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Item 2. Management’s Discussion and Analysis

2025-10-31 compared with 2025-05-02 · 93 added, 158 removed, 144 unchanged (64% of the section changed)

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In this MD&A, there are statements concerning the future operating and future financial performance of Madison Square Garden Sports Corp.

and its direct and indirect subsidiaries (collectively, “we,” “us,” “our,” “MSG Sports,” or the “Company”), including stated annual local media rights fees for the year ended June 30, 2026.

and its direct and indirect subsidiaries (collectively, “we,” “us,” “our,” “MSG Sports,” or the “Company”), including stated annual local media rights fees for the fiscal year ended June 30, 2026.

Words such as “expects,” “anticipates,” “believes,” “estimates,” “may,” “will,” “should,” “could,” “potential,” “continue,” “intends,” “plans,” and similar words and terms used in the discussion of future operating and future financial performance identify forward-looking statements.

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Factors that may cause such differences to occur include, but are not limited to:

• developments affecting the regional sports network industry, including the effects of such developments on MSG Networks Inc.’s (“MSG Networks”) solvency, its ability to perform its obligations under its local media rights agreements with us and our ability to broadcast the games of our teams if MSG Networks ceases to perform its obligations under its local media rights agreements with us;

• the level of our revenues, which depends in part on the popularity and competitiveness of our sports teams;

• costs associated with player injuries, waivers or contract terminations of players and other team personnel;

• costs associated with player injuries, waivers or contract terminations of players, coaches and other team personnel;

• changes in professional sports teams’ compensation, including the impact of signing free agents and executing trades, subject to league salary caps and the impact of luxury tax;

• general economic conditions, especially in the New York City metropolitan area, including the impact of a recession on our business;

• general economic conditions, especially in the New York City metropolitan area, including any economic downturn, recession, financial instability, impact from Government shutdowns or inflation;

• the demand for sponsorship arrangements and for advertising;

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• changes in laws, National Basketball Association (“NBA”) or National Hockey League (“NHL”) rules, regulations, guidelines, bulletins, directives, policies and agreements, including the leagues’ respective collective bargaining agreements (each, a “CBA”) with their players’ associations, salary caps, escrow requirements, revenue sharing, NBA luxury tax thresholds and media rights, or other regulations under which we operate;

• the performance by our affiliates of their obligations under various agreements with the Company;

• developments affecting the regional sports network industry, including the effects of such developments on MSG Networks Inc.’s (“MSG Networks”) solvency and its ability to perform its obligations under its local media rights agreements with us;

• a default by our subsidiaries under their respective credit facilities;

• any NBA, NHL or other work stoppage;

• any economic, political or other actions, such as boycotts, protests, work stoppages or campaigns by labor organizations;

• the performance by our affiliates of their obligations under various agreements with the Company;

• seasonal fluctuations and other variation in our operating results and cash flow from period to period;

• the level of our expenses, including our corporate expenses;

• operational, business, reputational, litigation and other risk if there is a security incident resulting in loss, disclosure or misappropriation of stored personal information or other breaches of our information security or if third party facilities, systems and/or software upon which we rely are interrupted or unavailable;

• activities or other developments, such as the domestic terrorism recently experienced in New Orleans, that discourage or may discourage congregation at prominent places of public assembly, including Madison Square Garden Arena (“The Garden”) where the home games of the New York Knickerbockers (the “Knicks”) and the New York Rangers (the “Rangers”) are played;

• a pandemic or public health emergency and our ability to effectively manage the impacts, including labor market disruptions;

• a default by our subsidiaries under their respective credit facilities;

• the acquisition or disposition of assets or businesses and/or the impact of, and our ability to successfully pursue acquisitions or other strategic transactions;

• our ability to successfully integrate acquisitions or new businesses into our operations and the operating and financial performance of strategic acquisitions and investments, including those we may not control;

• the impact of governmental regulations or laws, including potential legislation related to ticketing, changes in how those regulations and laws are interpreted and the continued benefit of certain tax exemptions (including for The Garden) and the ability for us and Madison Square Garden Entertainment Corp.

• a pandemic or another public health emergency and our ability to effectively manage the impacts, including labor market disruptions;

• activities or other developments that discourage or may discourage congregation at prominent places of public assembly, including Madison Square Garden Arena (“The Garden”) where the home games of the New York Knickerbockers (the “Knicks”) and the New York Rangers (the “Rangers”) are played;

• the impact of governmental regulations or laws, changes in how those regulations and laws are interpreted and the continued benefit of certain tax exemptions (including for The Garden) or tax deductions and the ability for us and Madison Square Garden Entertainment Corp.

(“MSG Entertainment”) to maintain necessary permits or licenses;

• the impact of any government plans to redesign New York City’s Pennsylvania Station;

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• certain restrictions on transfer and ownership of our common stock related to our ownership of professional sports franchises in the NBA and NHL;

• the tax-free treatment of the distribution of all of the outstanding common stock of Sphere Entertainment Co.

