What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-02-06 compared with 2025-11-06 · 134 added, 75 removed, 197 unchanged (51% of the section changed)

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All dollar amounts included in the following MD&A are presented in thousands, except as otherwise noted.

This MD&A is provided as a supplement to, and should be read in conjunction with, the Company’s unaudited condensed and consolidated financial statements and accompanying notes thereto included in this Quarterly Report on Form 10-Q, as well as the Company’s audited consolidated and combined financial statements and notes thereto as of June 30, 2025 and 2024 and for the three years ended June 30, 2025, 2024 and 2023 (the “Audited Consolidated and Combined Annual Financial Statements”) included in the 2025 Form 10-K, to help provide an understanding of our financial condition, changes in financial condition and results of operations .

This MD&A is provided as a supplement to, and should be read in conjunction with, the Company’s unaudited condensed and consolidated financial statements and accompanying notes thereto included in this Quarterly Report on Form 10-Q, as well as the 2025 Form 10-K, to help provide an understanding of our financial condition, changes in financial condition and results of operations.

Unless the context otherwise requires, all references to “we”, “us”, “our”, “MSG Entertainment”, or the “Company” refer collectively to Madison Square Garden Entertainment Corp., a holding company, and its direct and indirect subsidiaries through which substantially all of our operations are conducted.

The Company operates and reports financial information in one segment.

The Company reports on a fiscal year basis ending on June 30th (“Fiscal Year”).

In this MD&A, the years ending and ended on June 30, 2026 and 2025, are referred to as “Fiscal Year 2026” and “Fiscal Year 2025,” respectively.

Our MD&A is organized as follows:

In this MD&A, the years ending and ended on June 30, 2026 and 2025, respectively, are referred to as “Fiscal Year 2026” and “Fiscal Year 2025,” respectively.

This MD&A is organized as follows:

Business Overview.

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Results of Operations.

This section provides an analysis of our unaudited results of operations for the three months ended September 30, 2025 and 2024.

This section provides an analysis of our unaudited results of operations for the three and six months ended December 31, 2025 and 2024.

Liquidity and Capital Resources.

This section provides a discussion of our financial condition and liquidity, an analysis of our cash flows for the three months ended September 30, 2025 and 2024, as well as certain contractual obligations.

This section provides a discussion of our financial condition and liquidity, an analysis of our cash flows for the six months ended December 31, 2025 and 2024, as well as certain contractual obligations.

Seasonality of Our Business.

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The Company’s portfolio of venues includes:

The Garden, The Theater at Madison Square Garden, Radio City Music Hall, the Beacon Theatre, and The Chicago Theatre.

The Garden, the Infosys Theater at Madison Square Garden, Radio City Music Hall, the Beacon Theatre, and The Chicago Theatre.

The Company’s business includes the original production, the Christmas Spectacular.

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The Company conducts a significant portion of its operations at venues that it either owns or operates under long-term leases.

The Company owns The Garden, The Theater at Madison Square Garden, and The Chicago Theatre, and leases Radio City Music Hall and the Beacon Theatre.

The Company owns The Garden, the Infosys Theater at Madison Square Garden, and The Chicago Theatre, and leases Radio City Music Hall and the Beacon Theatre.

All of the Company’s revenues and assets are attributed to or located in the United States and are primarily concentrated in the New York City metropolitan area.

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Results of Operations

Comparison of the three months ended September 30, 2025 versus the three months ended September 30, 2024.

Comparison of the three and six months ended December 31, 2025 versus the three and six months ended December 31, 2024.

Three Months Ended

September 30, Change

December 31, Change

2025 2024 Amount Percentage

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Depreciation and amortization (13,984) (14,183) 199 1 %

Restructuring (charges) credits (1,126) 30 (1,156) NM

Operating income 163,815 139,001 24,814 18 %

Interest income 813 365 448 123 %

Interest expense (10,423) (12,955) 2,532 20 %

Other expense, net (673) (1,045) 372 36 %

Income from operations before income taxes 153,532 125,366 28,166 22 %

Income tax expense (60,817) (49,473) (11,344) (23) %

Net income $ 92,715 $ 75,893 $ 16,822 22 %

Six Months Ended

December 31, Change

2025 2024 Amount Percentage

Revenues from entertainment offerings

$ 491,763 $ 433,357 $ 58,406 13 %

Food, beverage, and merchandise revenues 87,161 78,296 8,865 11 %

Arena license fees and other leasing revenue (a)

39,278 34,478 4,800 14 %

Total revenues 618,202 546,131 72,071 13 %

Direct operating expenses

Entertainment offerings, arena license fees, and other leasing direct operating expenses (b)

