What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2024-02-06 compared with 2023-11-02 · 244 added, 156 removed, 552 unchanged (42% of the section changed)

3 unchanged sentences

(in thousands, except per share data)

September 30,

2023 June 30,

2 unchanged sentences

Restricted cash 3,352 61

Accounts receivable, net of allowance for doubtful accounts of $ 0 and $ 0 as of September 30, 2023 and June 30, 2023, respectively

Accounts receivable, net of allowance for doubtful accounts of $ 0 and $ 0 as of December 31, 2023 and June 30, 2023, respectively

72,668 40,139

3 unchanged sentences

Total current assets 215,633 149,233

Property and equipment, net of accumulated depreciation and amortization of $ 49,911 and $ 49,117 as of September 30, 2023 and June 30, 2023, respectively

Property and equipment, net of accumulated depreciation and amortization of $ 50,701 and $ 49,117 as of December 31, 2023 and June 30, 2023, respectively

29,697 30,501

9 unchanged sentences

(in thousands, except per share data)

September 30,

2023 June 30,

22 unchanged sentences

Class A Common Stock, par value $ 0.01 , 120,000 shares authorized;

19,404 and 19,364 shares outstanding as of September 30, 2023 and June 30, 2023, respectively

19,412 and 19,364 shares outstanding as of December 31, 2023 and June 30, 2023, respectively

Class B Common Stock, par value $ 0.01 , 30,000 shares authorized;

4,530 shares outstanding as of September 30, 2023 and June 30, 2023

4,530 shares outstanding as of December 31, 2023 and June 30, 2023

Preferred stock, par value $ 0.01 , 15,000 shares authorized;

none outstanding as of September 30, 2023 and June 30, 2023

none outstanding as of December 31, 2023 and June 30, 2023

Additional paid-in capital 11,471 16,846

Treasury stock, at cost, 1,044 and 1,084 shares as of September 30, 2023 and June 30, 2023, respectively

Treasury stock, at cost, 1,036 and 1,084 shares as of December 31, 2023 and June 30, 2023, respectively

( 171,400 ) ( 179,410 )

7 unchanged sentences

(in thousands, except per share data)

Three Months Ended

September 30,

Three Months Ended Six Months Ended

December 31, December 31,

2023 2022 2023 2022

$ 326,898 $ 353,694 $ 369,944 $ 377,783

Operating expenses:

Direct operating expenses (b)

232,225 225,702 235,745 229,383

Selling, general and administrative expenses (c)

1 unchanged sentence

Depreciation and amortization 790 838 1,584 1,863

Operating loss ( 14,824 ) ( 35,898 )

Operating income 28,817 51,518 13,993 15,620

Other income (expense):

1 unchanged sentence

Interest expense ( 7,419 ) ( 6,079 ) ( 14,348 ) ( 9,391 )

Miscellaneous expense, net ( 12,665 ) ( 166 )

Miscellaneous income (expense), net 2,991 385 ( 9,674 ) 219

( 3,809 ) ( 5,127 ) ( 22,950 ) ( 8,249 )

Loss before income taxes ( 33,965 ) ( 39,020 )

Income tax benefit 15,144 20,493

Net loss ( 18,821 ) ( 18,527 )

Income (loss) before income taxes 25,008 46,391 ( 8,957 ) 7,371

Income tax (expense) benefit ( 10,784 ) ( 24,555 ) 4,360 ( 4,062 )

Net income (loss) 14,224 21,836 ( 4,597 ) 3,309

Net loss attributable to nonredeemable noncontrolling interests — ( 655 ) — ( 1,362 )

Net loss attributable to Madison Square Garden Sports Corp.’s stockholders $ ( 18,821 ) $ ( 17,820 )

Basic loss per common share attributable to Madison Square Garden Sports Corp.’s stockholders $ ( 0.79 ) $ ( 0.73 )

Diluted loss per common share attributable to Madison Square Garden Sports Corp.’s stockholders $ ( 0.79 ) $ ( 0.73 )

Net income (loss) attributable to Madison Square Garden Sports Corp.’s stockholders $ 14,224 $ 22,491 $ ( 4,597 ) $ 4,671

Basic earnings (loss) per common share attributable to Madison Square Garden Sports Corp.’s stockholders $ 0.59 $ 0.85 $ ( 0.19 ) $ 0.11

Diluted earnings (loss) per common share attributable to Madison Square Garden Sports Corp.’s stockholders $ 0.59 $ 0.84 $ ( 0.19 ) $ 0.11

Weighted-average number of common shares outstanding:

2 unchanged sentences

_________________

(a) Includes revenues from related parties of $ 8,817 and $ 8,174 for the three months ended September 30, 2023 and 2022, respectively.

(b) Includes net charges from related parties of $ 2,616 and $ 2,184 for the three months ended September 30, 2023 and 2022, respectively.

(c) Includes net charges from related parties of $ 12,125 and $ 13,308 for the three months ended September 30, 2023 and 2022, respectively.