(“Sphere Entertainment”) to its stockholders, which was completed on April 17, 2020;

• the factors described under “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended June 30, 2024 and in this Quarterly Report on Form 10-Q.

• the factors described under “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended June 30, 2025 (our “2025 Form 10-K”).

We disclaim any obligation to update or revise the forward-looking statements contained herein, except as otherwise required by applicable federal securities laws.

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 financial statements and accompanying notes thereto included in this Quarterly Report on Form 10-Q, as well as the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2024, 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 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 Sports,” or the “Company” refer collectively to Madison Square Garden Sports Corp., a holding company, and its direct and indirect subsidiaries through which substantially all of our operations are conducted.

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Results of Operations.

This section provides an analysis of our unaudited results of operations for the three and nine months ended March 31, 2025 compared to the three and nine months ended March 31, 2024.

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

Liquidity and Capital Resources.

This section focuses primarily on (i) the liquidity and capital resources of the Company, (ii) an analysis of the Company’s cash flows for the nine months ended March 31, 2025 compared to the nine months ended March 31, 2024, and (iii) certain contractual obligations.

This section focuses primarily on (i) the liquidity and capital resources of the Company, (ii) an analysis of the Company’s cash flows for the three months ended September 30, 2025 compared to the three months ended September 30, 2024, and (iii) certain contractual obligations.

Seasonality of Our Business.

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This section discusses accounting pronouncements that have been adopted by the Company, if any, as well as the results of the Company’s annual impairment testing of goodwill and identifiable indefinite-lived intangible assets performed during the first quarter of fiscal year 2026.

This section should be read together with our critical accounting policies, which are discussed in our Annual Report on Form 10-K for the fiscal year ended June 30, 2024 under “Item 7.

This section should be read together with our critical accounting policies, which are discussed in our 2025 Form 10-K under “Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations — Recently Issued Accounting Pronouncements and Critical Accounting Policies — Critical Accounting Policies” and in the notes to the consolidated financial statements of the Company included therein.

Matters Affecting Comparability

Proposed Amendments to Media Rights Agreements

On April 24, 2025, New York Knicks, LLC and New York Rangers, LLC (collectively, the “Teams”), entered into a Transaction Support Agreement (the “Transaction Support Agreement”) with respect to amendments to the media rights agreements between subsidiaries of MSG Networks and the Teams and the restructuring of the debt of subsidiaries of MSG Networks (the “Transactions”).

The Transaction Support Agreement contemplates entering into amendments to the media rights agreements to which the Teams are a party, effective as of January 1, 2025, as follows:

Factors Affecting Operating Results

Amendments to Media Rights Agreements

On June 27, 2025, the media rights agreements between subsidiaries of MSG Networks, on the one hand, and New York Knicks, LLC (“Knicks LLC”) and New York Rangers, LLC (“Rangers LLC”), on the other hand, were amended, as follows:

• New York Knicks:

◦ a reduction of 28% in the annual rights fee;

◦ a modification to the annual rights fee to effect a 28% reduction as of January 1, 2025;

◦ an elimination of the annual rights fee escalator;

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• New York Rangers:

◦ a reduction of 18% in the annual rights fee;

◦ a modification to the annual rights fee to effect an 18% reduction as of January 1, 2025;

◦ an elimination of the annual rights fee escalator;

◦ a change to the contract expiration date to the end of the 2028-29 season, subject to a right of first refusal in favor of MSG Networks.

• the issuance by MSG Networks of penny warrants to the Company exercisable for 19.9% of the equity interests in MSG Networks.

The Transactions will be consummated upon the execution of definitive documents containing terms consistent with those set forth in the Transaction Support Agreement.

As a result of the proposed amendments to the media rights agreements contemplated by the Transaction Support Agreement, media rights fees revenues for the three and nine months ended March 31, 2025 have been recorded at the applicable reduced rate described above.

Concurrent with the amendments to the media rights agreements, MSG Networks issued penny warrants to the Company exercisable for 19.9% of the equity interests in MSG Networks.

As a result of the amendments to the media rights agreements, media rights fees revenues for the three months ended September 30, 2025 have been recorded at the applicable reduced rate described above.

The Company also expects to record media rights fees reflecting the reduced rates described above in future periods.

Knicks and Rangers Home Games at The Garden

The Company’s operating results are impacted by the number of home games the Knicks and the Rangers play at The Garden during each quarter of the fiscal year.

For the three months ended March 31, 2025 the Knicks and the Rangers played two fewer combined home games at The Garden during the current year period as compared to the prior year period.

For the nine months ended March 31, 2025 the Knicks and the Rangers playing a combined one additional home game at The Garden during the current year period as compared to the prior year period.

