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Item 7. Management’s Discussion and Analysis

2025-02-21 compared with 2024-02-22 · 142 added, 124 removed, 334 unchanged (44% of the section changed)

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Executive Overview

In 2023, we continued to see unprecedented demand for live experience in every corner of the world with emerging and superstar acts across all genres and in venues big and small in 2023.

After a record 2022, we surpassed last year’s results by double-digits for revenue, operating income, and AOI, not only at the consolidated level but also in each of our three major reporting segments.

Our operating income has increased by 228% and AOI has doubled compared to our pre-pandemic operations in 2019 – a testament to the strength of the live industry and our place in that robust ecosystem.

We saw double-digit growth in concert fans, Ticketmaster ticket sales, and sponsorship revenues globally.

Our overall revenue increased by $6.1 billion, or 36%, to $22.7 billion as compared to last year.

The increase was $6.0 billion without the impact of changes in foreign exchange rates.

Our operating income for the year improved by $334 million, or 46%, to $1.1 billion in 2023 due to stronger performance across all of our major reporting segments.

In 2024, we saw demand for the live experience growing across the globe with emerging to superstar acts performing to packed houses across all genres and in venues big and small.

After a record 2023 fueled by our highest volume of stadium shows ever, we surpassed last year’s revenue results.

While operating income declined double-digits as a result of the Astroworld legal contingency, we grew our AOI by double-digits and our underlying businesses thrived in 2024.

Our Concerts segment generated over $0.5 billion in AOI for the first time ever, growing by over 50%.

We added over 5 million fans and nearly 5,000 additional shows in Concerts, with new venues added to our global footprint and plans to open more in the year ahead.

Our overall revenue increased by $429 million, or 2%, to $23.2 billion as compared to last year.

The increase in revenue was $664 million without the impact of changes in foreign exchange rates.

Operating income for the year declined by $260 million or 24% primarily related to the Astroworld estimated loss contingencies of $455 million partially offset by stronger performance in our Concerts and Sponsorship segments.

The decrease in operating income was $208 million without the impact of changes in foreign exchange rates.

Consolidated AOI for the year increased by $265 million, or 14%, to $2.1 billion this year.

The increase was $412 million without the impact of changes in foreign exchange rates.

The increase in AOI was $320 million without the impact of changes in foreign exchange rates.

Our event-related deferred revenue balance increased by $336 million, or 11%, to $3.3 billion as of December 31, 2024 compared to December 31, 2023.

This, coupled with current ticket sales for 2025, suggests ongoing strong demand for concerts, making us confident in our continued success in the year ahead.

All of the segment financial comments to follow are based on reported foreign currency exchange rates.

Our Concerts segment revenue for the year increased by $5.3 billion, or 39% compared to 2022, from $13.5 billion to $18.8 billion.

For the year, we experienced unfavorable foreign currency translation impacts of $235 million on revenues, $52 million on operating income and $55 million on AOI.

The majority of the impacts came from Latin American currencies.

All of the segment financial comments below are based on reported foreign currency exchange rates.

Our Concerts segment revenue for the year increased by $283 million, or 2% compared to 2023, from $18.7 billion to $19.0 billion.

The growth in revenue was the result of more fans enjoying their favorite artists and spending more money at events to maximize their unique live experiences.

Approximately 145 million fans attended our shows in the year, our largest annual fan count ever, compared to approximately 121 million last year, for growth of 25 million or 20%.

The growth was relatively evenly distributed across our global markets with notable strength in Europe, Latin America, Asia-Pacific and Canada.

Growth in amphitheater, stadium and arena fan count drove the majority of the increase in show attendance.

In particular, stadium fan count increased by almost 11 million fans to over 29 million fans globally.

Some of the larger acts touring globally in the year included Beyoncé, Harry Styles, Karol G, The Weeknd and RBD, reflecting the global diversified base of our artists.

Concerts AOI for the year increased by $156 million, or nearly double, compared to 2022, from $170 million to $325 million.

Our ancillary revenue spending at our United States amphitheater shows was nearly $41 per fan for the year, a 10% growth over 2022, driven by higher food and beverage spending as well as increased upsells.

In our theaters and clubs across the United States and the United Kingdom, we also saw strong growth in APF revenue.

We also experienced double-digit growth with concessions, merchandise and upsells in our expanding owned or operated arena network, which includes the Moody Center arena.

Approximately 151 million fans attended our shows in the year, our largest annual fan count ever, compared to approximately 146 million last year, for growth of over 5 million or 4%.

The growth was relatively evenly distributed across our global markets with notable strength in the United States, Latin America and Asia-Pacific.

Growth in amphitheater, arena and theater & club fan count drove the increase in show attendance.

In particular, arena fan count increased by almost 8 million fans to over 50 million fans globally.

Some of the larger acts touring globally in the year included Coldplay, Pink, Metallica and Olivia Rodrigo, reflecting the global diversified base of our artists.

Concerts AOI for the year increased by $209 million, or 65%, compared to 2023, from $320 million to $530 million.

Our ancillary revenue spending at our United States amphitheater shows was over $44 per fan for the year, growing by nearly $1 over 2023, driven by higher food and beverage spending as well as merchandise and premium offerings.

After extensive renovations, our Jones Beach amphitheater re-opened on Long Island and produced double-digit growth on premium seating, concessions and VIP club revenues.

Similarly the Estadio GNP stadium (formerly known as Foro Sol) re-opened in Mexico City over the summer, offering fans an elevated concert-going experience with several new VIP lounges and additional points of sale for all fans.

