepaid expenses and other current assets in the Company’s condensed consolidated balance sheets, primarily relate to the Company’s rights to consideration for goods or services transferred to customers, for which the Company does not have an unconditional right to bill as of the reporting date. Contract assets are transferred to accounts receivable once the Company’s right to consideration becomes unconditional. (c) Revenue recognized for the three and nine months ended March 31, 2024 relating to the deferred revenue balance as of June 30, 2023 was $795 and $21,519, respectively. Transaction Price Allocated to the Remaining Performance Obligations As of March 31, 2024, the Company’s remaining performance obligations were $121,324 of which 59% is expected to be recognized over the next two years and an additional 37% of the balance is expected to be recognized in the following two years. This primarily relates to performance obligations under sponsorship agreements that have original expected durations longer than one year and for which the respective consideration is not variable. In developing the estimated revenue, the Company applies the allowable practical expedient and does not disclose information about remaining performance obligations that have original expected durations of one year or less. |
Restructuring Charges
Restructuring Charges | 9 Months Ended |
Mar. 31, 2024 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Charges | Restructuring Charges During Fiscal Year 2024, the Company has incurred costs for termination benefits for certain executives and employees in the Sphere segment. As a result, the Company has recognized restructuring charges of $4,667 and $9,345 for the three and nine months ended March 31, 2024, respectively, inclusive of $1,166 of share-based compensation expenses, which were recorded in Accounts payable, accrued and other current liabilities, Related party payables, current, and Additional paid-in capital on the condensed consolidated balance sheets. Restructuring charges of $18,670 and $26,745 were recorded for the three and nine months ended March 31, 2023, respectively, inclusive of $7,384 of share-based compensation expenses, which were recorded in Accounts payable, accrued and other current liabilities, and Additional paid-in capital on the condensed consolidated balance sheets. Changes to the Company’s restructuring liability through March 31, 2024 were as follows: Restructuring Liability June 30, 2023 $ 8,891 Restructuring charges (excluding share-based compensation expense) 8,179 Payments (10,144) March 31, 2024 $ 6,926 |
Investments
Investments | 9 Months Ended |
Mar. 31, 2024 | |
Equity Method Investments, Joint Ventures And Cost Method Investments [Abstract] | |
Investments | Investments The Company’s investments in nonconsolidated affiliates, which are accounted for under the equity method of accounting or as equity investments without readily determinable fair value, consisted of the following: Investment As of Ownership Percentage as of March 31, 2024 March 31, June 30, Equity method investments: SACO Technologies Inc. (“SACO”) 30 % $ 18,692 $ 22,246 Holoplot Loan (a) 21,336 20,971 Holoplot 25 % — 1,542 MSG Entertainment (b) — % — 341,039 Crown Properties Collection (c) 8 % 51 — Equity investments without readily determinable fair values 8,721 8,721 Other equity investments with readily determinable fair values held in trust under the Company’s Executive Deferred Compensation Plan (d) 3,049 1,087 Total investments $ 51,849 $ 395,606 _________________ (a) In January 2023, the Company, through an indirect subsidiary, extended financing to Holoplot GmbH (“Holoplot”) in the form of a three-year convertible loan (the “Holoplot Loan”) of €18,804, equivalent to $20,484 using the applicable exchange rate at the time of the transaction. As of the reporting date, absent conversion, which is not available under the terms of the Holoplot Loan, the Holoplot Loan and interest accrued thereon are due and payable at the conclusion of the three-year term. (b) As of March 31, 2024, following the sale of portions of the MSGE Retained Interest and the repayment of the DDTL Facility (as defined below) with MSG Entertainment using a portion of the MSGE Retained Interest, the Company no longer holds any of the outstanding common stock of MSG Entertainment. The Company elected the fair value option for its investment in MSG Entertainment as of June 30, 2023, when it held approximately 20% of the outstanding shares of common stock of MSG Entertainment (in the form of Class A common stock). The fair value of the investment was determined based on quoted market prices on the New York Stock Exchange (“NYSE”), which were classified within Level I of the fair value hierarchy. (c) In March 2024, the Company paid $51 for an 8.3% investment in Oak View Group’s Crown Properties Collection, LLC (“CPC”). The investment in CPC is accounted for as an equity method investment, with Sphere’s share of CPC results picked-up on a 3-month lag. (d) The Company’s investments with readily determinable fair values are classified within Level I of the fair value hierarchy as it is based on quoted prices in active markets. Refer to Note 12. Pension Plans and Other Postretirement Benefit Plan, for further detail on the Company’s Executive Deferred Compensation Plan. The following table summarizes the realized and unrealized gain (loss) on equity investments with and without readily determinable fair values, which is reported in Other (expense) income, net, for the three and nine months ended March 31, 2024 and 2023: Three Months Ended Nine Months Ended March 31, March 31, 2024 2023 2024 2023 Unrealized gain $ 127 $ 129 $ 264 $ 2,104 Realized loss from shares of MSG Entertainment Class A common stock sold — — (19,027) — Total realized and unrealized gain (loss) on equity investments $ 127 $ 129 $ (18,763) $ 2,104 Supplemental information on realized loss: Shares of MSG Entertainment Class A common stock disposed (a) — — 1,923 — Shares of MSG Entertainment Class A common stock sold (b) — — 8,221 — Cash proceeds from shares of MSG Entertainment Class A common stock sold $ — $ — $ 256,501 $ — _________________ (a) Refer to Note 11. Credit Facilities and Convertible Notes, for further explanation of the approximately 1,923 shares disposed related to the repayment of the DDTL Facility. (b) The sale of approximately 8,221 shares of MSG Entertainment Class A common stock resulted in the cash proceeds from common stock sold. |
Property and Equipment, net
Property and Equipment, net | 9 Months Ended |
Mar. 31, 2024 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, net | Property and Equipment, net As of March 31, 2024 and June 30, 2023, property and equipment, net consisted of the following: As of March 31, June 30, Land $ 44,233 $ 80,878 Buildings 2,287,306 69,049 Equipment, furniture, and fixtures 1,128,495 159,786 Leasehold improvements 18,491 18,491 Construction in progress 593 3,066,785 Total property and equipment, gross 3,479,118 3,394,989 Less accumulated depreciation and amortization (259,229) (87,828) Property and equipment, net $ 3,219,889 $ 3,307,161 The property and equipment balances above include $155,352 and $236,593 of capital expenditure accruals (primarily related to Sphere construction) as of March 31, 2024 and June 30, 2023, respectively, which are reflected in Accounts payable, accrued and other current liabilities in the accompanying condensed consolidated balance sheets. During the first quarter of Fiscal Year 2024, the Company placed $3,130,028 of construction in progress assets into service with the opening of Sphere in Las Vegas and began depreciating them over their corresponding estimated useful lives. See Note 2. Summary of Significant Accounting Policies, to the Audited Consolidated Annual Financial Statements included in the 2023 Form 10-K, for details on the Company’s estimated useful lives for each major category of property and equipment. The Company recorded depreciation expense on property and equipment of $79,088 and $171,821 for the three and nine months ended March 31, 2024, respectively, and $7,421 and $19,382 for the three and nine months ended March 31, 2023, respectively, which is recognized in Depreciation and amortization in the condensed consolidated statements of operations. On November 21, 2023, the Company announced that it was formally notified by the Mayor of London that its planning application for a Sphere venue in Stratford, London was not approved. In light of this decision, the Company no longer plans to allocate resources towards the development of a Sphere in the United Kingdom. In connection with this decision, the Company recorded an impairment charge of $116,541 on construction in progress and land assets reported within the Sphere segment during the second quarter of Fiscal Year 2024. This charge is recognized in Impairment and other (losses) gains, net within the condensed consolidated statements of operations for the nine months ended March 31, 2024. The fair value of the land was determined using an estimate of the assumed exit value from a market participant perspective. |
Original Immersive Production C
Original Immersive Production Content | 9 Months Ended |
Mar. 31, 2024 | |
Other Industries [Abstract] | |
Original Immersive Production Content | Original Immersive Production Content The Company’s production content for its original immersive productions are included within Other non-current assets in the accompanying condensed consolidated balance sheets. As of March 31, 2024 and June 30, 2023, total deferred immersive production content costs consisted of the following: As of March 31, June 30, Production content Released, less amortization $ 68,397 $ — In-process 4,584 61,421 Total production content $ 72,981 $ 61,421 The following table summarizes the Company’s amortization of production content costs, which is reported in Direct operating expenses in the accompanying condensed consolidated statements of operations for the three and nine months ended March 31, 2024 and 2023 as follows: Three Months Ended Nine Months Ended March 31, March 31, 2024 2023 2024 2023 Production content costs (a) $ 7,789 $ — $ 13,334 $ — _________________ (a) For purposes of amortization and impairment, each deferred immersive production content cost is classified based on its predominant monetization strategy. The Company’s current original immersive productions are monetized individually. Refer to Note 2. Accounting Policies, for further explanation of the monetization strategy. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 9 Months Ended |
Mar. 31, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets The carrying amounts of goodwill as of March 31, 2024 and June 30, 2023 were as follows: As of March 31, June 30, Sphere $ 32,299 $ 32,299 MSG Networks 424,508 424,508 Total Goodwill $ 456,807 $ 456,807 During the first quarter of Fiscal Year 2024, the Company performed its annual impairment test of goodwill and determined that there was no impairment of goodwill identified as of the impairment test date. The Company’s intangible assets subject to amortization, which relate to affiliate relationships, as of March 31, 2024 and June 30, 2023 were as follows: As of March 31, June 30, Gross carrying amount $ 83,044 $ 83,044 Accumulated amortization (67,470) (65,134) Intangible assets, net $ 15,574 $ 17,910 The Company recognized amortization expense on intangible assets of $779 and $2,336 for the three and nine months ended March 31, 2024, respectively, and $779 and $2,337 for the three and nine months ended March 31, 2023, respectively, which is recognized in Depreciation and amortization in the accompanying condensed consolidated statements of operations. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Mar. 31, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Commitments See Note 11. Commitments and Contingencies, to the Audited Consolidated Annual Financial Statements included in the 2023 Form 10-K, for details on the Company’s commitments. The Company’s commitments as of June 30, 2023 included a total of $3,134,884 of contract obligations (primarily related to media rights agreements from the MSG Networks segment). During the three and nine months ended March 31, 2024, the Company did not have any material changes in its non-cancelable contractual obligations (other than activities in the ordinary course business). See Note 11. Credit Facilities and Convertible Notes, for details of the principal repayments required under the Company’s various credit facilities. Legal Matters Fifteen complaints were filed in connection with the merger between a subsidiary of the Company and MSG Networks Inc. (the “Networks Merger”) by purported stockholders of the Company and MSG Networks Inc. Nine of these complaints involved allegations of materially incomplete and misleading information set forth in the joint proxy statement/prospectus filed by the Company and MSG Networks Inc. in connection with the Networks Merger. As a result of supplemental disclosures made by the Company and MSG Networks Inc. on July 1, 2021, all of the disclosure actions were voluntarily dismissed with prejudice prior to or shortly following the consummation of the Networks Merger. Six complaints involved allegations of fiduciary breaches in connection with the negotiation and approval of the Networks Merger and were consolidated into two remaining litigations. On September 10, 2021, the Court of Chancery of the State of Delaware (the “Court”) entered an order consolidating two derivative complaints filed by purported Company stockholders. The consolidated action is captioned: In re Madison Square Garden Entertainment Corp. Stockholders Litigation , C.A. No. 2021-0468-KSJM (the “MSG Entertainment Litigation”). The consolidated plaintiffs filed their Verified Consolidated Derivative Complaint on October 11, 2021. The complaint, which named the Company as only a nominal defendant, retained all of the derivative claims and alleged that the members of the board of directors and controlling stockholders violated their fiduciary duties in the course of negotiating and approving the Networks Merger. Plaintiffs sought, among other relief, an award of damages to the Company including interest, and plaintiffs’ attorneys’ fees. Pursuant to the indemnity rights in its bylaws and Delaware law, the Company advanced the costs incurred by defendants in this action, and defendants asserted indemnification rights in respect of any adverse judgment or settlement of the action. On March 14, 2023, the parties to the MSG Entertainment Litigation reached an agreement in principle to settle the MSG Entertainment Litigation, without admitting liability, on the terms and conditions set forth in a binding term sheet, which was incorporated into a long-form settlement agreement (the “MSGE Settlement Agreement”) that was filed with the Court on April 20, 2023. The MSGE Settlement Agreement provided for, among other things, the final dismissal of the MSG Entertainment Litigation in exchange for a settlement payment to the Company of $85,000, subject to customary reduction for attorneys’ fees and expenses, in an amount to be determined by the Court. The settlement’s amount was fully funded by the other defendants’ insurers. The MSGE Settlement Agreement was approved by the Court on August 14, 2023, which constituted the final judgment in the action. A realized gain of $62,647 was recognized in Other income (expense), net on the condensed consolidated statements of operations in connection with the settlement payment to the Company. On September 27, 2021, the Court entered an order consolidating four complaints filed by purported former stockholders of MSG Networks Inc. The consolidated action is captioned: In re MSG Networks Inc. Stockholder Class Action Litigation, C.A. No. 2021-0575-KSJM (the “MSG Networks Litigation”). The consolidated plaintiffs filed their Verified Consolidated Stockholder Class Action Complaint on October 29, 2021. The complaint asserted claims on behalf of a putative class of former MSG Networks Inc. stockholders against each member of the board of directors of MSG Networks Inc. and the controlling stockholders prior to the Networks Merger. Plaintiffs alleged that the MSG Networks Inc. board of directors and controlling stockholders breached their fiduciary duties in negotiating and approving the Networks Merger. The Company was not named as a defendant but was subpoenaed to produce documents and testimony related to the Networks Merger. Plaintiffs sought, among other relief, monetary damages for the putative class and plaintiffs’ attorneys’ fees. Pursuant to the indemnity rights in its bylaws and Delaware law, the Company advanced the costs incurred by defendants in this action, and defendants asserted indemnification rights in respect of any adverse judgment or settlement of the action. On April 6, 2023, the parties to the MSG Networks Litigation reached an agreement in principle to settle the MSG Networks Litigation , without admitting liability, on the terms and conditions set forth in a binding term sheet, which was incorporated into a long-form settlement agreement (the “MSGN Settlement Agreement”) that was filed with the Court on May 18, 2023. The MSGN Settlement Agreement provided for, among other things, the final dismissal of the MSG Networks Litigation in exchange for a settlement payment to the plaintiffs and the class of $48,500, of which $28,000 has been paid by the Company and $20,500 has been paid to the plaintiffs by insurers. As of March 31, 2024 , approximately $20,500 has been accrued for by the Company in Accounts payable, accrued and other current liabilities . The MSGN Settlement Agreement was approved by the Court on August 14, 2023, which constituted the final judgment in the action. MSG Networks has a dispute with its insurers over whether and to what extent there is insurance coverage for the settlement. Unless MSG Networks Inc. and the insurers settle that insurance dispute, it is expected to be resolved in a pending Delaware insurance coverage action. In the interim, and subject to final resolution of the parties’ insurance coverage dispute, and as referenced above, certain of MSG Networks’ insurers agreed to advance $20,500 to fund the settlement and related class notice costs. The Company is a defendant in various other lawsuits. Although the outcome of these other lawsuits cannot be predicted with certainty (including the extent of available insurance, if any), management does not believe that resolution of these other lawsuits will have a material adverse effect on the Company. |
Credit Facilities and Convertib
Credit Facilities and Convertible Notes | 9 Months Ended |
Mar. 31, 2024 | |
Line of Credit Facility [Abstract] | |
