Core Insights - TKO Group Holdings reported a revenue of $1.12 billion for the quarter ended September 2025, marking a 64.4% increase year-over-year, while EPS was $0.50, down from $0.53 in the previous year [1] - The revenue exceeded the Zacks Consensus Estimate of $1.08 billion by 4.13%, but the EPS fell short of the consensus estimate of $0.55 by 9.09% [1] Revenue Breakdown - Net Revenue for IMG was $336.7 million, slightly below the estimated $338.46 million [4] - Net Revenue for UFC was $325.2 million, compared to the average estimate of $342.4 million, reflecting an 8.4% year-over-year decline [4] - Net Revenue for WWE was $402.1 million, surpassing the average estimate of $348.64 million, showing a 23.2% year-over-year increase [4] - UFC Partnerships and Marketing generated $70.8 million, exceeding the estimate of $64.8 million [4] - Corporate & Other net revenues were $63.3 million, above the estimate of $60.05 million [4] - WWE Media Rights, Production, and Content revenue was $248.9 million, compared to the estimate of $217.13 million [4] - WWE Live Events and Hospitality revenue reached $82.5 million, exceeding the estimate of $64.94 million [4] - WWE Partnerships and Marketing generated $39.9 million, above the estimate of $32.38 million [4] - WWE Consumer Products Licensing and Other revenue was $30.8 million, compared to the estimate of $28.25 million [4] - UFC Live Events and Hospitality revenue was $43.6 million, slightly below the estimate of $44.79 million [4] - UFC Media Rights, Production, and Content revenue was $200.5 million, compared to the estimate of $217.88 million [4] - Eliminations reported a revenue of -$7.4 million, better than the estimate of -$14.7 million [4] Stock Performance - TKO Group's shares have returned -5.4% over the past month, while the Zacks S&P 500 composite increased by 1% [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Core Viewpoint - TKO Group Holdings reported quarterly earnings of $0.5 per share, missing the consensus estimate of $0.55 per share, and showing a decline from $0.53 per share a year ago [1][2] Financial Performance - The company posted revenues of $1.12 billion for the quarter ended September 2025, exceeding the Zacks Consensus Estimate by 4.13%, and up from $681.2 million year-over-year [3] - TKO Group has surpassed consensus revenue estimates four times over the last four quarters [3] Stock Performance - TKO Group shares have increased approximately 31.8% since the beginning of the year, outperforming the S&P 500's gain of 15.1% [4] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the market in the near future [7] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.26 on revenues of $1.01 billion, and for the current fiscal year, it is $2.84 on revenues of $4.66 billion [8] - The estimate revisions trend for TKO Group was mixed ahead of the earnings release, which may change following the recent report [7] Industry Context - The Film and Television Production and Distribution industry, to which TKO Group belongs, is currently ranked in the bottom 13% of over 250 Zacks industries, indicating potential challenges ahead [9]