The Knicks played 23 games at The Garden during the three months ended March 31, 2025 and 40 games at The Garden during the nine months ended March 31, 2025 as compared to 26 and 41 games, respectively, during the prior year periods.

The Rangers played 20 games at The Garden during the three months ended March 31, 2025 and 40 games at The Garden during the nine months ended March 31, 2025 as compared to 19 and 38 games, respectively, during the prior year periods.

Results of Operations

Comparison of the three and nine months ended March 31, 2025 versus the three and nine months ended March 31, 2024

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

The table below sets forth, for the periods presented, certain historical financial information.

Three Months Ended Nine Months Ended

March 31, Change March 31, Change

Three Months Ended September 30, Change

2025 2024 $ %

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Depreciation and amortization 811 782 29 4 %

Operating income 32,342 79,742 (47,400) (59) % 37,384 93,735 (56,351) (60) %

Operating loss (27,425) (8,273) (19,152) NM

Other income (expense):

Interest income 1,051 477 574 NM 2,605 1,549 1,056 68 %

Interest income 578 864 (286) (33) %

Interest expense (5,591) (6,055) 464 (8) %

Miscellaneous expense, net (5,743) (1,403) (4,340) NM (13,478) (11,077) (2,401) 22 %

Income before income taxes 22,630 71,895 (49,265) (69) % 9,849 62,938 (53,089) (84) %

Income tax expense (36,857) (34,018) (2,839) 8 % (30,507) (29,658) (849) 3 %

Net (loss) income $ (14,227) $ 37,877 $ (52,104) NM $ (20,658) $ 33,280 $ (53,938) NM

Miscellaneous income (expense), net 15,085 (1,126) 16,211 NM

Loss before income taxes (17,353) (14,590) (2,763) (19) %

Income tax benefit 8,555 7,048 1,507 21 %

Net loss $ (8,798) $ (7,542) $ (1,256) (17) %

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NM - Percentage is not meaningful

Revenues decreased $5,757, or 1%, to $424,197 for the three months ended March 31, 2025 as compared to the prior year period.

Revenues increased $35,365, or 4%, to $835,263 for the nine months ended March 31, 2025 as compared to the prior year period.

The net (decrease) increase were attributable to the following:

Months Months

Revenues decreased $13,853, or 26%, to $39,454 for the three months ended September 30, 2025 as compared to the prior year period.

The n et decrease was attributable to the following:

Decrease in revenues from league distributions $ (11,429)

Decrease in revenues from local media rights fees (2,253)

Decrease in pre/regular season food, beverage and merchandise sales (2,534) (96)

Increase in sponsorship and signage revenues 8,898 11,602

Increase in suite revenues 3,401 10,669

Increase in revenues from league distributions 2,446 14,822

Increase in pre/regular season ticket-related revenues 506 15,272

Other net increases (decreases) 164 (67)

$ (5,757) $ 35,365

The decreases in revenues from local media rights fees for the three and nine months ended March 31, 2025 were primarily due to a reduction in expected local media rights fees for the 2024-25 season as a result of proposed amendments to the Knicks’ and Rangers’ local media rights agreements with MSG Networks contemplated in the Transaction Support Agreement.

As a result of the amendments contemplated by the Transaction Support Agreement, the Company expects revenues from local media rights fees will be $1,098 lower for the three months ended June 30, 2025, as compared to the prior year period.

Stated annual local media rights fees, subject to adjustments in certain circumstances, including if the Company does not make available a minimum number of games in the year, after consideration of the media rights amendments contemplated in the Transaction Support Agreement are anticipated to be $162,939 and $139,237 for the years ended June 30, 2025 and 2026, respectively.

The decrease in pre/regular season food, beverage, and merchandise sales for the three months ended March 31, 2025 was primarily due to lower average per-game revenue, lower online sales of merchandise, and the Knicks and the Rangers playing two fewer combined home games at The Garden during the current year period as compared to the prior year period.

decrease in pre/regular season food, beverage, and merchandise sales for the nine months ended March 31, 2025 was primarily due to lower online sales of merchandise, partially offset by the Knicks and the Rangers playing a combined one additional home game at The Garden during the current year period as compared to the prior year period and higher average per-game revenue.

Merchandise sales for the three and nine months ended March 31, 2024 included the positive impact of new Rangers’ jersey launches.

The increase in sponsorship and signage revenues for the three months ended March 31, 2025 was primarily due to higher net sales of existing sponsorship and signage inventory, partially offset by the Knicks and the Rangers playing two fewer combined home games at The Garden during the current year period as compared to the prior year period.

The increase in sponsorship and signage revenues for the nine months ended March 31, 2025 was primarily due to higher net sales of existing sponsorship and signage inventory.

The increase in suite revenues for the three months ended March 31, 2025 was primarily due higher net sales of suite products, partially offset by the Knicks and the Rangers playing two fewer combined home games at The Garden during the current year period as compared to the prior year period.