Credit Facilities and Convertible Notes | Credit Facilities and Convertible Notes The following table summarizes the presentation of the outstanding balances under the Company’s credit agreements as of March 31, 2024 and June 30, 2023: As of March 31, 2024 June 30, 2023 Principal Unamortized Deferred Financing Costs Net Principal Unamortized Deferred Financing Costs Net Current portion MSG Networks Term Loan $ 870,375 $ (599) $ 869,776 $ 82,500 $ — $ 82,500 Current portion of long-term debt, net $ 870,375 $ (599) $ 869,776 $ 82,500 $ — $ 82,500 As of March 31, 2024 June 30, 2023 Principal Debt Discount Unamortized Deferred Financing Costs Net Principal Debt Discount Unamortized Deferred Financing Costs Net Non-current portion MSG Networks Term Loan $ — $ — $ — $ — $ 849,750 $ — $ (1,483) $ 848,267 LV Sphere Term Loan Facility 275,000 — (4,060) 270,940 275,000 — (4,880) 270,120 3.50% Convertible Senior Notes 258,750 (6,670) (963) 251,117 — — — — Long-term debt, net $ 533,750 $ (6,670) $ (5,023) $ 522,057 $ 1,124,750 $ — $ (6,363) $ 1,118,387 MSG Networks Credit Facilities General. MSGN Holdings, L.P. (“MSGN L.P.”), MSGN Eden, LLC, an indirect subsidiary of the Company and the general partner of MSGN L.P., Regional MSGN Holdings LLC, an indirect subsidiary of the Company and the limited partner of MSGN L.P. (collectively with MSGN Eden, LLC, the “MSGN Holdings Entities”), and certain subsidiaries of MSGN L.P. have senior secured credit facilities pursuant to a credit agreement (as amended and restated on October 11, 2019, the “MSGN Credit Agreement”) consisting of: (i) an initia l $1,100,000 term l oan facility (the “MSGN Term Loan Facility”) and ( ii) a $250,000 revolving credit facility (the “MSGN Revolving Credit Facility” and, together with the MSGN Term Loan Facility, the “MSG Networks Credit Facilities”), each with a term of five years. Up to $35,000 of the MSGN Revolving Credit Facility is available for the issuance of letters of credit. As of March 31, 2024, there were no borrowings or letters of credit issued and outstanding under the MSGN Revolving Credit Facility. Interest Rates. Borrowings under the MSGN Credit Agreement bear interest at a floating rate, which at the option of MSGN L.P. may be either (i) a base rate plus an additional rate ranging from 0.25% to 1.25% per annum (determined based on a total net leverage ratio), or (ii) adjusted Term SOFR (i.e., Term SOFR plus 0.10%) plus an additional rate ranging from 1.25% to 2.25% per annum (determined based on a total leverage ratio). Upon a payment default in respect of principal, interest or other amounts due and payable under the MSGN Credit Agreement or related loan documents, default interest will accrue on all overdue amounts at an additional rate of 2.00% per annum. The MSGN Credit Agreement requires that MSGN L.P. pay a commitment fee ranging from 0.225% to 0.30% (determined based on a total leverage ratio) in respect of the average daily unused commitments under the MSGN Revolving Credit Facility. MSGN L.P. will also be required to pay customary letter of credit fees, as well as fronting fees, to banks that issue letters of credit. The interest rate on the MSGN Term Loan Facility as of March 31, 2024 was 7.43%. Principal Repayments. Subject to customary notice and minimum amount conditions, MSGN L.P. may voluntarily repay outstanding loans under the MSGN Credit Agreement at any time, in whole or in part, without premium or penalty (except for customary breakage costs with respect to Eurodollar loans). The MSGN Term Loan Facility amortizes quarterly in accordance with its terms beginning March 31, 2020 through September 30, 2024 with a final maturity date of October 11, 2024. MSGN L.P. is required to make mandatory prepayments in certain circumstances, including without limitation from the net cash proceeds of certain sales of assets (including MSGN Collateral) or casualty insurance and/or condemnation recoveries (subject to certain reinvestment, repair or replacement rights) and the incurrence of certain indebtedness, subject to certain exceptions. Covenants. The MSGN Credit Agreement generally requires the MSGN Holdings Entities and MSGN L.P. and its restricted subsidiaries on a consolidated basis to comply with a maximum total leverage ratio of 5.50:1.00, subject, at the option of MSGN L.P. to an upward adjustment to 6.00:1.00 during the continuance of certain events. As of March 31, 2024, the total leverage ratio was 5.36:1.00. In addition, the MSGN Credit Agreement requires a minimum interest coverage ratio of 2.00:1.00 for the MSGN Holdings Entities and MSGN L.P. and its restricted subsidiaries on a consolidated basis. As of March 31, 2024, the interest coverage ratio was 2.24:1.00. All borrowings under the MSGN Credit Agreement are subject to the satisfaction of customary conditions, including absence of a default and accuracy of representations and warranties. As of March 31, 2024, the MSGN Holdings Entities and MSGN L.P. and its restricted subsidiaries on a consolidated basis were in compliance with the covenants. In addition to the financial covenants discussed above, the MSGN Credit Agreement and the related security agreement contain certain customary representations and warranties, affirmative covenants, and events of default. The MSGN Credit Agreement contains certain restrictions on the ability of MSGN L.P. and its restricted subsidiaries to take certain actions as provided in (and subject to various exceptions and baskets set forth in) the MSGN Credit Agreement, including the following: (i) incurring additional indebtedness and contingent liabilities; (ii) creating liens on certain assets; (iii) making investments, loans or advances in or to other persons; (iv) paying dividends and distributions or repurchasing capital stock; (v) changing their lines of business; (vi) engaging in certain transactions with affiliates; (vii) amending specified material agreements; (viii) merging or consolidating; (ix) making certain dispositions; and (x) entering into agreements that restrict the granting of liens. The MSGN Holdings Entities are also subject to customary passive holding company covenants. Guarantors and Collateral. All obligations under the MSGN Credit Agreement are guaranteed by the MSGN Holdings Entities and MSGN L.P.’s existing and future direct and indirect domestic subsidiaries that are not designated as excluded subsidiaries or unrestricted subsidiaries (the “MSGN Subsidiary Guarantors,” and together with the MSGN Holdings Entities, the “MSGN Guarantors”). All obligations under the MSGN Credit Agreement, including the guarantees of those obligations, are secured by certain assets of MSGN L.P. and each MSGN Guarantor (collectively, “MSGN Collateral”), including, but not limited to, a pledge of the equity interests in MSGN L.P. held directly by the MSGN Holdings Entities and the equity interests in each MSGN Subsidiary Guarantor held directly or indirectly by MSGN L.P. LV Sphere Term Loan Facility General. On December 22, 2022, MSG Las Vegas, LLC (“MSG LV”), an indirect, wholly-owned subsidiary of the Company, entered into a credit agreement with JP Morgan Chase Bank, N.A., as administrative agent and the lenders party thereto, providing for a five-year, $275,000 senior secured term loan facility (the “LV Sphere Term Loan Facility”). Interest Rates . Borrowings under the LV Sphere Term Loan Facility bear interest at a floating rate, which at the option of MSG LV may be either (i) a base rate plus a margin of 3.375% per annum or (ii) adjusted Term SOFR (i.e., Term SOFR plus 0.10%) plus a margin of 4.375% per annum. The interest rate on the LV Sphere Term Loan Facility as of March 31, 2024 was 9.80%. Principal Repayments . The LV Sphere Term Loan Facility will mature on December 22, 2027. The principal obligations under the LV Sphere Term Loan Facility are due at the maturity of the facility, with no amortization payments prior to maturity. Under certain circumstances, MSG LV is required to make mandatory prepayments on the loan, including prepayments in an amount equal to the net cash proceeds of casualty insurance and/or condemnation recoveries (subject to certain reinvestment, repair or replacement rights), subject to certain exceptions. Covenants . The LV Sphere Term Loan Facility and related guaranty by Sphere Entertainment Group include financial covenants requiring MSG LV to maintain a specified minimum debt service coverage ratio and requiring Sphere Entertainment Group to maintain a specified minimum liquidity level. The debt service coverage ratio covenant began testing in the fiscal quarter ended December 31, 2023 on a historical basis and on a prospective basis. Both the historical and prospective debt service coverage ratios are required to be at least 1.35:1.00. In addition, among other conditions, MSG LV is not permitted to make distributions to Sphere Entertainment Group unless the historical and prospective debt service coverage ratios are at least 1.50:1.00. The minimum liquidity level for Sphere Entertainment Group is set at $50,000, with $25,000 required to be held in cash or cash equivalents and is tested as of the last day of each fiscal quarter based on Sphere Entertainment Group’s unencumbered liquidity, consisting of cash and cash equivalents and available lines of credit, as of such date. In addition to the covenants described above, the LV Sphere Term Loan Facility and the related guaranty and security and pledge agreements contain certain customary representations and warranties, affirmative and negative covenants and events of default. The LV Sphere Term Loan Facility contains certain restrictions on the ability of MSG LV and Sphere Entertainment Group to take certain actions as provided in (and subject to various exceptions and baskets set forth in) the LV Sphere Term Loan Facility and the related guaranty and security and pledge agreements, including the following: (i) incur additional indebtedness; (ii) make investments, loans or advances in or to other persons; (iii) pay dividends and distributions (which will restrict the ability of MSG LV to make cash distributions to the Company); (iv) change its lines of business; (v) engage in certain transactions with affiliates; (vi) amend organizational documents; (vii) merge or consolidate; and (viii) make certain dispositions. Guarantors and Collateral . All obligations under the LV Sphere Term Loan Facility are guaranteed by Sphere Entertainment Group. All obligations under the LV Sphere Term Loan Facility, including the guarantees of those obligations, are secured by all of the assets of MSG LV and certain assets of Sphere Entertainment Group including, but not limited to, MSG LV’s leasehold interest in the land on which Sphere in Las Vegas is located and a pledge of all of the equity interests held directly by Sphere Entertainment Group in MSG LV. Delayed Draw Term Loan Facility On April 20, 2023, the Company entered into a delayed draw term loan facility (the “DDTL Facility”) with MSG Entertainment Holdings, LLC (“MSG Entertainment Holdings”). Pursuant to the DDTL Facility, MSG Entertainment Holdings committed to lend up to $65,000 in delayed draw term loans to the Company on an unsecured basis for a period of 18 months following the consummation of the MSGE Distribution. On July 14, 2023, the Company drew down the full amount of the $65,000 under the DDTL Facility. On August 9, 2023, the Company repaid all amounts outstanding under the DDTL Facility (including accrued interest and commitment fees) by delivering to MSG Entertainment Holdings approximately 1,923 shares of MSG Entertainment Class A common stock . 3.50% Convertible Senior Notes On December 8, 2023, the Company completed a private unregistered offering (the “Offering”) of $258,750 in aggregate principal amount of its 3.50% Convertible Senior Notes due 2028 (the “3.50% Convertible Senior Notes”), which amount includes the full exercise of the initial purchasers’ option to purchase additional 3.50% Convertible Senior Notes. The Company used $14,309 of the net proceeds from the Offering to fund the cost of entering into the capped call transactions described below, with the remaining net proceeds from the Offering designated for general corporate purposes, including capital for Sphere-related growth initiatives. The capped call transactions met all of the applicable criteria for equity classification in accordance with ASC 815-10-15-74(a), “Derivatives and Hedging—Embedded Derivatives—Certain Contracts Involving an Entity’s Own Equity,” and were recorded as a reduction to Equity on the Company’s condensed consolidated statements of stockholder’s equity and condensed consolidated balance sheets. On December 8, 2023, the Company entered into an Indenture, dated as of December 8, 2023 (the “Indenture”), with U.S. Bank Trust Company, National Association, as trustee (the “Trustee”), relating to the 3.50% Convertible Senior Notes. The 3.50% Convertible Senior Notes constitute a senior general unsecured obligation of the Company. The 3.50% Convertible Senior Notes bear interest at a rate of 3.50% per year, payable semi-annually in arrears on June 1 and December 1 of each year, beginning on June 1, 2024. The 3.50% Convertible Senior Notes will mature on December 1, 2028, unless earlier redeemed, repurchased or converted. Subject to the terms of the Indenture, the 3.50% Convertible Senior Notes may be converted at an initial conversion rate of 28.1591 shares of Class A Common Stock per $1,000 principal amount of 3.50% Convertible Senior Notes (equivalent to an initial conversion price of approximately $35.51 per share of Class A Common Stock). Upon conversion of the 3.50% Convertible Senior Notes, the Company will pay or deliver, as the case may be, cash, shares of Class A Common Stock or a combination of cash and shares of Class A Common Stock, at the Company’s election, in accordance with the Indenture. Holders of the 3.50% Convertible Senior Notes may convert their 3.50% Convertible Senior Notes at their option at any time on or after September 1, 2028 until the close of business on the second scheduled trading day immediately preceding the maturity date. Holders of the 3.50% Convertible Senior Notes will also have the right to convert the 3.50% Convertible Senior Notes prior to September 1, 2028, but only upon the occurrence of specified events described in the Indenture. The conversion rate is subject to anti-dilution adjustments if certain events occur. Prior to December 6, 2026, the 3.50% Convertible Senior Notes will not be redeemable. On or after December 6, 2026, the Company may redeem for cash all or part of the 3.50% Convertible Senior Notes (subject to certain exceptions), at its option, if the last reported sale price of the Class A Common Stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any period of 30 consecutive trading days (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption at a redemption price equal to 100% of the principal amount of the 3.50% Convertible Senior Notes to be redeemed, plus accrued and unpaid interest to, but not including, the redemption date. No sinking fund is provided for the 3.50% Convertible Senior Notes. If certain corporate events occur or the Company delivers a notice of redemption prior to the maturity date of the 3.50% Convertible Senior Notes, and a holder elects to convert its 3.50% Convertible Senior Notes in connection with such corporate event or notice of redemption, as the case may be, the Company will, under certain circumstances, increase the conversion rate for the 3.50% Convertible Senior Notes so surrendered for conversion by a number of additional shares of Class A Common Stock in accordance with the Indenture. No adjustment to the conversion rate will be made if the price paid or deemed to be paid per share of Class A Common Stock in such corporate event or redemption, as the case may be, is either less than $28.41 per share or exceeds $280.00 per share. If a specified “Fundamental Change” (as defined in the Indenture) occurs prior to the maturity date of the 3.50% Convertible Senior Notes, under certain circumstances each holder may require the Company to repurchase all or part of its 3.50% Convertible Senior Notes at a repurchase price equal to 100% of the principal amount, plus accrued and unpaid interest to, but not including, the repurchase date. Under the Indenture, the 3.50% Convertible Senior Notes may be accelerated upon the occurrence of certain events of default. In the case of an event of default with respect to the 3.50% Convertible Senior Notes arising from specified events of bankruptcy or insolvency of the Company, 100% of the principal of and accrued and unpaid interest on the 3.50% Convertible Senior Notes will automatically become due and payable. If any other event of default with respect to the 3.50% Convertible Senior Notes under the Indenture occurs or is continuing, the Trustee or holders of at least 25% in aggregate principal amount of the then outstanding 3.50% Convertible Senior Notes may declare the principal amount of the 3.50% Convertible Senior Notes to be immediately due and payable. On December 5, 2023, in connection with the pricing of the 3.50% Convertible Senior Notes, and on December 6, 2023, in connection with the exercise in full by the initial purchasers of their option to purchase additional 3.50% Convertible Senior Notes, the Company entered into capped call transactions with certain of the initial purchasers of the 3.50% Convertible Senior Notes or their respective affiliates and other financial institutions, pursuant to capped call confirmations. The capped call transactions are expected generally to reduce the potential dilution to the Class A Common Stock upon any conversion of the 3.50% Convertible Senior Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of converted 3.50% Convertible Senior Notes, as the case may be, with such reduction and/or offset subject to a cap based on a cap price initially equal to approximately $42.62 per share (which represents a premium of approximately 50% over the last reported sale price of the Class A Common Stock of $28.41 per share on the New York Stock Exchange (the “NYSE”) on December 5, 2023), and is subject to certain adjustments under the terms of the capped call transactions. Debt Maturities Long-term debt maturities over the next five years for the outstanding balance under the MSG Networks Credit Facilities, LV Sphere Term Loan Facility and 3.50% Convertible Senior Notes as of March 31, 2024 were as follows: MSG Networks Credit Facilities LV Sphere Term Loan Facility 3.50% Convertible Senior Notes Total Fiscal Year 2024 (remainder) $ 20,625 $ — $ — $ 20,625 Fiscal Year 2025 849,750 — — 849,750 Fiscal Year 2026 — — — — Fiscal Year 2027 — — — — Fiscal Year 2028 — 275,000 — 275,000 Thereafter — — 258,750 258,750 Total long-term debt $ 870,375 $ 275,000 $ 258,750 $ 1,404,125 Interest payments and loan principal repayments made by the Company under the credit agreements were as follows: Interest Payments Loan Principal Repayments Nine Months Ended Nine Months Ended March 31, March 31, 2024 2023 2024 2023 MSG Networks Credit Facilities $ 51,587 $ 41,034 $ 61,875 $ 45,375 LV Sphere Term Loan Facility 20,158 6,211 — — Delayed Draw Term Loan Facility 460 — 65,000 — Total Payments $ 72,205 $ 47,245 $ 126,875 $ 45,375 The carrying value and fair value of the Company’s debt reported in the accompanying condensed consolidated balance sheets are as follows: As of March 31, 2024 June 30, 2023 Carrying Value (a) Fair Carrying Value (a) Fair Liabilities: MSG Networks Credit Facilities $ 870,375 $ 866,203 $ 932,250 $ 927,589 LV Sphere Term Loan Facility 275,000 273,625 275,000 272,250 3.50% Convertible Senior Notes 252,080 404,323 — — Total Long-term debt $ 1,397,455 $ 1,544,151 $ 1,207,250 $ 1,199,839 _________________ (a) The total carrying value of the Company’s debt as of March 31, 2024 and June 30, 2023 is equal to the current and non-current principal payments for the Company’s credit agreements, net of discount, excluding unamortized deferred financing costs of $5,622 and $6,363, respectively. The Company’s long-term debt is classified within Level II of the fair value hierarchy as it is valued using quoted indices of similar instruments for which the inputs are readily observable. |
Pension Plans and Other Postret
Pension Plans and Other Postretirement Benefit Plan | 9 Months Ended |
Mar. 31, 2024 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Disclosures [Abstract] | |
Pension Plans and Other Postretirement Benefit Plan | Pension Plans and Other Postretirement Benefit Plan The Company sponsors (i) both funded and unfunded and qualified and non-qualified pension plans, including the Networks 1212 Plan (as defined below), Networks Excess Cash Balance Plan, and the Networks Excess Retirement Plan (together, the “Networks Plans”), (ii) an excess savings plan and (iii) a postretirement benefit plan (the “Postretirement Plan”). In connection with the MSGE Distribution, the Company established an unfunded non-contributory, non-qualified frozen excess cash balance plan (the “Sphere Excess Plan”) covering certain employees who participated in the pre-MSGE Distribution cash balance plan, which was transferred to MSG Entertainment in connection with the MSGE Distribution. The Networks Plans and Sphere Excess Plans are collectively referred to as the “Pension Plans.” Prior to the MSGE Distribution, the Company sponsored two contributory welfare plans which provided certain postretirement healthcare benefits to certain employees hired prior to January 1, 2001. The sponsorship of the Postretirement Plan covering Networks employees was retained by the Company while the postretirement plan covering MSGE employees was transferred to MSG Entertainment in connection with MSGE Distribution. In addition, the liabilities associated with the postretirement plan for MSGE employees were transferred from the Company to MSG Entertainment in connection with the MSGE Distribution. See Note 13. Pension Plans and Other Postretirement Benefit Plans, to the Audited Consolidated Annual Financial Statements included in the 2023 Form 10-K for more information regarding these plans. Defined Benefit Pension Plans and Postretirement Benefit Plan The following table presents components of net periodic benefit cost for the Pension Plans and Postretirement Plan included in the accompanying condensed consolidated statements of operations for the three and nine months ended March 31, 2024 and 2023. Service cost is recognized in direct operating expenses and selling, general and administrative expenses. All other components of net periodic benefit cost are reported in Other expense, net. Pension Plans Postretirement Plan Three Months Ended Three Months Ended March 31, March 31, 2024 2023 2024 2023 Service cost $ 61 $ 123 $ 5 $ 15 Interest cost 434 1,189 17 19 Expected return on plan assets (213) (1,719) — — Recognized actuarial loss (gain) 94 476 (17) (12) Net periodic benefit cost $ 376 $ 69 $ 5 $ 22 Pension Plans Postretirement Plan Nine Months Ended Nine Months Ended March 31, March 31, 2024 2023 2024 2023 Service cost $ 183 $ 369 $ 15 $ 45 Interest cost 1,302 3,567 51 57 Expected return on plan assets (347) (5,157) — — Recognized actuarial (gain) loss (10) 1,478 (51) 6 Net periodic benefit cost $ 1,128 $ 257 $ 15 $ 108 Contributions for Qualified Defined Benefit Plans The Company sponsors one non-contributory, qualified defined benefit pension plan covering certain of its union employees, the “Networks 1212 Plan.” The Company contributed $500 to the Networks 1212 Plan during the nine months ended March 31, 2024 and 2023, respectively. The Company did not contribute any amounts to the Networks 1212 Plan during the three months ended March 31, 2024 and 2023. Defined Contribution Plans The Company sponsors the MSGN Holdings, L.P. Excess Savings Plan, the Sphere Entertainment Excess Savings Plan, and participates in the Madison Square Garden 401(k) Savings Plan (collectively, “Savings Plans”). For the three and nine months ended March 31, 2024 and 2023, expenses related to the Savings Plans included in the accompanying condensed consolidated statements of operations are as follows: Three Months Ended Nine Months Ended March 31, March 31, 2024 2023 2024 2023 Continuing Operations $ 1,743 $ 1,937 $ 4,956 $ 5,058 Discontinued Operations — 1,367 — 3,553 Total Savings Plan Expenses $ 1,743 $ 3,304 $ 4,956 $ 8,611 Executive Deferred Compensation See Note 13. Pension Plans and Other Postretirement Benefit Plans, to the Company’s Audited Consolidated Annual Financial Statements included in the 2023 Form 10-K, for more information regarding the Company’s Executive Deferred Compensation Plan (the “Executive Deferred Compensation Plan”). The Company recorded compensation expense of $126 and $264 for the three and nine months ended March 31, 2024, respectively, and $129 and $135 for the three and nine months ended March 31, 2023, respectively, within Selling, general, and administrative expenses in the condensed, consolidated statements of operations to reflect the remeasurement of the Deferred Compensation Plan liability. In addition, the Company recorded gains of $126 and $264 for the three and nine months ended March 31, 2024, respectively, and $129 and $135 for the three and nine months ended March 31, 2023, respectively, within Other (expense) income, net in the condensed, consolidated statements of operations to reflect remeasurement of the fair value of assets under the Deferred Compensation Plan. The following table summarizes amounts recognized related to the Deferred Compensation Plan in the condensed consolidated balance sheets: As of March 31, June 30, Non-current assets (included in Investments) $ 3,049 $ 1,087 Non-current liabilities (included in Other non-current liabilities) $ (3,072) $ (1,087) |