Financial Data and Key Metrics Changes - The company generated revenue of $1.12 billion in Q3 2025, with adjusted EBITDA of $360 million and an adjusted EBITDA margin of 32% [13][14] - Year-over-year revenue decreased by 27%, while adjusted EBITDA increased by 59%, and adjusted EBITDA margin improved from 15% in the prior year period [14] - Free cash flow for the quarter was $399 million, with a conversion rate of adjusted EBITDA at 111% [23][24] Business Line Data and Key Metrics Changes - UFC segment revenue was $325 million, a decrease of 8%, with adjusted EBITDA of $166 million, down 15% [15][16] - WWE segment revenue increased by 23% to $402 million, with adjusted EBITDA rising by 19% to $208 million [17][18] - IMG segment revenue decreased by 59% to $337 million, but adjusted EBITDA improved significantly from -$7 million to $61 million [20][21] Market Data and Key Metrics Changes - UFC's media rights production and content revenue decreased by 7% to $201 million, while WWE's media rights production and content revenue increased by 9% to $249 million [15][18] - WWE's live events revenue increased by 61% to $83 million, driven by higher ticket sales and site fee revenue [17] - The company secured significant media rights agreements, including a seven-year, $7.7 billion deal with Paramount for UFC and a five-year partnership with ESPN for WWE [5][7] Company Strategy and Development Direction - The company is focused on maximizing shareholder value, preparing for UFC's Paramount debut, and launching Zuffa Boxing in 2026 [11][30] - Strategic priorities include sustaining strong performance across all businesses, capitalizing on new growth opportunities, and enhancing global partnerships [11][30] - The company aims to achieve $450 million in high-margin partnership revenue by 2025 and targets $1 billion in total company partnership revenue by around 2030 [31] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the company's momentum, citing strong demand for premium sports content and experiences [5][11] - The company raised its full-year 2025 guidance for revenue to $4.69 billion-$4.72 billion and adjusted EBITDA to $1.57 billion-$1.58 billion [26] - Management highlighted the importance of site fees and global partnerships as significant revenue drivers for 2026 and beyond [30][66] Other Important Information - The company announced a 100% increase in its quarterly cash dividend program, with a payment of approximately $150 million made under the new program [24] - A $1 billion stock buyback program was launched, with an ASR agreement to repurchase $800 million of Class A Common Stock [24][25] Q&A Session Summary Question: Discussion on UFC media rights and international opportunities - Management emphasized the importance of execution and operational expansion, focusing on maximizing media rights opportunities internationally [37][39] Question: WWE live events revenue growth - Management noted that both premium live events and weekly events contributed to revenue growth, with high capacity and appropriate pricing strategies [40][41] Question: Distribution model with Paramount and pay-per-view model - Management clarified that while some markets still utilize pay-per-view, the focus is on expanding distribution through subscription models [46] Question: Incremental flow-through margin percentage and fighter pay structure - Management indicated that the new media rights deal would be margin accretive, with plans for increased fighter pay in line with historical margins [48][49] Question: Opportunities in boxing and potential for larger investments - Management expressed a strong appetite for boxing, focusing on super fights and the Zuffa Boxing league, while remaining cautious about distractions from core operations [52][56] Question: Site fees as a revenue driver - Management highlighted the potential for significant revenue from site fees, particularly with upcoming events in Saudi Arabia and ongoing discussions with various municipalities [64][66]

Financial Data and Key Metrics Changes - The company generated revenue of $1.12 billion in Q3 2025, with adjusted EBITDA of $360 million, reflecting a 59% increase year-over-year [13][14] - Adjusted EBITDA margin improved to 32%, up from 15% in the prior year period [14] - Reported revenue decreased by 27% year-over-year, primarily due to the impact of the 2024 Paris Olympics [14] Business Line Data and Key Metrics Changes - UFC segment revenue was $325 million, down 8%, with adjusted EBITDA of $166 million, a decrease of 15% [15][16] - WWE segment revenue increased by 23% to $402 million, with adjusted EBITDA rising 19% to $208 million [16][17] - IMG segment revenue decreased by 59% to $337 million, but adjusted EBITDA increased significantly to $61 million from a negative $55 million [20][21] Market Data and Key Metrics Changes - UFC's media rights production and content revenue decreased by 7% to $201 million, while WWE's media rights production and content revenue increased by 9% to $249 million [15][18] - Live events and hospitality revenue for UFC decreased by 15% to $44 million, while WWE's live events revenue surged by 61% to $83 million [16][17] Company Strategy and Development Direction - The company is focused on maximizing shareholder value, preparing for UFC's Paramount debut, and expanding WWE's presence on ESPN [11][12] - Significant media rights agreements have been secured, providing a high-margin, contractual revenue stream with annual escalators [12][30] - The company aims to achieve $450 million in high-margin partnership revenue by 2025 and targets $1 billion in total company partnership revenue by around 2030 [31] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the company's momentum and the strong demand for premium sports content [5][11] - The outlook for Q4 2025 is positive, with expectations of strong financial performance driven by increased events and new media rights agreements [26][29] - The company is preparing for a significant step-up in financials in 2026 due to new media rights deals and increased site fees [30][31] Other Important Information - The company announced a 100% increase in its quarterly cash dividend program, with the first payment of approximately $150 million made on September 30 [24] - A $1 billion stock buyback program was launched, with an ASR agreement to repurchase $800 million of Class A Common Stock [24][25] Q&A Session Summary Question: Why was Paramount chosen as the partner for LATAM and Australia? - Management highlighted the strong brand alignment and marketing plan offered by Paramount, which provided the best rights fee and overall value for the company [36][39] Question: What is the outlook for WWE live events revenue? - Management indicated that both premium live events and weekly events are contributing to revenue growth, with increased ticket prices and capacity [40][42] Question: What is the distribution model with Paramount? - The company plans to sell a significant amount of content to distributors, focusing on maximizing monetization opportunities internationally [45][46] Question: What are the expectations for fighter pay in the UFC? - Management confirmed that there will be an increase in fighter pay, aligning with the margins maintained over the years [49][50] Question: Are there plans for more boxing events beyond the current joint venture? - Management expressed a strong appetite for boxing, with plans for multiple super fights and leveraging Zuffa Boxing to enhance revenue opportunities [53][56] Question: How significant will site fees be in 2026? - Management indicated that site fees will be a major revenue driver, with ongoing discussions for multiple events globally [65][68]