Our Ticketing segment revenue for the year increased by $29 million, or 1%, compared to 2023, from $2.96 billion to $2.99 billion.

The improvement resulted from an increase in ticket sales, upward pricing momentum due to higher fan demand and higher non-service fee revenue.

We sold 329 million fee-bearing tickets in 2023 compared to 281 million tickets last year, an increase of 17%.

North America increased total fee-bearing GTV by 26% while International rose by 42% compared to last year.

Pricing on our fee-bearing tickets increased by double-digits, reflecting strong consumer demand, particularly for premium seats and VIP experiences.

Ticketing AOI for the year improved by $288 million, or 35%, compared to 2022, from $828 million to $1.1 billion.

We signed 21.4 million net new tickets in 2023.

16.9 million of the net new tickets, or roughly 80%, are from clients outside of North America, highlighting the significance of our international operations and our global expansion opportunity.

We sold 331 million fee-bearing tickets in 2024 compared to 329 million tickets last year, essentially flat for the year.

GTV for the year was $34.7 billion, down $1 billion, or 3% compared to 2023.

Despite some sales headwinds during the year and a tough 2023 comparison with respect to stadium activity, the year ended on an encouraging note with the fourth quarter coming in as our highest quarter ever for transacted ticket sales and GTV.

This resulted in a record fourth quarter for Ticketing across all of our key financial metrics – revenue, operating income and AOI.

Ticketing AOI for the year was $1.1 billion, roughly in line with our 2023 results.

We signed 22.8 million net new tickets in 2024, of which 14.3 million, or roughly 60%, are from clients outside of North America, highlighting the significance of our international operations and our global expansion opportunity.

This gives us confidence that our ticketing platforms’ features and functionalities will continue to fuel growth going forward.

Our Sponsorship & Advertising segment revenue for the year increased by $127 million, or 13%, compared to 2022 from $968 million to $1.1 billion.

The increase was largely driven by our United States business with new strategic deals, expanded deals across our ticket access and venue assets, and the addition of the Moody Center arena in Austin.

We also added new marketing partners in Mexico.

Our Sponsorship & Advertising segment revenue for the year increased by $100 million, or 9%, compared to 2023 from $1.1 billion to $1.2 billion.

The increase was largely driven by our international divisions with new naming rights and other deals for Estadio GNP in Mexico City, newly acquired festivals in Colombia, additional sponsorable content in Mexico and the timing of the Rock in Rio Brazil and Portugal festivals which play every two years.

Sponsorship & Advertising AOI increased by $89 million, or 13%, compared to 2023, from $675 million to $764 million.

We are optimistic about the long-term potential of our Company and are focused on the key elements of our business model:

expanding our concerts platform with more shows and fans in both existing and new markets as well as improving the on-site experience for our fans by enhancing food and beverage products and premium service offerings.

We will drive ticket sales through development of innovative products for fans, with a focus on reducing friction in the ticket purchase experience and creating additional revenue opportunities.

In addition, we continue to grow our sponsorship and advertising partnerships, enabling our clients to reach customers via the powerful connection that live shows create with ardent fans.

expanding our global platforms to connect artists and fans.

Consolidated Results of Operations

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2024 2023 2022

As Reported Currency Impacts Constant Currency** As Reported As Reported As Reported Constant Currency As Reported

As Reported Currency Impacts Constant Currency* As Revised As Revised As Reported Constant Currency* As Revised

(in thousands)

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Corporate expenses 367,629 330,817 237,834 11% 39%

Operating income (loss) 1,066,203 (29,569) 1,036,634 732,118 (417,858) 46% 42% *

Operating income 824,510 52,365 876,875 1,084,933 722,031 (24)% (19)% 50%

Operating margin 3.6% 3.7% 4.8% 4.3%

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Loss on extinguishment of debt

2,563 18,504 —

Interest income (156,254) (237,818) (77,620)

Equity in losses (earnings) of nonconsolidated affiliates 16,675 5,455 (10,571)

Loss (gain) from sale of investments in nonconsolidated affiliates 341 (448) (83,578)

Other expense, net 34,933 36,827 3,692

Income (loss) before income taxes 894,544 505,447 (611,267)

Other expense (income), net (103,874) 35,274 41,215

Income before income taxes 739,426 913,274 490,524

Income tax expense (benefit) (391,698) 209,476 115,941

Net income (loss) 734,317 409,193 (608,786)

Net income 1,131,124 703,798 374,583

Net income attributable to noncontrolling interests 234,837 146,905 108,143

Net income (loss) attributable to common stockholders of Live Nation $ 563,280 $ 295,986 $ (650,904)

* Percentages are not meaningful.

Net income attributable to common stockholders of Live Nation $ 896,287 $ 556,893 $ 266,440

* Constant currency is a non-GAAP financial measure.

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We present constant currency information to provide a framework for assessing how our underlying businesses performed excluding the effect of foreign currency rate fluctuations.

Revenue increased $6.1 billion during the year ended December 31, 2023 as compared to the prior year driven by increased revenue in our Concerts segment of $5.3 billion, Ticketing segment of $720.9 million and Sponsorship & Advertising segment of $127.1 million as further discussed within each segment’s operating results.

Revenue increased $429.3 million during the year ended December 31, 2024 as compared to the prior year driven by increased revenue in our Concerts segment of $283.4 million, Ticketing segment of $29.2 million and Sponsorship & Advertising segment of $99.8 million as further discussed within each segment’s operating results.

