Madison Square Garden Entertainment Corp. Q2 FY2026 earnings call

• Christmas Spectacular: 215 paid performances, 14 more than last year, sold over 1.2 million tickets, highest attendance in 25 years, mid-single-digit per show revenue increase, record food, beverage, and merchandise per caps. - Venue activity: Welcomed ~2.9 million guests at over 475 events. - Bookings: Increased events year-over-year, driven by concerts, family shows, and marquee sports; Garden concerts down due to timing, but theaters saw growth. - Knicks and Rangers: Teams began seasons, higher per game revenues in profit sharing. - Marketing partnerships: Renewals with Anheuser-Busch and expanded partnership with Infosys, Infosys as official naming rights partner of theater at MSG. - Premium hospitality: Strong new sales and renewal activity for suites. - Technology: Sphere Immersive Sound system in use for all concerts at Radio City Music Hall.

For the fiscal 2026 second quarter, revenues were $460 million and adjusted operating income was $190 million, both with double-digit percentage year-over-year increases. The Christmas Spectacular was a key driver, generating approximately $195 million in total revenue this season with 215 paid performances, 14 more than last year, selling over 1.2 million tickets across 8.5 weeks, and seeing growth in individual and group tickets, average ticket yields, and per caps on food, beverage, and merchandise. Revenues from entertainment offerings, arena license fees, other leasing revenues, and Knicks/Rangers-related streams grew. Concert revenues at the Garden were down year-over-year due to fewer concerts there but offset by more concerts at theaters and higher per concert revenues. Food, beverage, and merchandise revenues increased due to sales at Knicks/Rangers games, Christmas Spectacular, and other events, partially offset by lower sales at Garden concerts. Revenue contribution: Christmas Spectacular was a major contributor, and Knicks/Rangers and other live events also played significant roles.

• Confident in robust revenue and adjusted operating income growth for fiscal 2026. - Christmas Spectacular has room to increase show count and improve yields for future runs. - Garden concert bookings for fiscal 2027 are pacing well ahead, including Harry Styles' 30-night residency, Bon Jovi's 9-show residency, and other notable acts. - Continue to explore ways to opportunistically return capital to shareholders with $45 million remaining under buyback authorization.

• Macro environment changes could impact consumer demand for events. - Uncertainty in ticket sales due to factors like international tourism trends. - Potential delays or issues with Penn Station redevelopment affecting venue operations and event scheduling.

Q: Talk about pricing sell-through and audience demographic trends for Christmas Spectacular and future growth opportunity.

A: This year had mid-single-digit per show revenue increase due to per show ticketing growth and record food, beverage, merchandise per caps. Sell-through demand was broad-based except international tourism down. Room to increase show count and improve yields for future seasons as Christmas Spectacular is a premium product priced below comparable options.

Q: Update on concert bookings trends, pacing for fiscal 2027.

A: Rest of fiscal 2026 theaters pacing behind March and June quarters but actively booking; Garden pacing strongly for third and fourth quarters, exceeded concert bookings goal, and fiscal 2027 Garden pacing well ahead with Harry Styles residency and other notable acts, on pace to shatter September 2025 concert record.

Q: Incremental impact of Harry Styles residency on fiscal 2027, type of deal.

A: 30-night residency starting late August to October in fiscal 2027 first and second quarters, strong presales with $11.5 million registrations, rental deal, and expected to be a meaningful contributor to Garden concert growth in 2027.

Q: Consumer demand trends and capital returns.

A: Strong consumer demand seen in Christmas Spectacular and concert bookings; capital allocation priorities are strong balance sheet, flexibility for opportunities, and opportunistically returning capital, with $25 million repurchased and $45 million remaining under buyback authorization.

Q: SG&A elevation and outlook, F&B per cap impact.

A: SG&A elevated due to nonrecurring items like executive management transition costs and onetime expense true-up, expecting SG&A to normalize by June quarter; F&B per cap fluctuates by event mix, e.g., rock vs pop acts, but combined Garden F&B and merchandise per caps up in fiscal second quarter.