Financial Analysis

Commitments and Contingencies Commitments As of June 30, 2026, commitments of the Company in the normal course of business were as follows: Commitments 2026 (Remainder) 2027 2028 2029 2030 Thereafter Total Sphere Event-related commitments $ 6,055 $ 15,000 $ $ $ $ $ 21,055 Letter of credit 918 918 Total Sphere Commitments $ 6,973 $ 15,000 $ $ $ $ $ 21,973 MSG Networks Broadcast rights $ 100,466 $ 208,334 $ 201,493 $ 113,008 $ 26,262 $ 13,131 $ 662,694 Purchase commitments 13,540 17,359 4,290 764 200 36,153 Total MSG Networks Commitments $ 114,006 $ 225,693 $ 205,783 $ 113,772 $ 26,462 $ 13,131 $ 698,847 Total Commitments $ 120,979 $ 240,693 $ 205,783 $ 113,772 $ 26,462 $ 13,131 $ 720,820 See Note 11. Leases to the Audited Consolidated Financial Statements included in the Form 10-K for more information regarding the Companys contractually obligated minimum lease payments for operating leases having an initial noncancelable term in excess of one year. See Note 10. Credit Facilities and Convertible Notes for details of the principal repayments required under the Companys various credit facilities. Legal Matters Fifteen complaints were filed in connection with the merger between a subsidiary of the Company and MSG Networks Inc. (the Networks Merger) by purported stockholders of the Company and MSG Networks Inc. Nine of these complaints involved allegations of materially incomplete and misleading information set forth in the joint proxy statement/prospectus filed by the Company and …

CommitmentsAndContingenciesDisclosureTextBlock · excerpt; the full note is in the filing

Credit Facilities and Convertible Notes The following table summarizes the presentation of the outstanding balances under the Companys credit agreements and convertible notes as of June 30, 2026 and December 31, 2025: As of June 30, 2026 December 31, 2025 Principal Unamortized Deferred Financing Costs Net Principal Unamortized Deferred Financing Costs Net Current portion MSG Networks term loan facility (a) $ 58,263 $ $ 58,263 $ 63,009 $ $ 63,009 Current portion of long-term debt, net $ 58,263 $ $ 58,263 $ 63,009 $ $ 63,009 _________________ (a) The June 30, 2026 carrying amount of the MSG Networks term loan facility is calculated pursuant to the troubled debt restructuring guidance as further discussed below in this Note 10. As of June 30, 2026 December 31, 2025 Principal Debt Discount Unamortized Deferred Financing Costs Net Principal Debt Discount Unamortized Deferred Financing Costs Net Non-current portion MSG Networks term loan facility (a) $ 195,990 $ $ $ 195,990 $ 240,695 $ $ $ 240,695 2026 LV Sphere Term Loan Facility 275,000 (3,577) 271,423 2022 LV Sphere Term Loan Facility 275,000 (2,151) 272,849 3.50% Convertible Senior Notes 258,750 (3,460) (561) 254,729 258,750 (4,168) (687) 253,895 Long-term debt, net $ 729,740 $ (3,460) $ (4,138) $ 722,142 $ 774,445 $ (4,168) $ (2,838) $ 767,439 _________________ (a) The June 30, 2026 carrying amount of the MSG Networks term loan facility is calculated pursuant to the troubled debt restructuring guidance, as further discussed be …

DebtDisclosureTextBlock · excerpt; the full note is in the filing

The following tables disaggregate the Companys consolidated revenues by segment and type of goods or services for the three and six months ended June 30, 2026 and 2025: Three Months Ended June 30, 2026 Sphere MSG Networks Total Ticketing and venue license fee revenues (a) $ 150,235 $ $ 150,235 Sponsorship, signage, Exosphere advertising, and suite license revenues (b) 34,760 34,760 Food, beverage, and merchandise revenues (c) 35,951 35,951 Media networks revenues (b) 87,286 87,286 Other 4,971 4,971 Total revenues from contracts with customers 225,917 87,286 313,203 Revenues from subleases 436 436 Total revenues $ 226,353 $ 87,286 $ 313,639 Three Months Ended June 30, 2025 Sphere MSG Networks Total Ticketing and venue license fee revenues (a) $ 117,810 $ $ 117,810 Sponsorship, signage, Exosphere advertising, and suite license revenues (b) 22,624 22,624 Food, beverage, and merchandise revenues (c) 27,884 27,884 Media networks revenues (b) 107,090 107,090 Other 6,830 6,830 Total revenues from contracts with customers 175,148 107,090 282,238 Revenues from subleases 439 439 Total revenues $ 175,587 $ 107,090 $ 282,677 Six Months Ended June 30, 2026 Sphere MSG Networks Total Ticketing and venue license fee revenues (a) $ 348,538 $ $ 348,538 Sponsorship, signage, Exosphere advertising, and suite license revenues (b) 61,826 61,826 Food, beverage, and merchandise revenues (c) 69,669 69,669 Media networks revenues (b) 207,733 207,733 Other 11,410 11,410 Total revenues from contracts wi …