Financial Data and Key Metrics Changes - TKO generated revenue of $1.12 billion in Q3 2025, with adjusted EBITDA of $360 million, resulting in an adjusted EBITDA margin of 32% [11][12] - Year-over-year revenue decreased by 27%, while adjusted EBITDA increased by 59%, and adjusted EBITDA margin improved from 15% in the prior year [12] - Free cash flow for the quarter was $399 million, with a conversion rate of 111% [22][23] Business Line Data and Key Metrics Changes - UFC segment revenue was $325 million, down 8%, with adjusted EBITDA of $166 million, a decrease of 15% [13][15] - WWE segment revenue increased by 23% to $402 million, with adjusted EBITDA rising by 19% to $208 million [15][16] - IMG segment revenue decreased by 59% to $337 million, but adjusted EBITDA improved significantly from negative $7 million to $61 million [18][19] Market Data and Key Metrics Changes - UFC's media rights production and content revenue decreased by 7% to $201 million, while WWE's media rights production and content revenue increased by 9% to $249 million [13][17] - WWE's live events revenue surged by 61% to $83 million, driven by higher ticket sales and site fees [16][17] - PBR's broadcast drew an average of 2.7 million viewers, the largest audience since joining CBS in 2012 [9] Company Strategy and Development Direction - TKO is focused on maximizing shareholder value through strong performance across all business segments and capitalizing on new growth opportunities [10][25] - The company aims to enhance its competitive position in boxing with the launch of Zuffa Boxing and significant media rights agreements [5][31] - TKO plans to leverage its media rights deals to secure high-margin revenue streams and expand its global partnerships [29][30] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the company's momentum, citing strong demand for premium sports content and experiences [4][10] - The company raised its full-year 2025 guidance for revenue and adjusted EBITDA for the third consecutive quarter, targeting revenue of $4.69 billion to $4.72 billion [25][26] - Management highlighted the importance of international market expansion and monetization opportunities as key growth drivers [36][37] Other Important Information - TKO announced a $1 billion stock buyback program and doubled its quarterly cash dividend [4][23] - The company ended the quarter with $3.759 billion in debt and $861 million in cash and cash equivalents [24] Q&A Session Summary Question: Why was Paramount chosen as the partner for LATAM and Australia? - Management emphasized the execution story and the importance of maximizing media rights opportunities, noting that Paramount offered the best overall deal [33][34][37] Question: What is the outlook for WWE live events revenue? - Management indicated that both premium live events and weekly events are contributing to revenue growth, with high capacity and appropriate pricing strategies [38][39] Question: How will the distribution model with Paramount affect international markets? - Management clarified that while some markets will retain pay-per-view models, the focus will be on maximizing reach through subscription-based offerings [40][41] Question: What are the plans for boxing beyond the Zuffa Boxing initiative? - Management expressed a strong appetite for super fights and emphasized the potential for high-margin revenue through promotional and management fees [45][46] Question: How significant will site fees be for revenue in 2026? - Management highlighted the strategic focus on securing site fees and the potential for significant revenue growth from upcoming events, particularly in Saudi Arabia [52][54]

Core Insights - The owner of Ultimate Fighting Championship (UFC) and World Wrestling Entertainment (WWE) experienced significant growth due to strong performance in both sectors, with sales increasing by 23% in the third quarter [1] Group 1: Company Performance - UFC and WWE sales rose by 23% in the third quarter, indicating robust demand and successful event management [1]

Core Insights - TKO Group experienced a decline in third quarter revenue but an increase in profits, influenced by IMG's Summer Olympic Games in Paris in 2024 [1][5] Revenue and Profit Performance - Revenue for the three months ended in September fell 27% to $1.12 billion, with IMG's revenue dropping 59% to $337 million [1][2] - UFC sales decreased by approximately $30 million (or 8%) to $325 million, attributed to one less numbered event compared to the previous year [2] - WWE revenue increased by $76 million to $402 million, with profit growing 19% to $207 million due to successful events [3] Profitability - TKO's consolidated net income surged to $107 million from $3.4 million, driven by lower operating expenses at IMG, which reported a profit of $61.4 million [2] Future Guidance - TKO raised its full-year revenue target to $4.72 billion and profit target to $1.58 billion [4] - TKO's executive chair and CEO expressed strong conviction in the company's future, citing secured multiyear media rights deals for UFC, WWE, and Zuffa Boxing [5]