Operating income

Operating income increased $334.1 million during the year ended December 31, 2023 as compared to the prior year primarily driven by increased operating income in our Concerts segment of $94.6 million, Ticketing segment of $283.9 million and Sponsorship & Advertising segment of $66.0 million as further discussed within each segment’s operating results.

These increases were partially offset by higher Corporate expenses primarily due to higher compensation expense in 2023 due to headcount growth as a result of increased operating opportunities in 2023.

Operating income decreased $260.4 million during the year ended December 31, 2024 as compared to the prior year primarily driven by decreased operating income in our Concerts segment of $313.2 million, which included Astroworld estimated loss contingencies of $454.9 million, and Ticketing segment of $20.7 million.

These decreases in operating income were partially offset by increased operating income in our Sponsorship & Advertising segment of $99.2 million as further discussed within each segment’s operating results.

Interest expense

Interest expense increased $71.8 million during the year ended December 31, 2023 as compared to the prior year primarily driven by the issuance of $1.0 billion principal amount of our 3.125% convertible senior notes due 2029 in January 2023.

Interest expense decreased $24.3 million during the year ended December 31, 2024 as compared to the prior year primarily driven by lower debt balance throughout 2024 as compared to 2023.

Interest income

Interest income increased $160.2 million during the year ended December 31, 2023 as compared to the prior year primarily attributed to higher rate of return on our cash and cash equivalents in 2023 and an increase in our cash and cash equivalents.

For the year ended December 31, 2023, we had a net tax expense of $160.2 million on income before income taxes of $894.5 million compared to a net tax expense of $96.3 million on income before income taxes of $505.4 million for 2022.

In 2023, the net income tax expense consisted of $7.2 million of tax expense related to United States federal income taxes, $128.6 million of tax expense related to foreign entities and $24.4 million of tax expense related to state and local income taxes.

The net increase in tax expense of $64.0 million is due primarily to higher pre-tax income in taxable jurisdictions.

Interest income decreased $81.6 million during the year ended December 31, 2024 as compared to the prior year primarily attributed to lower rate of return on our cash and cash equivalents in 2024 and a decrease in our cash and cash equivalents.

Other expense (income), net

For the year ended December 31, 2024, we had $103.9 million of other income, net, which primarily includes mark to market adjustments for certain investments in nonconsolidated affiliates of $99.2 million.

For the year ended December 31, 2023, we had $35.3 million of other expense, net, which includes net foreign exchange rate losses of $74.5 million partially offset by mark to market adjustments for certain investments in nonconsolidated affiliates of $46.5 million.

The net foreign exchange rate gains and losses result primarily from revaluation of certain foreign currency denominated net assets held internationally.

For the year ended December 31, 2024, we had a net tax benefit of $391.7 million on income before income taxes of $739.4 million compared to a net tax expense of $209.5 million on income before income taxes of $913.3 million for 2023.

In 2024, the net income tax benefit consisted of $518.3 million of tax benefit related to United States federal income taxes, $127.0 million of tax expense related to foreign entities and $0.4 million of tax benefit related to state and local income taxes.

The net decrease in tax expense of $601.2 million is related to a valuation allowance release, due to changes in judgment regarding the realizability of certain deferred tax assets.

Net income attributable to noncontrolling interests

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Non-GAAP Measures

AOI is a non-GAAP financial measure that we define as consolidated operating income (loss) before certain acquisition expenses (including transaction costs, changes in the fair value of accrued acquisition-related contingent consideration obligations, and acquisition-related severance and compensation), amortization of non-recoupable ticketing contract advances, depreciation and amortization (including goodwill impairment), loss (gain) on disposal of operating assets, and stock-based compensation expense.

Consolidated AOI

Consolidated AOI is a non-GAAP financial measure that we define as consolidated operating income (loss) before certain acquisition expenses (including ongoing legal costs stemming from the Ticketmaster merger, changes in the fair value of accrued acquisition-related contingent consideration obligations, and acquisition-related severance and compensation), amortization of non-recoupable ticketing contract advances, depreciation and amortization (including goodwill impairment), loss (gain) on disposal of operating assets, and stock-based compensation expense.

We also exclude from AOI the impact of estimated or realized liabilities for settlements or damages arising out of the Astroworld matter that exceed our estimated insurance recovery, due to the significant and non-recurring nature of the matter.

Ongoing legal costs associated with defense of these claims, such as attorney fees, are not excluded from AOI.

We use AOI to evaluate the performance of our operating segments.

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thus, AOI as presented herein may not be comparable to similarly titled measures of other companies.

AOI margin is a non-GAAP financial measure that we calculate by dividing AOI by revenue.

We use AOI margin to evaluate the performance of our operating segments.

We believe that information about AOI margin assists investors by allowing them to evaluate changes in the operating results of our portfolio of businesses separate from non-operational factors that affect net income (loss), thus providing insights into both operations and the other factors that affect reported results.

AOI margin is not calculated or presented in accordance with GAAP.

A limitation of the use of AOI margin as a performance measure is that it does not reflect the periodic costs of certain amortizing assets used in generating revenue in our business.

Accordingly, AOI margin should be considered in addition to, and not as a substitute for, operating income (loss) margin, and other measures of financial performance reported in accordance with GAAP.

Furthermore, this measure may vary among other companies;

thus, AOI margin as presented herein may not be comparable to similarly titled measures of other companies.