(264,620) (250,760) (13,860) (6) %

Food, beverage, and merchandise direct operating expenses

(50,406) (44,023) (6,383) (14) %

Total direct operating expenses

(315,026) (294,783) (20,243) (7) %

Selling, general, and administrative expenses

(124,944) (102,935) (22,009) (21) %

Depreciation and amortization (28,058) (27,964) (94) NM

Impairment of long-lived assets (13,782) — (13,782) NM

Restructuring (charges) credits (2,316) 70 (2,386) NM

Operating loss (29,739) (18,482) (11,257) (61) %

Operating income 134,076 120,519 13,557 11 %

Interest income 1,333 737 596 81 %

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Other expense, net (845) (1,814) 969 53 %

Loss from operations before income taxes (40,419) (32,922) (7,497) (23) %

Income tax benefit 18,765 13,601 5,164 38 %

Net loss $ (21,654) $ (19,321) $ (2,333) (12) %

Income from operations before income taxes 113,113 92,444 20,669 22 %

Income tax expense (42,052) (35,872) (6,180) (17) %

Net income $ 71,061 $ 56,572 $ 14,489 26 %

______________________________________________________

(a) Arena license fees and other leasing revenue are recognized on a straight-line basis and are comprised of a contractual cash component plus or minus a non-cash component for each period presented.

Arena license fees include operating lease revenue of (i) $879 and $854 collected in cash for the three months ended September 30, 2025 and 2024 , respectively, and (ii) a non-cash portion of $445 and $470 for the three months ended September 30, 2025 and 2024, respectively.

Arena license fees include operating lease revenue of (i) $20,185 and $21,064 collected in cash for the three and six months ended December 31, 2025 , respectively, and $17,447 and $18,301 collected in cash for the three and six months ended December 31, 2024 , respectively, and (ii) a non-cash portion of $10,093 and $10,538 for the three and six months ended December 31, 2025, respectively, and $9,514 and $9,984 for the three and six months ended December 31, 2024, respectively.

(b) Venue operations and infrastructure costs are not specifically allocated to each revenue stream, but are instead attributed in their entirety to service revenue which is the Company’s principal revenue stream.

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NM — Absolute percentages greater than 200% and comparisons from positive to negative values or to zero values are considered not meaningful.

Revenues for the three months ended September 30, 2025 increased $19,548 as compared to the prior year period.

Revenues for the three and six months ended December 31, 2025 increased $52,523 and $72,071, respectively, as compared to the prior year periods.

Revenues from Entertainment Offerings

For the three months ended September 30, 2025, the increase in revenues from entertainment offerings of $16,229 was primarily due to (i) higher revenues from concerts of $8,263 due to an increase in the number of concerts at the Company’s theaters, an increase in the number of concerts at The Garden and higher per-event revenues, and (ii) higher revenues from other live entertainment and sporting events (excluding the Knicks and Rangers) of $6,806, primarily due to an increase in the number of events at The Garden.

For the three months ended December 31, 2025, the increase in revenues from entertainment offerings of $42,177 was primarily due to (i) higher revenues from the presentation of the Christmas Spectacular production of $18,597, (ii) higher revenues from other live entertainment and sporting events (excluding the Knicks and Rangers) of $11,774, (iii) higher revenues subject to the sharing of economics with MSG Sports pursuant to the Arena License Agreements of $5,947, and (iv) higher revenues from venue-related sponsorship, signage, and suite license fees of $5,155, slightly offset by (v) lower revenues from concerts of $1,227, all as compared to the prior year period.

The increase in revenues of $18,597 from the presentation of the Christmas Spectacular production was primarily due to an increase in ticket-related revenue, which reflected 14 additional performances and higher per-show revenue, both as compared to the prior year period.

The increase in per-show revenue was primarily due to a higher average ticket yield and, to a lesser extent, higher per-show attendance as compared to the prior year period.

The Company had 215 Christmas Spectacular performances during this year’s holiday season, of which 199 took place in the three months ended December 31, 2025, as compared to 200 performances in the prior year’s holiday season, of which 185 took place in the three months ended December 31, 2024.

For this year’s holiday season, over 1.2 million tickets were sold, as compared to approximately 1.1 million tickets sold in the prior year’s holiday season.

The increase in revenues of $11,774 from other live entertainment and sporting events (excluding the Knicks and Rangers) was primarily due to higher per-event revenue and, to a lesser extent, an increase in the number of events at The Garden.

The increase in revenues subject to the sharing of economics with MSG Sports pursuant to the Arena License Agreements of $5,947 was primarily due to higher suite license fee revenues (excluding the portion retained by the Company).

The increase in revenues of $5,155 from venue-related sponsorship, signage, and suite license fees was due to higher suite license fee revenues (excluding the portion shared with MSG Sports pursuant to the Arena License Agreements) and higher sponsorship and signage revenues.