Share-based Compensation
Share-based Compensation | 9 Months Ended |
Mar. 31, 2024 | |
Share-Based Payment Arrangement [Abstract] | |
Share-based Compensation | Share-based Compensation The Company has three share-based compensation plans: the 2020 Employee Stock Plan, the 2020 Stock Plan for Non-Employee Directors and the MSG Networks Inc. 2010 Employee Stock Plan, in each case as amended from time to time. See Note 12. Share-based Compensation, to the Audited Consolidated Annual Financial Statements included in the 2023 Form 10-K, for more detail on these plans. Share-based compensation expense for the Company’s restricted stock units (“RSUs”), performance stock units (“PSUs”), stock options and/or cash-settled stock appreciation rights (“SARs”) are recognized in the condensed consolidated statements of operations as a component of direct operating expenses or selling, general and administrative expenses. The following table summarizes the Company’s share-based compensation expense: Three Months Ended Nine Months Ended March 31, March 31, 2024 2023 2024 2023 Share-based compensation (a) $ 17,164 $ 9,105 $ 34,119 $ 36,950 Fair value of awards vested and exercised (b) $ 9,567 $ 806 $ 42,988 $ 35,933 _________________ (a) Share-based compensation excludes costs that have been capitalized of $1,881 and $2,887 for the nine months ended March 31, 2024 and 2023, respectively. (b) To fulfill required statutory tax withholding obligations for the applicable income and other employment taxes, RSUs and PSUs with an aggregate value of $409 and $14,844, and $208 and $14,949 were retained by the Company during the three and nine months ended March 31, 2024, and 2023, respectively. As of March 31, 2024, there was $104,913 of unrecognized compensation cost related to unvested RSUs, PSUs, stock options and SARs held by the Company’s employees. The cost is expected to be recognized over a weighted-average period of approximately 2.1 years. For the three and nine months ended March 31, 2024 all restricted stock units and stock options were excluded from the anti-dilutive calculation because the Company reported a net loss for the period and, therefore, their impact on reported loss per share would have been antidilutive. Award Activity RSUs During the nine months ended March 31, 2024 and 2023, approximately 514 and 657 RSUs were granted, respectively, and approximately 659 and 560 RSUs vested, respectively. PSUs During the nine months ended March 31, 2024 and 2023, approximately 404 and 566 PSUs were granted, respectively, and approximately 273 and 91 PSUs vested, respectively. Stock options During the nine months ended March 31, 2024, approximately 3,819 stock options were granted. No stock options were granted during the nine months ended March 31, 2023. During the nine months ended March 31, 2024 and 2023, 184 options were exercised and no options were exercised, respectively. During the nine months ended March 31, 2024, cash received from option exercises was approximately $8,827. During the nine months ended March 31, 2023, no cash was received from option exercises. SARs During the nine months ended March 31, 2024, approximately 188 SARs were granted, and no SARs vested. During the nine months ended March 31, 2023 no SARs were granted or vested. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Mar. 31, 2024 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Stockholders’ Equity Preferred Stock The Company is authorized to issue 15,000 shares of preferred stock, par value $0.01. As of March 31, 2024 and June 30, 2023, no shares of preferred stock were outstanding. Stock Repurchase Program On March 31, 2020, the Company’s Board of Directors authorized the repurchase of up to $350,000 of the Company’s Class A Common Stock. The program was re-authorized by the Company’s Board of Directors on March 29, 2023. Under the authorization, shares of Class A Common Stock may be purchased from time to time in accordance with applicable insider trading and other securities laws and regulations. The timing and amount of purchases will depend on market conditions and other factors. The Company has not engaged in any share repurchase activities under its share repurchase program to date. Accumulated Other Comprehensive Loss The following tables detail the components of accumulated other comprehensive loss: Three Months Ended March 31, 2024 Pension Plans and Cumulative Accumulated Balance as of December 31, 2023 $ (5,240) $ (1,074) $ (6,314) Other comprehensive income (loss): Other comprehensive loss before reclassifications — (968) (968) Amounts reclassified from accumulated other comprehensive loss (a) 77 — 77 Income tax (expense) benefit (19) 250 231 Other comprehensive income (loss), total 58 (718) (660) Balance as of March 31, 2024 $ (5,182) $ (1,792) $ (6,974) Three Months Ended March 31, 2023 Pension Plans and Cumulative Accumulated Balance as of December 31, 2022 $ (39,453) $ (9,110) $ (48,563) Other comprehensive income: Other comprehensive income before reclassifications — 2,071 2,071 Amounts reclassified from accumulated other comprehensive loss (a) 464 — 464 Income tax expense (58) (353) (411) Other comprehensive income, total 406 1,718 2,124 Balance as of March 31, 2023 $ (39,047) $ (7,392) $ (46,439) Nine Months Ended March 31, 2024 Pension Plans and Postretirement Plan Cumulative Accumulated Balance as of June 30, 2023 $ (5,138) $ 200 $ (4,938) Other comprehensive loss: Other comprehensive loss before reclassifications — (2,688) (2,688) Amounts reclassified from accumulated other comprehensive loss (a) (61) — (61) Income tax benefit 17 696 713 Other comprehensive loss, total (44) (1,992) (2,036) Balance as of March 31, 2024 $ (5,182) $ (1,792) $ (6,974) Nine Months Ended March 31, 2023 Pension Plans and Cumulative Accumulated Balance as of June 30, 2022 $ (40,287) $ (8,068) $ (48,355) Other comprehensive income: Other comprehensive income before reclassifications — 794 794 Amounts reclassified from accumulated other comprehensive loss (a) 1,484 — 1,484 Income tax expense (244) (118) (362) Other comprehensive income, total 1,240 676 1,916 Balance as of March 31, 2023 $ (39,047) $ (7,392) $ (46,439) _________________ (a) Amounts reclassified from accumulated other comprehensive loss represent the amortization of net actuarial loss and net unrecognized prior service credit included in net periodic benefit cost, which is reflected under Other income (expense), net in the accompanying condensed consolidated statements of operations (see Note 12. Pension Plans and Other Postretirement Benefit Plans). |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Mar. 31, 2024 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions As of March 31, 2024, certain m embers of the Dolan family, including certain trusts for the benefit of members of the Dolan family (collectively, the “Dolan Family Group”), for purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended, collectively beneficially owned 100% of the Company’s outstanding Class B Common Stock and approximately 6.5% of the Company’s outstanding Class A Common Stock (inclusive of options exercisable within 60 days after March 31, 2024 ). Such shares of the Company’s Class A Common Stock and Class B Common Stock, collectively, represent approximately 72.3% of the aggregate voting power of the Company’s outstanding common stock. Members of the Dolan family are also the controlling stockholders of MSG Entertainment, MSG Sports and AMC Networks Inc. See Note 17. Related Party Transactions, to the Audited Consolidated Annual Financial Statements included in the 2023 Form 10-K, for a description of the Company’s related party arrangements. There have been no material changes in such related party arrangements except as described below. As of March 31, 2024, t he Company was party to arrangements with (i) MSG Sports, pursuant to which MSG Sports provided certain sponsorship and other business operations services to the Company in exchange for service fees (subsequent to March 31, 2024, MSG Sports no longer provides these sponsorship services to the Company) , (ii) MSG Entertainment, pursuant to which MSG Entertainment provides certain sponsorship-related account management services to the Company in exchange for service fees, (iii) MSG Sports and MSG Entertainment, pursuant to which the three companies have agreed to allocate expenses in connection with the use by each company of aircraft owned or leased by MSG Entertainment and MSG Sports, and (iv) MSG Sports and MSG Entertainment pursuant to which the Company has certain sponsorship rights. In addition, in connection with the Company’s disposition of the MSGE Retained Interest, the Company no longer has “demand” or “piggyback” registration rights with respect to the MSGE Retained Interest. See Note 6. Investments in Nonconsolidated Affiliates, for additional information on the MSGE Retained Interest. The Company has also entered into certain commercial agreements with its equity method investment nonconsolidated affiliates in connection with Sphere. The Company recorded capital expenditures of $7 and $8,049 for the three and nine months ended March 31, 2024, respectively, and $14,271 and $87,357 for the three and nine months ended March 31, 2023, respectively , in connection with services provided to the Company under these agreements. The Company recorded commission expense of $3,323 and $4,060 for the three and nine months ended March 31, 2024, respectively, and did not record any commission expense for the three and nine months ended March 31, 2023, in connection with sponsorship sales services provided under certain of these arrangements. As of March 31, 2024 and June 30, 2023, accrued liabilities associated with related parties were $17,450 and $13,412, respectively, and are reported under Accounts payable, accrued and other current liabilities in the accompanying condensed consolidated balance sheets. As of March 31, 2024 and June 30, 2023, prepaid expenses associated with related parties were $1,190 and $0, respectively, and are reported under Other non-current assets in the accompanying condensed consolidated balance sheets. From time to time, the Company enters into arrangements with 605, LLC (“605”). Kristin Dolan, a director of the Company and the spouse of James L. Dolan, the Executive Chairman and Chief Executive Officer of the Company, founded and was the Chief Executive Officer of 605, an audience measurement and data analytics company in the media and entertainment industries, until February 2023. The Company’s Audit Committee approved the entry into one or more agreements with 605 to provide certain data analytics services to the Company for an aggregate amount of up to $1,000. On September 13, 2023, 605 was sold to iSpot.tv, and James L. Dolan and Kristin A. Dolan now hold a minority interest in iSpot.tv. As a result, from and after September 13, 2023, 605 is no longer considered to be a related party. Revenues and Operating Expenses The following table summarizes the composition and amounts of the transactions with the Company’s affiliates. These amounts are reflected in revenues and operating expenses in the accompanying condensed consolidated statements of operations for the three and nine months ended March 31, 2024 and 2023: Three Months Ended Nine Months Ended March 31, March 31, 2024 2023 2024 2023 Revenues $ 1,215 $ 1,730 $ 3,262 $ 1,730 Operating expenses (credits): Media rights fees 43,947 43,433 132,617 129,633 Cost reimbursement from MSG Sports - MSG Sports Services Agreement — (9,789) — (28,781) Corporate general and administrative expenses, net - MSG Entertainment Transition Services Agreement (a) 27,494 — 83,611 — Origination, master control and technical services 1,283 1,257 3,797 3,721 Other operating expenses (credits), net (b) 5,102 (69) 13,880 (365) Total operating expenses, net (c) $ 77,826 $ 34,832 $ 233,905 $ 104,208 _________________ (a) Included in the three and nine months ended March 31, 2024, Corporate general and administrative expenses, net - MSG Entertainment Transition Services Agreement (the “MSGE TSA”) are $558 and $3,363, respectively, related to Restructuring charges for employees who provided services to the Company under the MSGE TSA. (b) Other operating expenses, net, includes CPC commission expenses, and reimbursements to MSG Entertainment for aircraft-related expenses, professional and payroll fees. (c) Of the total operating expenses, net, $45,332 and $138,869 for three and nine months ended March 31, 2024, respectively, and $45,280 and $134,387 for the three and nine months ended March 31, 2023, respectively, are included in direct operating expenses in the accompanying condensed consolidated statements of operations. Of the total operating expenses, net $32,494 and $95,036 for three and nine months ended March 31, 2024, respectively, are included as expenses, and $(10,448) and $(30,179) for the three and nine months ended March 31, 2023, respectively, are included as net credits, in selling, general, and administrative expenses in the accompanying condensed consolidated statements of operations. Revenues Revenues from related parties relate primarily to certain advertising agreements between MSG Networks and MSG Sports. |
Segment Information
Segment Information | 9 Months Ended |
Mar. 31, 2024 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information As of March 31, 2024, the Company was comprised of two reportable segments: Sphere and MSG Networks. The Company takes into account whether two or more operating segments can be aggregated together as one reportable segment as well as the type of discrete financial information that is available and regularly reviewed by its Chief Operating Decision Maker. The Company evaluates segment performance based on several factors, of which the key financial measure is adjusted operating income (loss), a non-GAAP financial measure. We define adjusted operating income (loss) as operating income (loss) excluding: (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 and acquisition-related costs, including merger-related litigation expenses, (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 (which was established in November 2021). The Company believes that the exclusion of share-based compensation expense or benefit allows investors to better track the performance of the Company’s business without regard to the settlement of an obligation that is not expected to be made in cash. The Company eliminates merger and acquisition-related costs, 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 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). The Company believes adjusted operating income (loss) is an appropriate measure for evaluating the operating performance of its 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 the Company’s performance. The Company uses revenues and adjusted operating income (loss) measures as the most important indicators of its business performance, and evaluates 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. The Company has presented the components that reconcile operating income (loss), the most directly comparable GAAP financial measure, to adjusted operating income (loss). Information as to the operations of the Company’s reportable segments is set forth below. Three Months Ended March 31, 2024 Sphere MSG Networks Total Revenues $ 170,364 $ 150,966 $ 321,330 Direct operating expenses (62,294) (91,746) (154,040) Selling, general and administrative expenses (108,976) (14,173) (123,149) Depreciation and amortization (77,706) (2,161) (79,867) Restructuring charges (4,886) 219 (4,667) Operating (loss) income $ (83,498) $ 43,105 $ (40,393) Interest income 7,654 Interest expense (27,119) Other expense, net (3,256) Loss from operations before income taxes $ (63,114) Reconciliation of operating (loss) income to adjusted operating income: Operating (loss) income $ (83,498) $ 43,105 $ (40,393) Add back: Share-based compensation 13,273 3,451 16,724 Depreciation and amortization 77,706 2,161 79,867 Restructuring charges 4,886 (219) 4,667 Merger and acquisition related costs, net of insurance recoveries 416 92 508 Amortization for capitalized cloud computing arrangement costs — 22 22 Remeasurement of deferred compensation plan liabilities 126 — 126 Adjusted operating income $ 12,909 $ 48,612 $ 61,521 Other information: Capital expenditures $ 17,502 $ 1,962 $ 19,464 Three Months Ended March 31, 2023 Sphere MSG Networks Total Revenues $ 626 $ 161,436 $ 162,062 Direct operating expenses (4,414) (89,251) (93,665) Selling, general and administrative expenses (83,381) (60,052) (143,433) Depreciation and amortization (6,511) (1,689) (8,200) Restructuring charges (18,670) — (18,670) Operating (loss) income $ (112,350) $ 10,444 $ (101,906) Interest income 3,374 Other expense, net (4,182) Loss from operations before income taxes $ (102,714) Reconciliation of operating (loss) income to adjusted operating (loss) income: Operating (loss) income $ (112,350) $ 10,444 $ (101,906) Add back: Share-based compensation 8,466 639 9,105 Depreciation and amortization 6,511 1,689 8,200 Restructuring charges 18,670 — 18,670 Merger and acquisition related costs 1,532 45,513 47,045 Amortization for capitalized cloud computing arrangement costs 125 43 168 Adjusted operating (loss) income $ (77,046) $ 58,328 $ (18,718) Other information: Capital expenditures $ 195,945 $ 1,818 $ 197,763 Nine Months Ended March 31, 2024 Sphere MSG Networks Total Revenues $ 345,942 $ 407,552 $ 753,494 Direct operating expenses (137,437) (260,868) (398,305) Selling, general and administrative expenses (290,930) (34,883) (325,813) Depreciation and amortization (168,127) (6,030) (174,157) Impairment and other losses, net (115,738) — (115,738) Restructuring charges (9,564) 219 (9,345) Operating (loss) income $ (375,854) $ 105,990 $ (269,864) Interest income 17,958 Interest expense (52,947) Other income, net 37,810 Loss from operations before income taxes $ (267,043) Reconciliation of operating (loss) income to adjusted operating (loss) income: Operating (loss) income $ (375,854) $ 105,990 $ (269,864) Add back: Share-based compensation 28,177 5,346 33,523 Depreciation and amortization 168,127 6,030 174,157 Restructuring charges 9,564 (219) 9,345 Impairment and other losses, net 115,738 — 115,738 Merger and acquisition related costs, net of insurance recoveries (2,086) (6,069) (8,155) Amortization for capitalized cloud computing arrangement costs — 66 66 Remeasurement of deferred compensation plan liabilities 264 — 264 Adjusted operating (loss) income $ (56,070) $ 111,144 $ 55,074 Other information: Capital expenditures $ 244,963 $ 6,473 $ 251,436 Nine Months Ended March 31, 2023 Sphere MSG Networks Total Revenues $ 1,919 $ 442,813 $ 444,732 Direct operating expenses (4,414) (255,071) (259,485) Selling, general and administrative expenses (235,331) (107,148) (342,479) Depreciation and amortization (16,775) (4,944) (21,719) Other gains 3,000 — 3,000 Restructuring charges (22,757) (3,988) (26,745) Operating (loss) income $ (274,358) $ 71,662 $ (202,696) Interest income 9,376 Other expense, net (5,952) Loss from operations before income taxes $ (199,272) Reconciliation of operating (loss) income to adjusted operating (loss) income: Operating (loss) income $ (274,358) $ 71,662 $ (202,696) Add back: Share-based compensation 31,308 5,642 36,950 Depreciation and amortization 16,775 4,944 21,719 Restructuring charges 22,757 3,988 26,745 Other gains (3,000) — (3,000) Merger and acquisition related costs 4,223 52,958 57,181 Amortization for capitalized cloud computing arrangement costs 285 131 416 Adjusted operating (loss) income $ (202,010) $ 139,325 $ (62,685) Other information: Capital expenditures $ 733,198 $ 5,710 $ 738,908 Concentration of Risk Accounts receivable, net in the accompanying condensed consolidated balance sheets as of March 31, 2024 and June 30, 2023 include amounts due from the following individual customers, which accounted for the noted percentages of the gross balance: As of March 31, June 30, Customer A 13 % 23 % Customer B 13 % 22 % Customer C 10 % 17 % Revenues in the accompanying condensed consolidated statements of operations for the three and nine months ended March 31, 2024 and 2023 include amounts from the following individual customers: Three Months Ended Nine Months Ended March 31, March 31, 2024 2023 2024 2023 Customer 1 11 % 23 % 14 % 26 % Customer 2 11 % 21 % 14 % 25 % Customer 3 8 % 19 % 11 % 21 % |