The increase in suite revenues for the nine months ended March 31, 2025 was primarily due higher net sales of suite products and the Knicks and the Rangers playing a combined one additional home game at The Garden during the current year period as compared to the prior year period.

The increase in revenues from league distributions for the three months ended March 31, 2025 was primarily due to increased national media rights fees in the current year period.

The increase in revenues from league distributions for the nine months ended March 31, 2025 was primarily due to an increase in certain league distributions unrelated to national media rights fees and increased national media rights fees in the current year period.

The increase in pre/regular season ticket-related revenues for the three months ended March 31, 2025 was primarily due to higher average per-game revenue, partially offset by the Knicks and the Rangers playing two fewer combined home games at The Garden during the current year period as compared to the prior year period.

The increase in pre/regular season ticket-related revenues for the nine months ended March 31, 2025 was primarily due to higher average per-game revenue and the Knicks and the Rangers playing a combined one additional home game at The Garden during the current year period as compared to the prior year period.

Other net decreases (171)

The decrease in revenues from league distributions for the three months ended September 30, 2025 was primarily due to a decrease in certain league distributions unrelated to national media rights fees.

The decrease in revenues from local media rights fees for the three months ended September 30, 2025 was primarily due to reduced local media rights fees as a result of amendments to the Knicks’ and Rangers’ local media rights agreements with MSG Networks entered into in the fourth quarter of fiscal year 2025, and to a lesser extent, a reduction in rights fees due to a decrease in the number of games exclusively available to MSG Networks during the current fiscal year as compared to the prior fiscal year.

Stated annual local media rights fees, subject to adjustments in certain circumstances, including if the Company does not make available a minimum number of games in the year, after consideration of the media rights amendments are $139,237 for the year ending June 30, 2026 as compared to $162,939 in stated annual local media rights fees for the fiscal year ended June 30, 2025.

Direct operating expenses

Direct operating expenses increased $43,309, or 16%, to $316,335 for the three months ended March 31, 2025 as compared to the prior year period.

Direct operating expenses increased $91,528, or 18%, to $600,299 for the nine months ended March 31, 2025 as compared to the prior year period.

The net increases were attributable to the following:

Months Months

Increase in net provisions for league revenue sharing expense (net of escrow and excluding playoffs) and NBA luxury tax $ 33,808 $ 52,808

Increase in team personnel compensation 14,692 29,939

Increase in other team operating expenses 1,091 2,972

(Decrease) increase in net (credits) provisions for certain team personnel transactions (2,823) 5,596

(Decrease) increase in operating lease costs associated with the Knicks and the Rangers playing home games at The Garden (1,989) 429

Decrease in pre/regular season expense associated with merchandise sales (1,470) (216)

$ 43,309 $ 91,528

Three Months Ended Nine Months Ended

March 31, March 31,

2025 2024 Increase 2025 2024 Increase

Net provisions for league revenue sharing expense (net of escrow and excluding playoffs) and NBA luxury tax $ 53,911 $ 20,103 $ 33,808 $ 95,329 $ 42,521 $ 52,808

The increases in net provisions for league revenue sharing expense (net of escrow and excluding playoffs) and NBA luxury tax for the three and nine months ended March 31, 2025 were primarily due to higher NBA luxury tax expense.

In addition, the increase in net provisions for league revenue sharing expense (net of escrow and excluding playoffs) and NBA luxury tax for

the three months ended March 31, 2025 was partially due to higher provisions for league revenue sharing expense (net of escrow and excluding playoffs).

The increases in NBA luxury tax expense were the result of the Knicks being a significant luxury tax payer for the 2024-25 season based on their roster as of March 31, 2025, whereas the Knicks were not a luxury tax payer for the 2023-24 season.

The Knicks received an equal share of the portion of luxury tax receipts that were distributed to non-paying teams for the 2023-24 season.

The actual net provisions for league revenue sharing expense (net of escrow and excluding playoffs) for the 2024-25 seasons may vary significantly from the recorded provisions based on actual operating results for each league and all teams within each league for the season and other factors.

The increases in team personnel compensation for the three and nine months ended March 31, 2025 were primarily due to changes in the Knicks roster.

Other team operating expenses primarily consist of expenses associated with day-to-day operations, including variable day-of-event costs incurred at The Garden, team travel, player insurance, and league assessments.

The increase in other team operating expenses for the three months ended March 31, 2025 was primarily due to higher average per-game expenses, partially offset by the Knicks and the Rangers playing two fewer combined home games at The Garden during the current year period as compared to the prior year period.

The increase in other team operating expenses for the nine months ended March 31, 2025 was primarily due to higher average per-game expenses and the Knicks and the Rangers playing a combined one additional home game at The Garden during the current year period as compared to the prior year period.

