Financial Data and Key Metrics Changes - For Q1 2024, TKO generated revenue of $630 million, a significant increase from $298 million in Q1 2023, reflecting a 6% growth year-over-year [11][13] - The net loss for the quarter was $250 million, primarily due to a $335 million charge related to a legal settlement [11][10] - Adjusted EBITDA was $282 million with a margin of 45%, up from $117 million and a 39% margin in the previous year [11][13] - Free cash flow for the quarter was $28 million, with capital expenditures of $32 million [15] Business Line Data and Key Metrics Changes - The UFC segment generated revenue of $313 million, a 2% increase from the previous year, with adjusted EBITDA rising 5% to $195 million [29] - WWE's revenue was $317 million with an adjusted EBITDA of $140 million, maintaining a 44% margin [160] - Media rights and content revenue for TKO decreased by 4% to $215 million, attributed to one less numbered event [12] Market Data and Key Metrics Changes - WrestleMania 40 set a WWE gate record with 145,000 fans over two days, indicating strong market demand [5] - UFC 300 became one of the highest-grossing events in UFC history, showcasing the brand's market strength [5] - The company secured a short-term agreement with USA Network to extend RAW through Q4 2024, indicating ongoing media rights negotiations [8] Company Strategy and Development Direction - TKO is focused on integrating UFC and WWE operations to realize revenue and cost synergies [9] - The company aims to explore M&A opportunities selectively, particularly in premium sports content and live events [34][62] - TKO raised its full-year 2024 guidance for revenue and adjusted EBITDA, targeting revenue of $2.61 billion to $2.685 billion [17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong performance of both UFC and WWE, citing record attendance and revenue growth [22][138] - The company anticipates continued strength in live events and brand partnerships, particularly with the upcoming UFC events [6][35] - Management highlighted the importance of site fees and partnerships with local governments to maximize revenue opportunities [115][128] Other Important Information - The company settled all claims in UFC antitrust lawsuits, which is expected to have no adverse impact on existing business operations [10][152] - TKO ended the quarter with $2.752 billion in debt and $246 million in cash, indicating a focus on financial capacity and shareholder value [16] Q&A Session Summary Question: How does the NBA deal impact TKO's future? - Management noted that TKO is off to a solid start in 2024, with strong performance across both UFC and WWE, and emphasized the positive outlook for media rights renewals [21][22] Question: What is TKO's strategy regarding media rights? - Management stated they are open to discussions but are not looking to reduce commitments, focusing on maximizing value for UFC [51][53] Question: How does TKO view potential acquisitions? - Management expressed interest in exploring M&A opportunities selectively, particularly in premium sports content, while maintaining a disciplined approach [60][62] Question: What are the expectations for events in Saudi Arabia? - Management confirmed a strong relationship with the Kingdom and indicated plans for additional events, emphasizing the importance of site fees [64][66] Question: How does TKO plan to manage its capital structure? - Management highlighted the intention to generate significant free cash flow and consider various opportunities to enhance shareholder value, including share repurchases and dividends [16][42]

Revenue and Growth - Revenue for Q1 2024 reached $629.7 million, a significant increase from $306.7 million in Q1 2023, representing a growth of 105.5%[22] - Total revenue for the three months ended March 31, 2024, was $629.7 million, a significant increase from $306.7 million in the same period of 2023[59] - The UFC segment generated total revenue of $312.99 million, while the WWE segment contributed $316.72 million in the same period[59] - WWE contributed revenue of $316.7 million, driven by $221.1 million from media rights and content, $50.2 million from live events, and $31.6 million from consumer products licensing[170] - UFC revenue increased by $6.3 million, or 2%, driven by higher sponsorship revenue and live event revenue[170] Expenses and Losses - Total operating expenses for Q1 2024 were $840.1 million, compared to $160.7 million in Q1 2023, indicating an increase of 423.5%[22] - The net loss attributable to TKO Group Holdings, Inc. for Q1 2024 was $103.8 million, while there was no loss reported for the same period in 2023[22] - The company experienced a comprehensive loss attributable to TKO Group Holdings, Inc. of $105.6 million for Q1 2024[26] - For the three months ended March 31, 2024, TKO Group Holdings reported a net loss of $249.5 million, compared to a net income of $87.95 million for the same period in 2023[31] - Selling, general and administrative expenses increased by $475.6 million, or 845%, to $531.9 million for the three months ended March 31, 2024 compared to the same period in 2023[173] Cash and Liquidity - Cash and cash equivalents as of March 31, 2024, were $245.8 million, up from $235.8 million as of December 31, 2023[20] - The company reported net cash provided by operating activities of $59.3 million for the three months ended March 31, 2024, down from $69.7 million in the same period of 2023[205] - The Company expects its liquidity sources to be sufficient to meet working capital requirements and long-term debt service commitments for at least the next 12 months[208] - Cash used in investing activities increased significantly from $4.6 million in Q1 2023 to $36.2 million in Q1 2024, primarily for property and equipment[206] Assets and Liabilities - Total assets increased to $12.7 billion as of March 31, 2024, compared to $12.7 billion as of December 31, 2023[20] - Total liabilities rose to $4.1 billion as of March 31, 2024, compared to $3.8 billion as of December 31, 2023[20] - TKO Group Holdings' total stockholders' equity as of March 31, 2024, was $8.62 billion, down from $8.84 billion at the end of 2023[28] Capital Expenditures and Investments - The company incurred $31.48 million in capital expenditures during the three months ended March 31, 2024, compared to $4.58 million in the same period last year[31] - The fair value of the consideration transferred in the reverse acquisition of WWE was $8,432.1 million, including $8,061.8 million in TKO Class A common stock[54] Adjusted EBITDA and Operational Performance - Adjusted EBITDA for the three months ended March 31, 2024, was $282.16 million, up from $172.61 million in the same period of 2023, reflecting a 63.5% increase[138] - The company reported a total Adjusted EBITDA of $282.2 million for Q1 2024, compared to $172.6 million in Q1 2023, indicating a strong operational performance[190] Debt and Financing - Total debt as of March 31, 2024, is $2,730,682 thousand, slightly down from $2,736,315 thousand as of December 31, 2023[83] - The First Lien Term Loan has an outstanding balance of $2,721,016 thousand as of March 31, 2024, with an interest rate of 8.34%[84][86] - The Company amended the Credit Agreement in May 2024, extending the Revolving Credit Facility's maturity by twelve months to October 29, 2025[198] Legal and Compliance - The effective tax rate for the three months ended March 31, 2024, was 9.3%, compared to 3.9% for the same period in 2023, influenced by a legal settlement related to UFC antitrust lawsuits[115] - The company recorded a legal settlement charge of $335.0 million related to UFC antitrust lawsuits during the three months ended March 31, 2024[138] Segment Performance - The company operates two reportable segments: UFC and WWE, following the acquisition of WWE effective September 12, 2023[131] - UFC segment revenue reached $313.0 million, up from $306.7 million in Q1 2023, with an Adjusted EBITDA of $195.1 million, reflecting a margin of 62%[180] - WWE segment generated $316.7 million in revenue for Q1 2024, with an Adjusted EBITDA of $140.2 million and a margin of 44%[182]

Financial Data and Key Metrics Changes - TKO generated reported revenue of $1.675 billion for the full year 2023, with net income of $176 million and adjusted EBITDA of $809 million [39] - Combined revenue, including WWE activity, was $2.619 billion, an increase of 8% compared to $2.432 billion in the prior year [39] - Combined adjusted EBITDA was $1.092 billion for 2023, also an increase of 8%, with an adjusted EBITDA margin of 42% for both periods [39] Business Line Data and Key Metrics Changes - UFC segment revenue increased 13% to $1.292 billion, with adjusted EBITDA of $756 million, an increase of 11% [57] - Live events revenue for TKO increased 34% to $168 million, driven by five additional events with live audiences [40] - WWE segment combined revenue increased 3% to $1.326 billion, with combined adjusted EBITDA of $533 million, an increase of 4% [41] Market Data and Key Metrics Changes - Media rights and content revenue increased 10% to $871 million, primarily due to higher domestic and international rights fees [16] - Average viewership for UFC's pay-per-view prelims grew 35% over 2022, marking the highest ever average viewership on ESPN's networks [27] - WWE's Royal Rumble attracted over 48,000 fans, setting a venue record and the largest gate for any premium live event outside of WrestleMania [29] Company Strategy and Development Direction - TKO is focused on leveraging the combination of UFC and WWE to drive revenue growth and margin expansion, with significant potential in global partnerships [24][23] - The company has secured a transformative partnership with Netflix, worth approximately $5.2 billion over ten years, to bring WWE's flagship program to a global audience [22] - TKO aims to capitalize on the evolving media landscape and enhance fan engagement through strategic partnerships and content distribution [37] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the future, highlighting strong demand for premium content and live events, with expectations for continued growth in 2024 [54] - The company anticipates revenue of $2.575 billion to $2.650 billion and adjusted EBITDA of $1.15 billion to $1.17 billion for 2024, driven by growth in partnership sales and licensing agreements [42] - Management acknowledged the impact of the current economic environment on cash flow generation and net leverage, with a focus on maintaining a strong financial position [81] Other Important Information - TKO's corporate expenses were $196 million for the full year, reflecting general and administrative operations supporting both segments [62] - The company ended the year with $2.761 billion in debt and $236 million in cash, having repurchased 1.3 million shares for $100 million [65] - TKO expects to realize annualized net savings of $50 million to $100 million from identified run rate savings opportunities [56] Q&A Session Summary Question: What excites the company about the Netflix deal? - Management expressed excitement about the global reach and strategic benefits of the Netflix partnership, viewing it as a transformative deal for the company [70] Question: Clarification on Q4 revenue guidance? - Management confirmed that Q4 guidance excludes any income from Raw, which is estimated at approximately $75 million [73] Question: Impact of Netflix on international brand extension? - Management indicated that Netflix will have rights to all international territories as they become available, enhancing global brand presence [101] Question: Cost savings from having one partner for programming? - Management confirmed that sun-setting the WWE Network is part of the plan, which will yield cost savings when transitioning to a licensed model [141] Question: Thoughts on the sports rights landscape? - Management expressed confidence in the value of their premium content and the competitive landscape for sports rights, anticipating strong demand [118]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Delaware 92-3569035 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) WASHINGTON, D.C. 20549 ___________________________________________________________________ ___________________________________________________________________ FORM 10-K ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2023 or TRANSITION REPORT PURSUANT TO SECTION 13 O ...

Revenue and Income - Revenue for the three months ended September 30, 2023, was $449.058 million, a 32% increase from $340.699 million in the same period of 2022[22] - Net income for the three months ended September 30, 2023, was $22.020 million, down from $129.673 million in the same period of 2022, representing a decline of 83%[22] - The company reported a total revenue of $1.061 billion for the nine months ended September 30, 2023, compared to $868.376 million for the same period in 2022, marking a 22.2% increase[22] - Net income for the nine months ended September 30, 2023, was $191.824 million, a decrease of 40.2% compared to $320.540 million in the same period of 2022[37] - The company reported a comprehensive income of $66,377 thousand for the three months ended September 30, 2023[31] Operating Expenses - Operating income for the three months ended September 30, 2023, was $93.837 million, compared to $169.636 million in the same period of 2022, reflecting a decrease of 44.6%[22] - Total operating expenses for the three months ended September 30, 2023, were $355.221 million, an increase of 107.5% from $171.063 million in the same period of 2022[22] - Selling, general and administrative expenses for the three months ended September 30, 2023, were $193.211 million, compared to $56.497 million in the same period of 2022, reflecting a significant increase of 242%[22] - Interest expense for the three months ended September 30, 2023, was $(60.636) million, compared to $(35.319) million in the same period of 2022, an increase of 71.5%[22] Assets and Liabilities - Total assets increased to $12,736,453 thousand as of September 30, 2023, compared to $3,580,730 thousand as of December 31, 2022, reflecting a growth of 255%[29] - Total liabilities stood at $3,764,903 thousand, compared to $3,001,906 thousand, indicating an increase of 25%[29] - Stockholders' equity reached $8,960,439 thousand, a substantial rise from $568,916 thousand, reflecting a growth of 1,475%[29] - Total current liabilities increased to $399,454 thousand from $230,179 thousand, reflecting a growth of 73%[29] Cash Flow and Investments - Net cash provided by operating activities for the nine months ended September 30, 2023, was $247.655 million, down 34.2% from $376.781 million in the prior year[37] - The company reported a net cash increase of $8.018 million in cash and cash equivalents, compared to a decrease of $456.102 million in the same period last year[37] - Cash acquired from WWE during the investing activities amounted to $381.153 million, while the payment of deferred consideration to former WWE shareholders was $321.006 million[37] Acquisition and Goodwill - TKO completed the acquisition of WWE on September 12, 2023, with a fair value of consideration transferred amounting to $8,432.1 million[70] - The acquisition of WWE was recorded at a net value of $8.111 billion, reflecting the significant scale of the transaction[37] - Goodwill increased significantly to $7,644,053 thousand from $2,602,639 thousand, marking a growth of 194%[29] - The preliminary allocation of purchase price includes goodwill of $5,041,414 thousand, primarily attributable to expected synergies from the acquisition[79] Segment Performance - UFC segment revenue for the nine months ended September 30, 2023, reached $1,009,435 thousand, up 16% from $868,376 thousand in 2022[86] - WWE segment revenue for the three months ended September 30, 2023, was $51,538 thousand, with no revenue reported in the same period of 2022[86] - The UFC segment generated revenue of $397.5 million for the three months ended September 30, 2023, up 16.6% from $340.7 million in the prior year[193] Equity and Shares - The company issued 83,162,215 shares of Class A common stock and 89,616,891 shares of Class B common stock as of September 30, 2023[31] - The company authorized a total of 5,000,000,000 shares of Class A common stock and 5,000,000,000 shares of Class B common stock as part of its amended certificate of incorporation[141] Tax and Incentives - The provision for income taxes for the three months ended September 30, 2023, was $11.2 million based on pretax income of $32.5 million, resulting in an effective tax rate of 34.5%[167] - The company recorded content production incentives of $13.1 million related to qualifying content production activities during the three and nine months ended September 30, 2023[177] Future Outlook - The company anticipates continued growth in media rights and content, live events, sponsorship, and consumer products licensing as part of its strategic outlook[203]