Additional Financial Informatio
Additional Financial Information | 9 Months Ended |
Mar. 31, 2024 | |
Additional Financial Information [Abstract] | |
Additional Financial Information | Additional Financial Information The following table provides a summary of the amounts recorded as cash, cash equivalents and restricted cash. As of March 31, June 30, Cash and cash equivalents $ 680,575 $ 131,965 Restricted cash 13,371 297,149 Total cash, cash equivalents and restricted cash $ 693,946 $ 429,114 The Company’s c ash, cash equivalents, and restricted cash are classified within Level I of the fair value hierarchy as it is valued using observable inputs that reflect quoted prices for identical assets in active markets. The Company’s restricted cash includes cash deposited in escrow accounts. The Company has deposited cash in interest-bearing escrow accounts related to credit support, debt facilities, and collateral to its workers compensation and general liability insurance obligations. Prepaid expenses and other current assets consisted of the following: As of March 31, June 30, Prepaid expenses $ 12,614 $ 22,616 Note and other receivables 8,589 21,453 Inventory 1,684 — Current deferred production content costs 1,906 6,524 Other 5,423 5,492 Total prepaid expenses and other current assets $ 30,216 $ 56,085 Accounts payable, accrued and other current liabilities consisted of the following: As of March 31, June 30, Accounts payable $ 73,670 $ 39,654 Accrued payroll and employee related liabilities 71,584 75,579 Cash due to promoters 57,360 73,611 Capital expenditure accruals 155,352 236,593 Accrued legal fees 23,442 53,857 Other accrued expenses 41,705 36,437 Total accounts payable, accrued and other current liabilities $ 423,113 $ 515,731 Other (expense) income, net includes the following: Three Months Ended Nine Months Ended March 31, March 31, 2024 2023 2024 2023 Gain on litigation settlement $ — $ — $ 62,647 $ — Realized loss on equity method investments — — (19,027) — Other (3,256) (4,182) (5,810) (5,952) Total other (expense) income, net $ (3,256) $ (4,182) $ 37,810 $ (5,952) Income Taxes During the nine months ended March 31, 2024 and 2023, the Company made income tax payments, net of refunds, of $18,859 and $5,372, respectively. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Mar. 31, 2024 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On April 25, 2024, a subsidiary of the Company entered into a share purchase and transfer agreement to acquire the remaining equity interest in Holoplot GmbH not previously owned by the Company. Following the acquisition on April 25, 2024, Holoplot is now a consolidated subsidiary of the Company. The Company expects to complete the related purchase price allocation and the corresponding recognition of assets acquired and liabilities assumed during the fourth quarter of Fiscal Year 2024. |
Accounting Policies (Policies)
Accounting Policies (Policies) | 9 Months Ended |
Mar. 31, 2024 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The Company reports on a fiscal year basis ending on June 30 th (“Fiscal Year”). In these unaudited condensed consolidated financial statements, the fiscal year ending on June 30, 2024 and the fiscal year ended on June 30, 2023 are referred to as “Fiscal Year 2024” and “Fiscal Year 2023,” respectively. The Company has presented both the MSG Entertainment business and Tao Group Hospitality as discontinued operations for all periods presented. See Note 3. Discontinued Operations, for further discussion on accounting for the MSGE Distribution and Tao Group Hospitality Disposition. The accompanying condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and the instructions of Rule 10-01 of Regulation S-X of the Securities and Exchange Commission (the “SEC”), and should be read in conjunction with the Company’s audited consolidated financial statements and notes thereto as of June 30, 2023 and 2022 and for the three years ended June 30, 2023, 2022 and 2021 (the “Audited Consolidated Annual Financial Statements”) included in the 2023 Form 10-K. In the opinion of the Company, the accompanying condensed consolidated financial statements contain all adjustments, consisting of only normal recurring adjustments, necessary for a fair statement of the Company’s financial position as of March 31, 2024 and its results of operations for the three and nine months ended March 31, 2024 and 2023, and cash flows for the nine months ended March 31, 2024 and 2023. The condensed consolidated financial statements and the accompanying notes as of March 31, 2024 were derived from audited annual consolidated financial statements but do not contain all of the footnote disclosures from the audited annual consolidated financial statements. The results of operations for the periods presented are not necessarily indicative of the results that might be expected for future interim periods or for the full year. Our MSG Networks segment earns a higher share of its annual revenues in the second and third quarters of its fiscal year as a result of MSG Networks’ advertising revenue being largely derived from the sale of inventory in its live NBA and NHL professional sports programming. |
Reclassifications | Reclassifications For purposes of comparability, certain prior period amounts have been reclassified to conform to the current year presentation in accordance with GAAP. |
Principles of Consolidation | Principles of Consolidation The condensed consolidated financial statements of the Company include the accounts of Sphere Entertainment Co. and its subsidiaries. They also historically included accounts of Tao Group Hospitality, MSG Entertainment, and Boston Calling Events, LLC (“BCE”) until their dispositions on May 3, 2023, April 20, 2023, and December 2, 2022, respectively. All significant intercompany transactions and balances have been eliminated in consolidation. Prior to their dispositions, Tao Group Hospitality and BCE were consolidated with the equity owned by other stockholders shown as redeemable or nonredeemable noncontrolling interests of discontinued operations in the accompanying condensed consolidated balance sheets, and the other stockholders’ portion of net earnings (loss) and other comprehensive income (loss) shown as net income (loss) or comprehensive income (loss) attributable to redeemable or nonredeemable noncontrolling interests from discontinued operations in the accompanying consolidated statements of operations and consolidated statements of comprehensive income (loss), respectively. See Note 3. Discontinued Operations, for details regarding the Tao Group Hospitality Disposition, and MSGE Distribution. See Note 2. Summary of Significant Accounting Policies, to the Audited Consolidated Annual Financial Statements included in the 2023 Form 10-K, regarding the classification of redeemable noncontrolling interests of Tao Group Hospitality. |
Use of Estimates | Use of Estimates The preparation of the accompanying condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions about future events. These estimates and the underlying assumptions affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities, and reported amounts of revenues and expenses. Such estimates include the provision for credit losses, valuation of investments, goodwill, intangible assets, deferred production content costs, other long-lived assets, deferred tax assets, pension and other postretirement benefit obligations and the related net periodic benefit cost, ultimate revenue (as described below), and other liabilities. In addition, estimates are used in revenue recognition, rights fees, performance and share-based compensation, depreciation and amortization, litigation matters and other matters. Management believes its use of estimates in the condensed consolidated financial statements to be reasonable. Management evaluates its estimates on an ongoing basis using historical experience and other factors, including the general economic environment and actions it may take in the future. The Company adjusts such estimates when facts and circumstances dictate. However, these estimates may involve significant uncertainties and judgments and cannot be determined with precision. In addition, these estimates are based on management’s best judgment at a point in time and, as such, these estimates may ultimately differ from actual results. Changes in estimates resulting from weakness in the economic environment or other factors beyond the Company’s control could be material and would be reflected in the Company’s condensed consolidated financial statements in future periods. |
Production Costs for the Company's Original Immersive Productions | Production Costs for the Company’s Original Immersive Productions The Company debuted its first original immersive production, Postcard From Earth TM , on October 6, 2023, which resulted in the amortization of the related production costs. The following reflects the Company’s complete policies with respect to immersive production costs. The Company defers certain costs during the production phase of its original immersive productions for Sphere that are directly related to production activities. Such costs include, but are not limited to, fees paid to writers, directors and producers as well as video and music production costs and production-specific overhead. For purposes of evaluating the recognition of amortization and any potential impairment, deferred immersive production costs are classified based on their predominant monetization strategy. The determination of the predominant monetization strategy is made at the commencement of production and is based on the means by which the Company expects to derive third-party revenues from use of the content. The Company’s primary monetization strategy and classification for its current content is on an individual production basis, which the Company defines as content where the lifetime value is predominantly derived from third-party revenues that are directly attributable to the specific production. The classification of content only changes if there is a significant change to the production’s monetization strategy relative to management’s initial assessment. Deferred immersive production costs are amortized beginning in the month the production debuts, in the same ratio that current period actual revenue bears to estimated remaining unrecognized ultimate revenue as of the beginning of the current fiscal year. Estimates of ultimate revenues are prepared on an individual production basis and reviewed regularly by management and revised where necessary to reflect the most current information. Ultimate revenues reflect management’s estimates of future revenue over a period not to exceed ten years following the premiere of the production. Deferred immersive production costs are subject to recoverability assessments whenever there is an indication of potential impairment. |
Recently Issued and Adopted Accounting Pronouncements | Recently Issued and Adopted Accounting Pronouncements Recently Issued Accounting Pronouncements In November 2023, the Financial Accounting Standards Board (the “FASB”) issued ASU No. 2023-07, Improvement to Reportable Segment Disclosures . This ASU aims to improve segment disclosures through enhanced disclosures about significant segment expenses. The standard requires disclosure of significant expense categories and amounts for such expenses, including those segment expenses that are regularly provided to the chief operating decision maker, easily computable from information that is regularly provided, or significant expenses that are expressed in a form other than actual amounts. This standard will be effective for the Company in Fiscal Year 2025 and is required to be applied retrospectively to all prior periods presented in the financial statements. The Company is currently evaluating the impact of the additional disclosure requirements on the Company’s condensed consolidated financial statements. In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures , a final standard on improvements to income tax disclosures which applies to all entities subject to income taxes. The standard requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. The standard is intended to benefit investors by providing more detailed income tax disclosures that would be useful in making capital allocation decisions. This standard will be effective for the Company in Fiscal Year 2026 and is required to be applied prospectively. The Company is currently evaluating the impact of the additional disclosure requirements on the Company’s condensed consolidated financial statements. |
Revenue, Remaining Performance Obligation | In developing the estimated revenue, the Company applies the allowable practical expedient and does not disclose information about remaining performance obligations that have original expected durations of one year or less. |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 9 Months Ended |
Mar. 31, 2024 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of Discontinued Operations | The table below sets forth operating results of discontinued operations for the three and nine months ended March 31, 2023. Amounts presented below differ from historically reported results for the MSG Entertainment and Tao Group Hospitality business segments due to reclassifications and adjustments made for purposes of discontinued operations. Three Months Ended March 31, 2023 MSG Entertainment Tao Group Hospitality Eliminations Total Revenues $ 200,043 $ 130,857 $ 1,190 $ 332,090 Direct operating expenses (114,298) (77,963) (1,247) (193,508) Selling, general and administrative expenses (37,367) (46,541) — (83,908) Depreciation and amortization (14,798) (7,421) — (22,219) Impairment and other losses, net (51) — — (51) Restructuring charges (1,828) — — (1,828) Operating income (loss) 31,701 (1,068) (57) 30,576 Interest income 313 49 (1,047) (685) Interest expense — (160) — (160) Other income (loss), net 9,180 (8) — 9,172 Income (loss) from operations before income taxes 41,194 (1,187) (1,104) 38,903 Income tax benefit 12,295 4,245 — 16,540 Net income 53,489 3,058 (1,104) 55,443 Less: Net loss attributable to nonredeemable noncontrolling interests — (216) — (216) Less: Net loss attributable to redeemable noncontrolling interests — (1,492) — (1,492) Net income from discontinued operations attributable to Sphere Entertainment Co.’s stockholders $ 53,489 $ 4,766 $ (1,104) $ 57,151 Nine Months Ended March 31, 2023 MSG Entertainment Tao Group Hospitality Eliminations Total Revenues $ 694,755 $ 398,078 $ 3 $ 1,092,836 Direct operating expenses (396,691) (232,029) — (628,720) Selling, general and administrative expenses (102,333) (131,200) — (233,533) Depreciation and amortization (46,370) (21,144) — (67,514) Impairment and other gains, net 4,361 473 — 4,834 Restructuring charges (7,435) — — (7,435) Operating income 146,287 14,178 3 160,468 Interest income 1,832 85 (1,047) 870 Interest expense (1,083) (2,138) — (3,221) Other income, net 7,895 719 — 8,614 Income from operations before income taxes 154,931 12,844 (1,044) 166,731 Income tax expense (9,120) (2,043) — (11,163) Net income 145,811 10,801 (1,044) 155,568 Less: Net loss attributable to nonredeemable noncontrolling interests (553) (129) — (682) Less: Net income attributable to redeemable noncontrolling interests — 2,661 — 2,661 Net income from discontinued operations attributable to Sphere Entertainment Co.’s stockholders $ 146,364 $ 8,269 $ (1,044) $ 153,589 The table below sets forth, for the period presented, significant selected financial information related to discontinued activities included in the accompanying condensed consolidated financial statements: Three Months Ended Nine Months Ended March 31, 2023 March 31, 2023 MSG Entertainment Tao Group Hospitality MSG Entertainment Tao Group Hospitality Non-cash items included in net income: Depreciation and amortization $ 14,798 $ 7,421 $ 46,370 $ 21,144 Share-based compensation expense, net 1,792 2,144 2,896 6,570 Cash flows from investing activities: Capital expenditures, net $ 2,979 $ 4,962 $ 12,187 $ 16,417 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 9 Months Ended |
Mar. 31, 2024 | |
Revenue Recognition [Abstract] | |
Disaggregation of Revenue | The following tables disaggregate the Company’s revenue by major source and reportable segment based upon the timing of transfer of goods or services to the customer for the three and nine months ended March 31, 2024 and 2023: Three Months Ended March 31, 2024 Sphere MSG Networks Total Event-related (a) $ 134,835 $ — $ 134,835 Sponsorship, signage, Exosphere TM advertising, and suite licenses revenues (b) 32,942 656 33,598 Media related, primarily from affiliation agreements (b) — 148,417 148,417 Other 1,864 1,893 3,757 Total revenues from contracts with customers 169,641 150,966 320,607 Revenues from subleases 723 — 723 Total revenues $ 170,364 $ 150,966 $ 321,330 Three Months Ended March 31, 2023 Sphere MSG Networks Total Sponsorship, signage, Exosphere advertising, and suite licenses (b) $ — $ 696 $ 696 Media related, primarily from affiliation agreements (b) — 158,526 158,526 Other — 2,214 2,214 Total revenues from contracts with customers — 161,436 161,436 Revenues from subleases 626 — 626 Total revenues $ 626 $ 161,436 $ 162,062 Nine Months Ended March 31, 2024 Sphere MSG Networks Total Event-related (a) $ 286,991 $ — $ 286,991 Sponsorship, signage, Exosphere TM advertising, and suite licenses revenues (b) 53,024 1,564 54,588 Media related, primarily from affiliation agreements (b) — 401,308 401,308 Other 3,713 4,680 8,393 Total revenues from contracts with customers 343,728 407,552 751,280 Revenues from subleases 2,214 — 2,214 Total revenues $ 345,942 $ 407,552 $ 753,494 Nine Months Ended March 31, 2023 Sphere MSG Networks Total Sponsorship, signage, Exosphere advertising, and suite licenses (b) $ — $ 1,453 $ 1,453 Media related, primarily from affiliation agreements (b) — 436,630 436,630 Other — 4,730 4,730 Total revenues from contracts with customers — 442,813 442,813 Revenues from subleases 1,919 — 1,919 Total revenues $ 1,919 $ 442,813 $ 444,732 _________________ (a) Event-related revenues consists of (i) the Sphere Experience, (ii) ticket sales and other ticket-related revenues, (iii) venue license fees from third-party promoters, and (iv) food, beverage and merchandise sales. Event-related revenues are recognized at a point in time. As such, these revenues have been included in the same category in the table above. (b) See Note 2. Summary of Significant Accounting Policies, Revenue Recognition, and Note 4. Revenue Recognition, to the Audited Consolidated Annual Financial Statements included in the 2023 Form 10-K, for further details on the pattern of recognition of sponsorship, signage, Exosphere advertising, suite licenses, and media related revenue. In addition to the disaggregation of the Company’s revenue by major source based upon the timing of transfer of goods or services to the customer disclosed above, the following tables disaggregate the Company’s consolidated revenues by type of goods or services in accordance with the required entity-wide disclosure requirements of ASC Subtopic 280-10-50-38 to 40 and the disaggregation of revenue required disclosures in accordance with ASC Subtopic 606-10-50-5 for the three and nine months ended March 31, 2024 and 2023: Three Months Ended March 31, 2024 Sphere MSG Networks Total Ticketing and venue license fee revenues (a) $ 110,655 $ — $ 110,655 Sponsorship, signage, Exosphere advertising, and suite revenues 40,511 — 40,511 Food, beverage, and merchandise revenues 18,475 — 18,475 Media networks revenues (b) — 150,966 150,966 Total revenues from contracts with customers 169,641 150,966 320,607 Revenues from subleases 723 — 723 Total revenues $ 170,364 $ 150,966 $ 321,330 Three Months Ended March 31, 2023 Sphere MSG Networks Total Media networks revenues (b) $ — $ 161,436 $ 161,436 Revenues from subleases 626 — 626 Total revenues $ 626 $ 161,436 $ 162,062 Nine Months Ended March 31, 2024 Sphere MSG Networks Total Ticketing and venue license fee revenues (a) $ 235,283 $ — $ 235,283 Sponsorship, signage, Exosphere advertising, and suite revenues 66,817 — 66,817 Food, beverage, and merchandise revenues 41,628 — 41,628 Media networks revenues (b) — 407,552 407,552 Total revenues from contracts with customers 343,728 407,552 751,280 Revenues from subleases 2,214 — 2,214 Total revenues $ 345,942 $ 407,552 $ 753,494 Nine Months Ended March 31, 2023 Sphere MSG Networks Total Media networks revenues (b) $ — $ 442,813 $ 442,813 Revenues from subleases 1,919 — 1,919 Total revenues $ 1,919 $ 442,813 $ 444,732 _________________ (a) Amounts include ticket sales, other ticket-related revenue, and venue license fees from the Company’s events such as (i) concerts, (ii) The Sphere Experience and (iii) other live entertainment and sporting events. (b) Primarily consists of affiliation fees from Distributors (as defined below) and, to a lesser extent, advertising revenues through the sale of commercial time and other advertising inventory during MSG Networks programming. |