Net (credits) provisions for certain team personnel transactions were as follows:

Three Months Ended Nine Months Ended

March 31, March 31,

2025 2024 Decrease 2025 2024 Increase (Decrease)

Season-ending player injuries $ 133 $ 2,170 $ (2,037) $ 133 $ 2,170 $ (2,037)

Player trades (786) — (786) 6,800 — 6,800

Waivers/contract terminations — — — 833 — 833

Net (credits) provisions for certain team personnel transactions $ (653) $ 2,170 $ (2,823) $ 7,766 $ 2,170 $ 5,596

The decrease in operating lease costs associated with the Knicks and the Rangers playing home games at The Garden for the three months ended March 31, 2025 was a result of the Knicks and the Rangers playing two fewer combined home games at The Garden during the current year period as compared to the prior year period.

The increase in operating lease costs associated with the Knicks and the Rangers playing home games at The Garden for the nine months ended March 31, 2025 was a result of the Knicks and the Rangers playing a combined one additional home game at The Garden during the current year period as compared to the prior year period.

Recognition of operating lease costs is recorded on a straight-line basis over the term of the applicable agreement based upon the value of total future payments under the arrangement.

Operating lease costs associated with the Knicks and the Rangers playing home games at The Garden includes operating lease costs of (i) $21,747 and $40,048 of expense paid in cash for the three and nine months ended March 31, 2025, respectively, and $22,372 and $38,610 of expense paid in cash for the three and nine months ended March 31, 2024, respectively, and (ii) a non-cash expense of $11,633 and $21,424 for the three and nine months ended March 31, 2025, respectively, and $12,998 and $22,433 for the three and nine months ended March 31, 2024, respectively.

The decrease in pre/regular season expense associated with merchandise sales for the three months ended March 31, 2025 was primarily related to lower average per-game revenue, lower online sales of merchandise, and the Knicks and the Rangers playing two fewer combined home games at The Garden during the current year period as compared to the prior year period.

The decrease in pre/regular season expense associated with merchandise sales for the nine months ended March 31, 2025 was primarily due to higher reserves for obsolete inventory recorded in the prior year period as compared to the current year period.

Direct operating expenses increased $68, or 1%, to $8,279 for the three months ended September 30, 2025 as compared to the prior year period.

The net increase was attributable to the following:

Increase in net provisions for certain team personnel transactions $ 1,549

Decrease in net provisions for league revenue sharing expense (net of escrow and excluding playoffs) and NBA luxury tax (2,428)

Other net increases 947

Net provisions for certain team personnel transactions for the three months ended September 30, 2025 and 2024 reflect provisions recorded for waiver/contract terminations of $2,382 and $833, respectively.

The decrease in net provisions for league revenue sharing expense (net of escrow and excluding playoffs) and NBA luxury tax for the three months ended September 30, 2025 was due to the net impact of adjustments to prior seasons’ revenue sharing expense (net of escrow).

Selling, general and administrative expenses

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Selling, general and administrative expenses generally do not fluctuate in line with changes in the Company’s revenues and direct operating expenses.

Selling, general and administrative expenses for the three months ended March 31, 2025 decreased $1,701, or 2%, to $74,697 as compared to the prior year period driven by lower employee compensation and related benefits of $12,423, primarily related to executive management transition costs recognized in the prior year period, and lower other general and administrative expenses, partially offset by (i) higher professional fees of $7,617, (ii) higher costs related to the Services Agreement of $1,844, (iii) higher operating lease costs of $1,373, and (iv) higher fees related to the Sponsorship Sales and Service Representation Agreements of $1,182.

Selling, general and administrative expenses for the nine months ended March 31, 2025 increased $164 to $195,184 as compared to the prior year period driven by (i) higher professional fees of $11,518, (ii) higher operating lease costs of $5,138, and (iii) higher fees related to the Sponsorship Sales and Service Representation Agreements of $1,686, offset by lower employee compensation and related benefits of $15,701, primarily related to executive management transition costs recognized in the prior year period, lower sales and marketing costs of $2,202, and lower other general and administrative expenses.

Operating income

Operating income for the three months ended March 31, 2025 decreased $47,400, or 59%, to $32,342 as compared to the prior year period primarily due to higher direct operating expenses and, to a lesser extent, lower revenues.

Operating income for the nine months ended March 31, 2025 decreased $56,351, or 60%, to $37,384 as compared to the prior year period primarily due to higher direct operating expenses, partially offset by higher revenues.

Selling, general and administrative expenses for the three months ended September 30, 2025 increased $5,202, or 10%, to $57,789 as compared to the prior year period driven by (i) higher costs related to the Services Agreement of $1,614, (ii) higher operating lease costs of $1,222, (iii) higher employee compensation and related benefits of $1,008, and (iv) higher other general and administrative expenses.

Operating loss

Operating loss for the three months ended September 30, 2025 increased $19,152 to $27,425 as compared to the prior year period primarily due to lower revenues and higher selling, general and administrative expenses.