The following table sets forth the reconciliation of consolidated operating income (loss) to consolidated AOI for the years ended December 31, 2023, 2022 and 2021:

The following table sets forth the reconciliation of consolidated operating income to consolidated AOI for the years ended December 31, 2024, 2023 and 2022:

2024 2023 2022

As Revised As Revised

(in thousands)

Operating income (loss) $ 1,066,203 $ 732,118 $ (417,858)

Operating income (1)

$ 824,510 $ 1,084,933 $ 722,031

Acquisition expenses 128,513 93,664 68,078

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Gain on sale of operating assets (11,015) (13,927) (32,082)

Astroworld estimated loss contingencies 454,902 — —

Stock-based compensation expense 110,348 115,959 110,049

AOI $ 1,862,389 $ 1,407,182 $ 323,863

Consolidated AOI (1)

$ 2,145,898 $ 1,881,119 $ 1,397,095

___________________

For the years ended December 31, 2023 and December 31, 2022, the revision increased our operating income and consolidated AOI by $18.7 million for 2023 and decreased our operating income and consolidated AOI by $10.1 million for 2022, respectively.

See further discussion in Part II — Financial Information—Item 8.—Financial Statements and Supplementary Data—Note 2 – Correction of Errors in Previously Reported Consolidated Financial Statements.

Segment Overview

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Concerts direct operating expenses include artist fees, event production costs, show-related marketing and advertising expenses, along with other costs.

To judge the health of our Concerts segment, we primarily monitor the number of confirmed events and fan attendance in our network of owned or operated and third-party venues, talent fees, average paid attendance, market ticket pricing, advance ticket sales and the number of major artist clients under management.

In addition, at our owned or operated venues and festivals, we monitor APF and premium ticket sales.

To judge the health of our Concerts segment, we primarily monitor the number of confirmed events and fan attendance in our network of operated and third-party venues, talent fees, average paid attendance, market ticket pricing, advance ticket sales and the number of major artist clients under management.

In addition, at our operated venues and festivals, we monitor ancillary revenue per fan and premium ticket sales.

For business that is conducted in foreign markets, we also compare the operating results from our foreign operations to prior periods without the impact of changes in foreign exchange rates.

Revenue related to ticketing service charges is recognized when the ticket is sold for our third-party clients.

For our own events, where our concert promoters control ticketing, revenue is deferred and recognized when the event occurs.

For our own events, where our concert promoters or venues control ticketing, revenue is deferred and recognized when the event occurs.

GTV represents the total amount of the transaction related to a ticket sale and includes the face value of the ticket as well as the service charge.

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North America (2)

36,673 33,629 29,170

International 18,014 16,430 14,475

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North America (2)

86,563 81,252 69,693

International 64,486 64,538 51,459

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Events and fan attendance metrics are estimated each quarter.

(2) North America refers to our events and fans within the United States and Canada.

(3) The fee-bearing tickets estimated above include primary and secondary tickets that are sold using our Ticketmaster systems or that we issue through affiliates.

This metric includes primary tickets sold during the year regardless of event timing, except for our own events where our concert promoters control ticketing which are reported when the events occur.

This metric includes primary tickets sold during the year regardless of event timing, except for our own events where our concert promoters or venues control ticketing which are reported when the events occur.

The non-fee-bearing tickets estimated above include primary tickets sold using our Ticketmaster systems, through season seat packages and our venue clients’ box offices, along with tickets sold on our “do it yourself” platform.

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2024 2023 2022

As Revised As Revised As Revised

(in thousands)

Revenue $ 18,763,669 $ 13,494,100 $ 4,722,190 39% *

$ 19,024,302 $ 18,740,913 $ 13,494,100 2% 39%

Direct operating expenses (2)

16,041,350 16,001,769 11,334,178 0.2% 41%

Selling, general and administrative expenses 3,005,885 2,497,983 2,083,637 20% 20%

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Operating loss (3)

$ (381,947) $ (68,715) $ (153,143) * 55%

Operating margin (2.0)% (0.4)% (1.1)%

AOI $ 325,497 $ 169,740 $ (221,338) 92% *

$ 529,748 $ 320,397 $ 174,840 65% 83%

AOI margin 2.8% 1.7% 1.3%

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* Percentages are not meaningful.

** See “—Non-GAAP Measures” above for the definition of AOI margin.

Concerts revenue increased $5.3 billion during the year ended December 31, 2023 as compared to the prior year primarily due to increased fan growth which was evenly distributed across our global markets with notable strength in Europe, Latin America, Asia-Pacific and Canada.

In addition, Concerts had incremental revenue of $578.5 million during the year ended December 31, 2023 from acquisitions and new venues.

For the year ended December 31, 2023, the revision decreased revenue by $22.8 million.

For the years ended December 31, 2023 and December 31, 2022, the revision decreased direct operating expenses by $17.7 million and $5.1 million, respectively.

For the years ended December 31, 2023 and December 31, 2022, the revision decreased operating income and AOI by $5.1 million as well as increased operating income and AOI by $5.1 million, respectively.

Concerts revenue increased $283.4 million during the year ended December 31, 2024 as compared to the prior year attributable to acquisitions and new venues of $335.1 million as well as increased show count and fan growth.

In particular, higher arena and amphitheater shows and related fan count partially offset by fewer stadium shows contributed to the increase in revenue.

Operating results

Concerts AOI increased $155.8 million and operating loss improved $94.6 million for the year ended December 31, 2023 as compared to the prior year primarily driven by an increase in revenue discussed above as well as incremental revenue from acquisitions and new venues of $23.2 million.