Core Insights - Paramount+ has secured a five-year media rights agreement to become the primary streaming home for PBR's premier tour, Unleash The Beast, starting December 12, 2026 [1][2] - The agreement allows Paramount+ to stream live coverage of the entire PBR Unleash The Beast season, which spans five months and includes events in 19 cities across 17 states [2][4] - This partnership builds on a long-standing relationship between PBR and CBS Sports, which began in 2013 and will continue through 2030, with CBS still airing the CBS Game of the Week during the 2026 season [2][3] Company and Industry Highlights - PBR's CEO, Sean Gleason, expressed excitement about the deal, emphasizing its potential to expand PBR's audience [3] - CBS Sports reported its highest-rated PBR broadcast in October, reaching an average of 2.70 million viewers, indicating strong performance in broadcast [3] - The 2026 Unleash The Beast season will feature notable events, including PBR's debut at TD Garden in Boston and a return to Madison Square Garden for the 18th time [4] - Paramount+ will also become the exclusive U.S. home for all UFC events starting in 2026, further solidifying its position in the sports streaming market [5] - PBR is part of TKO Group Holdings, which is expanding its media agreements with Paramount, including exclusive streaming rights for Zuffa Boxing starting January 2026 [5][7]

Core Insights - The Zacks Film and Television Production and Distribution industry is experiencing increased demand for digital entertainment due to operational constraints in traditional venues like movie theaters and theme parks, benefiting companies such as TKO Group Holdings, Cinemark, and IMAX [1] - Rising content costs due to competition are pressuring profitability, forcing companies to invest heavily in original programming and exclusive rights [1] Industry Overview - The industry includes companies involved in the creation, distribution, and exhibition of film and television content, with a focus on producing entertainment for various platforms [2] - IMAX is noted for its advanced motion picture technologies and immersive experiences, while the financial performance of industry players is closely tied to global box office success and viewership ratings [2] Trends in the Industry - Over-the-top (OTT) services are gaining prominence as content creators distribute through these platforms to leverage franchise popularity, while streaming companies are producing original content to reduce licensing costs [3] - Binge-watching and advancements in technology are driving digital content consumption, prompting industry players to adapt their distribution strategies [4] - Technological advancements, such as laser projection systems and immersive audio, are enhancing the movie experience, although alternative distribution channels pose challenges to traditional exhibitors [5] Industry Performance - The Zacks Film and Television Production and Distribution industry ranks 209, placing it in the bottom 14% of over 246 Zacks industries, indicating a negative earnings outlook [6][8] - Despite this, the industry has outperformed the broader Zacks Consumer Discretionary sector and the S&P 500, returning 25.1% over the past year compared to 4.3% and 20.7% respectively [10] Current Valuation - The industry is currently trading at a trailing 12-month price-to-sales (P/S) ratio of 2.93X, lower than the S&P 500's 6.14X and the sector's 2.38X, with historical trading ranges between 1.35X and 3.2X [13] Notable Companies - IMAX reported record Q3 2025 revenue of $106.7 million, with a nearly 50% year-over-year increase in global box office to $368 million, and a 67% rise in net income to $22.6 million [16][17] - TKO Group Holdings completed a $3.25 billion acquisition, diversifying its revenue streams and raising its 2025 revenue guidance to $4.6-4.7 billion [21][22] - Cinemark is preparing for its Q3 2025 earnings report, with recent box office successes and a reinstated dividend of 32 cents annually, indicating a positive outlook for the theatrical recovery [26][27]

Company Overview - TKO Group Holdings, Inc. (NYSE:TKO) is a sports and entertainment company that owns and manages major sports intellectual property, produces live and digital content, and operates the UFC streaming service [2]. Investment Insights - Jim Cramer provided insights on TKO, indicating it is a stock that can be owned, describing it as a "very, very good company" [1]. - Cramer also mentioned that TKO is currently a momentum stock, expressing concern about potential downside momentum for the next two days, which may affect investment decisions [2]. Comparative Analysis - While TKO shows potential as an investment, there are suggestions that certain AI stocks may offer greater upside potential and carry less downside risk compared to TKO [2].