The decrease in revenues of $1,227 from concerts was primarily due to a decrease in the number of events at The Garden, partially offset by higher per-concert revenue and an increase in the number of events at the Company’s theaters.

For the six months ended December 31, 2025, the increase in revenues from entertainment offerings of $58,406 was primarily due to (i) higher revenues from the presentation of the Christmas Spectacular production of $19,436, (ii) higher revenues from other live entertainment and sporting events (excluding the Knicks and Rangers) of $18,580, (iii) higher revenues from concerts of $7,036, (iv) higher revenues subject to the sharing of economics with MSG Sports pursuant to the Arena License Agreements of $6,269, and (v) higher revenues from venue-related sponsorship, signage, and suite license fees of $5,617, all as compared to the prior year period.

The increase in revenues of $18,580 from other live entertainment and sporting events (excluding the Knicks and Rangers) was primarily due to higher per-event revenue and an increase in the number of events at the Company’s venues.

The increase in revenues of $7,036 from concerts was primarily due to higher per-concert revenue and an increase in the number of events at the Company’s theaters, partially offset by a decrease in the number of events at The Garden.

Food, Beverage, and Merchandise Revenues

For the three months ended September 30, 2025, the increase in food, beverage, and merchandise revenues was primarily due to higher food and beverage sales at concerts of $2,460, and higher food and beverage sales at other live entertainment and sporting events (excluding the Knicks and Rangers) of $1,382.

The increase in food and beverage sales at concerts was due to higher per-event revenue and an increase in the number of events held at the Company’s venues, both as compared to the prior year quarter.

The increase in food and beverage sales at other live entertainment and sporting events was primarily due to an increase in the number of events held at The Garden as compared to the prior year quarter.

For the three months ended December 31, 2025, the increase in food, beverage, and merchandise revenues of $5,003 was primarily due to (i) higher food and beverage sales of $3,254 at Knicks and Rangers games, (ii) higher food, beverage and merchandise sales of $2,694 related to the Christmas Spectacular production and (iii) higher food and beverage sales at other live entertainment and sporting events (excluding the Knicks and Rangers) of $2,342, partially offset by (iv) lower food and beverage sales of $3,294 at concerts at the Company’s venues, all as compared to the prior year period.

The increase in food and beverage sales of $3,254 at Knicks and Rangers games was due to the impact of a combined four more Knicks and Rangers games played at The Garden and, higher per-game revenue.

The increase in food, beverage and merchandise sales of $2,694 related to the Christmas Spectacular production was due to higher per-show revenue and, to a lesser extent, 14 additional performances.

The increase in food, beverage and merchandise sales of $2,342 from other live entertainment and sporting events (excluding the Knicks and Rangers) was primarily due to an increase in the number of events at The Garden and, to a lesser extent, higher per-event revenue.

The decrease in food, beverage and merchandise sales of $3,294 from concerts was primarily due to a decrease in the number of events at The Garden.

For the six months ended December 31, 2025, the increase in food, beverage, and merchandise revenues of $8,865 was primarily due to (i) higher food and beverage sales at other live entertainment and sporting events (excluding the Knicks and Rangers) of $3,724, (ii) higher food and beverage sales of $3,304 at Knicks and Rangers games, and (iii) and higher food, beverage and merchandise sales of $2,638 related to the Christmas Spectacular production, partially offset by (iv) lower food and beverage sales of $833 at concerts at the Company’s venues, all as compared to the prior year period.

The increase in food and beverage sales at other live entertainment and sporting events (excluding the Knicks and Rangers) of $3,724 was primarily due to an increase in the number of events held at the Company’s venues and higher per-event revenue.

The decrease in food, beverage and merchandise sales of $833 from concerts was primarily due to a decrease in the number of events at The Garden, partially offset by an increase in the number of events at the Company’s theaters.

Arena License Fees and Other Leasing Revenue

For the three months ended September 30, 2025, the decrease in revenues was due to lower related party sublease income for corporate office space.

For the three and six months ended December 31, 2025, the increase in arena license fees and other leasing revenue of $5,343, and $4,800, respectively, was due to higher arena license fees from MSG Sports pursuant to the Arena License Agreements due to a combined four more Knicks and Rangers games played at The Garden in the current year periods, and an increase in other sublease revenue.

For the three and six months ended December 31, 2025, the Knicks and Rangers played a combined 39 and 41 pre/regular season games at The Garden, respectively, as compared to 35 and 37 combined pre/regular season games, respectively, in the prior year periods.

Direct operating expenses

Direct operating expenses for the three months ended September 30, 2025 increased $4,661 as compared to the prior year period.