These increases were partially offset by increased direct operating expenses to support increased fan growth at events and increased selling general and administrative expenses primarily related to increased headcount and compensation expenses.

The remaining change in operating income outside of AOI of $61.1 million is primarily attributable to higher depreciation and amortization expenses of $60.4 million for additional capital expenditures incurred to support the increased operations as well as from acquisitions and new venues.

Concerts AOI increased $209.4 million during the year ended December 31, 2024 as compared to the prior year primarily driven by an increase in revenues from the number of shows discussed above partially offset by increased selling general and administrative expenses related to additional compensation expenses fueled by growth from our venue footprint and additional global activity.

The remaining change in operating income outside of AOI of $522.6 million is primarily associated with Astroworld estimated loss contingencies of $454.9 million and higher depreciation and amortization expenses of $49.4 million for additional capital expenditures incurred to support the increased operations as well as from acquisitions and new venues.

Our Ticketing segment operating results were, and discussions of significant variances are, as follows:

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2024 2023 2022

As Revised As Revised As Revised

(in thousands)

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Direct operating expenses (1)

1,089,608 1,067,937 809,173 2% 32%

Selling, general and administrative expenses 888,198 855,070 711,574 4% 20%

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Operating income (2)

$ 910,509 $ 931,175 $ 608,290 (2)% 53%

Operating margin 30.5% 31.5% 27.2%

AOI $ 1,116,303 $ 827,901 $ 420,545 35% 97%

$ 1,123,588 $ 1,140,133 $ 812,714 (1)% 40%

AOI margin 37.6% 38.5% 36.3%

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* Percentages are not meaningful.

** See “—Non-GAAP Measures” above for the definition of AOI margin.

For the years ended December 31, 2023 and December 31, 2022, the revision decreased direct operating expenses by $23.8 million and increased direct operating expenses by $15.2 million, respectively.

For the years ended December 31, 2023 and December 31, 2022, the revision increased operating income and AOI by $23.8 million as well as decreased operating income and AOI by $15.2 million, respectively.

Ticketing revenue increased $29.2 million during the year ended December 31, 2024 as compared to the prior year.

This increase is primarily due to higher primary and secondary sales volumes driven by more events on sale and upward pricing momentum due to more fan demand and artist mix in 2023 as compared to 2022.

Ticket sales and gross transaction value for concerts, sporting and family & arts events were largely in line with 2023.

For concert events, higher sales for arena and amphitheater shows were mostly offset by a reduction in stadium shows, coming off a record year of stadium activity in 2023.

Operating results

Ticketing AOI increased $288.4 million and operating income increased $283.9 million during the year ended December 31, 2023 as compared to the prior year primarily driven by increased ticketing activity discussed above.

These increases were partially offset by higher direct operating expenses to support the increased operations and enterprise growth as well as higher selling, general and administrative expenses attributable to increased compensation expenses from increased headcount as compared to the prior year.

Ticketing AOI decreased $16.5 million and operating income decreased $20.7 million during the year ended December 31, 2024 as compared to the prior year primarily driven by higher selling, general and administrative expenses attributable to improving the user experience and reducing friction during high demand on-sales.

Sponsorship & Advertising

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Depreciation and amortization 62,934 72,969 60,318 (14)% 21%

Loss on sale of operating assets 38 — — * *

Operating income $ 691,946 $ 592,793 $ 526,799 17% 13%

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* Percentages are not meaningful.

** See “—Non-GAAP Measures” above for the definition of AOI margin.

Sponsorship & Advertising revenue increased $127.1 million during the year ended December 31, 2023 as compared to the prior year due to expanded deals across our ticket access and venue assets, the addition of the Moody Center arena in Austin and new partnerships in Mexico.

Sponsorship & Advertising had incremental revenue of $36.0 million during the year ended December 31, 2023 from acquisitions of new venues.

Sponsorship & Advertising revenue increased $99.8 million during the year ended December 31, 2024 as compared to the prior year primarily driven by increased sponsorship activity from our international markets and onsite sponsorships.

Operating results

Sponsorship & Advertising AOI increased $88.6 million and operating income increased $99.2 million during the year ended December 31, 2024 as compared to the prior year.

These increases were primarily due to higher sponsorship revenue discussed above.

These increases were partially offset by increases in direct operating expenses, including higher artist activation costs, and selling, general and administrative expenses primarily related to increased headcount and compensation expenses.

The remaining change in operating income outside of AOI of $17.2 million was primarily due to an increase in depreciation and amortization related to assets utilized to support higher activity levels as compared to the prior year.

These increases were primarily due to increased revenues from sponsorship activity discussed above.

Liquidity and Capital Resources

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If the original maturity of these borrowings is 90 days or less, we present the borrowings and subsequent repayments on a net basis in the statement of cash flows to better represent our financing activities.

Our balance sheet reflects total net debt of $6.6 billion and $5.9 billion at December 31, 2023 and 2022, respectively.

Our weighted-average cost of debt, excluding unamortized debt discounts and debt issuance costs on our term loans and notes, was 4.7% at December 31, 2023 with approximately 87% of our debt at a fixed rate.

Our balance sheet reflects total net debt of $6.4 billion and $6.6 billion, respectively, at December 31, 2024 and December 31, 2023.

Our weighted-average cost of debt, excluding unamortized debt discounts and debt issuance costs on our term loans and notes, was 4.4% at December 31, 2024, with approximately 93% of our debt at fixed rates.

