NEW YORK--(BUSINESS WIRE)--Sphere Entertainment Co. (NYSE: SPHR) (“Sphere Entertainment” or the “Company”) today reported financial results for the third quarter ended September 30, 2026.

Recent highlights for the Company’s Sphere segment include:

• In late September, the Company debuted enhanced and expanded 4D effects for The Wizard of Oz at Sphere, and announced that the production had exceeded half a billion dollars in ticket sales with over four million tickets sold since its debut in August 2025, while the production also surpassed its 1,000^th showing in early October;
• Production is underway on The Rocky Horror Picture Show at Sphere, a new Sphere Experience, which the Company expects will debut by the end of March 2027;
• In October, Metallica began a new concert residency at Sphere, with 24 concerts planned through March 2027;
• Backstreet Boys and the Eagles have continued to extend their long-running residencies – now up to 63 and 74 planned nights, respectively – while Oprah Winfrey and John Mayer each announced new residencies for 2027; and
• The Company announced a new multi-year sponsorship agreement with Lyft.

For the three months ended September 30, 2026, the Company reported revenues of $274.3 million, an increase of $11.7 million, or 4%, as compared to the prior year quarter. In addition, the Company reported an operating loss of $240.6 million, an increase of $77.5 million, or 47%, and adjusted operating income of $39.2 million, an increase of $2.8 million, or 8%, both as compared to the prior year quarter.⁽¹⁾

Executive Chairman and CEO James L. Dolan said, “With today’s results, our Sphere segment remains on track to deliver substantial growth this calendar year. Looking ahead, we continue to make progress on our long-term vision for Sphere, including a global network of venues and a growing slate of original content.”

Segment Results for the Three and Nine Months Ended September 30, 2026 and 2025:

Sphere
For the three months ended September 30, 2026, the Sphere segment reported revenues of $198.9 million, an increase of $24.8 million, or 14%, as compared to the prior year quarter.

Revenues related to The Sphere Experience increased $13.1 million as compared to the prior year quarter, which reflected an increase in the number of overall performances and, to a lesser extent, higher per-show revenue. In the current year quarter, The Sphere Experience reflected 241 performances of The Wizard of Oz at Sphere as compared to a combined 220 performances of The Wizard of Oz at Sphere, Postcard from Earth and V-U2 An Immersive Concert Film in the prior year quarter. The Wizard of Oz at Sphere debuted on August 28, 2025 in the prior year quarter.

Revenues from sponsorship, Exosphere advertising and suite license fees increased $6.2 million as compared to the prior year quarter due to higher Exosphere advertising revenues and, to a lesser extent, higher sponsorship revenues and suite license fee revenues.

Event-related revenues increased $6.1 million as compared to the prior year quarter, primarily due to higher revenues from concerts. The increase in revenues from concerts primarily reflects the impact of three additional concert residency shows held at Sphere in Las Vegas during the current year quarter.

For the three months ended September 30, 2026, the Sphere segment had direct operating expenses of $83.8 million, an increase of $5.1 million, or 6%, as compared to the prior year quarter. This increase was primarily due to higher expenses associated with The Sphere Experience of $7.6 million as compared to the prior year quarter, which reflected higher per-show expenses and an increase in the number of overall performances. As mentioned above, in the current year quarter, The Sphere Experience solely reflected performances of The Wizard of Oz at Sphere as compared to showings of The Wizard of Oz at Sphere, Postcard from Earth and V-U2 An Immersive Concert Film in the prior year quarter.

For the three months ended September 30, 2026, selling, general and administrative expenses of $98.3 million increased $5.6 million, or 6%, as compared to the prior year quarter, primarily due to (i) higher employee compensation and related benefits and (ii) other cost increases, partially offset by (iii) the impact of mark-to-market adjustments on certain share-based compensation awards as a result of the decrease in the Company’s stock price during the current year quarter.

For the three months ended September 30, 2026, operating loss of $67.0 million improved by $17.5 million, or 21%, as compared to the prior year quarter, primarily due to the increase in revenues, partially offset by higher selling, general and administrative expenses and direct operating expenses. Adjusted operating income of $32.4 million increased $15.3 million, or 90%, as compared to the prior year quarter, primarily due to the increase in revenues, partially offset by higher direct operating expenses and selling, general and administrative expenses (excluding share-based compensation).