Contract with Customer, Contract Assets and Liabilities | The following table provides information about contract balances from the Company’s contracts with customers as of March 31, 2024 and June 30, 2023: As of March 31, June 30, 2024 2023 Receivables from contracts with customers, net (a) $ 179,022 $ 115,039 Contract assets, current (b) 1,500 314 Deferred revenue, including non-current portion (c) 76,712 27,397 _________________ (a) Receivables from contracts with customers, net, which are reported in Accounts receivable, net in the Company’s condensed consolidated balance sheets, represent the Company’s unconditional rights to consideration under its contracts with customers. As of March 31, 2024 and June 30, 2023, the Company’s receivables from contracts with customers above included $320 and $2,730, respectively, related to various related parties. See Note 15. Related Party Transactions, for further details on these related party arrangements. (b) Contract assets current, which are reported as Prepaid expenses and other current assets in the Company’s condensed consolidated balance sheets, primarily relate to the Company’s rights to consideration for goods or services transferred to customers, for which the Company does not have an unconditional right to bill as of the reporting date. Contract assets are transferred to accounts receivable once the Company’s right to consideration becomes unconditional. (c) Revenue recognized for the three and nine months ended March 31, 2024 relating to the deferred revenue balance as of June 30, 2023 was $795 and $21,519, respectively. |
Restructuring Charges (Tables)
Restructuring Charges (Tables) | 9 Months Ended |
Mar. 31, 2024 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Charges | Changes to the Company’s restructuring liability through March 31, 2024 were as follows: Restructuring Liability June 30, 2023 $ 8,891 Restructuring charges (excluding share-based compensation expense) 8,179 Payments (10,144) March 31, 2024 $ 6,926 |
Investments (Tables)
Investments (Tables) | 9 Months Ended |
Mar. 31, 2024 | |
Equity Method Investments, Joint Ventures And Cost Method Investments [Abstract] | |
Cost and Equity Method Investments | The Company’s investments in nonconsolidated affiliates, which are accounted for under the equity method of accounting or as equity investments without readily determinable fair value, consisted of the following: Investment As of Ownership Percentage as of March 31, 2024 March 31, June 30, Equity method investments: SACO Technologies Inc. (“SACO”) 30 % $ 18,692 $ 22,246 Holoplot Loan (a) 21,336 20,971 Holoplot 25 % — 1,542 MSG Entertainment (b) — % — 341,039 Crown Properties Collection (c) 8 % 51 — Equity investments without readily determinable fair values 8,721 8,721 Other equity investments with readily determinable fair values held in trust under the Company’s Executive Deferred Compensation Plan (d) 3,049 1,087 Total investments $ 51,849 $ 395,606 _________________ (a) In January 2023, the Company, through an indirect subsidiary, extended financing to Holoplot GmbH (“Holoplot”) in the form of a three-year convertible loan (the “Holoplot Loan”) of €18,804, equivalent to $20,484 using the applicable exchange rate at the time of the transaction. As of the reporting date, absent conversion, which is not available under the terms of the Holoplot Loan, the Holoplot Loan and interest accrued thereon are due and payable at the conclusion of the three-year term. (b) As of March 31, 2024, following the sale of portions of the MSGE Retained Interest and the repayment of the DDTL Facility (as defined below) with MSG Entertainment using a portion of the MSGE Retained Interest, the Company no longer holds any of the outstanding common stock of MSG Entertainment. The Company elected the fair value option for its investment in MSG Entertainment as of June 30, 2023, when it held approximately 20% of the outstanding shares of common stock of MSG Entertainment (in the form of Class A common stock). The fair value of the investment was determined based on quoted market prices on the New York Stock Exchange (“NYSE”), which were classified within Level I of the fair value hierarchy. (c) In March 2024, the Company paid $51 for an 8.3% investment in Oak View Group’s Crown Properties Collection, LLC (“CPC”). The investment in CPC is accounted for as an equity method investment, with Sphere’s share of CPC results picked-up on a 3-month lag. (d) The Company’s investments with readily determinable fair values are classified within Level I of the fair value hierarchy as it is based on quoted prices in active markets. |
Gain (Loss) on Securities | The following table summarizes the realized and unrealized gain (loss) on equity investments with and without readily determinable fair values, which is reported in Other (expense) income, net, for the three and nine months ended March 31, 2024 and 2023: Three Months Ended Nine Months Ended March 31, March 31, 2024 2023 2024 2023 Unrealized gain $ 127 $ 129 $ 264 $ 2,104 Realized loss from shares of MSG Entertainment Class A common stock sold — — (19,027) — Total realized and unrealized gain (loss) on equity investments $ 127 $ 129 $ (18,763) $ 2,104 Supplemental information on realized loss: Shares of MSG Entertainment Class A common stock disposed (a) — — 1,923 — Shares of MSG Entertainment Class A common stock sold (b) — — 8,221 — Cash proceeds from shares of MSG Entertainment Class A common stock sold $ — $ — $ 256,501 $ — _________________ (a) Refer to Note 11. Credit Facilities and Convertible Notes, for further explanation of the approximately 1,923 shares disposed related to the repayment of the DDTL Facility. (b) The sale of approximately 8,221 shares of MSG Entertainment Class A common stock resulted in the cash proceeds from common stock sold. |
Property and Equipment, net (Ta
Property and Equipment, net (Tables) | 9 Months Ended |
Mar. 31, 2024 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | As of March 31, 2024 and June 30, 2023, property and equipment, net consisted of the following: As of March 31, June 30, Land $ 44,233 $ 80,878 Buildings 2,287,306 69,049 Equipment, furniture, and fixtures 1,128,495 159,786 Leasehold improvements 18,491 18,491 Construction in progress 593 3,066,785 Total property and equipment, gross 3,479,118 3,394,989 Less accumulated depreciation and amortization (259,229) (87,828) Property and equipment, net $ 3,219,889 $ 3,307,161 |
Original Immersive Production_2
Original Immersive Production Content (Tables) | 9 Months Ended |
Mar. 31, 2024 | |
Other Industries [Abstract] | |
Schedule Of Deferred Immersive Production Costs | As of March 31, 2024 and June 30, 2023, total deferred immersive production content costs consisted of the following: As of March 31, June 30, Production content Released, less amortization $ 68,397 $ — In-process 4,584 61,421 Total production content $ 72,981 $ 61,421 |
Schedule Of Amortization Of Deferred Immersive Production Costs | The following table summarizes the Company’s amortization of production content costs, which is reported in Direct operating expenses in the accompanying condensed consolidated statements of operations for the three and nine months ended March 31, 2024 and 2023 as follows: Three Months Ended Nine Months Ended March 31, March 31, 2024 2023 2024 2023 Production content costs (a) $ 7,789 $ — $ 13,334 $ — _________________ (a) For purposes of amortization and impairment, each deferred immersive production content cost is classified based on its predominant monetization strategy. The Company’s current original immersive productions are monetized individually. Refer to Note 2. Accounting Policies, for further explanation of the monetization strategy. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 9 Months Ended |
Mar. 31, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Carrying Amount of Goodwill by Reportable Segment | The carrying amounts of goodwill as of March 31, 2024 and June 30, 2023 were as follows: As of March 31, June 30, Sphere $ 32,299 $ 32,299 MSG Networks 424,508 424,508 Total Goodwill $ 456,807 $ 456,807 |
Schedule of Intangible Assets Subject to Amortization | The Company’s intangible assets subject to amortization, which relate to affiliate relationships, as of March 31, 2024 and June 30, 2023 were as follows: As of March 31, June 30, Gross carrying amount $ 83,044 $ 83,044 Accumulated amortization (67,470) (65,134) Intangible assets, net $ 15,574 $ 17,910 |
Credit Facilities and Convert_2
Credit Facilities and Convertible Notes (Tables) | 9 Months Ended |
Mar. 31, 2024 | |
Line of Credit Facility [Abstract] | |
Schedule of Debt Outstanding and Deferred Financing Costs | The following table summarizes the presentation of the outstanding balances under the Company’s credit agreements as of March 31, 2024 and June 30, 2023: As of March 31, 2024 June 30, 2023 Principal Unamortized Deferred Financing Costs Net Principal Unamortized Deferred Financing Costs Net Current portion MSG Networks Term Loan $ 870,375 $ (599) $ 869,776 $ 82,500 $ — $ 82,500 Current portion of long-term debt, net $ 870,375 $ (599) $ 869,776 $ 82,500 $ — $ 82,500 As of March 31, 2024 June 30, 2023 Principal Debt Discount Unamortized Deferred Financing Costs Net Principal Debt Discount Unamortized Deferred Financing Costs Net Non-current portion MSG Networks Term Loan $ — $ — $ — $ — $ 849,750 $ — $ (1,483) $ 848,267 LV Sphere Term Loan Facility 275,000 — (4,060) 270,940 275,000 — (4,880) 270,120 3.50% Convertible Senior Notes 258,750 (6,670) (963) 251,117 — — — — Long-term debt, net $ 533,750 $ (6,670) $ (5,023) $ 522,057 $ 1,124,750 $ — $ (6,363) $ 1,118,387 |
Schedule of Maturities of Long-term Debt | Long-term debt maturities over the next five years for the outstanding balance under the MSG Networks Credit Facilities, LV Sphere Term Loan Facility and 3.50% Convertible Senior Notes as of March 31, 2024 were as follows: MSG Networks Credit Facilities LV Sphere Term Loan Facility 3.50% Convertible Senior Notes Total Fiscal Year 2024 (remainder) $ 20,625 $ — $ — $ 20,625 Fiscal Year 2025 849,750 — — 849,750 Fiscal Year 2026 — — — — Fiscal Year 2027 — — — — Fiscal Year 2028 — 275,000 — 275,000 Thereafter — — 258,750 258,750 Total long-term debt $ 870,375 $ 275,000 $ 258,750 $ 1,404,125 |
Interest Payments and Loan Principal Repayments | Interest payments and loan principal repayments made by the Company under the credit agreements were as follows: Interest Payments Loan Principal Repayments Nine Months Ended Nine Months Ended March 31, March 31, 2024 2023 2024 2023 MSG Networks Credit Facilities $ 51,587 $ 41,034 $ 61,875 $ 45,375 LV Sphere Term Loan Facility 20,158 6,211 — — Delayed Draw Term Loan Facility 460 — 65,000 — Total Payments $ 72,205 $ 47,245 $ 126,875 $ 45,375 The carrying value and fair value of the Company’s debt reported in the accompanying condensed consolidated balance sheets are as follows: As of March 31, 2024 June 30, 2023 Carrying Value (a) Fair Carrying Value (a) Fair Liabilities: MSG Networks Credit Facilities $ 870,375 $ 866,203 $ 932,250 $ 927,589 LV Sphere Term Loan Facility 275,000 273,625 275,000 272,250 3.50% Convertible Senior Notes 252,080 404,323 — — Total Long-term debt $ 1,397,455 $ 1,544,151 $ 1,207,250 $ 1,199,839 _________________ (a) The total carrying value of the Company’s debt as of March 31, 2024 and June 30, 2023 is equal to the current and non-current principal payments for the Company’s credit agreements, net of discount, excluding unamortized deferred financing costs of $5,622 and $6,363, respectively. |
Pension Plans and Other Postr_2
Pension Plans and Other Postretirement Benefit Plan (Tables) | 9 Months Ended |
Mar. 31, 2024 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Disclosures [Abstract] | |
Schedule of Net Periodic Benefit Cost | The following table presents components of net periodic benefit cost for the Pension Plans and Postretirement Plan included in the accompanying condensed consolidated statements of operations for the three and nine months ended March 31, 2024 and 2023. Service cost is recognized in direct operating expenses and selling, general and administrative expenses. All other components of net periodic benefit cost are reported in Other expense, net. Pension Plans Postretirement Plan Three Months Ended Three Months Ended March 31, March 31, 2024 2023 2024 2023 Service cost $ 61 $ 123 $ 5 $ 15 Interest cost 434 1,189 17 19 Expected return on plan assets (213) (1,719) — — Recognized actuarial loss (gain) 94 476 (17) (12) Net periodic benefit cost $ 376 $ 69 $ 5 $ 22 Pension Plans Postretirement Plan Nine Months Ended Nine Months Ended March 31, March 31, 2024 2023 2024 2023 Service cost $ 183 $ 369 $ 15 $ 45 Interest cost 1,302 3,567 51 57 Expected return on plan assets (347) (5,157) — — Recognized actuarial (gain) loss (10) 1,478 (51) 6 Net periodic benefit cost $ 1,128 $ 257 $ 15 $ 108 |
Schedule of Defined Contribution Plans | For the three and nine months ended March 31, 2024 and 2023, expenses related to the Savings Plans included in the accompanying condensed consolidated statements of operations are as follows: Three Months Ended Nine Months Ended March 31, March 31, 2024 2023 2024 2023 Continuing Operations $ 1,743 $ 1,937 $ 4,956 $ 5,058 Discontinued Operations — 1,367 — 3,553 Total Savings Plan Expenses $ 1,743 $ 3,304 $ 4,956 $ 8,611 |
Schedule of Defined Benefit Plans Disclosures | The following table summarizes amounts recognized related to the Deferred Compensation Plan in the condensed consolidated balance sheets: As of March 31, June 30, Non-current assets (included in Investments) $ 3,049 $ 1,087 Non-current liabilities (included in Other non-current liabilities) $ (3,072) $ (1,087) |
Share-based Compensation (Table
Share-based Compensation (Tables) | 9 Months Ended |
Mar. 31, 2024 | |
Share-Based Payment Arrangement [Abstract] | |
Share-Based Compensation Expense | The following table summarizes the Company’s share-based compensation expense: Three Months Ended Nine Months Ended March 31, March 31, 2024 2023 2024 2023 Share-based compensation (a) $ 17,164 $ 9,105 $ 34,119 $ 36,950 Fair value of awards vested and exercised (b) $ 9,567 $ 806 $ 42,988 $ 35,933 _________________ (a) Share-based compensation excludes costs that have been capitalized of $1,881 and $2,887 for the nine months ended March 31, 2024 and 2023, respectively. |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 9 Months Ended |
Mar. 31, 2024 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | The following tables detail the components of accumulated other comprehensive loss: Three Months Ended March 31, 2024 Pension Plans and Cumulative Accumulated Balance as of December 31, 2023 $ (5,240) $ (1,074) $ (6,314) Other comprehensive income (loss): Other comprehensive loss before reclassifications — (968) (968) Amounts reclassified from accumulated other comprehensive loss (a) 77 — 77 Income tax (expense) benefit (19) 250 231 Other comprehensive income (loss), total 58 (718) (660) Balance as of March 31, 2024 $ (5,182) $ (1,792) $ (6,974) Three Months Ended March 31, 2023 Pension Plans and Cumulative Accumulated Balance as of December 31, 2022 $ (39,453) $ (9,110) $ (48,563) Other comprehensive income: Other comprehensive income before reclassifications — 2,071 2,071 Amounts reclassified from accumulated other comprehensive loss (a) 464 — 464 Income tax expense (58) (353) (411) Other comprehensive income, total 406 1,718 2,124 Balance as of March 31, 2023 $ (39,047) $ (7,392) $ (46,439) Nine Months Ended March 31, 2024 Pension Plans and Postretirement Plan Cumulative Accumulated Balance as of June 30, 2023 $ (5,138) $ 200 $ (4,938) Other comprehensive loss: Other comprehensive loss before reclassifications — (2,688) (2,688) Amounts reclassified from accumulated other comprehensive loss (a) (61) — (61) Income tax benefit 17 696 713 Other comprehensive loss, total (44) (1,992) (2,036) Balance as of March 31, 2024 $ (5,182) $ (1,792) $ (6,974) Nine Months Ended March 31, 2023 Pension Plans and Cumulative Accumulated Balance as of June 30, 2022 $ (40,287) $ (8,068) $ (48,355) Other comprehensive income: Other comprehensive income before reclassifications — 794 794 Amounts reclassified from accumulated other comprehensive loss (a) 1,484 — 1,484 Income tax expense (244) (118) (362) Other comprehensive income, total 1,240 676 1,916 Balance as of March 31, 2023 $ (39,047) $ (7,392) $ (46,439) _________________ (a) Amounts reclassified from accumulated other comprehensive loss represent the amortization of net actuarial loss and net unrecognized prior service credit included in net periodic benefit cost, which is reflected under Other income (expense), net in the accompanying condensed consolidated statements of operations (see Note 12. Pension Plans and Other Postretirement Benefit Plans). |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 9 Months Ended |
Mar. 31, 2024 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions | The following table summarizes the composition and amounts of the transactions with the Company’s affiliates. These amounts are reflected in revenues and operating expenses in the accompanying condensed consolidated statements of operations for the three and nine months ended March 31, 2024 and 2023: Three Months Ended Nine Months Ended March 31, March 31, 2024 2023 2024 2023 Revenues $ 1,215 $ 1,730 $ 3,262 $ 1,730 Operating expenses (credits): Media rights fees 43,947 43,433 132,617 129,633 Cost reimbursement from MSG Sports - MSG Sports Services Agreement — (9,789) — (28,781) Corporate general and administrative expenses, net - MSG Entertainment Transition Services Agreement (a) 27,494 — 83,611 — Origination, master control and technical services 1,283 1,257 3,797 3,721 Other operating expenses (credits), net (b) 5,102 (69) 13,880 (365) Total operating expenses, net (c) $ 77,826 $ 34,832 $ 233,905 $ 104,208 _________________ (a) Included in the three and nine months ended March 31, 2024, Corporate general and administrative expenses, net - MSG Entertainment Transition Services Agreement (the “MSGE TSA”) are $558 and $3,363, respectively, related to Restructuring charges for employees who provided services to the Company under the MSGE TSA. (b) Other operating expenses, net, includes CPC commission expenses, and reimbursements to MSG Entertainment for aircraft-related expenses, professional and payroll fees. (c) Of the total operating expenses, net, $45,332 and $138,869 for three and nine months ended March 31, 2024, respectively, and $45,280 and $134,387 for the three and nine months ended March 31, 2023, respectively, are included in direct operating expenses in the accompanying condensed consolidated statements of operations. Of the total operating expenses, net $32,494 and $95,036 for three and nine months ended March 31, 2024, respectively, are included as expenses, and $(10,448) and $(30,179) for the three and nine months ended March 31, 2023, respectively, are included as net credits, in selling, general, and administrative expenses in the accompanying condensed consolidated statements of operations. |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Mar. 31, 2024 | |
Segment Reporting [Abstract] | |