Our weighted-average cost of debt for short-term borrowings outstanding at December 31, 2024, excluding unamortized debt discounts and debt issuance costs on our term loans and notes, was 5.0%.

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Sources of Cash

In November 2023, we amended our senior secured credit facility and now have a $1.3 billion revolving credit facility in addition to the existing $950 million term loan B facility.

The new $1.3 billion revolving credit facility refinanced our existing $630 million revolving credit facilities and we drew down $370 million at closing to repay in full our outstanding $367.5 million delayed draw term A loan facility and related accrued interest and fees.

In December 2024, we issued $1.1 billion principal amount of 2.875% convertible senior notes due 2030.

In conjunction with this issuance, we used the net proceeds to repay $585.0 million outstanding amounts under our senior secured revolving credit facility, to repurchase $316.0 million aggregate principal amount of the 2.0% convertible senior notes due 2025 and related repurchase premiums, fees and accrued interest of $98.0 million, paid debt issuance costs of $18.1 million, with any remaining proceeds available for general corporate purposes.

In November 2024, we amended our senior secured credit facility and added a new venue expansion revolving credit facility of $400.0 million, which resulted in a total available revolving borrowing capacity of $1.7 billion.

During the three months ended March 31, 2024, we repaid $370.0 million outstanding amounts under our senior secured revolving credit facility that had been outstanding as of December 31, 2023.

No material gain or loss was recorded as a result of this repayment.

In November 2023, we amended our senior secured credit facility to include a $1.3 billion revolving credit facility in addition to the existing $950.0 million term loan B facility.

The $1.3 billion revolving credit facility refinanced our existing $630.0 million revolving credit facilities and we drew down $370.0 million at closing to repay in full our outstanding $367.5 million delayed draw term A loan facility and related accrued interest and fees.

The delayed draw term A loan facility was permanently retired upon being repaid in full.

On February 9, 2024, we repaid $250 million of principal related to our revolving credit facility.

In February 2023, we amended our senior secured credit facility.

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In conjunction with this issuance, we used approximately $485.8 million of the net proceeds to repurchase $440.0 million aggregate principal amount of the 2.5% convertible senior notes due 2023, entered into capped call transactions at a cost of $75.5 million, paid debt issuance costs of $15.0 million, with any remaining proceeds available for general corporate purposes.

In December 2022, we entered into a $126.7 million Euro denominated note due in 2024 with a floating interest rate of three month Euribor plus 3.0% per annum related to an asset acquisition in Europe.

In September 2021, we elected to draw down the $400 million term loan A under the amended senior secured credit facility prior to expiration of the drawdown period on October 17, 2021.

We also completed the public offering of 5,239,259 shares of common stock.

A portion of the gross proceeds of $455.3 million were used to pay fees of $5.7 million, leaving $449.6 million of net proceeds.

We used the net proceeds to fund the acquisition of 51% of the capital stock of OCESA and any remaining proceeds for general corporate purposes.

In January 2021, we issued $500 million principal amount of 3.75% senior secured notes due 2028.

The proceeds were used to pay fees of $7.7 million and repay $75.0 million aggregate principal amount of our senior secured term loan B facility, leaving approximately $417.3 million for general corporate purposes, including acquisitions and organic investment opportunities.

In December 2022, we entered into a $126.7 million Euro denominated loan due in 2024 with a floating interest rate of three month Euribor plus 3.0% per annum related to an asset acquisition in Europe.

In December 2024, we extended the maturity of the Euro denominated loan to December 2025.

Debt Instruments

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Information regarding our debt covenants can be found in Part II —Financial Information —Item 8.—Financial Statements and Supplementary Data—Note 5 – Long-Term Debt.

When we make acquisitions, the acquired entity may have cash on its balance sheet at the time of acquisition.

All amounts related to the use of cash for acquisitions discussed in this section are presented net of any cash acquired.

During 2023, we completed various acquisitions for total consideration, net of cash acquired, of $17.5 million, including business acquisitions accounted for as asset acquisitions.

This includes acquisitions of businesses for which we assumed debt of $278.9 million.

Information regarding our acquisitions can be found in Part II —Financial Information —Item 8.—Financial Statements and Supplementary Data—Note 2 – Acquisitions.

Subsequent Event

On February 18, 2025, we utilized $84.8 million of our existing cash balance to repay the remaining aggregate principal amount of the 2.0% convertible senior notes due February 2025 plus accrued interest and we issued 182,560 shares of common stock to the convertible holders.

During 2024, we completed various acquisitions that resulted in cash paid, net of cash acquired, of $98.3 million.

Capital Expenditures

Venue and ticketing operations require ongoing investment in our existing venues and ticketing systems to address fan and artist expectations, technological industry advances and various federal, state and/or local regulations.

We categorize capital outlays between maintenance capital expenditures and revenue generating capital expenditures.

Revenue generating capital expenditures generally relate to the construction of new venues to expand our global footprint, major renovations to existing buildings or buildings that are being added to our venue network, the development of new ticketing tools and technology enhancements.

We categorize capital outlays between revenue generating capital expenditures and maintenance capital expenditures.

Revenue generating capital expenditures are primarily focused on our global venue expansion strategy as we connect more artists to their global fan base and major renovations to buildings to enhance the fan experience and drive improvements in our hospitality efforts including onsite spending and premium experiences.

In addition, in Ticketing, we continue to develop new ticketing tools and technology enhancements.

Revenue generating capital expenditures can also include smaller projects whose purpose is to increase revenue and/or improve operating income.