Interest income

Interest income for the three months ended March 31, 2025 increased $574 to $1,051 as compared to the prior year period primarily due to higher average cash balances in the current year period, partially offset by lower average interest rates.

Interest income for the nine months ended March 31, 2025 increased $1,056, or 68%, to $2,605 as compared to the prior year period primarily due to higher average cash balances in the current year period, partially offset by lower average interest rates.

Interest income for the three months ended September 30, 2025 decreased $286, or 33%, to $578 as compared to the prior year period primarily due to lower average interest rates and lower average cash balances in the current year period.

Interest expense

Interest expense for the three months ended March 31, 2025 decreased $1,901, or 27%, to $5,020 as compared to the prior year period primarily due to lower average borrowings under the Rangers Revolving Credit Facility in the current year period and lower average interest rates under the Knicks Revolving Credit Facility in the current year period.

Interest expense for the nine months ended March 31, 2025 decreased $4,607, or 22%, to $16,662 as compared to the prior year period primarily due to lower average borrowings under the Rangers Revolving Credit Facility in the current year period and lower average interest rates under the Knicks Revolving Credit Facility in the current year period.

Miscellaneous expense, net

Miscellaneous expense, net for the three months ended March 31, 2025 increased $4,340 to $5,743 as compared to the prior year period primarily due to higher unrealized losses in the current year period as compared to the prior year period related to the Company’s investments in Xtract One common stock and warrants and the net impact of the remeasurement of the fair value of assets under the Deferred Compensation Plan.

Miscellaneous expense, net for the nine months ended March 31, 2025 increased $2,401, or 22%, to $13,478 as compared to the prior year period primarily due to higher unrealized losses in the current year period related to the Company’s investments in equity investments without readily determinable fair values and Xtract One common stock and warrants, and lower unrealized gains in the current year period related to the remeasurement of the fair value of assets under the Deferred Compensation Plan.

Interest expense for the three months ended September 30, 2025 decreased $464, or 8%, to $5,591 as compared to the prior year period primarily due to lower average interest rates and lower average borrowings under the Knicks Revolving Credit Facility in the current year period, partially offset by higher other interest expense.

Miscellaneous income (expense), net

Miscellaneous income (expense), net for the three months ended September 30, 2025 reflected net income of $15,085 and miscellaneous income (expense), net for the three months ended September 30, 2024 reflected net expense of $1,126.

The increase in miscellaneous income (expense), net relates to changes in fair value in the Company’s investments.

See Note 16 to the consolidated financial statements included in “Part I — Item 1.

Financial Statements” of this Quarterly Report on Form 10-Q for a discussion of the Company’s income taxes.

Adjusted operating income

Changes in tax regulations could limit the availability of tax benefits or deductions that the Company expects to claim or otherwise increase the taxes imposed on the Company’s operations.

For example, to the extent the expansion of Section 162(m) of the U.S.

Internal Revenue Code, which will become effective for the Company’s fiscal year ending June 30, 2028, reduces the amount of tax deductions available to us, our income tax expense would increase, which would reduce our net income.

See “Item 1A.

Risk Factors—Operational Risks—We Are Subject to Governmental Regulation, Which Can Change, and Any

Failure to Comply With These Regulations May Have a Material Negative Effect on Our Business and Results of Operations” in our 2025 Form 10-K.

Adjusted operating loss

The Company evaluates performance based on several factors, of which the key financial measure is operating income (loss) excluding (i) depreciation, amortization and impairments of property and equipment, goodwill and other intangible assets, (ii) share-based compensation expense or benefit, (iii) restructuring charges or credits, (iv) gains or losses on sales or dispositions of businesses, (v) the impact of purchase accounting adjustments related to business acquisitions, and (vi) gains and losses related to the remeasurement of liabilities under the Company’s Executive Deferred Compensation Plan, which is referred to as adjusted operating income (loss), a non-GAAP measure.

Management believes that the exclusion of share-based compensation expense or benefit allows investors to better track the performance of the Company’s business without regard to the settlement of an obligation that is not expected to be made in

In addition, management believes that the exclusion of gains and losses related to the remeasurement of liabilities under the Company’s 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 Company’s Executive Deferred Compensation Plan are recognized in Operating income (loss) whereas gains and losses related to the remeasurement of the assets under the Company’s 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 Miscellaneous income (expense), net, which is not reflected in Operating income (loss).

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The Company has presented the components that reconcile operating income (loss), the most directly comparable GAAP financial measure, to adjusted operating income (loss).