Schedule of Segment Information, by Segment | Information as to the operations of the Company’s reportable segments is set forth below. Three Months Ended March 31, 2024 Sphere MSG Networks Total Revenues $ 170,364 $ 150,966 $ 321,330 Direct operating expenses (62,294) (91,746) (154,040) Selling, general and administrative expenses (108,976) (14,173) (123,149) Depreciation and amortization (77,706) (2,161) (79,867) Restructuring charges (4,886) 219 (4,667) Operating (loss) income $ (83,498) $ 43,105 $ (40,393) Interest income 7,654 Interest expense (27,119) Other expense, net (3,256) Loss from operations before income taxes $ (63,114) Reconciliation of operating (loss) income to adjusted operating income: Operating (loss) income $ (83,498) $ 43,105 $ (40,393) Add back: Share-based compensation 13,273 3,451 16,724 Depreciation and amortization 77,706 2,161 79,867 Restructuring charges 4,886 (219) 4,667 Merger and acquisition related costs, net of insurance recoveries 416 92 508 Amortization for capitalized cloud computing arrangement costs — 22 22 Remeasurement of deferred compensation plan liabilities 126 — 126 Adjusted operating income $ 12,909 $ 48,612 $ 61,521 Other information: Capital expenditures $ 17,502 $ 1,962 $ 19,464 Three Months Ended March 31, 2023 Sphere MSG Networks Total Revenues $ 626 $ 161,436 $ 162,062 Direct operating expenses (4,414) (89,251) (93,665) Selling, general and administrative expenses (83,381) (60,052) (143,433) Depreciation and amortization (6,511) (1,689) (8,200) Restructuring charges (18,670) — (18,670) Operating (loss) income $ (112,350) $ 10,444 $ (101,906) Interest income 3,374 Other expense, net (4,182) Loss from operations before income taxes $ (102,714) Reconciliation of operating (loss) income to adjusted operating (loss) income: Operating (loss) income $ (112,350) $ 10,444 $ (101,906) Add back: Share-based compensation 8,466 639 9,105 Depreciation and amortization 6,511 1,689 8,200 Restructuring charges 18,670 — 18,670 Merger and acquisition related costs 1,532 45,513 47,045 Amortization for capitalized cloud computing arrangement costs 125 43 168 Adjusted operating (loss) income $ (77,046) $ 58,328 $ (18,718) Other information: Capital expenditures $ 195,945 $ 1,818 $ 197,763 Nine Months Ended March 31, 2024 Sphere MSG Networks Total Revenues $ 345,942 $ 407,552 $ 753,494 Direct operating expenses (137,437) (260,868) (398,305) Selling, general and administrative expenses (290,930) (34,883) (325,813) Depreciation and amortization (168,127) (6,030) (174,157) Impairment and other losses, net (115,738) — (115,738) Restructuring charges (9,564) 219 (9,345) Operating (loss) income $ (375,854) $ 105,990 $ (269,864) Interest income 17,958 Interest expense (52,947) Other income, net 37,810 Loss from operations before income taxes $ (267,043) Reconciliation of operating (loss) income to adjusted operating (loss) income: Operating (loss) income $ (375,854) $ 105,990 $ (269,864) Add back: Share-based compensation 28,177 5,346 33,523 Depreciation and amortization 168,127 6,030 174,157 Restructuring charges 9,564 (219) 9,345 Impairment and other losses, net 115,738 — 115,738 Merger and acquisition related costs, net of insurance recoveries (2,086) (6,069) (8,155) Amortization for capitalized cloud computing arrangement costs — 66 66 Remeasurement of deferred compensation plan liabilities 264 — 264 Adjusted operating (loss) income $ (56,070) $ 111,144 $ 55,074 Other information: Capital expenditures $ 244,963 $ 6,473 $ 251,436 Nine Months Ended March 31, 2023 Sphere MSG Networks Total Revenues $ 1,919 $ 442,813 $ 444,732 Direct operating expenses (4,414) (255,071) (259,485) Selling, general and administrative expenses (235,331) (107,148) (342,479) Depreciation and amortization (16,775) (4,944) (21,719) Other gains 3,000 — 3,000 Restructuring charges (22,757) (3,988) (26,745) Operating (loss) income $ (274,358) $ 71,662 $ (202,696) Interest income 9,376 Other expense, net (5,952) Loss from operations before income taxes $ (199,272) Reconciliation of operating (loss) income to adjusted operating (loss) income: Operating (loss) income $ (274,358) $ 71,662 $ (202,696) Add back: Share-based compensation 31,308 5,642 36,950 Depreciation and amortization 16,775 4,944 21,719 Restructuring charges 22,757 3,988 26,745 Other gains (3,000) — (3,000) Merger and acquisition related costs 4,223 52,958 57,181 Amortization for capitalized cloud computing arrangement costs 285 131 416 Adjusted operating (loss) income $ (202,010) $ 139,325 $ (62,685) Other information: Capital expenditures $ 733,198 $ 5,710 $ 738,908 |
Schedules of Concentration of Risk, by Risk Factor | Concentration of Risk Accounts receivable, net in the accompanying condensed consolidated balance sheets as of March 31, 2024 and June 30, 2023 include amounts due from the following individual customers, which accounted for the noted percentages of the gross balance: As of March 31, June 30, Customer A 13 % 23 % Customer B 13 % 22 % Customer C 10 % 17 % Revenues in the accompanying condensed consolidated statements of operations for the three and nine months ended March 31, 2024 and 2023 include amounts from the following individual customers: Three Months Ended Nine Months Ended March 31, March 31, 2024 2023 2024 2023 Customer 1 11 % 23 % 14 % 26 % Customer 2 11 % 21 % 14 % 25 % Customer 3 8 % 19 % 11 % 21 % |
Additional Financial Informat_2
Additional Financial Information (Tables) | 9 Months Ended |
Mar. 31, 2024 | |
Additional Financial Information [Abstract] | |
Schedule Of Cash, Cash Equivalents, and Restricted Cash | The following table provides a summary of the amounts recorded as cash, cash equivalents and restricted cash. As of March 31, June 30, Cash and cash equivalents $ 680,575 $ 131,965 Restricted cash 13,371 297,149 Total cash, cash equivalents and restricted cash $ 693,946 $ 429,114 |
Cash, Cash Equivalents and Restricted Cash | The following table provides a summary of the amounts recorded as cash, cash equivalents and restricted cash. As of March 31, June 30, Cash and cash equivalents $ 680,575 $ 131,965 Restricted cash 13,371 297,149 Total cash, cash equivalents and restricted cash $ 693,946 $ 429,114 |
Schedule of Other Current Assets | Prepaid expenses and other current assets consisted of the following: As of March 31, June 30, Prepaid expenses $ 12,614 $ 22,616 Note and other receivables 8,589 21,453 Inventory 1,684 — Current deferred production content costs 1,906 6,524 Other 5,423 5,492 Total prepaid expenses and other current assets $ 30,216 $ 56,085 |
Other Current Liabilities | Accounts payable, accrued and other current liabilities consisted of the following: As of March 31, June 30, Accounts payable $ 73,670 $ 39,654 Accrued payroll and employee related liabilities 71,584 75,579 Cash due to promoters 57,360 73,611 Capital expenditure accruals 155,352 236,593 Accrued legal fees 23,442 53,857 Other accrued expenses 41,705 36,437 Total accounts payable, accrued and other current liabilities $ 423,113 $ 515,731 |
Schedule of Other Nonoperating Income (Expense) | Other (expense) income, net includes the following: Three Months Ended Nine Months Ended March 31, March 31, 2024 2023 2024 2023 Gain on litigation settlement $ — $ — $ 62,647 $ — Realized loss on equity method investments — — (19,027) — Other (3,256) (4,182) (5,810) (5,952) Total other (expense) income, net $ (3,256) $ (4,182) $ 37,810 $ (5,952) |
Description of Business and B_2
Description of Business and Basis of Presentation (Details) | 9 Months Ended | |||
Apr. 20, 2023 $ / shares shares | Mar. 31, 2024 ft² segment network guest ft $ / shares | Jun. 30, 2023 $ / shares | May 03, 2023 | |
Conversion of Stock [Line Items] | ||||
Number of reportable segments | segment | 2 | |||
Number of networks | network | 2 | |||
Venue occupancy, number of guests | guest | 20,000 | |||
Building height, feet (in feet) | ft | 100 | |||
Discontinued Operations, Disposed of by Sale | Tao Group Hospitality | ||||
Conversion of Stock [Line Items] | ||||
Disposal group, including discontinued operation, ownership percentage in disposed asset | 66.90% | |||
Common Class A | ||||
Conversion of Stock [Line Items] | ||||
Common stock, par or stated value per share (in dollars per share) | $ 0.01 | $ 0.01 | ||
Common Class B | ||||
Conversion of Stock [Line Items] | ||||
Common stock, par or stated value per share (in dollars per share) | $ 0.01 | $ 0.01 | ||
Spinoff | MSG Entertainment | Common Class A | ||||
Conversion of Stock [Line Items] | ||||
Number of shares received for every one common stock shares held on record date (in shares) | shares | 1 | |||
Common stock, par or stated value per share (in dollars per share) | $ 0.01 | |||
Spinoff | MSG Entertainment | Common Class B | ||||
Conversion of Stock [Line Items] | ||||
Number of shares received for every one common stock shares held on record date (in shares) | shares | 1 | |||
Common stock, par or stated value per share (in dollars per share) | $ 0.01 | |||
Spinoff | Sphere | Common Class A | ||||
Conversion of Stock [Line Items] | ||||
Common stock, par or stated value per share (in dollars per share) | $ 0.01 | |||
MSG Entertainment | Spinoff | MSG Stockholders | ||||
Conversion of Stock [Line Items] | ||||
Noncontrolling interest, ownership percentage by parent | 67% | |||
Noncontrolling interest, ownership percentage by noncontrolling owners | 33% | |||
Studio Campus | ||||
Conversion of Stock [Line Items] | ||||
Building, square footage (in square feet) | ft² | 68,000 | |||
Big Dome | ||||
Conversion of Stock [Line Items] | ||||
Building, square footage (in square feet) | ft² | 28,000 |
Accounting Policies (Details)
Accounting Policies (Details) - USD ($) $ in Thousands | 5 Months Ended | ||||
Sep. 30, 2024 | Oct. 31, 2024 | Mar. 31, 2024 | Dec. 31, 2023 | Jun. 30, 2023 | |
Cash and Cash Equivalents [Line Items] | |||||
Customer advances | $ 125,252 | ||||
Capital expenditures reflected in payables | 423,113 | $ 515,731 | |||
Capital expenditure accruals | 155,352 | 236,593 | |||
Net | 1,404,125 | ||||
Current portion of long-term debt, net | 869,776 | 82,500 | |||
Forecast | Secured Debt | MSG Networks | |||||
Cash and Cash Equivalents [Line Items] | |||||
Repayments of secured debt | $ 41,250 | ||||
MSG Networks Term Loan | Line of Credit | Secured Debt | |||||
Cash and Cash Equivalents [Line Items] | |||||
Current portion of long-term debt, net | $ 869,776 | 82,500 | |||
Long-term debt, term | 1 year | ||||
Long-term debt, extended term | 1 year | ||||
MSG Networks Term Loan | Forecast | Line of Credit | Secured Debt | |||||
Cash and Cash Equivalents [Line Items] | |||||
Current portion of long-term debt, net | $ 829,125 | ||||
MSG Networks Credit Facilities | |||||
Cash and Cash Equivalents [Line Items] | |||||
Net | $ 870,375 | ||||
MSG Networks | |||||
Cash and Cash Equivalents [Line Items] | |||||
Cash and cash equivalents | 102,825 | ||||
Continuing Operations | |||||
Cash and Cash Equivalents [Line Items] | |||||
Cash and cash equivalents | $ 680,575 | $ 614,549 | $ 131,965 |
Discontinued Operations - Narra
Discontinued Operations - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
Discontinued Operations and Disposal Groups [Abstract] | ||||
Income (loss) from discontinued operations, net of taxes | $ 0 | $ 55,443 | $ (647) | $ 155,568 |
Income tax benefit | $ 0 | $ 294 |
Discontinued Operations - Sched
Discontinued Operations - Schedule of Disposed Income Discontinued Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Income tax benefit | $ 0 | $ (294) | ||
Net income | $ 0 | $ 55,443 | $ (647) | $ 155,568 |
Discontinued Operations, Disposed of by Means Other than Sale, Spinoff | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Revenues | 332,090 | 1,092,836 | ||
Direct operating expenses | (193,508) | (628,720) | ||
Selling, general and administrative expenses | (83,908) | (233,533) | ||
Depreciation and amortization | (22,219) | (67,514) | ||
Impairment and other gains (losses), net | (51) | 4,834 | ||
Restructuring charges | (1,828) | (7,435) | ||
Operating income (loss) | 30,576 | 160,468 | ||
Interest income | (685) | |||
Interest income | 870 | |||
Interest expense | (160) | (3,221) | ||
Other income (loss), net | 9,172 | 8,614 | ||
Income (loss) from operations before income taxes | 38,903 | 166,731 | ||
Income tax benefit | 16,540 | (11,163) | ||
Net income | 55,443 | 155,568 | ||
Less: Net loss attributable to nonredeemable noncontrolling interests | (216) | (682) | ||
Less: Net loss attributable to redeemable noncontrolling interests | (1,492) | 2,661 | ||
Net income from discontinued operations attributable to Sphere Entertainment Co.’s stockholders | 57,151 | 153,589 | ||
Discontinued Operations, Disposed of by Means Other than Sale, Spinoff | MSG Entertainment | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Depreciation and amortization | (14,798) | (46,370) | ||
Discontinued Operations, Disposed of by Means Other than Sale, Spinoff | Tao Group Hospitality | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Depreciation and amortization | (7,421) | (21,144) | ||
Discontinued Operations, Disposed of by Means Other than Sale, Spinoff | Operating segments | MSG Entertainment | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Revenues | 200,043 | 694,755 | ||
Direct operating expenses | (114,298) | (396,691) | ||
Selling, general and administrative expenses | (37,367) | (102,333) | ||
Depreciation and amortization | (14,798) | (46,370) | ||
Impairment and other gains (losses), net | (51) | 4,361 | ||
Restructuring charges | (1,828) | (7,435) | ||
Operating income (loss) | 31,701 | 146,287 | ||
Interest income | 313 | |||
Interest income | 1,832 | |||
Interest expense | 0 | (1,083) | ||
Other income (loss), net | 9,180 | 7,895 | ||
Income (loss) from operations before income taxes | 41,194 | 154,931 | ||
Income tax benefit | 12,295 | (9,120) | ||
Net income | 53,489 | 145,811 | ||
Less: Net loss attributable to nonredeemable noncontrolling interests | 0 | (553) | ||
Less: Net loss attributable to redeemable noncontrolling interests | 0 | 0 | ||
Net income from discontinued operations attributable to Sphere Entertainment Co.’s stockholders | 53,489 | 146,364 | ||
Discontinued Operations, Disposed of by Means Other than Sale, Spinoff | Operating segments | Tao Group Hospitality | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Revenues | 130,857 | 398,078 | ||
Direct operating expenses | (77,963) | (232,029) | ||
Selling, general and administrative expenses | (46,541) | (131,200) | ||
Depreciation and amortization | (7,421) | (21,144) | ||
Impairment and other gains (losses), net | 0 | 473 | ||
Restructuring charges | 0 | 0 | ||
Operating income (loss) | (1,068) | 14,178 | ||
Interest income | 49 | |||
Interest income | 85 | |||
Interest expense | (160) | (2,138) | ||
Other income (loss), net | (8) | 719 | ||
Income (loss) from operations before income taxes | (1,187) | 12,844 | ||
Income tax benefit | 4,245 | (2,043) | ||
Net income | 3,058 | 10,801 | ||
Less: Net loss attributable to nonredeemable noncontrolling interests | (216) | (129) | ||
Less: Net loss attributable to redeemable noncontrolling interests | (1,492) | 2,661 | ||
Net income from discontinued operations attributable to Sphere Entertainment Co.’s stockholders | 4,766 | 8,269 | ||
Discontinued Operations, Disposed of by Means Other than Sale, Spinoff | Other | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Revenues | 1,190 | 3 | ||
Direct operating expenses | (1,247) | 0 | ||
Selling, general and administrative expenses | 0 | 0 | ||
Depreciation and amortization | 0 | 0 | ||
Impairment and other gains (losses), net | 0 | 0 | ||
Restructuring charges | 0 | 0 | ||
Operating income (loss) | (57) | 3 | ||
Interest income | (1,047) | |||
Interest income | (1,047) | |||
Interest expense | 0 | 0 | ||
Other income (loss), net | 0 | 0 | ||
Income (loss) from operations before income taxes | (1,104) | (1,044) | ||
Income tax benefit | 0 | 0 | ||
Net income | (1,104) | (1,044) | ||
Less: Net loss attributable to nonredeemable noncontrolling interests | 0 | 0 | ||
Less: Net loss attributable to redeemable noncontrolling interests | 0 | 0 | ||
Net income from discontinued operations attributable to Sphere Entertainment Co.’s stockholders | $ (1,104) | $ (1,044) |
Discontinued Operations - Sch_2
Discontinued Operations - Schedule of Disposed Cash Flows (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
Non-cash items included in net income: | |||
Share-based compensation | $ 34,742 | $ 56,092 | |
Cash flows from investing activities: | |||
Capital expenditures, net | $ 249,939 | 764,513 | |
Discontinued Operations, Disposed of by Means Other than Sale, Spinoff | |||
Non-cash items included in net income: | |||
Depreciation and amortization | $ 22,219 | 67,514 | |
Discontinued Operations, Disposed of by Means Other than Sale, Spinoff | MSG Entertainment | |||
Non-cash items included in net income: | |||
Depreciation and amortization | 14,798 | 46,370 | |
Share-based compensation | 1,792 | 2,896 | |
Cash flows from investing activities: | |||
Capital expenditures, net | 2,979 | 12,187 | |
Discontinued Operations, Disposed of by Means Other than Sale, Spinoff | Tao Group Hospitality | |||
Non-cash items included in net income: | |||
Depreciation and amortization | 7,421 | 21,144 | |
Share-based compensation | 2,144 | 6,570 | |
Cash flows from investing activities: | |||
Capital expenditures, net | $ 4,962 | $ 16,417 |
Revenue Recognition - Disaggreg
Revenue Recognition - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | $ 320,607 | $ 161,436 | $ 751,280 | $ 442,813 |
Revenues from subleases | 723 | 626 | 2,214 | 1,919 |
Total revenues | 321,330 | 162,062 | 753,494 | 444,732 |
Sphere | Operating segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | 169,641 | 0 | 343,728 | 0 |
Revenues from subleases | 723 | 626 | 2,214 | 1,919 |
Total revenues | 170,364 | 626 | 345,942 | 1,919 |
MSG Networks | Operating segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | 150,966 | 161,436 | 407,552 | 442,813 |
Revenues from subleases | 0 | 0 | 0 | 0 |
Total revenues | 150,966 | 161,436 | 407,552 | 442,813 |
Sponsorship, signage, exosphere advertising and suite license revenues | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | 40,511 | 66,817 | ||
Sponsorship, signage, exosphere advertising and suite license revenues | Sphere | Operating segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | 40,511 | 66,817 | ||
Sponsorship, signage, exosphere advertising and suite license revenues | MSG Networks | Operating segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | 0 | 0 | ||
Ticketing and venue license fee revenues | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | 110,655 | 235,283 | ||
Ticketing and venue license fee revenues | Sphere | Operating segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | 110,655 | 235,283 | ||
Ticketing and venue license fee revenues | MSG Networks | Operating segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | 0 | 0 | ||
Food, beverage and merchandise revenues | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | 18,475 | 41,628 | ||
Food, beverage and merchandise revenues | Sphere | Operating segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | 18,475 | 41,628 | ||
Food, beverage and merchandise revenues | MSG Networks | Operating segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | 0 | 0 | ||
Media networks revenues | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | 150,966 | 161,436 | 407,552 | 442,813 |
Media networks revenues | Sphere | Operating segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | 0 | 0 | 0 | 0 |
Media networks revenues | MSG Networks | Operating segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | 150,966 | 161,436 | 407,552 | 442,813 |
Transferred over Time | Event-related | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | 134,835 | 286,991 | ||
Transferred over Time | Event-related | Sphere | Operating segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | 134,835 | 286,991 | ||
Transferred over Time | Event-related | MSG Networks | Operating segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | 0 | 0 | ||
Transferred over Time | Sponsorship, signage, exosphere advertising and suite license revenues | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | 33,598 | 696 | 54,588 | 1,453 |
Transferred over Time | Sponsorship, signage, exosphere advertising and suite license revenues | Sphere | Operating segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | 32,942 | 0 | 53,024 | 0 |
Transferred over Time | Sponsorship, signage, exosphere advertising and suite license revenues | MSG Networks | Operating segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | 656 | 696 | 1,564 | 1,453 |
Transferred over Time | Media related, primarily from affiliation agreements | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | 148,417 | 158,526 | 401,308 | 436,630 |
Transferred over Time | Media related, primarily from affiliation agreements | Sphere | Operating segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | 0 | 0 | 0 | 0 |
Transferred over Time | Media related, primarily from affiliation agreements | MSG Networks | Operating segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | 148,417 | 158,526 | 401,308 | 436,630 |
Transferred at Point in Time | Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | 3,757 | 2,214 | 8,393 | 4,730 |
Transferred at Point in Time | Other | Sphere | Operating segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | 1,864 | 0 | 3,713 | 0 |
Transferred at Point in Time | Other | MSG Networks | Operating segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Total revenues from contracts with customers | $ 1,893 | $ 2,214 | $ 4,680 | $ 4,730 |
Revenue Recognition - Contract