MSG Networks
For the three months ended September 30, 2026, the MSG Networks segment reported total revenues of $75.4 million, a decrease of $13.0 million, or 15%, as compared to the prior year quarter.

Distribution revenue decreased $12.8 million, primarily reflecting a decrease in total subscribers of approximately 15.5%.

For the three months ended September 30, 2026, direct operating expenses of $59.3 million increased $1.0 million, or 2%, as compared to the prior year quarter.

For the three months ended September 30, 2026, selling, general and administrative expenses of $10.0 million increased $3.0 million, or 43%, as compared to the prior year quarter. This increase was primarily due to (i) higher employee compensation and related benefits of $3.5 million and (ii) other cost increases, partially offset by (iii) lower advertising and marketing costs of $1.6 million.

For the three months ended September 30, 2026, operating loss of $173.6 million increased $94.9 million as compared to the prior year quarter, primarily due to an increase in impairments and other losses⁽³⁾ and, to a lesser extent, the decrease in revenues. Adjusted operating income of $6.8 million decreased $12.5 million as compared to the prior year quarter, primarily due to the decrease in revenues.

About Sphere Entertainment Co.
Sphere Entertainment Co. is a leader in immersive experiences, technology and media. The Company includes Sphere, an experiential medium powered by advanced technologies. The first Sphere opened in Las Vegas, with plans also announced for Sphere venues in Abu Dhabi and National Harbor. In addition, the Company includes MSG Networks, which operates two regional sports and entertainment networks, MSG Network and MSG Sportsnet, as well as a direct-to-consumer and authenticated streaming product, MSG+, delivering a wide range of live sports content and other programming. More information is available at www.sphereentertainmentco.com.

Non-GAAP Financial Measures
We define adjusted operating income (loss), which is a non-GAAP financial measure, as operating income (loss) before (i) depreciation, amortization and impairments of property and equipment, goodwill and intangible assets, (ii) amortization for capitalized cloud computing arrangement costs, (iii) share-based compensation expense, (iv) restructuring charges or credits, (v) merger, debt work-out and acquisition-related costs, including merger-related litigation expenses, net of insurance recoveries, (vi) gains or losses on sales or dispositions of businesses and associated settlements, (vii) the impact of purchase accounting adjustments related to business acquisitions, and (viii) gains and losses related to the remeasurement of liabilities under the Company’s Executive Deferred Compensation Plan. We believe that the exclusion of share-based compensation expense or benefit allows investors to better track the performance of our business without regard to the settlement of an obligation that is not expected to be made in cash. We eliminate merger, debt work-out and acquisition-related costs, including merger related litigation expenses, net of insurance recoveries, when applicable, because the Company does not consider such costs to be indicative of the ongoing operating performance of the Company as they result from an event that is of a non-recurring nature, thereby enhancing comparability. In addition, management believes that the exclusion of gains and losses related to the remeasurement of liabilities under the Company’s Executive Deferred Compensation Plan, provides investors with a clearer picture of the Company’s operating performance given that, in accordance with U.S. generally accepted accounting principles (“GAAP”), gains and losses related to the remeasurement of liabilities under the Company’s Executive Deferred Compensation Plan are recognized in operating income (loss) whereas gains and losses related to the remeasurement of the assets under the Company’s Executive Deferred Compensation Plan, which are equal to and therefore fully offset the gains and losses related to the remeasurement of liabilities, are recognized in other income (expense), net, which is not reflected in operating income (loss).

We believe adjusted operating income (loss) is an appropriate measure for evaluating the operating performance of our business segments and the Company on a consolidated basis. Adjusted operating income (loss) and similar measures with similar titles are common performance measures used by investors and analysts to analyze our performance. Internally, we use revenues and adjusted operating income (loss) as the most important indicators of our business performance, and evaluate management’s effectiveness with specific reference to these indicators. Adjusted operating income (loss) should be viewed as a supplement to and not a substitute for operating income (loss), net income (loss), cash flows from operating activities, and other measures of performance and/or liquidity presented in accordance with GAAP. Since adjusted operating income (loss) is not a measure of performance calculated in accordance with GAAP, this measure may not be comparable to similar measures with similar titles used by other companies. For a reconciliation of operating income (loss) to adjusted operating income (loss), please see page 5 of this release.