Direct operating expenses for the three and six months ended December 31, 2025 increased $15,582 and $20,243, respectively, as compared to the prior year periods.

Direct Operating Expenses Associated with Entertainment Offerings, Arena License Fees and Other Leasing

For the three months ended September 30, 2025, the increase in direct operating expenses associated with entertainment offerings, arena license fees, and other leasing primarily reflects (i) higher direct operating expenses from other live entertainment and sporting events (excluding the Knicks and Rangers) of $4,835, primarily due to an increase in the number of events at The Garden as compared to the prior year period, partially offset by (ii) the decrease in venue operating costs of $1,287, primarily due to lower repairs and maintenance expenses and lower employee compensation and benefits, and (iii) lower direct operating expenses from concerts of $1,230, primarily due to lower per-event expenses as a result of a shift in the mix of events at The Garden from promoted events to rentals, partially offset by an increase in the number of events at the Company’s venues.

For the three months ended December 31, 2025, the increase in direct operating expenses associated with entertainment offerings, arena license fees, and other leasing of $11,768 primarily reflects (i) higher direct operating expenses subject to the sharing of economics with MSG Sports pursuant to the Arena License Agreements of $5,263, primarily due to expenses incurred as a result of the increase in suite license fee revenues, (ii) higher direct operating expenses related to the Christmas Spectacular production of $5,039 incurred as a result of 14 additional shows and higher per-show expenses, and (iii) higher direct operating expenses from other live entertainment and sporting events (excluding the Knicks and Rangers) of $3,030, primarily due to an increase in the number of events at The Garden and, to a lesser extent, higher per-event expenses, partially offset by (iv) lower direct operating expenses from concerts of $1,407, primarily due to a decrease in the number of concerts at The Garden, partially offset by higher per-concert expenses and an increase in the number of concerts at the Company’s theaters, all as compared to the prior year period.

For the six months ended December 31, 2025, the increase in direct operating expenses associated with entertainment offerings, arena license fees, and other leasing of $13,860 primarily reflects (i) higher direct operating expenses from other live entertainment and sporting events (excluding the Knicks and Rangers) of $7,865, primarily due to an increase in the number of events at the Company’s venues and higher-per event expenses, (ii) higher direct operating expenses subject to the sharing of economics with MSG Sports pursuant to the Arena License Agreements of $5,554, primarily due to expenses incurred as a result of the increase in suite license revenues, and (iii) higher direct operating expenses related to the Christmas Spectacular production of $4,811, primarily due to 14 additional shows, partially offset by (iv) lower direct operating expenses from concerts of $2,637, primarily due to a decrease in the number of events at The Garden and lower per-event expenses, partially offset by an increase in the number of events at the Company’s theaters, and (v) a decrease in venue operating costs of $1,961, all as compared to the prior year period.

Direct Operating Expenses Associated with Food, Beverage, and Merchandise

For the three months ended September 30, 2025, the increase in food, beverage and merchandise direct operating expenses was primarily driven by the related increase in food and beverage sales at concerts held at the Company’s venues and the related increase in food and beverage sales from other live entertainment and sporting events (excluding the Knicks and Rangers).

For the three months ended December 31, 2025, the increase in food, beverage and merchandise direct operating expenses of $3,814 primarily reflects higher food, beverage and merchandise costs related to Knicks and Rangers games at The Garden, the Christmas Spectacular production, and other live entertainment and sporting events (excluding the Knicks and Rangers), partially offset by lower food and beverage costs related to concerts, all as compared to the prior year period.

For the six months ended December 31, 2025, the increase in food, beverage and merchandise direct operating expenses of $6,383 primarily reflects higher food, beverage and merchandise costs related to Knicks and Rangers games at The Garden, other live entertainment and sporting events (excluding the Knicks and Rangers), and the Christmas Spectacular production, all as compared to the prior year period.

Selling, general, and administrative expenses

For the three months ended September 30, 2025, selling, general, and administrative expenses increased $10,839 as compared to the prior year period primarily due to an increase in employee compensation and benefits.

Depreciation and amortization

For the three months ended September 30, 2025, depreciation and amortization increased $293 as compared to the prior year period primarily due to fixed asset additions made during Fiscal Year 2025 and the first quarter of Fiscal Year 2026.

For the three and six months ended December 31, 2025, selling, general, and administrative expenses increased $11,170 and $22,009, respectively, as compared to the prior year periods, primarily due to an increase in employee compensation and benefits, including $3,970 in executive management transition costs in the current year periods as compared to $4,544 of executive management transition costs in the prior year periods.

Impairment of long-lived assets

For the three months ended September 30, 2025, impairment of long-lived assets increased $13,782 as compared to the prior year period, primarily due to impairment losses recognized on the Company’s right-of-use lease assets in its New York corporate office in the first quarter of Fiscal Year 2026.