Revenue Recognition - Contract Balances (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2024 | Jun. 30, 2023 | |
Contract Assets and Liabilities [Line Items] | |||
Contract with customer, deferred revenue, revenue recognized | $ 795 | $ 21,519 | |
Receivables from contracts with customers, net | |||
Contract Assets and Liabilities [Line Items] | |||
Contracts with customers, assets, net | 179,022 | 179,022 | $ 115,039 |
Contract assets, current | |||
Contract Assets and Liabilities [Line Items] | |||
Contracts with customers, assets, net | 1,500 | 1,500 | 314 |
Deferred revenue, including non-current portion | |||
Contract Assets and Liabilities [Line Items] | |||
Deferred revenue, including non-current portion | 76,712 | 76,712 | 27,397 |
Affiliated Entities | Net related party receivables | |||
Contract Assets and Liabilities [Line Items] | |||
Contracts with customers, assets, net | $ 320 | $ 320 | $ 2,730 |
Revenue Recognition - Remaining
Revenue Recognition - Remaining Performance Obligation (Details) $ in Thousands | Mar. 31, 2024 USD ($) |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, amount | $ 121,324 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2024-04-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, percentage | 59% |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 2 years |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2026-04-01 | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, percentage | 37% |
Revenue, remaining performance obligation, expected timing of satisfaction, period | 2 years |
Restructuring Charges - Additio
Restructuring Charges - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
Restructuring and Related Activities [Abstract] | ||||
Restructuring charges | $ 4,667 | $ 18,670 | $ 9,345 | $ 26,745 |
Share-based compensation | $ 1,166 | $ 7,384 | $ 1,166 | $ 7,384 |
Restructuring Charges - Schedul
Restructuring Charges - Schedule of Restructuring Activity (Details) $ in Thousands | 9 Months Ended |
Mar. 31, 2024 USD ($) | |
Restructuring Liability | |
Restructuring reserve, beginning balance | $ 8,891 |
Restructuring charges (excluding share-based compensation expense) | 8,179 |
Payments | (10,144) |
Restructuring reserve, ending balance | $ 6,926 |
Investments - Schedule Without
Investments - Schedule Without Readily Determinable Fair Values (Details) € in Thousands, $ in Thousands | 1 Months Ended | |||
Mar. 31, 2024 USD ($) | Jan. 31, 2023 USD ($) | Jun. 30, 2023 USD ($) | Jan. 31, 2023 EUR (€) | |
Schedule of Investments [Line Items] | ||||
Investments | $ 51,849 | $ 395,606 | ||
Crown Properties Collection | ||||
Schedule of Investments [Line Items] | ||||
Ownership Percentage as of March 31, 2024 | 8.30% | |||
Payments to acquire equity method investments | $ 51 | |||
Equity method investment, share of results, duration of lag | 3 months | |||
Equity Method Investments | SACO Technologies Inc. (“SACO”) | ||||
Schedule of Investments [Line Items] | ||||
Ownership Percentage as of March 31, 2024 | 30% | |||
Investments | $ 18,692 | 22,246 | ||
Equity Method Investments | Holoplot Loan | ||||
Schedule of Investments [Line Items] | ||||
Investments | $ 21,336 | 20,971 | ||
Financing receivable, term | 3 years | |||
Face amount | $ 20,484 | € 18,804 | ||
Equity Method Investments | Holoplot | ||||
Schedule of Investments [Line Items] | ||||
Ownership Percentage as of March 31, 2024 | 25% | |||
Investments | $ 0 | $ 1,542 | ||
Equity Method Investments | MSG Entertainment | ||||
Schedule of Investments [Line Items] | ||||
Ownership Percentage as of March 31, 2024 | 0% | 20% | ||
Investments | $ 0 | $ 341,039 | ||
Equity Method Investments | Crown Properties Collection | ||||
Schedule of Investments [Line Items] | ||||
Ownership Percentage as of March 31, 2024 | 8% | |||
Investments | $ 51 | 0 | ||
Equity investments without readily determinable fair values | ||||
Schedule of Investments [Line Items] | ||||
Investments | 8,721 | 8,721 | ||
Other equity investments with readily determinable fair values held in trust under the Company’s Executive Deferred Compensation Plan | ||||
Schedule of Investments [Line Items] | ||||
Investments | $ 3,049 | $ 1,087 |
Investments - Schedule With Rea
Investments - Schedule With Readily Determinable Fair Values (Details) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
Debt and Equity Securities, FV-NI [Line Items] | ||||
Total realized and unrealized gain (loss) on equity investments | $ (20,805) | $ 1,723 | ||
Supplemental information on realized loss: | ||||
Cash proceeds from shares of MSG Entertainment Class A common stock sold | 0 | 4,369 | ||
MSG Entertainment | ||||
Debt and Equity Securities, FV-NI [Line Items] | ||||
Unrealized gain | $ 127 | $ 129 | 264 | 2,104 |
Realized loss from shares of MSG Entertainment Class A common stock sold | 0 | 0 | (19,027) | 0 |
Total realized and unrealized gain (loss) on equity investments | $ 127 | $ 129 | $ (18,763) | $ 2,104 |
Supplemental information on realized loss: | ||||
Shares of MSG Entertainment Class A common stock disposed (in shares) | 0 | 0 | 1,923 | 0 |
Shares of MSG Entertainment Class A common stock sold (in shares) | 0 | 0 | 8,221 | 0 |
Cash proceeds from shares of MSG Entertainment Class A common stock sold | $ 0 | $ 0 | $ 256,501 | $ 0 |
Property and Equipment, net - S
Property and Equipment, net - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Jun. 30, 2023 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 3,479,118 | $ 3,394,989 |
Less accumulated depreciation and amortization | (259,229) | (87,828) |
Property and equipment, net | 3,219,889 | 3,307,161 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 44,233 | 80,878 |
Buildings | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 2,287,306 | 69,049 |
Equipment, furniture, and fixtures | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 1,128,495 | 159,786 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | 18,491 | 18,491 |
Construction in progress | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment | $ 593 | $ 3,066,785 |
Property and Equipment, net - A
Property and Equipment, net - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Mar. 31, 2024 | Sep. 30, 2023 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | Jun. 30, 2023 | |
Property, Plant and Equipment [Abstract] | ||||||
Capital expenditure accruals | $ 155,352 | $ 155,352 | $ 236,593 | |||
Property, plant and equipment, transfers and changes | $ 3,130,028 | |||||
Depreciation and amortization expense on property and equipment | $ 79,088 | $ 7,421 | 171,821 | $ 19,382 | ||
Impairment charges | $ 116,541 |
Original Immersive Production_3
Original Immersive Production Content - Schedule of Deferred Immersive Production Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | Jun. 30, 2023 | |
Other Industries [Abstract] | |||||
Released, less amortization | $ 68,397 | $ 68,397 | $ 0 | ||
In-process | 4,584 | 4,584 | 61,421 | ||
Total production content | 72,981 | 72,981 | $ 61,421 | ||
Produced content costs | $ 7,789 | $ 0 | $ 13,334 | $ 0 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Schedule of Carrying Amount of Goodwill (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Jun. 30, 2023 |
Finite-Lived Intangible Assets [Line Items] | ||
Goodwill | $ 456,807 | $ 456,807 |
Sphere | ||
Finite-Lived Intangible Assets [Line Items] | ||
Goodwill | 32,299 | 32,299 |
MSG Networks | ||
Finite-Lived Intangible Assets [Line Items] | ||
Goodwill | $ 424,508 | $ 424,508 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Mar. 31, 2024 | Sep. 30, 2023 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||||
Goodwill, impairment loss | $ 0 | ||||
Amortization of intangible assets | $ 779,000 | $ 779,000 | $ 2,336,000 | $ 2,337,000 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Schedule of Intangible Assets Subject to Amortization (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Jun. 30, 2023 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Gross carrying amount | $ 83,044 | $ 83,044 |
Accumulated amortization | (67,470) | (65,134) |
Intangible assets, net | $ 15,574 | $ 17,910 |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||||||
Apr. 06, 2023 USD ($) | Mar. 14, 2023 USD ($) | Sep. 10, 2021 complaint | Mar. 31, 2024 USD ($) complaint | Mar. 31, 2023 USD ($) | Mar. 31, 2024 USD ($) complaint | Mar. 31, 2023 USD ($) | Jun. 30, 2023 USD ($) | Sep. 27, 2021 complaint | |
Loss Contingencies [Line Items] | |||||||||
Contractual obligation | $ 3,134,884 | ||||||||
Loss contingency, number of complaints filed | complaint | 15 | ||||||||
Loss contingency, remaining claims filed involving fiduciary breaches | complaint | 2 | 2 | |||||||
Loss contingency, new claims filed, number | complaint | 2 | ||||||||
Gain on litigation settlement | $ 0 | $ 0 | $ 62,647 | $ 0 | |||||
Loss contingency, number of consolidated claims | complaint | 4 | ||||||||
MSGE Settlement Agreement | Settled Litigation | |||||||||
Loss Contingencies [Line Items] | |||||||||
Litigation settlement, amount awarded from other party | $ 85,000 | ||||||||
Gain on litigation settlement | 62,647 | ||||||||
MSGE Networks Term Sheet | Settled Litigation | |||||||||
Loss Contingencies [Line Items] | |||||||||
Litigation settlement, amount awarded to other party | $ 48,500 | ||||||||
Payments for legal settlements | 28,000 | ||||||||
Loss contingency accrual | $ 20,500 | $ 20,500 | |||||||
MSGE Networks Term Sheet | Settled Litigation | MSG Network Insurers | |||||||||
Loss Contingencies [Line Items] | |||||||||
Payments for legal settlements | 20,500 | ||||||||
MSGE Networks Term Sheet | Settled Litigation | Insurance | |||||||||
Loss Contingencies [Line Items] | |||||||||
Payments for legal settlements | $ 20,500 | ||||||||
Networks Merger | |||||||||
Loss Contingencies [Line Items] | |||||||||
Loss contingency, new claims filed with incomplete and misleading information | complaint | 9 | ||||||||
Loss contingency, new claims filed involving fiduciary breaches | complaint | 6 |
Credit Facilities and Convert_3
Credit Facilities and Convertible Notes - Debt Outstanding and Deferred Financing Costs (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 08, 2023 | Jun. 30, 2023 |
Current portion | |||
Principal | $ 870,375 | $ 82,500 | |
Unamortized Deferred Financing Costs | (599) | 0 | |
Net | 869,776 | 82,500 | |
Non-current portion | |||
Net | 522,057 | 1,118,387 | |
Line of Credit | Secured Debt | |||
Non-current portion | |||
Principal | 533,750 | 1,124,750 | |
Debt Discount | (6,670) | 0 | |
Unamortized Deferred Financing Costs | (5,023) | (6,363) | |
Net | 522,057 | 1,118,387 | |
Line of Credit | MSG Networks Term Loan | Secured Debt | |||
Current portion | |||
Principal | 870,375 | 82,500 | |
Unamortized Deferred Financing Costs | (599) | 0 | |
Net | 869,776 | 82,500 | |
Non-current portion | |||
Principal | 0 | 849,750 | |
Debt Discount | 0 | 0 | |
Unamortized Deferred Financing Costs | 0 | (1,483) | |
Net | 0 | 848,267 | |
Line of Credit | LV Sphere Term Loan Facility | Secured Debt | |||
Non-current portion | |||
Principal | 275,000 | 275,000 | |
Debt Discount | 0 | 0 | |
Unamortized Deferred Financing Costs | (4,060) | (4,880) | |
Net | 270,940 | 270,120 | |
Line of Credit | 3.50% Convertible Senior Notes | Secured Debt | |||
Non-current portion | |||
Principal | 258,750 | 0 | |
Debt Discount | (6,670) | 0 | |
Unamortized Deferred Financing Costs | (963) | 0 | |
Net | $ 251,117 | $ 0 | |
Senior Notes | 3.50% Convertible Senior Notes | |||
Non-current portion | |||
Interest rate | 3.50% | 3.50% |
Credit Facilities and Convert_4
Credit Facilities and Convertible Notes - MSG Networks - Narrative (Details) | 9 Months Ended | |
Oct. 11, 2019 USD ($) | Mar. 31, 2024 USD ($) | |
MSG Networks Credit Facilities | Measurement Input, Leverage Ratio | ||
Debt Instrument [Line Items] | ||
Debt instrument, measurement input | 5.36 | |
MSG Networks Credit Facilities | Measurement Input, Leverage Ratio | Incremental adjustment | ||
Debt Instrument [Line Items] | ||
Debt instrument, measurement input | 6 | |
MSG Networks Credit Facilities | Measurement Input, Interest Coverage Ratio | ||
Debt Instrument [Line Items] | ||
Debt instrument, measurement input | 2.24 | |
MSG Networks Credit Facilities | Minimum | Measurement Input, Interest Coverage Ratio | ||
Debt Instrument [Line Items] | ||
Debt instrument, measurement input | 2 | |
MSG Networks Credit Facilities | Maximum | Measurement Input, Leverage Ratio | ||
Debt Instrument [Line Items] | ||
Debt instrument, measurement input | 5.50 | |
MSG Networks | MSG Networks Credit Facilities | Secured Overnight Financing Rate (SOFR) | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate | 0.10% | |
MSG Networks | MSG Networks Credit Facilities | Measurement Input, Default Rate | ||
Debt Instrument [Line Items] | ||
Debt instrument, interest rate, increase (decrease) | 2% | |
MSG Networks | MSG Networks Credit Facilities | Minimum | ||
Debt Instrument [Line Items] | ||
Commitment fee percentage | 0.225% | |
MSG Networks | MSG Networks Credit Facilities | Minimum | Base Rate | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate | 0.25% | |
MSG Networks | MSG Networks Credit Facilities | Minimum | Secured Overnight Financing Rate (SOFR) | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate | 1.25% | |
MSG Networks | MSG Networks Credit Facilities | Maximum | ||
Debt Instrument [Line Items] | ||
Commitment fee percentage | 0.30% | |
MSG Networks | MSG Networks Credit Facilities | Maximum | Base Rate | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate | 1.25% | |
MSG Networks | MSG Networks Credit Facilities | Maximum | Secured Overnight Financing Rate (SOFR) | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate | 2.25% | |
MSG Networks | Revolving Credit Facility | MSG Networks Credit Facilities | ||
Debt Instrument [Line Items] | ||
Long-term debt, term | 5 years | |
Principal | $ 0 | |
MSG Networks | Revolving Credit Facility | MSG Networks Term Loan | ||
Debt Instrument [Line Items] | ||
Letters of credit outstanding, amount | $ 35,000,000 | |
Secured Debt | ||
Debt Instrument [Line Items] | ||
Face amount | 1,100,000,000 | |
Secured Debt | MSG Networks | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate | 7.43% | |
Revolving Credit Facility | MSG Networks | ||
Debt Instrument [Line Items] | ||
Face amount | $ 250,000,000 |
Credit Facilities and Convert_5
Credit Facilities and Convertible Notes - LV Sphere - Narrative (Details) $ in Thousands | Dec. 22, 2022 USD ($) | Mar. 31, 2024 | Oct. 11, 2019 USD ($) |
LV Sphere | Subsidiaries | |||
Debt Instrument [Line Items] | |||
Interest rate | 9.80% | ||
LV Sphere | Minimum Liquidity Step-Down | Subsidiaries | |||
Debt Instrument [Line Items] | |||
Debt covenant, minimum consolidated liquidity | $ 50,000 | ||
Debt instrument, covenant, held in cash | $ 25,000 | ||
LV Sphere | Measurement Input, Historical Debt Service Coverage Ratio | Subsidiaries | |||
Debt Instrument [Line Items] | |||
Debt instrument, measurement input | 1.35 | ||
LV Sphere | Measurement Input, Prospective Debt Service Coverage Ratio | Subsidiaries | |||
Debt Instrument [Line Items] | |||
Debt instrument, measurement input | 1.35 | ||
LV Sphere | Minimum | Measurement Input, Historical Debt Service Coverage Ratio | Subsidiaries | |||
Debt Instrument [Line Items] | |||
Debt instrument, contingent measurement input | 1.50 | ||
LV Sphere | Minimum | Measurement Input, Prospective Debt Service Coverage Ratio | Subsidiaries | |||
Debt Instrument [Line Items] | |||
Debt instrument, contingent measurement input | 1.50 | ||
LV Sphere | Base Rate | Subsidiaries | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 3.375% | ||
LV Sphere | Secured Overnight Financing Rate (SOFR) | Subsidiaries | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 0.10% | ||
Debt instrument, interest rate, increase (decrease) | 4.375% | ||
Secured Debt | |||
Debt Instrument [Line Items] | |||
Face amount | $ 1,100,000 | ||
Secured Debt | LV Sphere | Subsidiaries | |||
Debt Instrument [Line Items] | |||
Debt instrument term | 5 years | ||
Face amount | $ 275,000 |
Credit Facilities and Convert_6
Credit Facilities and Convertible Notes - Delayed Draw Term Loan Facility - Narrative (Details) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Apr. 20, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | Jul. 14, 2023 | |
MSG Entertainment | ||||||
Line of Credit Facility [Line Items] | ||||||
Equity securities, FV-NI, shares disposed (in shares) | 0 | 0 | 1,923 | 0 | ||
Delayed Draw Term Loan Facility | Line of Credit | Sphere | Secured Debt | MSG Entertainment Holdings | ||||||
Line of Credit Facility [Line Items] | ||||||
Loans receivable, maximum borrowing amount | $ 65,000 | |||||
Delayed Draw Term Loan Facility | Unsecured Debt | ||||||
Line of Credit Facility [Line Items] | ||||||
Debt instrument term | 18 months | |||||
Face amount | $ 65,000 |
Credit Facilities and Convert_7
Credit Facilities and Convertible Notes - 3.5% Senior Notes - Narrative (Details) $ / shares in Units, $ in Thousands | Dec. 08, 2023 USD ($) day $ / shares | Dec. 05, 2023 $ / shares | Mar. 31, 2024 |
Common Class A | |||
Line of Credit Facility [Line Items] | |||
Option indexed to issuer's equity, cap price (in dollars per share) | $ 42.62 | ||
Debt instrument, convertible, conversion price premium on stock price | 50% | ||
Share price (in dollars per share) | $ 28.41 | ||
3.50% Convertible Senior Notes | Senior Notes | |||
Line of Credit Facility [Line Items] | |||
Interest rate | 3.50% | 3.50% | |
Face amount | $ | $ 258,750 | ||
Purchases of capped calls in connection with senior notes | $ | $ 14,309 | ||
Debt instrument, convertible, conversion ratio | 0.0281591 | ||
Debt instrument, convertible, conversion price (in dollars per share) | $ 35.51 | ||
3.50% Convertible Senior Notes | Senior Notes | Debt Conversion Terms One | |||
Line of Credit Facility [Line Items] | |||
Debt instrument, convertible, threshold percentage of stock price trigger | 130% | ||
Debt instrument, convertible, threshold trading days | day | 20 | ||
Debt instrument, convertible, threshold consecutive trading days | day | 30 | ||
Debt instrument, redemption price, percentage of principal amount redeemed | 100% | ||
3.50% Convertible Senior Notes | Senior Notes | Debt Conversion Terms Two | Minimum | |||
Line of Credit Facility [Line Items] | |||
Debt instrument, convertible, conversion price (in dollars per share) | $ 28.41 | ||
3.50% Convertible Senior Notes | Senior Notes | Debt Conversion Terms Two | Maximum | |||
Line of Credit Facility [Line Items] | |||
Debt instrument, convertible, conversion price (in dollars per share) | $ 280 | ||
3.50% Convertible Senior Notes | Senior Notes | Debt Conversion Terms Three | |||
Line of Credit Facility [Line Items] | |||
Debt instrument, redemption price, percentage | 100% | ||
3.50% Convertible Senior Notes | Senior Notes | Debt Conversion, Terms Four | |||
Line of Credit Facility [Line Items] | |||
Debt instrument, redemption price, percentage | 100% | ||
3.50% Convertible Senior Notes | Senior Notes | Debt Conversion, Terms Four | Minimum | |||
Line of Credit Facility [Line Items] | |||
Debt instrument, aggregate principal amount of the notes percentage | 25% |
Credit Facilities and Convert_8
Credit Facilities and Convertible Notes - Long-Term Debt Maturity Schedule (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 08, 2023 |
Debt Instrument [Line Items] | ||
Fiscal Year 2024 (remainder) | $ 20,625 | |
Fiscal Year 2025 | 849,750 | |
Fiscal Year 2026 | 0 | |
Fiscal Year 2027 | 0 | |
Fiscal Year 2028 | 275,000 | |
Thereafter | 258,750 | |
Total long-term debt | 1,404,125 | |
MSG Networks Credit Facilities | ||
Debt Instrument [Line Items] | ||
Fiscal Year 2024 (remainder) | 20,625 | |
Fiscal Year 2025 | 849,750 | |
Fiscal Year 2026 | 0 | |
Fiscal Year 2027 | 0 | |
Fiscal Year 2028 | 0 | |
Thereafter | 0 | |
Total long-term debt | 870,375 | |
LV Sphere | ||
Debt Instrument [Line Items] | ||
Fiscal Year 2024 (remainder) | 0 | |
Fiscal Year 2025 | 0 | |
Fiscal Year 2026 | 0 | |
Fiscal Year 2027 | 0 | |
Fiscal Year 2028 | 275,000 | |
Thereafter | 0 | |
Total long-term debt | 275,000 | |
3.50% Convertible Senior Notes | ||
Debt Instrument [Line Items] | ||
Fiscal Year 2024 (remainder) | 0 | |
Fiscal Year 2025 | 0 | |
Fiscal Year 2026 | 0 | |
Fiscal Year 2027 | 0 | |
Fiscal Year 2028 | 0 | |
Thereafter | 258,750 | |
Total long-term debt | $ 258,750 | |
3.50% Convertible Senior Notes | Senior Notes | ||
Debt Instrument [Line Items] | ||
Interest rate | 3.50% | 3.50% |
Credit Facilities and Convert_9
Credit Facilities and Convertible Notes - Schedule of Interest, Carrying Value, and Fair Value (Details) - USD ($) $ in Thousands | 9 Months Ended | |||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 08, 2023 | Jun. 30, 2023 | |
Line of Credit Facility [Line Items] | ||||
Unamortized deferred financing costs | $ 5,622 | $ 6,363 | ||
MSG Networks, LV Sphere, Delayed Draw, 3.5% Senior Notes | ||||
Line of Credit Facility [Line Items] | ||||
Interest Payments | 72,205 | $ 47,245 | ||
Loan Principal Repayments | 126,875 | 45,375 | ||
Total long-term debt, carrying value | 1,397,455 | 1,207,250 | ||
Total long-term debt, fair value | 1,544,151 | 1,199,839 | ||