DisaggregationOfRevenueTableTextBlock · excerpt; the full note is in the filing

Share-based Compensation The Company has three share-based compensation plans: the 2020 Employee Stock Plan, the 2020 Stock Plan for Non-Employee Directors and the MSG Networks Inc. 2010 Employee Stock Plan, in each case as amended from time to time. See Note 16. Share-based Compensation to the Audited Consolidated Financial Statements included in the Form 10-K for more detail on these plans. Share-based compensation expense for the Companys restricted stock units (RSUs), performance stock units (PSUs), stock options and/or cash-settled stock appreciation rights (SARs) are recorded in the condensed consolidated statements of operations as a component of direct operating expenses or selling, general and administrative expenses. The following table summarizes the Companys share-based compensation expense: Three Months Ended Six Months Ended June 30, June 30, 2026 2025 2026 2025 Share-based compensation (a) $ 29,000 $ 19,497 $ 52,735 $ 40,918 Fair value of awards vested $ 8,712 $ 8,848 $ 20,326 $ 11,460 _________________ (a) Share-based compensation excludes costs that have been capitalized of $191 and $546 for the six months ended June 30, 2026 and 2025, respectively. As of June 30, 2026, there was $77,221 of unrecognized compensation cost related to unvested RSUs, PSUs, stock options and SARs held by the Companys employees. The cost is expected to be recognized over a weighted-average period of approximately 1.84 years. For the three and six months ended June 30, 2026, all RSU …

DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock · excerpt; the full note is in the filing

Goodwill and Intangible Assets The carrying amounts of goodwill as of June 30, 2026 and December 31, 2025 were as follows: Sphere MSG Networks Consolidated Gross balance at December 31, 2025 $ 46,864 $ 424,508 $ 471,372 Accumulated impairment losses (126,600) (126,600) Net balance at December 31, 2025 $ 46,864 $ 297,908 $ 344,772 Changes during the period : Acquisitions Impairments Gross balance at June 30, 2026 $ 46,864 $ 424,508 $ 471,372 Accumulated impairment losses (126,600) (126,600) Net balance at June 30, 2026 $ 46,864 $ 297,908 $ 344,772 During the quarterly period ended September 30, 2025, the Company performed its annual impairment tests of goodwill. With respect to the Sphere segment, the Company performed a qualitative assessment and determined that, as of the annual impairment test date, there was no impairment of the Sphere segments goodwill. With respect to the MSG Networks segment, the Company could not support the conclusion that it is not more likely than not that the fair value of the reporting unit is greater than its carrying amount as of the annual impairment testing date and thus elected to perform a quantitative goodwill impairment test to identify potential impairment by comparing the fair value of the reporting unit with its carrying amount, including goodwill. In doing so, the Company estimated the fair value of the MSG Networks reporting unit based on a discounted cash flow model (income approach). This approach relied on numerous assumptions and …

GoodwillAndIntangibleAssetsDisclosureTextBlock · excerpt; the full note is in the filing

Recently Issued and Adopted Accounting Pronouncements Recently Issued Accounting Pronouncements In November 2024, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2024-03, Disaggregation of Income Statement Expenses , requiring additional disclosures about specified categories of expenses included in certain expense captions presented on the face of the income statement. This standard will be effective for the Company as of and for the annual period ending December 31, 2027, and may be applied either prospectively to financial statements issued for reporting periods after the effective date of this ASU or retrospectively to all prior periods presented in the financial statements. The Company continues to evaluate the impact of adopting this guidance on the Companys condensed consolidated financial statements and disclosures. In November 2024, the FASB issued ASU 2024-04, Induced Conversions of Convertible Debt Instruments , providing clarification on the requirements for determining whether certain settlements of convertible debt should be accounted for as induced conversions. This ASU will be effective for the Company as of and for the annual period ending December 31, 2026, and may be applied either prospectively to financial statements issued for reporting periods after the effective date of this ASU or retrospectively to all prior periods presented in the financial statements. The Company does not expect the adoption of this guidanc …