The following are the reconciliations of operating income to adjusted operating income for the three and nine months ended March 31, 2025 and 2024:

Three Months Ended Nine Months Ended

March 31, Change March 31, Change

The following are the reconciliations of operating loss to adjusted operating loss for the three months ended September 30, 2025 and 2024:

Three Months Ended September 30, Change

2025 2024 $ %

Operating income $ 32,342 $ 79,742 $ (47,400) (59) % $ 37,384 $ 93,735 $ (56,351) (60) %

Operating loss $ (27,425) $ (8,273) $ (19,152) NM

Depreciation and amortization 811 782

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Remeasurement of deferred compensation plan liabilities 963 965

Adjusted operating income $ 36,931 $ 88,701 $ (51,770) (58) % $ 54,912 $ 115,732 $ (60,820) (53) %

For the three months ended March 31, 2025, adjusted operating income decreased $51,770, or 58%, to $36,931 as compared to the prior year period.

The decrease in adjusted operating income was primarily due to higher direct operating expenses and, to a lesser extent, lower revenues.

For the nine months ended March 31, 2025, adjusted operating income decreased $60,820, or 53%, to $54,912 as compared to the prior year period.

The decrease in adjusted operating income was primarily due to higher direct operating expenses, partially offset by higher revenues.

Adjusted operating loss $ (20,807) $ (2,258) $ (18,549) NM

For the three months ended September 30, 2025, adjusted operating loss increased $18,549 to $20,807 as compared to the prior year period.

The increase in adjusted operating loss was primarily due to lower revenues and higher selling, general and administrative expenses.

Liquidity and Capital Resources

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Our principal uses of cash include the operation of our businesses, working capital-related items, the repayment of outstanding debt, repurchases of shares of the Company’s Class A Common Stock, dividends, if declared, and investments.

As of March 31, 2025, we had $96,536 in C ash and cash equivale nts.

In addition, as of March 31, 2025, the Company’s deferred revenue obligations were $124,958, net of billed, but not yet collected deferred revenue.

This balance is primarily comprised of obligations in connection with tickets and suites.

As of September 30, 2025, we had $48,634 in C ash and cash equivale nts.

In addition, as of September 30, 2025, the Company’s deferred revenue obligations were $302,021, net of billed, but not yet collected deferred revenue.

This balance is primarily comprised of obligations in connection with tickets, suites, sponsorships, and local media rights.

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

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and global economic and market conditions could adversely impact its ability to do so at that time.

We believe we have sufficient liquidity, including approximately $96,536 in Cash and cash equivalents as of March 31, 2025, along with $258,000 of additional available borrowing capacity under existing credit facilities (as of March 31, 2025), to fund our operations and satisfy any obligations for the foreseeable future.

We believe we have sufficient liquidity, including approximately $48,634 in Cash and cash equivalents as of September 30, 2025, along with $258,000 of additional available borrowing capacity under existing credit facilities (as of September 30, 2025), to fund our operations and satisfy any obligations for the foreseeable future.

If MSG Networks were to experience a bankruptcy or insolvency event (as set forth in each of the credit facilities), we would be prevented, absent a cure or waiver, from making borrowings under our revolving credit facilities.

The Rangers Credit Agreement also includes an event of default upon a bankruptcy or insolvency event with respect to a material media rights counterparty, including MSG Networks.

There were no borrowings outstanding under the Rangers Revolving Credit Facility as of March 31, 2025.

In addition, we had an outstanding receivable balance of $30,101 as of March 31, 2025 from MSG Networks related to unpaid amounts under the media rights agreements.

If MSG Networks were to experience a bankruptcy or insolvency event, some or all of this accounts receivable balance could be impaired.

There were no borrowings outstanding under the Rangers Revolving Credit Facility as of September 30, 2025.

See “Item 1A.

Risk Factors — Economic and Business Relationship Risks — Certain of Our Subsidiaries Have Incurred Substantial Indebtedness, and the Occurrence of an Event of Default Under Our Subsidiaries’ Credit Facilities or Our Inability to Repay Such Indebtedness When Due Could Substantially Impair the Assets of Those Subsidiaries and Have a Negative Effect on Our Business.

” in our 2025 Form 10-K.

Financing Agreements and Stock Repurchases

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Contractual Obligations

The Company did not have any material changes in its contractual obligations since the end of fiscal year 2024 other than the New Sublease Agreement described in Note 7 to the consolidated financial statements included in “Part I — Item 1.

Financial Statements” of this Quarterly Report on Form 10-Q and activities in the ordinary course of business.

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.

Cash Flow Discussion

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

Nine Months Ended March 31,

Net (loss) income $ (20,658) $ 33,280

Adjustments to reconcile net (loss) income to net cash provided by (used in) operating activities:

21,038 24,407

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 loss $ (8,798) $ (7,542)

Adjustments to reconcile net loss to net cash used in operating activities:

Changes in working capital assets and liabilities (59,475) (18,811)

Net cash provided by (used in) operating activities 41,884 (16,220)

Net cash used in operating activities (84,954) (26,158)

Net cash used in investing activities (1,848) (1,163)

Net cash (used in) provided by financing activities (26,406) 26,234

Net increase in cash, cash equivalents and restricted cash $ 10,129 $ 4,325

Net cash used in financing activities (9,110) (9,502)

Net decrease in cash, cash equivalents and restricted cash $ (95,912) $ (36,823)

Operating Activities

Net cash provided by (used in) operating activities for the nine months ended March 31, 2025 improved by $58,104 to $41,884 as compared to the prior year period.