For the six months ended December 31, 2025, impairment of long-lived assets increased $13,782, as compared to the prior year period, primarily due to impairment losses recognized on the Company’s right-of-use lease assets in its New York corporate office.

Restructuring charges

For the three months ended September 30, 2025, restructuring charges increased $1,230 as compared to the prior year period, which reflects termination benefits provided in the first quarter of Fiscal Year 2026 due to a workforce reduction.

Operating loss

For the three months ended September 30, 2025, operating loss increased by $11,257 as compared to the prior year period, primarily due to an increase in impairment of long-lived assets, including right-of-use asset and related lease costs, selling, general, and administrative expenses, and direct operating expenses, partially offset by an increase in revenues.

For the three and six months ended December 31, 2025, restructuring charges increased $1,156 and $2,386, respectively, as compared to the prior year periods, which reflects termination benefits provided due to a workforce reduction.

Operating income

For the three and six months ended December 31, 2025, operating income increased by $24,814 and $13,557, respectively.

The increase in operating income for the three months ended December 31, 2025 was primarily due to an increase in revenues, partially offset by an increase in direct operating expenses and selling, general and administrative expenses.

The increase in operating income for the six months ended December 31, 2025 was primarily due to an increase in revenues, partially offset by an increase in direct operating expenses, selling, general and administrative expenses and impairment of long-lived assets.

Interest income

For the three months ended September 30, 2025, interest income increased $148 as compared to the prior year period, primarily due to higher average balances in the Company’s cash, cash equivalents and restricted cash for the quarter.

For the three and six months ended December 31, 2025, interest income increased $448 and $596, respectively, as compared to the prior year periods, primarily due to higher average balances in the Company’s cash, cash equivalents and restricted cash.

Interest expense

For the three months ended September 30, 2025, interest expense decreased $3,015 as compared to the prior year period primarily due to lower average borrowing rates under the National Properties Facilities (as defined below under Liquidity and Capital Resources).

For the three and six months ended December 31, 2025, interest expense decreased $2,532 and $5,547, respectively, as compared to the prior year periods primarily due to lower average borrowing rates under the National Properties Facilities (as defined below under Liquidity and Capital Resources).

Other expense, net

For the three months ended September 30, 2025, other expense, net decreased $597 as compared to the prior year period primarily due to (i) lower net periodic benefit costs associated with the Company’s funded and unfunded and qualified and non-qualified defined benefit plans, and (ii) an increase in unrealized gains associated with the Company’s Executive Deferred Compensation Plan.

Income tax benefit

For the three and six months ended December 31, 2025, other expense, net decreased $372 and $969, respectively, as compared to the prior year periods primarily due to (i) lower net periodic benefit costs associated with the Company’s funded and unfunded and qualified and non-qualified defined benefit plans, and (ii) an increase in unrealized gains associated with the Company’s Executive Deferred Compensation Plan.

Income tax expense

In general, the Company is required to use an estimated annual effective tax rate to measure the tax benefit or tax expense recognized in an interim period.

The estimated annual effective tax rate is revised on a quarterly basis.

Income tax benefit for the three months ended September 30, 2025 of $18,765 reflects an effective tax rate of 46%.

The estimated annual effective tax rate exceeds the statutory federal tax rate of 21% primarily due to state and local taxes and excess tax deficiencies related to share-based compensation, partially offset by nondeductible officers’ compensation.

Income tax benefit for the three months ended September 30, 2024 of $13,601 reflects an effective tax rate of 41%.

The estimated annual effective tax rate exceeds the statutory federal tax rate of 21% primarily due to state taxes and excess tax deficiencies related to share-based compensation.

Additional Financial Information to the financial statements included in “— Item 1.

Financial Statements” of this Quarterly Report on Form 10-Q for discussions of the Company’s income tax expense.

Adjusted operating income (“AOI”)

The Company evaluates its performance based on several factors, of which the key financial measure is adjusted operating income, a non-GAAP financial measure.

We define adjusted operating income as operating loss excluding:

We define adjusted operating income as operating income excluding:

(i) depreciation, amortization and impairments of property and equipment, goodwill and other long-lived assets, including right-of-use lease assets and related lease costs,

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The Company eliminates merger, spin-off, and acquisition-related transaction costs, when applicable, because the Company does not consider such costs to be indicative of the ongoing operating performance of the Company as they result from an event that is of a non-recurring nature, thereby enhancing comparability.