NewAccountingPronouncementsPolicyPolicyTextBlock · excerpt; the full note is in the filing

Pension Plans and Other Postretirement Benefit Plan The Company sponsors (i) both funded and unfunded and qualified and non-qualified pension plans, including the Networks 1212 Plan (as defined below), Networks Excess Cash Balance Plan, and the Networks Excess Retirement Plan (together, the Networks Plans), (ii) an excess savings plan and (iii) a postretirement benefit plan (the Postretirement Plan). In connection with the distribution of approximately 67% of the outstanding common stock of MSGE Spinco, Inc. (now known as Madison Square Garden Entertainment Corp. and referred to herein as MSG Entertainment) to the Companys stockholders on April 20, 2023 (the MSGE Distribution), the Company established an unfunded non-contributory, non-qualified frozen excess cash balance plan (the Sphere Excess Plan) covering certain employees who participated in the pre-MSGE Distribution cash balance plan, which was transferred to MSG Entertainment in connection with the MSGE Distribution. The Networks Plans and Sphere Excess Plan are collectively referred to as the Pension Plans. Prior to the MSGE Distribution, the Company sponsored two contributory welfare plans which provided certain postretirement healthcare benefits to certain employees hired prior to January 1, 2001. The sponsorship of the Postretirement Plan covering Networks employees was retained by the Company while the postretirement plan covering MSG Entertainment employees was transferred to MSG Entertainment in connection with …

PensionAndOtherPostretirementBenefitsDisclosureTextBlock · excerpt; the full note is in the filing

Related Party Transactions As of June 30, 2026, certain m embers of the Dolan family, including certain trusts for the benefit of members of the Dolan family (collectively, the Dolan Family Group), collectively beneficially owned 100% of the Companys outstanding Class B Common Stock, par value $0.01 per share (Class B Common Stock) and approximately 6.3% of the Companys outstanding Class A Common Stock (inclusive of options exercisable within 60 days after June 30, 2026 ) for purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended. Such shares of the Companys Class A Common Stock and Class B Common Stock, collectively, represent approximately 72.0% of the aggregate voting power of the Companys outstanding common stock. Members of the Dolan family are also the controlling stockholders of MSG Entertainment, Madison Square Garden Sports Corp. (MSG Sports) and AMC Global Media Inc. (formerly AMC Networks Inc., AMC Networks). See Note 19. Related Party Transactions, to the Audited Consolidated Financial Statements included in the Form 10-K for a description of the Companys related party arrangements. There were no material changes in such related party arrangements during the three and six months ended June 30, 2026. Accrued liabilities associated with other equity method investment nonconsolidated affiliates were $18,204 as of June 30, 2026 and December 31, 2025, and are reported under Accrued expenses and other current liabilities in the accompanying condens …

RelatedPartyTransactionsDisclosureTextBlock · excerpt; the full note is in the filing

Restructuring Charges During the three and six months ended June 30, 2026, the Company recognized restructuring charges of $323 and $3,737, respectively, primarily related to termination benefits provided as part of a voluntary exit program the Company implemented during the six month period. These charges were recorded in Accrued expenses and other current liabilities on the accompanying condensed consolidated balance sheets. During the three and six months ended June 30, 2025, the Company recognized restructuring charges of $947 and $2,788, respectively, related to termination benefits for certain executives and employees, which were recorded in Accrued expenses and other current liabilities on the accompanying condensed consolidated balance sheets. Changes to the Companys restructuring liability through June 30, 2026 were as follows: Restructuring Liability Balance as of December 31, 2025 $ 8,218 Restructuring charges 3,737 Payments (9,231) Balance as of June 30, 2026 $ 2,724 …

RestructuringAndRelatedActivitiesDisclosureTextBlock · excerpt; the full note is in the filing