The improvement was primarily due to changes in working capital assets and liabilities, partially

offset by the decrease in net (loss) income adjusted for non-cash items.

The changes in working capital assets and liabilities were primarily driven by (i) an increase in deferred revenue of $68,441 primarily due to higher collections of ticket, suites, and sponsorship sales in advance of recognition, (ii) a higher increase in accrued and other liabilities of $39,964 primarily due to increased accruals for NBA luxury tax in the current year period, (iii) a lower increase in prepaid expenses and other assets of $33,982 primarily due to a lower increase in contract assets in the current year period primarily due to lower revenue recognized under the Company’s local media rights agreements, and (iv) a decrease in net related party receivables of $10,327 primarily due to the timing of collections related to the Company’s Sponsorship Sales and Service Representation Agreements.

These changes were partially offset by a higher increase in accounts receivable, net of $39,559 primarily due to higher accounts receivable from MSG Networks related to unpaid amounts under the local media rights agreements.

Net cash used in operating activities for the three months ended September 30, 2025 increased by $58,796 to $84,954 as compared to the prior year period.

The increase in net cash used in operating activities was primarily due to changes in working capital assets and liabilities and the decrease in net loss adjusted for non-cash items.

The changes in working capital assets and liabilities were primarily driven by (i) an increase in net related party receivables of $29,339 primarily due to the timing of collections related to the Company’s Arena License Agreements., (ii) a higher increase in prepaid expenses and other assets of $16,478 primarily due to higher prepayments related to team personnel compensation and income taxes in the current year period, and (iii) a higher increase in accounts receivable, net, of $5,242 primarily due to the lack of receipts related to NBA luxury tax in the current year period, partially offset by higher collections of sponsorship sales in the current year period.

These changes were partially offset by a higher increase in deferred revenue of $8,247 primarily due to higher collections of ticket sales in advance of recognition in the current year period.

Investing Activities

Net cash used in investing activities for the nine months ended March 31, 2025 decreased by $340 to $5,349 as compared to the prior year period primarily due to lower purchases of investments in the current year period, partially offset by higher capital expenditures.

Net cash used in investing activities for the three months ended September 30, 2025 increased by $685 to $1,848 as compared to the prior year period primarily due to higher purchases of investments in the current year period.

Financing Activities

Net cash used in financing activities for the nine months ended March 31, 2025 was $26,406 as compared to net cash provided by financing activities for the nine months ended March 31, 2024 of $26,234.

This was primarily due to additional borrowings under the Company’s credit facilities in the prior year period and, to a lesser extent, the impact of principal repayments under the Rangers NHL Advance Agreement in the current year period and higher taxes paid in lieu of shares issued for equity-based compensation in the current year period.

These were partially offset by lower repayments under the Company’s credit facilities in the current year period.

Net cash used in financing activities for the three months ended September 30, 2025 decreased by $392 to $9,110 as compared to the prior year period primarily due to lower taxes paid in lieu of shares issued for equity-based compensation and lower dividends paid in the current year period.

Seasonality of Our Business

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The following discussion has been included to provide the results of our annual impairment testing of goodwill and identifiable indefinite-lived intangible assets performed during the first quarter of fiscal year 2026.

There have been no material changes to the Company’s critical accounting policies from those set forth in our Annual Report on Form 10-K for the fiscal year ended June 30, 2024.

The carrying amount of goodwill as of March 31, 2025 was $226,523.

There have been no material changes to the Company’s critical accounting policies from those set forth in our 2025 Form 10-K.

The carrying amount of goodwill as of September 30, 2025 was $226,523.

Goodwill is tested annually for impairment as of August 31 st and at any time upon the occurrence of certain events or changes in circumstances.

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The Company performed its most recent annual impairment test of goodwill during the first quarter of fiscal year 2026, and there was no impairment of goodwill.

Based on this impairment test, the Company concluded it was not more likely than not that the fair value of the reporting unit was less than its carrying amount.

Based on this impairment test, the Company concluded it was not more likely than not

that the fair value of the reporting unit was less than its carrying amount.

Identifiable Indefinite-Lived Intangible Assets

Identifiable indefinite-lived intangible assets are tested annually for impairment as of August 31 st and at any time upon the occurrence of certain events or substantive changes in circumstances.

The following table sets forth the amount of identifiable indefinite-lived intangible assets reported in the Company’s consolidated balance sheet as of March 31, 2025:

The following table sets forth the amount of identifiable indefinite-lived intangible assets reported in the Company’s consolidated balance sheet as of September 30, 2025:

Sports franchises $ 102,564

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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