In addition, management believes that the exclusion of gains and losses related to the remeasurement of liabilities under the executive deferred compensation plan, provides investors with a clearer picture of the Company’s operating performance given that, in accordance with GAAP, gains and losses related to the remeasurement of liabilities under the executive deferred compensation plan are recognized in Operating loss whereas gains and losses related to the remeasurement of the assets under the executive deferred compensation plan, which are equal to and therefore fully offset the gains and losses related to the remeasurement of liabilities, are recognized in Other expense, net, which is not reflected in Operating loss.

In addition, management believes that the exclusion of gains and losses related to the remeasurement of liabilities under the Executive Deferred Compensation Plan, provides investors with a clearer picture of the Company’s operating performance given that, in accordance with GAAP, gains and losses related to the remeasurement of liabilities under the Executive Deferred Compensation Plan are recognized in operating income whereas gains and losses related to the remeasurement of the assets under the Executive Deferred Compensation Plan, which are equal to and therefore fully offset the gains and losses related to the remeasurement of liabilities, are recognized in other expense, net, which is not reflected in operating income.

The Company believes AOI is an appropriate measure for evaluating the operating performance of the Company on a consolidated basis.

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The Company uses revenues and AOI measures as the most important indicators of its business performance and evaluates management’s effectiveness with specific reference to these indicators.

AOI should be viewed as a supplement to and not a substitute for operating loss, net loss, cash flows from operating activities, and other measures of performance and/or liquidity presented in accordance with GAAP.

AOI should be viewed as a supplement to and not a substitute for operating income, net income, cash flows from operating activities, and other measures of performance and/or liquidity presented in accordance with GAAP.

Since AOI is not a measure of performance calculated in accordance with GAAP, this measure may not be comparable to similar measures with similar titles used by other companies.

The Company has presented the components that reconcile operating loss, the most directly comparable GAAP financial measure, to AOI.

The following is a reconciliation of operating loss to adjusted operating income for the three months ended September 30, 2025 as compared to the prior year period:

The Company has presented the components that reconcile operating income, the most directly comparable GAAP financial measure, to AOI.

The following is a reconciliation of operating income to adjusted operating income for the three and six months ended December 31, 2025 as compared to the prior year periods:

Three Months Ended

September 30, Change

December 31, Change

2025 2024 Amount Percentage

Operating loss $ (29,739) $ (18,482) $ (11,257) (61) %

Operating income $ 163,815 $ 139,001 $ 24,814 18 %

Depreciation and amortization 13,984 14,183 (199) (1) %

Impairment of long-lived assets 13,782 — 13,782 NM

Impairment of long-lived assets and related lease costs 1,296 — 1,296 NM

Share-based compensation 10,037 9,322 715 8 %

Restructuring charges (credits) 1,126 (30) 1,156 NM

Merger, spin-off , and acquisition-related costs

— 1,361 (1,361) NM

Amortization for capitalized cloud computing arrangement costs 31 201 (170) (85) %

Remeasurement of deferred compensation plan liabilities 141 (26) 167 NM

Adjusted operating income $ 190,430 $ 164,012 $ 26,418 16 %

Six Months Ended

December 31, Change

2025 2024 Amount Percentage

Operating income $ 134,076 $ 120,519 $ 13,557 11 %

Depreciation and amortization 28,058 27,964 94 NM

Impairment of long-lived assets and related lease costs 15,078 — 15,078 NM

Share-based compensation 17,330 15,584 1,746 11 %

Restructuring charges (credits) 2,316 (70) 2,386 NM

Merger, spin-off , and acquisition-related costs

— 1,361 (1,361) NM

Amortization for capitalized cloud computing arrangement costs 206 369 (163) (44) %

Remeasurement of deferred compensation plan liabilities 447 194 253 130 %

Adjusted operating income $ 7,081 $ 1,909 $ 5,172 NM

Adjusted operating income $ 197,511 $ 165,921 $ 31,590 19 %

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Our principal uses of cash include working capital-related items (including funding our operations), capital spending, debt service, investments and related loans and advances that we may fund from time to time.

We may also use cash to continue to repurchase shares of our Class A Common Stock pursuant to the share repurchase program authorized by our Board of Directors on March 29, 2023, of which there was $44,796 remaining as of September 30, 2025.

Our decisions as to the use of our available liquidity will be based upon the ongoing review of the funding needs of the business, the optimal allocation of cash resources, and the timing of cash flow generation.

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We regularly monitor and assess our ability to meet our net funding and investing requirements.

As of September 30, 2025, the Company’s unrestricted cash and cash equivalents balance was $29,950.

The principal balance of the Company’s total debt outstanding as of September 30, 2025 was $621,758 and the Company had $112,573 of available borrowing capacity under the National Properties Revolving Credit Facility.

As of December 31, 2025, the Company’s unrestricted cash and cash equivalents balance was $157,056.