MSG Networks Term Loan | Debt | ||||
Line of Credit Facility [Line Items] | ||||
Carrying Value | 870,375 | 932,250 | ||
Fair Value | 866,203 | 927,589 | ||
MSG Networks Term Loan | MSG Networks | ||||
Line of Credit Facility [Line Items] | ||||
Interest Payments | 51,587 | 41,034 | ||
Loan Principal Repayments | 61,875 | 45,375 | ||
LV Sphere | Debt | ||||
Line of Credit Facility [Line Items] | ||||
Carrying Value | 275,000 | 275,000 | ||
Fair Value | 273,625 | 272,250 | ||
LV Sphere | LV Sphere | ||||
Line of Credit Facility [Line Items] | ||||
Interest Payments | 20,158 | 6,211 | ||
Loan Principal Repayments | 0 | 0 | ||
Delayed Draw Term Loan Facility | ||||
Line of Credit Facility [Line Items] | ||||
Interest Payments | 460 | 0 | ||
Loan Principal Repayments | $ 65,000 | $ 0 | ||
3.50% Convertible Senior Notes | Senior Notes | ||||
Line of Credit Facility [Line Items] | ||||
Interest rate | 3.50% | 3.50% | ||
3.50% Convertible Senior Notes | Debt | ||||
Line of Credit Facility [Line Items] | ||||
Carrying Value | $ 252,080 | 0 | ||
Fair Value | $ 404,323 | $ 0 |
Pension Plans and Other Postr_3
Pension Plans and Other Postretirement Benefit Plan - Narrative (Details) | 3 Months Ended | 9 Months Ended | |||
Mar. 31, 2024 USD ($) plan | Mar. 31, 2023 USD ($) | Mar. 31, 2024 USD ($) plan | Mar. 31, 2023 USD ($) | Apr. 19, 2023 plan | |
Defined Contribution Plan Disclosure [Line Items] | |||||
Defined benefit plan, number of contributory welfare plans | plan | 2 | ||||
Defined benefit plan, number of sponsored plans | plan | 1 | 1 | |||
Deferred compensation arrangement with individual, compensation expense | $ 126,000 | $ 129,000 | $ 264,000 | $ 135,000 | |
Gain (loss) on remeasurement | 126,000 | 129,000 | 264,000 | 135,000 | |
Other Pension, Postretirement and Supplemental Plans | |||||
Defined Contribution Plan Disclosure [Line Items] | |||||
Defined benefit plan, plan assets, contributions by employer | $ 0 | $ 0 | $ 500,000 | $ 500,000 |
Pension Plans and Other Postr_4
Pension Plans and Other Postretirement Benefit Plan - Schedule of Net Periodic Benefit Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
Pension Plans and Postretirement Plan | ||||
Defined Benefit Plan, Net Periodic Benefit Cost (Credit) [Abstract] | ||||
Service cost | $ 61 | $ 123 | $ 183 | $ 369 |
Interest cost | 434 | 1,189 | 1,302 | 3,567 |
Expected return on plan assets | (213) | (1,719) | (347) | (5,157) |
Recognized actuarial loss (gain) | 94 | 476 | (10) | 1,478 |
Net periodic benefit cost | 376 | 69 | 1,128 | 257 |
Postretirement Plan | ||||
Defined Benefit Plan, Net Periodic Benefit Cost (Credit) [Abstract] | ||||
Service cost | 5 | 15 | 15 | 45 |
Interest cost | 17 | 19 | 51 | 57 |
Expected return on plan assets | 0 | 0 | 0 | 0 |
Recognized actuarial loss (gain) | (17) | (12) | (51) | 6 |
Net periodic benefit cost | $ 5 | $ 22 | $ 15 | $ 108 |
Pension Plans and Other Postr_5
Pension Plans and Other Postretirement Benefit Plan - Schedule of Defined Contribution Plans (Details) - Savings Plan - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
Defined Contribution Plan Disclosure [Line Items] | ||||
Total Savings Plan Expenses | $ 1,743 | $ 3,304 | $ 4,956 | $ 8,611 |
Continuing Operations | ||||
Defined Contribution Plan Disclosure [Line Items] | ||||
Total Savings Plan Expenses | 1,743 | 1,937 | 4,956 | 5,058 |
Discontinued Operations | ||||
Defined Contribution Plan Disclosure [Line Items] | ||||
Total Savings Plan Expenses | $ 0 | $ 1,367 | $ 0 | $ 3,553 |
Pension Plans and Other Postr_6
Pension Plans and Other Postretirement Benefit Plan - Schedule of Deferred Compensation Plan Amounts Recognized On Balance Sheet (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Jun. 30, 2023 |
Defined Benefit Plans and Other Postretirement Benefit Plans Disclosures [Abstract] | ||
Non-current assets (included in Investments) | $ 3,049 | $ 1,087 |
Non-current liabilities (included in Other non-current liabilities) | $ (3,072) | $ (1,087) |
Share-based Compensation, Restr
Share-based Compensation, Restricted Stock Units Activity (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation | $ 1,166 | $ 7,384 | $ 1,166 | $ 7,384 |
Share-based compensation capitalized in property and equipment | 1,811 | 2,887 | ||
Payment, tax withholding, share-based payment arrangement | 15,238 | 14,980 | ||
Performance Stock Units and Restricted Stock Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Share-based compensation | 17,164 | 9,105 | 34,119 | 36,950 |
Fair value of awards vested and exercised | 9,567 | 806 | 42,988 | 35,933 |
Share-based compensation capitalized in property and equipment | 1,881 | 2,887 | ||
Payment, tax withholding, share-based payment arrangement | $ 409 | $ 208 | $ 14,844 | $ 14,949 |
Share-based Compensation - Addi
Share-based Compensation - Additional Information (Details) $ in Thousands | 9 Months Ended | |
Mar. 31, 2024 USD ($) plan shares | Mar. 31, 2023 USD ($) shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of share-based compensation plans | plan | 3 | |
Share-based compensation arrangement by share-based payment award, options, grants in period, gross (in shares) | 3,819,000 | 0 |
Exercise of stock options (in shares) | 184,000 | 0 |
Proceeds from exercise of stock options | $ | $ 8,827 | $ 0 |
Restricted Stock Units (RSUs) | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Awards granted (in shares) | 514,000 | 657,000 |
Awards vested (in shares) | 659,000 | 560,000 |
Performance Stock Units (PSUs) | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Awards granted (in shares) | 404,000 | 566,000 |
Awards vested (in shares) | 273,000 | 91,000 |
Stock Appreciation Rights (SARs) | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Share-based compensation arrangement by share-based payment award, number of shares authorized (in shares) | 188,000 | 0 |
Share-based compensation arrangement by share-based payment award, accelerated vesting, number (in shares) | 0 | 0 |
Employee | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Unrecognized compensation cost | $ | $ 104,913 | |
Period for recognition | 2 years 1 month 6 days |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | Mar. 31, 2024 | Jun. 30, 2023 | Mar. 31, 2020 |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Preferred stock, shares authorized (in shares) | 15,000,000 | 15,000,000 | |
Preferred stock, par or stated value per share (in shares) | $ 0.01 | $ 0.01 | |
Preferred stock, shares outstanding (in shares) | 0 | 0 | |
Common Class A | |||
Accumulated Other Comprehensive Income (Loss) [Line Items] | |||
Stock repurchase program, authorized amount | $ 350,000 |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Balance at the beginning of the period | $ 2,465,164 | $ 2,018,920 | $ 2,583,865 | $ 1,975,384 |
Other comprehensive (loss) income, net of income taxes | (660) | 2,124 | (2,036) | 1,916 |
Balance at the end of the period | 2,443,599 | 2,033,986 | 2,443,599 | 2,033,986 |
Pension Plans and Postretirement Plan | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Balance at the beginning of the period | (5,240) | (39,453) | (5,138) | (40,287) |
Other comprehensive income (loss) before reclassifications | 0 | 0 | 0 | 0 |
Amounts reclassified from accumulated other comprehensive loss | 77 | 464 | (61) | 1,484 |
Income tax benefit (expense) | (19) | (58) | 17 | (244) |
Other comprehensive (loss) income, net of income taxes | 58 | 406 | (44) | 1,240 |
Balance at the end of the period | (5,182) | (39,047) | (5,182) | (39,047) |
Cumulative Translation Adjustments | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Balance at the beginning of the period | (1,074) | (9,110) | 200 | (8,068) |
Other comprehensive income (loss) before reclassifications | (968) | 2,071 | (2,688) | 794 |
Amounts reclassified from accumulated other comprehensive loss | 0 | 0 | 0 | 0 |
Income tax benefit (expense) | 250 | (353) | 696 | (118) |
Other comprehensive (loss) income, net of income taxes | (718) | 1,718 | (1,992) | 676 |
Balance at the end of the period | (1,792) | (7,392) | (1,792) | (7,392) |
Accumulated Other Comprehensive Loss | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Balance at the beginning of the period | (6,314) | (48,563) | (4,938) | (48,355) |
Other comprehensive income (loss) before reclassifications | (968) | 2,071 | (2,688) | 794 |
Amounts reclassified from accumulated other comprehensive loss | 77 | 464 | (61) | 1,484 |
Income tax benefit (expense) | 231 | (411) | 713 | (362) |
Other comprehensive (loss) income, net of income taxes | (660) | 2,124 | (2,036) | 1,916 |
Balance at the end of the period | $ (6,974) | $ (46,439) | $ (6,974) | $ (46,439) |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Mar. 31, 2024 | Jun. 30, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
Related Party Transaction [Line Items] | ||||||
Capital expenditures incurred but not yet paid | $ 55,806 | $ 104,004 | ||||
Related Party | ||||||
Related Party Transaction [Line Items] | ||||||
Capital expenditures in connection with services provided | $ 7 | $ 14,271 | 8,049 | 87,357 | ||
Sales commissions and fees | 3,323 | $ 0 | 4,060 | $ 0 | ||
Capital expenditures incurred but not yet paid | $ 17,450 | $ 13,412 | ||||
Prepaid expense | $ 1,190 | $ 0 | $ 1,190 | $ 1,190 | ||
Dolan Family Group | ||||||
Related Party Transaction [Line Items] | ||||||
Common stock exercisable term | 60 days | |||||
605 LLC | Audience Measurement And Data Analytics Services | ||||||
Related Party Transaction [Line Items] | ||||||
Miscellaneous expenses with related party | $ 1,000 | |||||
Dolan Family Group | ||||||
Related Party Transaction [Line Items] | ||||||
Noncontrolling interest, ownership percentage by parent | 72.30% | 72.30% | 72.30% | |||
Dolan Family Group | Common Class B | ||||||
Related Party Transaction [Line Items] | ||||||
Noncontrolling interest, ownership percentage by parent | 100% | 100% | 100% | |||
Dolan Family Group | Common Class A | ||||||
Related Party Transaction [Line Items] | ||||||
Noncontrolling interest, ownership percentage by parent | 6.50% | 6.50% | 6.50% |
Related Party Transactions - Sc
Related Party Transactions - Schedule of Transactions by Type (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
Related Party Transaction [Line Items] | ||||
Revenues | $ 321,330 | $ 162,062 | $ 753,494 | $ 444,732 |
Operating expenses (credits): | ||||
Restructuring charges | 4,667 | 18,670 | 9,345 | 26,745 |
Related Party | ||||
Related Party Transaction [Line Items] | ||||
Revenues | 1,215 | 1,730 | 3,262 | 1,730 |
Operating expenses (credits): | ||||
Total operating expenses, net | 77,826 | 34,832 | 233,905 | 104,208 |
Direct operating expenses | 45,332 | 45,280 | 138,869 | 134,387 |
Selling, general and administrative expenses | 32,494 | 10,448 | 95,036 | 30,179 |
Related Party | Media rights fees | ||||
Operating expenses (credits): | ||||
Other gains | 43,947 | 43,433 | 132,617 | 129,633 |
Related Party | Corporate general and administrative expenses, net - MSG Entertainment Transition Services Agreement | ||||
Operating expenses (credits): | ||||
Restructuring charges | 558 | 3,363 | ||
Related Party | Origination, master control and technical services | ||||
Operating expenses (credits): | ||||
Other gains | 1,283 | 1,257 | 3,797 | 3,721 |
Related Party | Other operating expenses (credits), net | ||||
Operating expenses (credits): | ||||
Other gains | 5,102 | (69) | 13,880 | (365) |
MSG Sports | Cost reimbursement from MSG Sports - MSG Sports Services Agreement | ||||
Operating expenses (credits): | ||||
Other gains | 0 | (9,789) | 0 | (28,781) |
MSG Entertainment | Corporate general and administrative expenses, net - MSG Entertainment Transition Services Agreement | ||||
Operating expenses (credits): | ||||
Other gains | $ 27,494 | $ 0 | $ 83,611 | $ 0 |
Segment Information - Additiona
Segment Information - Additional Information (Details) | 9 Months Ended |
Mar. 31, 2024 segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 2 |
Segment Information - Schedule
Segment Information - Schedule of Segment Reporting (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | ||
Segment Reporting Information [Line Items] | |||||
Revenues | $ 321,330 | $ 162,062 | $ 753,494 | $ 444,732 | |
Depreciation and amortization | (174,157) | (89,234) | |||
Impairment and other losses, net | (115,738) | 7,834 | |||
Restructuring charges | (4,667) | (18,670) | (9,345) | (26,745) | |
Other (expense) income, net | (3,256) | (4,182) | 37,810 | (5,952) | |
Add back: | |||||
Share-based compensation | 1,166 | 7,384 | 1,166 | 7,384 | |
Depreciation and amortization | 174,157 | 89,234 | |||
Restructuring charges | 4,667 | 18,670 | 9,345 | 26,745 | |
Impairment and other gains (losses), net | 115,738 | (7,834) | |||
Continuing Operations | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | [1] | 321,330 | 162,062 | 753,494 | 444,732 |
Direct operating expenses | [1] | (154,040) | (93,665) | (398,305) | (259,485) |
Selling, general and administrative expenses | [1] | (123,149) | (143,433) | (325,813) | (342,479) |
Depreciation and amortization | (79,867) | (8,200) | (174,157) | (21,719) | |
Impairment and other losses, net | 0 | 0 | (115,738) | 3,000 | |
Other gains | 3,000 | ||||
Restructuring charges | (4,667) | (18,670) | (9,345) | (26,745) | |
Operating (loss) income | (40,393) | (101,906) | (269,864) | (202,696) | |
Interest income | 7,654 | 3,374 | 17,958 | 9,376 | |
Interest expense | (27,119) | 0 | (52,947) | 0 | |
Other (expense) income, net | (3,256) | (4,182) | 37,810 | (5,952) | |
Loss from continuing operations before income taxes | (63,114) | (102,714) | (267,043) | (199,272) | |
Reconciliation of operating (loss) income to adjusted operating (loss) income: | |||||
Operating (loss) income | (40,393) | (101,906) | (269,864) | (202,696) | |
Add back: | |||||
Share-based compensation | 16,724 | 9,105 | 33,523 | 36,950 | |
Depreciation and amortization | 79,867 | 8,200 | 174,157 | 21,719 | |
Restructuring charges | 4,667 | 18,670 | 9,345 | 26,745 | |
Impairment and other gains (losses), net | 0 | 0 | 115,738 | (3,000) | |
Other gains | (3,000) | ||||
Merger and acquisition related costs, net of insurance recoveries | 508 | 47,045 | (8,155) | 57,181 | |
Amortization for capitalized cloud computing arrangement costs | 22 | 168 | 66 | 416 | |
Remeasurement of deferred compensation plan liabilities | 126 | 264 | |||
Adjusted operating income | 61,521 | (18,718) | 55,074 | (62,685) | |
Other information: | |||||
Capital expenditures | 19,464 | 197,763 | 251,436 | 738,908 | |
Operating segments | Sphere | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 170,364 | 626 | 345,942 | 1,919 | |
Operating segments | Sphere | Continuing Operations | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 170,364 | 626 | 345,942 | 1,919 | |
Direct operating expenses | (62,294) | (4,414) | (137,437) | (4,414) | |
Selling, general and administrative expenses | (108,976) | (83,381) | (290,930) | (235,331) | |
Depreciation and amortization | (77,706) | (6,511) | (168,127) | (16,775) | |
Impairment and other losses, net | (115,738) | ||||
Other gains | 3,000 | ||||
Restructuring charges | (4,886) | (18,670) | (9,564) | (22,757) | |
Operating (loss) income | (83,498) | (112,350) | (375,854) | (274,358) | |
Reconciliation of operating (loss) income to adjusted operating (loss) income: | |||||
Operating (loss) income | (83,498) | (112,350) | (375,854) | (274,358) | |
Add back: | |||||
Share-based compensation | 13,273 | 8,466 | 28,177 | 31,308 | |
Depreciation and amortization | 77,706 | 6,511 | 168,127 | 16,775 | |
Restructuring charges | 4,886 | 18,670 | 9,564 | 22,757 | |
Impairment and other gains (losses), net | 115,738 | ||||
Other gains | (3,000) | ||||
Merger and acquisition related costs, net of insurance recoveries | 416 | 1,532 | (2,086) | 4,223 | |
Amortization for capitalized cloud computing arrangement costs | 0 | 125 | 0 | 285 | |
Remeasurement of deferred compensation plan liabilities | 126 | 264 | |||
Adjusted operating income | 12,909 | (77,046) | (56,070) | (202,010) | |
Other information: | |||||
Capital expenditures | 17,502 | 195,945 | 244,963 | 733,198 | |
Operating segments | MSG Networks | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 150,966 | 161,436 | 407,552 | 442,813 | |
Operating segments | MSG Networks | Continuing Operations | |||||
Segment Reporting Information [Line Items] | |||||
Revenues | 150,966 | 161,436 | 407,552 | 442,813 | |
Direct operating expenses | (91,746) | (89,251) | (260,868) | (255,071) | |
Selling, general and administrative expenses | (14,173) | (60,052) | (34,883) | (107,148) | |
Depreciation and amortization | (2,161) | (1,689) | (6,030) | (4,944) | |
Impairment and other losses, net | 0 | ||||
Other gains | 0 | ||||
Restructuring charges | 219 | 0 | 219 | (3,988) | |
Operating (loss) income | 43,105 | 10,444 | 105,990 | 71,662 | |
Reconciliation of operating (loss) income to adjusted operating (loss) income: | |||||
Operating (loss) income | 43,105 | 10,444 | 105,990 | 71,662 | |
Add back: | |||||
Share-based compensation | 3,451 | 639 | 5,346 | 5,642 | |
Depreciation and amortization | 2,161 | 1,689 | 6,030 | 4,944 | |
Restructuring charges | (219) | 0 | (219) | 3,988 | |
Impairment and other gains (losses), net | 0 | ||||
Other gains | 0 | ||||
Merger and acquisition related costs, net of insurance recoveries | 92 | 45,513 | (6,069) | 52,958 | |
Amortization for capitalized cloud computing arrangement costs | 22 | 43 | 66 | 131 | |
Remeasurement of deferred compensation plan liabilities | 0 | 0 | |||
Adjusted operating income | 48,612 | 58,328 | 111,144 | 139,325 | |
Other information: | |||||
Capital expenditures | $ 1,962 | $ 1,818 | $ 6,473 | $ 5,710 | |
[1]See Note 15. Related Party Transactions, for further information on related party revenues and expenses. |
Segment Information - Schedul_2
Segment Information - Schedule of Concentration Risk (Details) - Customer Concentration Risk | 3 Months Ended | 9 Months Ended | ||||
Mar. 31, 2024 | Jun. 30, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
Accounts Receivable | Customer A | ||||||
Revenue, Major Customer [Line Items] | ||||||
Concentration risk, percentage | 13% | 23% | ||||
Accounts Receivable | Customer B | ||||||
Revenue, Major Customer [Line Items] | ||||||
Concentration risk, percentage | 13% | 22% | ||||
Accounts Receivable | Customer C | ||||||
Revenue, Major Customer [Line Items] | ||||||
Concentration risk, percentage | 10% | 17% | ||||
Revenue Benchmark | Customer 1 | ||||||
Revenue, Major Customer [Line Items] | ||||||
Concentration risk, percentage | 11% | 23% | 14% | 26% | ||
Revenue Benchmark | Customer 2 | ||||||
Revenue, Major Customer [Line Items] | ||||||
Concentration risk, percentage | 11% | 21% | 14% | 25% | ||
Revenue Benchmark | Customer 3 | ||||||
Revenue, Major Customer [Line Items] | ||||||
Concentration risk, percentage | 8% | 19% | 11% | 21% |
Additional Financial Informat_3
Additional Financial Information - Schedule of Cash, Cash Equivalents, and Restricted Cash (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Dec. 31, 2023 | Jun. 30, 2023 |
Cash and Cash Equivalents [Line Items] | |||
Total cash, cash equivalents and restricted cash | $ 693,946 | $ 429,114 | |
Continuing Operations | |||
Cash and Cash Equivalents [Line Items] | |||
Cash and cash equivalents | 680,575 | $ 614,549 | 131,965 |
Restricted cash | 13,371 | 297,149 | |
Total cash, cash equivalents and restricted cash | $ 693,946 | $ 429,114 |
Additional Financial Informat_4
Additional Financial Information - Schedule of Current Assets (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Jun. 30, 2023 |
Additional Financial Information [Abstract] | ||
Prepaid expenses | $ 12,614 | $ 22,616 |
Note and other receivables | 8,589 | 21,453 |
Inventory | 1,684 | 0 |
Current deferred production content costs | 1,906 | 6,524 |
Other | 5,423 | 5,492 |
Total prepaid expenses and other current assets | $ 30,216 | $ 56,085 |
Additional Financial Informat_5
Additional Financial Information - Schedule of Current Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2024 | Jun. 30, 2023 |
Additional Financial Information [Abstract] | ||
Accounts payable | $ 73,670 | $ 39,654 |
Accrued payroll and employee related liabilities | 71,584 | 75,579 |
Cash due to promoters | 57,360 | 73,611 |
Capital expenditure accruals | 155,352 | 236,593 |
Accrued legal fees | 23,442 | 53,857 |
Other accrued expenses | 41,705 | 36,437 |
Total accounts payable, accrued and other current liabilities | $ 423,113 | $ 515,731 |
Additional Financial Informat_6
Additional Financial Information - Schedule of Other Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Mar. 31, 2024 | Mar. 31, 2023 | |
Additional Financial Information [Abstract] | ||||
Gain on litigation settlement | $ 0 | $ 0 | $ 62,647 | $ 0 |
Realized loss on equity method investments | 0 | 0 | (19,027) | 0 |
Other | (3,256) | (4,182) | (5,810) | (5,952) |
Other (expense) income, net | $ (3,256) | $ (4,182) | $ 37,810 | $ (5,952) |
Additional Financial Informat_7
Additional Financial Information - Additional Information (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Additional Financial Information [Abstract] | ||
Income taxes paid, net | $ 18,859 | $ 5,372 |