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Capital expenditures typically increase during periods when our venues are not in operation since that is the time that such improvements can be completed.

Our capital expenditures, including accruals for amounts incurred but not yet paid for but net of expenditures funded by outside parties such as landlords and noncontrolling interest partners or replacements funded by insurance proceeds, consisted of the following:

Our capital expenditures, including accruals for amounts incurred but not yet paid for, but net of expenditures funded by outside parties such as landlords and noncontrolling interest partners or expenditures funded by insurance proceeds, consisted of the following:

Year Ended December 31,

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Total capital expenditures $ 632,631 $ 453,751 $ 364,560

Revenue generating capital expenditures for 2023 increased from the same period of the prior year primarily due to enhancements at our amphitheaters and theaters in North America.

For the years ended December 31, 2024, 2023 and 2022, $5.0 million, $15.0 million and $12.4 million, respectively, of insurance proceeds and landlord or noncontrolling interest partner reimbursements have been excluded from capital expenditures in the table above.

We expect capital expenditures to be approximately $540 million for the year ending December 31, 2024 with approximately two-thirds of the capital expenditure on revenue generating projects and approximately one-third of the capital expenditure on four venues.

Revenue generating capital expenditures for 2024 increased from the same period of the prior year primarily due to enhancements at our theaters and amphitheaters in the United States as well as a stadium in Mexico.

We expect capital expenditures to be approximately $900 million to $1.0 billion for the year ending December 31, 2025 with approximately 85% dedicated to revenue generating projects, including $700 million to $800 million of spend relating to our venue expansion and enhancement plans.

Some of the more significant projects in 2025 include an extensive renovation of an arena in Hamilton, Ontario in Canada and the new Riverside Amphitheater outside of Kansas City, Missouri which will open in 2026.

In the third quarter of 2025, our new stadium in Bogota, Colombia will open, with capacity for 40,000 fans, further strengthening our presence in Latin America.

Approximately $250 million of our capital expenditure estimate is being funded outside our cash flow by third party equity partners, sponsors, pre-selling certain premium rights and project-based debt.

Year Ended December 31,

2024 2023 2022

As Revised As Revised

(in thousands)

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Operating Activities

Cash provided by operating activities decreased $461.3 million for the year ended December 31, 2023 as compared to the prior year primarily due to changes in operating assets and liabilities partially offset by an increase in 2023 operating results as discussed within each segment’s operating results.

Cash provided by operating activities increased $362.2 million for the year ended December 31, 2024 as compared to the prior year primarily due to an overall increase in net income combined with changes in operating assets and liabilities partially offset by higher deferred income taxes, lower provision for uncollectible accounts receivable, changes in fair value of contingent considerations from certain acquisitions and higher gains on mark-to-market of investments in nonconsolidated affiliates during 2024.

Investing Activities

Cash used in investing activities decreased $88.9 million for the year ended December 31, 2023 as compared to the prior year primarily due to lower cash paid for acquisitions, net of cash acquired of $239.7 million.

This was partially offset by an increase of $91.4 million in purchases of property, plant and equipment in 2023 for revenue generating and maintenance capital expenditures.

Cash used in investing activities increased $158.5 million for the year ended December 31, 2024 as compared to the prior year primarily due to higher purchases of property, plant and equipment in 2024 for revenue generating capital expenditures and cash paid for acquisitions, net of cash acquired, which were partially offset by lower advances in notes receivable and higher collections of notes receivable due to timing.

See “—Uses of Cash” above for further discussion.

Financing Activities

Cash used in financing activities decreased $56.1 million for the year ended December 31, 2023 as compared to the prior year primarily due to proceeds in 2023 from the issuance of our 3.125% convertible senior notes and draw down from our revolving credit facility partially offset by the repurchase of our 2.5% convertible senior notes and capped call transactions in connection with such issuance, repayment of the delayed draw term A loan facility and higher distributions to noncontrolling interests.

Cash used in financing activities increased $571.3 million for the year ended December 31, 2024 as compared to the prior year primarily due to higher payments of our long-term debt as a result of the repayment of outstanding amounts under our senior secured revolving credit facility, repayment of the principal amount on our 4.875% senior notes and the repurchase of a portion of our 2.0% convertible senior notes.

These repayments were partially offset by higher proceeds of debt in 2024 from the issuance of our 2.875% convertible senior notes and draw down from our senior secured revolving credit facility as compared to 2023.

See “—Sources of Cash” above for further discussion.

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Guarantees of Third-Party Obligations

As of December 31, 2023 and 2022, we guaranteed the debt of third parties of approximately $19.4 million and $19.5 million, respectively, primarily related to maximum credit limits on employee and tour-related credit cards, obligations of a nonconsolidated affiliate and obligations under a venue management agreement.

As of December 31, 2024 and 2023, we guaranteed the debt of third parties of approximately $19.4 million and $19.4 million, respectively, primarily related to maximum credit limits on employee and tour-related credit cards and obligations under a venue management agreement.

Information regarding the seasonality of our business can be found in Part II—Financial Information—Item 8.—Financial Statements and Supplementary Data—Note 1 – The Company and Summary of Significant Accounting Policies.

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As a result, our financial results could be affected by factors such as changes in foreign currency exchange rates or weak economic conditions in the foreign markets in which we have operations.

Our foreign operations reported operating income of $586.0 million for the year ended December 31, 2023.

We operate in certain countries that are hyper-inflationary, for example Argentina, however the impact of these currencies did not have a material impact on our statement of operations for the year ended December 31, 2024.