The principal balance of the Company’s total debt outstanding as of December 31, 2025 was $594,141 and the Company had $132,573 of available borrowing capacity under the National Properties Revolving Credit Facility.

We believe we have sufficient liquidity from cash and cash equivalents, available borrowing capacity under the National Properties Revolving Credit Facility and cash flows from operations to fund our operations and satisfy any obligations for the foreseeable future.

Financing Agreements

Credit Facilities, to the financial statements included in “— Item 1.

Financial Statements” of this Quarterly Report on Form 10-Q for discussions of the Company’s debt obligations and financing agreements.

National Properties Facilities

On June 27, 2025, MSG National Properties, MSG Entertainment Holdings and certain subsidiaries of MSG National Properties entered into Amendment No.

On June 27, 2025, MSG National Properties, LLC (“MSG National Properties”), MSG Entertainment Holdings, LLC (“MSG Entertainment Holdings”) and certain subsidiaries of MSG National Properties entered into Amendment No.

4 (“Amendment No.

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Up to $25,000 of the National Properties Revolving Credit Facility is available for the issuance of letters of credit.

As of September 30, 2025, outstanding letters of credit were $17,427 and the remaining balance available under the National Properties Revolving Credit Facility was $112,573.

During October 2025, the Company paid $20,000 to fully settle the outstanding borrowings under the National Properties Revolving Credit Facility.

In October 2025, the Company paid $20,000 to fully repay the outstanding borrowings under the National Properties Revolving Credit Facility.

As of December 31, 2025, outstanding letters of credit were $17,427 and the remaining balance available under the National Properties Revolving Credit Facility was $132,573.

Proceeds of the National Properties Revolving Credit Facility may be used to fund working capital needs, for general corporate purposes of MSG National Properties and its subsidiaries and to make distributions to MSG Entertainment Holdings.

Interest Rates.

Borrowings under the National Properties Facilities bear interest at a floating rate, which at the option of MSG National Properties may be either (a) Term SOFR plus an applicable margin ranging from 1.75% to 2.50% per annum, determined based on the total leverage ratio of MSG National Properties and its restricted subsidiaries, or (b) a base rate plus an applicable margin ranging from 0.75% to 1.50% per annum, determined based on the total leverage ratio of MSG National Properties and its restricted subsidiaries.

Borrowings under the National Properties Facilities bear interest at a floating rate, which at the option of MSG National Properties may be either (a) Term Secured Overnight Financing Rate (“SOFR”) plus an applicable margin ranging from 1.75% to 2.50% per annum, determined based on the total leverage ratio of MSG National Properties and its restricted subsidiaries, or (b) a base rate plus an applicable margin ranging from 0.75% to 1.50% per annum, determined based on the total leverage ratio of MSG National Properties and its restricted subsidiaries.

The National Properties Credit Agreement requires MSG National Properties to pay a commitment fee ranging from 0.20% to 0.30% in respect of the daily unused commitments under the National Properties Revolving Credit Facility.

MSG National Properties is also required to pay customary letter of credit fees, as well as fronting fees, to banks that issue letters of credit pursuant to the National Properties Credit Agreement.

As of September 30, 2025, the interest rates on the National Properties Term Loan Facility and the National Properties Revolving Credit Facility were 6.41% and 6.39%, respectively.

The interest rate on the National Properties Term Loan Facility as of December 31, 2025 was 5.97%.

Principal Repayments.

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The principal obligations under the National Properties Revolving Credit Facility are due at the maturity of the facility.

Under certain circumstances, MSG National Properties is required to make mandatory prepayments on loans outstanding, including prepayments in an amount equal to the net cash proceeds of certain sales of assets or casualty insurance and/or condemnation recoveries (subject to certain reinvestment, repair or replacement rights), subject to certain exceptions.

Under certain circumstances, MSG National Properties is

required to make mandatory prepayments on loans outstanding, including prepayments in an amount equal to the net cash proceeds of certain sales of assets or casualty insurance and/or condemnation recoveries (subject to certain reinvestment, repair or replacement rights), subject to certain exceptions.

The National Properties Credit Agreement includes financial covenants requiring MSG National Properties and its restricted subsidiaries to maintain a specified minimum debt service coverage ratio and specified maximum total leverage ratio.

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The leverage ratio covenant is tested based on the ratio of MSG National Properties and its restricted subsidiaries’ consolidated total indebtedness to adjusted operating income, with a maximum ratio of 3.50:1.

As of September 30, 2025, MSG National Properties and its restricted subsidiaries were in compliance with the covenants of the National Properties Credit Agreement.

As of December 31, 2025, MSG National Properties and its restricted subsidiaries were in compliance with the covenants of the National Properties Credit Agreement.