Revenue Recognition Contracts with Customers See Note 2. Summary of Significant Accounting Policies and Note 5. Revenue Recognition, to the Audited Consolidated Financial Statements included in the Form 10-K, for more information regarding the details of the Companys revenue recognition policies. All revenue recorded in the condensed consolidated statements of operations is considered to be revenue from contracts with customers in accordance with ASC Topic 606, Revenue From Contracts with Customers , except for revenues from subleases that are accounted for in accordance with ASC Topic 842, Leases . Disaggregation of Revenue The following tables disaggregate the Companys consolidated revenues by segment and type of goods or services for the three and six months ended June 30, 2026 and 2025: Three Months Ended June 30, 2026 Sphere MSG Networks Total Ticketing and venue license fee revenues (a) $ 150,235 $ $ 150,235 Sponsorship, signage, Exosphere advertising, and suite license revenues (b) 34,760 34,760 Food, beverage, and merchandise revenues (c) 35,951 35,951 Media networks revenues (b) 87,286 87,286 Other 4,971 4,971 Total revenues from contracts with customers 225,917 87,286 313,203 Revenues from subleases 436 436 Total revenues $ 226,353 $ 87,286 $ 313,639 Three Months Ended June 30, 2025 Sphere MSG Networks Total Ticketing and venue license fee revenues (a) $ 117,810 $ $ 117,810 Sponsorship, signage, Exosphere advertising, and suite license revenues (b) 22,624 22,624 Foo …

RevenueFromContractWithCustomerTextBlock · excerpt; the full note is in the filing

Segment Information As of June 30, 2026, the Company was comprised of two reportable segments: Sphere and MSG Networks. The Company takes into account whether two or more operating segments can be aggregated together as one reportable segment as well as the type of discrete financial information that is available and regularly reviewed by its Chief Operating Decision Maker (CODM). The CODM is the Companys Executive Chairman and Chief Executive Officer. The CODM evaluates segment performance and determines how to allocate resources based on the Companys key financial measure of adjusted operating income (AOI), a non-GAAP financial measure. The Company defines AOI as operating income excluding: (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 Companys Executive Deferred Compensation Plan (which was established in November 2021). The Company believes that the exclusion of share-based compensation …

SegmentReportingDisclosureTextBlock · excerpt; the full note is in the filing

Accounting Policies Principles of Consolidation The condensed consolidated financial statements of the Company include the accounts of Sphere Entertainment Co. and its subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation. Use of Estimates The preparation of the accompanying condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions about future events. These estimates and the underlying assumptions affect the amounts of assets and liabilities reported, disclosures about contingent assets and liabilities, and reported amounts of revenues and expenses. Such estimates include the provision for credit losses, valuation of investments, goodwill, intangible assets, deferred production content costs, other long-lived assets, deferred tax assets, pension and other postretirement benefit obligations and the related net periodic benefit cost, ultimate revenue, and other liabilities. In addition, estimates are used in revenue recognition, rights fees expense, performance and share-based compensation, depreciation and amortization, litigation matters and other matters. Management believes its use of estimates in the condensed consolidated financial statements to be reasonable. Management evaluates its estimates on an ongoing basis using historical experience and other factors, including the general economic environment and actions it may take in the future. The Company adj …

SignificantAccountingPoliciesTextBlock · excerpt; the full note is in the filing

Stockholders Equity Preferred Stock The Company is authorized to issue 15,000 shares of preferred stock, par value $0.01. As of June 30, 2026 and December 31, 2025, no shares of preferred stock were outstanding. Stock Repurchase Program On March 31, 2020, the Companys Board of Directors authorized a share repurchase program to repurchase up to $350,000 of the Companys Class A Common Stock. The program was re-authorized by the Companys Board of Directors on March 29, 2023. Under the authorization, shares of Class A Common Stock may be purchased from time to time in open market or private transactions, block trades or such other manner as the Company may determine, in accordance with applicable insider trading and other securities laws and regulations. The timing and amount of purchases will depend on market conditions and other factors. During the six months ended June 30, 2026, the Company did not engage in any share repurchase activities under its share repurchase program. As of June 30, 2026, the Company had approximately $300,000 remaining available for repurchases of the Companys Class A Common Stock. Accumulated Other Comprehensive Loss The following tables detail the components of accumulated other comprehensive loss: Pension Plans and Postretirement Plan Cumulative Translation Adjustments Accumulated Other Comprehensive Loss Balance as of December 31, 2025 $ (6,854) $ 6,072 $ (782) Other comprehensive loss: Other comprehensive income (loss) before reclassifications (11 …

StockholdersEquityNoteDisclosureTextBlock · excerpt; the full note is in the filing