Forward-Looking Statements
This press release may contain statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Investors are cautioned that any such forward-looking statements are not guarantees of future performance or results and involve risks and uncertainties, and that actual results, developments or events may differ materially from those in the forward-looking statements as a result of various factors, including financial community perceptions of the Company and its business, operations, financial condition and the industries in which it operates and the factors described in the Company’s filings with the Securities and Exchange Commission, including the sections titled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” contained therein. The Company disclaims any obligation to update any forward-looking statements contained herein.

Conference Call Information:
The conference call will be webcast live today at 11:00 a.m. ET at investor.sphereentertainmentco.com
Conference call dial-in number is 833-461-5787 / Conference ID Number 556087132
Webcast replay available at investor.sphereentertainmentco.com until November 12, 2026

SPHERE ENTERTAINMENT CO.
ADJUSTMENTS TO RECONCILE OPERATING INCOME (LOSS) TO ADJUSTED OPERATING INCOME (LOSS)
(In thousands)
(Unaudited)

The following is a description of the adjustments to operating loss in arriving at adjusted operating income as described in this earnings release:

• Share-based compensation. This adjustment eliminates the compensation expense relating to restricted stock units, performance stock units and stock options granted under the Sphere Entertainment Employee Stock Plan, MSG Networks Employee Stock Plan, as amended and assumed by Sphere Entertainment, and Sphere Entertainment Non-Employee Director Plan.
• Depreciation and amortization. This adjustment eliminates depreciation and amortization of property and equipment and intangible assets.
• Restructuring charges. This adjustment eliminates costs related to termination benefits provided to certain executives and employees.
• Impairments and other losses (gains), net. This adjustment eliminates non-cash impairment charges and the impact of gains or losses from the disposition of assets or businesses.
• Merger, debt work-out, and acquisition-related costs, including merger-related litigation expenses, net of insurance recoveries. This adjustment eliminates costs related to mergers, debt work-outs and acquisitions, including litigation expenses.
• Amortization for capitalized cloud computing arrangement costs. This adjustment eliminates amortization of capitalized cloud computing arrangement costs.
• Remeasurement of deferred compensation plan liabilities. This adjustment eliminates the impact of gains and losses related to the remeasurement of liabilities under the Company's executive deferred compensation plan.

SPHERE ENTERTAINMENT CO.
EXHIBIT A
REVISION OF PREVIOUSLY ISSUED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands)
(Unaudited)

Correction of Previously Issued Financial Statements for Immaterial Errors

Subsequent to the issuance of the Company’s consolidated financial statements as of and for the year ended December 31, 2025, condensed consolidated financial statements as of and for the three and nine months ended September 30, 2025 and consolidated financial statements as of and for the six-month transition period ended December 31, 2024 (the “Company’s previously issued financial statements”), management identified errors related to the goodwill impairment charges recorded with respect to the Company’s MSG Networks reporting unit during the quarterly period ended September 30, 2025 and the six-month transition period ended December 31, 2024, primarily due to the misallocation of deferred tax liabilities between the Company’s reporting units. Management evaluated the quantitative and qualitative impact of these accounting errors and concluded they were not material to the Company’s previously issued financial statements. Notwithstanding this conclusion, management has revised the accompanying condensed consolidated financial statements included herein to correct these accounting errors for all periods presented.

The effect of the correction of the errors noted above on the balance sheets included in the Company’s previously issued financial statements is as follows:

The effect of the correction of the errors noted above on the statements of operations included in the Company’s previously issued financial statements is as follows:

View source version on businesswire.com: https://www.businesswire.com/news/home/20261105830110/en/

Ari Danes, CFA
Investor Relations
(212) 465-6072

Grace Kaminer
Investor Relations
(212) 631-5076

Source: Sphere Entertainment Co.