In addition to the financial covenants discussed above, the National Properties Credit Agreement and the related security agreement contain certain customary representations and warranties, affirmative and negative covenants and events of default.

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Contractual Obligations

During the three months ended September 30, 2025, the Company did not have any material changes in its non-cancelable contractual obligations (other than activities in the ordinary course of business).

Property and Equipment, Net and Note 7.

The Company did not have any material changes in its contractual obligations since the end of Fiscal Year 2025 other than activities in the ordinary course of business.

Commitments and Contingencies, to the financial statements included in “— Item 1.

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Cash Flow Discussion

As of September 30, 2025, cash, cash equivalents and restricted cash totaled $30,471, as compared to $43,538 as of June 30, 2025.

The following table summarizes the Company’s cash flow activities for the three months ended September 30, 2025 and 2024:

Three Months Ended

September 30,

Net cash provided by (used in) operating activities $ 19,808 $ (27,359)

As of December 31, 2025, cash, cash equivalents and restricted cash totaled $157,577, as compared to $43,538 as of June 30, 2025.

The following table summarizes the Company’s cash flow activities for the six months ended December 31, 2025 and 2024:

Six Months Ended

Net cash provided by operating activities $ 184,194 $ 85,499

Net cash used in investing activities (15,290) (16,282)

Net cash (used in) provided by financing activities (26,077) 38,107

Net (decrease) increase in cash, cash equivalents, and restricted cash $ (13,067) $ 4,058

Net cash used in financing activities (54,865) (47,553)

Net increase in cash, cash equivalents, and restricted cash $ 114,039 $ 21,664

Operating Activities

Net cash provided by operating activities for the three months ended September 30, 2025 increased by $47,167 as compared to the prior year period, primarily due to higher net income adjusted for non-cash items of $7,118, and an increase in cash flows from changes in working capital of $40,049.

The increase in cash flows from changes in working capital was primarily driven by (i) a smaller net cash outflow for accrued and other current and non-current liabilities settled, primarily as a result of lower employee related costs, and their associated payroll tax costs, and (ii) net cash inflows from related party receivables and payables, due to the timing and settlement of the underlying related party transactions.

These increases were partially offset by (iii) an increase in payments for prepaid expenses and other current and non-current assets, primarily related to contractual revenue sharing expenses related to suite licenses paid to MSG Sports, and (iv) a decrease in accounts payable, due to the timing of payments to vendors, in each case as compared to the three months ended September 30, 2024.

Net cash provided by operating activities for the six months ended December 31, 2025 increased by $98,695 as compared to the prior year period, primarily due to higher net income adjusted for non-cash items of $15,236, and an increase in cash flows from changes in working capital of $83,459.

The increase in cash flows from changes in working capital was mainly driven by (i) a smaller net cash outflow for accrued and other current and non-current liabilities, primarily due to lower employee-related costs and associated payroll taxes, and lower payments to promoters due to the timing of event settlements, (ii) a smaller net cash outflow from related party receivables and payables, net, due to the timing and settlement of the underlying related party transactions, primarily with MSG Sports, and (iii) a smaller net cash outflow from accounts payable, primarily due to the timing of event settlements.

These increases were partially offset by (iv) a smaller net cash inflow from accounts receivable, due to the timing of cash collections from sponsors

and event settlements, in each case as compared to the six months ended December 31, 2024.

Investing Activities

Net cash used in investing activities for the three months ended September 30, 2025 increased by $108 to $6,798 as compared to the prior year period primarily due to (i) the absence of proceeds received from the sale of investments, and (ii) a slight reduction in capital expenditures, both as compared to the prior year period.

Net cash used in investing activities for the six months ended December 31, 2025 decreased by $992 to $15,290 as compared to the prior year period primarily due to a reduction in capital expenditures, as compared to the prior year period.

Financing Activities

Net cash used in financing activities for the three months ended September 30, 2025 increased by $64,184 to $26,077 as compared to the prior year period primarily due to (i) an increase in stock repurchases, (ii) a decrease in proceeds received from the National Properties Revolving Credit Facility, and (iii) incremental principal repayments under the National Properties Revolving Facilities.

Net cash used in financing activities for the six months ended December 31, 2025 increased by $7,312 to $54,865 as compared to the prior year period primarily due to (i) a decrease in proceeds received from the National Properties Revolving Credit Facility, partially offset by (ii) lower principal repayments under the National Properties Revolving Facilities.

Seasonality of Our Business

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Recently Issued Accounting Pronouncements and Critical Accounting Estimates

Recently Issued and Adopted Accounting Pronouncements

Recently Issued Accounting Pronouncements

Summary of Significant Accounting Policies, to the financial statements included in “— Item 1.

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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-Q

Item 2. Management’s Discussion and Analysis