Our foreign operations reported an operating income of $744.4 million for the year ended December 31, 2024.

We estimate that a 10% change in the value of the United States dollar relative to foreign currencies would change our operating income for the year ended December 31, 2024 by $74.4 million.

As of December 31, 2023, our most significant foreign exchange exposure included the

Euro, British Pound, Australian Dollar, Canadian Dollar and Mexican Peso.

As of December 31, 2024, our most significant foreign exchange exposure included the Euro, British Pound, Australian Dollar, Canadian Dollar and Mexican Peso.

This analysis does not consider the implication such currency fluctuations could have on the overall economic conditions of the United States or other foreign countries in which we operate or on the results of operations of our foreign entities.

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We primarily use forward currency contracts, in addition to options, to reduce our exposure to foreign currency risk associated with short-term artist fee commitments.

We also may enter into forward currency contracts to minimize the risks and/or costs associated with changes in foreign currency rates on forecasted operating income.

At December 31, 2023, we had forward currency contracts outstanding with a notional amount of $210.4 million.

At December 31, 2024, we had forward currency contracts outstanding with an aggregate notional amount of $283.1 million.

Interest Rate Risk

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We had $6.5 billion of total debt, excluding unamortized debt discounts and issuance costs, outstanding as of December 31, 2024.

Of the total amount, we had $5.8 billion of fixed-rate debt and $0.8 billion of floating-rate debt.

Of the total amount, we had $6.0 billion of fixed-rate debt and $457.6 million of floating-rate debt.

Based on the amount of our floating-rate debt as of December 31, 2024, each 25-basis point increase or decrease in interest rates would increase or decrease our annual interest expense and cash outlay by approximately $1.1 million.

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Critical Accounting Policies and Estimates

The preparation of our consolidated financial statements in conformity with GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amount of revenue and expenses during the reporting period.

The preparation of our financial statements in conformity with GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenue and expenses during the reporting period.

On an ongoing basis, we evaluate our estimates that are based on historical experience and on various other assumptions that are believed to be reasonable under the circumstances.

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If any reporting units are concluded to be more likely than not impaired, or if that conclusion cannot be determined qualitatively, a second step is performed for that reporting unit utilizing a quantitative approach.

For the year ended December 31, 2023, as part of our annual test for impairment, one of our reporting units, which accounted for approximately 12% of our goodwill at December 31, 2023, was assessed under the quantitative analysis primarily using a discounted cash flows methodology, with a lesser weighting attributed to the market multiple approach.

For the year ended December 31, 2024, as part of a refresh of the fair values of reporting units, as of July 1, 2024, three of our reporting units were assessed under quantitative analysis to support future qualitative evaluation.

As of October 1, as required by our policy to perform goodwill tests annually as of October 1, these three reporting units were also assessed under the initial qualitative evaluation and did not advance to the quantitative analysis.

As of October 1, the remaining three reporting units with goodwill were assessed under quantitative analysis to support future qualitative evaluation.

All of our reporting units assessed under the quantitative analysis primarily used a discounted cash flows methodology, with a lesser weighting attributed to the market multiple approach.

The discounted cash flows methodology estimates fair value by discounting the reporting unit’s estimated future cash flows using a weighted-average cost of capital that reflects current market conditions and the risk profile of the reporting unit.

Under the market multiple approach, the estimated fair value of the reporting unit was estimated by applying market multiples derived from stock

prices of companies that are engaged in the same or similar lines of business as the reporting unit and that are actively traded on a free and open market.

Under the market multiple approach, the estimated fair value of the reporting unit was estimated by applying market multiples derived from stock prices of companies that are engaged in the same or similar lines of business as the reporting unit and that are actively traded on a free and open market.

The derived multiples are then applied to the reporting unit’s financial metrics.

The remaining reporting units with goodwill were assessed under the initial qualitative evaluation and did not advance to the quantitative analysis.

For the years ended December 31, 2022 and 2021, as part of our annual test for impairment, all of our reporting units with goodwill were assessed under the initial qualitative evaluation and did not advance to the quantitative analysis.

For the year ended December 31, 2022, as part of our annual test for impairment, all of our reporting units with goodwill were assessed under the initial qualitative evaluation and did not advance to the quantitative analysis.

No impairment charges were recorded for the years ended December 31, 2024, 2023 and 2022.

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We account for income taxes using the liability method which results in deferred tax assets and liabilities based on differences between financial reporting bases and tax bases of assets and liabilities and are measured using the enacted tax rates expected to apply to taxable income in the periods in which the deferred tax asset or liability is expected to be realized or settled.

Deferred tax assets are reduced by valuation allowances if we believe it is more likely than not that some portion of or the entire asset will not be realized.

We assess the realizability of our deferred tax assets, considering all relevant factors, at each reporting period.

As almost all earnings from our continuing foreign operations are permanently reinvested and not distributed, our income tax provision does not include additional United States state and foreign withholding or transaction taxes on those foreign earnings that would be incurred if they were distributed.

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We have established a policy of including interest related to tax loss contingencies in income tax expense (benefit) in the statements of operations.

The Tax Cuts and Jobs Act (“TCJA”) enacted in December 2017 subjects a United States corporation to tax on its Global Intangible Low-Taxed Income (“GILTI”).

We have established a policy of treating the taxes due on future GILTI inclusions in United States taxable income as a current-period expense when incurred.

We treat the taxes due on future Global Intangible Low-Taxed Income (“GILTI”) inclusions in United States taxable income as a current-period expense when incurred.

QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis