Liberty(FWONK) - 2025 Q3 - Quarterly Report

Financial Position - As of September 30, 2025, the Formula One Group had cash and cash equivalents of approximately $1,291 million, including $825 million of subsidiary cash[164] - The Liberty Live Group had cash and cash equivalents of approximately $297 million as of September 30, 2025[165] - As of September 30, 2025, Liberty's total cash and cash equivalents amounted to $1,291 million for the Formula One Group and $297 million for the Liberty Live Group[187][188] - As of September 30, 2025, substantially all cash and cash equivalents were invested in highly rated financial instruments, indicating a strong liquidity position[184] - The company does not have a debt rating, which may impact its borrowing capacity in the future[186] Acquisitions and Investments - The Company acquired approximately 84% of the equity interests in Dorna Sports, S.L. (MotoGP) on July 3, 2025, making it a consolidated subsidiary[157] - Liberty's primary cash use during the nine months ended September 30, 2025, was $3,267 million for the acquisition of MotoGP, funded by cash on hand and borrowings[189] - Liberty acquired approximately 84% of MotoGP's equity interests on July 3, 2025, consolidating its results from that date[211] - The acquisition accounting adjustments related to MotoGP are expected to have a continuing impact on Liberty's results of operations[211] Revenue and Earnings - Consolidated revenue increased by $174 million (19.1%) and $387 million (15.6%) for the three and nine months ended September 30, 2025, respectively, driven by increases in Formula 1 revenue and the acquisition of MotoGP[169] - Formula 1's primary revenue for the nine months ended September 30, 2025, increased by $129 million to $2,089 million compared to the prior year, driven by contractual fee increases and new sponsorships[195][196] - Other revenue for Formula 1 increased by $84 million during the nine months ended September 30, 2025, primarily due to higher hospitality revenue and growth in licensing income[200] - Total motorsport revenue for Formula 1 for the nine months ended September 30, 2025, was $2,498 million, compared to $2,285 million in the prior year[195] - MotoGP's primary revenue for the three months ended September 30, 2025, was $147 million, a $1 million increase from the prior year, while for the nine months, it was $365 million, up $41 million[214][215] - Total motorsport revenue for the three months ended September 30, 2025, was $169 million, unchanged from the prior year, and for the nine months, it was $417 million, an increase of $46 million[214] Operating Performance - Operating income increased by $42 million (39.3%) and $94 million (35.5%) for the three and nine months ended September 30, 2025, respectively, primarily due to improvements in Formula 1's operating results and the acquisition of MotoGP[170] - Adjusted OIBDA increased by $84 million (40.9%) and $152 million (26.6%) for the three and nine months ended September 30, 2025, respectively, primarily due to increases in Formula 1's Adjusted OIBDA and the acquisition of MotoGP[174] - Formula 1's operating income for the nine months ended September 30, 2025, was $433 million, up from $366 million in the prior year[195] - MotoGP's operating income for the three months ended September 30, 2025, was $28 million, down from $36 million in the prior year, while for the nine months, it was $41 million, down from $44 million[214] Expenses - Stock-based compensation expense was $18 million for the nine months ended September 30, 2025, down from $27 million in the same period of 2024[172] - Acquisition costs related to corporate acquisitions were $14 million for the three months ended September 30, 2025, compared to $3 million in the same period of 2024[173] - Interest expense increased by $24 million (38.7%) and $14 million (7.6%) for the three and nine months ended September 30, 2025, respectively, primarily due to an increase in the average amount of debt outstanding[177] - Selling, general and administrative expenses increased by $33 million during the nine months ended September 30, 2025, primarily due to higher marketing and personnel costs[207] - Selling, general and administrative expenses rose by $2 million to $19 million for the three months ended September 30, 2025, and by $13 million to $53 million for the nine months[222] Taxation - The effective income tax rate for the three months ended September 30, 2025, was 43%, significantly higher than the expected federal tax rate of 21%[182] Future Projections - MotoGP is projected to consist of 22 events in 2025, up from 20 events in 2024, indicating potential growth in revenue opportunities[210] - MotoGP's motorsport revenue decreased by 4.7% on a constant currency basis for the three months ended September 30, 2025, while it grew by 12.4% in U.S. dollars for the nine months[219] - MotoGP's reported revenue would be impacted by approximately $17 million for every 10% change in the Euro/U.S. dollar exchange rate[228]