(a) Includes revenues from related parties of $ 77,658 and $ 74,950 for the three months ended December 31, 2023 and 2022, respectively, and $ 86,475 and $ 83,124 for the six months ended December 31, 2023 and 2022, respectively.

(b) Includes net charges from related parties of $ 35,683 and $ 45,485 for the three months ended December 31, 2023 and 2022, respectively, and $ 38,299 and $ 47,669 for the six months ended December 31, 2023 and 2022, respectively.

(c) Includes net charges from related parties of $ 16,630 and $ 17,433 for the three months ended December 31, 2023 and 2022, respectively, and $ 28,755 and $ 30,741 for the six months ended December 31, 2023 and 2022, respectively.

See accompanying notes to consolidated financial statements.

2 unchanged sentences

(in thousands)

Three Months Ended

September 30,

Net loss $ ( 18,821 ) $ ( 18,527 )

Three Months Ended Six Months Ended

December 31, December 31,

2023 2022 2023 2022

Net income (loss) $ 14,224 $ 21,836 $ ( 4,597 ) $ 3,309

Other comprehensive income, before income taxes:

5 unchanged sentences

Other comprehensive income, net of income taxes 6 3 12 6

Comprehensive loss ( 18,815 ) ( 18,524 )

Comprehensive income (loss) 14,230 21,839 ( 4,585 ) 3,315

Comprehensive loss attributable to nonredeemable noncontrolling interests — ( 655 ) — ( 1,362 )

Comprehensive loss attributable to Madison Square Garden Sports Corp.’s stockholders $ ( 18,815 ) $ ( 17,817 )

Comprehensive income (loss) attributable to Madison Square Garden Sports Corp.’s stockholders $ 14,230 $ 22,494 $ ( 4,585 ) $ 4,677

See accompanying notes to consolidated financial statements.

2 unchanged sentences

(in thousands)

Three Months Ended

September 30,

Six Months Ended

Cash flows from operating activities:

Net loss $ ( 18,821 ) $ ( 18,527 )

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

Net (loss) income $ ( 4,597 ) $ 3,309

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

Depreciation and amortization 1,584 1,863

1 unchanged sentence

Share-based compensation expense 10,719 18,839

Unrealized loss on equity investments with readily determinable fair value and warrants 12,101 103

Unrealized loss (gain) on equity investments with readily determinable fair value and warrants 8,397 ( 346 )

Other non-cash adjustments 2,120 572

15 unchanged sentences

Cash flows from financing activities:

Accelerated share repurchase — ( 75,000 )

Dividends paid ( 648 ) ( 170,683 )

1 unchanged sentence

Proceeds from revolving credit facilities 75,000 215,000

Repayment of revolving credit facilities ( 40,000 ) ( 30,000 )

Net cash provided by (used in) financing activities 26,268 ( 76,123 )

8 unchanged sentences

(in thousands)

Three Months Ended September 30, 2023

Three Months Ended December 31, 2023

Issued Additional

3 unchanged sentences

Loss Total Equity

Balance as of September 30, 2023 $ 249 $ 7,553 $ ( 172,605 ) $ ( 192,737 ) $ ( 1,003 ) $ ( 358,543 )

Net income — — — 14,224 — 14,224

Other comprehensive income — — — — 6 6

Comprehensive income — — — — — 14,230

Share-based compensation

— 6,570 — — — 6,570

Tax withholding associated with shares issued for equity-based compensation

— ( 1,447 ) — — — ( 1,447 )

Common stock issued under stock incentive plans

— ( 1,205 ) 1,205 — — —

Dividends declared ($ 7.00 per share)

Balance as of December 31, 2023 $ 249 $ 11,471 $ ( 171,400 ) $ ( 178,512 ) $ ( 997 ) $ ( 339,189 )

See accompanying notes to consolidated financial statements.

MADISON SQUARE GARDEN SPORTS CORP.

CONSOLIDATED STATEMENTS OF EQUITY (Continued)

(in thousands)

Three Months Ended December 31, 2022

Common Stock Issued Additional

Capital Treasury

Stock Accumulated Deficit Accumulated

Comprehensive Loss Total Madison Square Garden Sports Corp.

Stockholders ’ Equity

Noncontrolling

Interests Total Equity

Balance as of September 30, 2022 $ 249 $ — $ ( 109,981 ) $ ( 62,447 ) $ ( 1,183 ) $ ( 173,362 ) $ 1,452 $ ( 171,910 )

Net income (loss) — — — 22,491 — 22,491 ( 655 ) 21,836

Other comprehensive income — — — — 3 3 — 3

Comprehensive income (loss) — — — — — 22,494 ( 655 ) 21,839

Share-based compensation

— 11,619 — — — 11,619 — 11,619

Tax withholding associated with shares issued for equity-based compensation

— ( 211 ) — — — ( 211 ) — ( 211 )

Common stock issued under stock incentive plans

— ( 209 ) 209 — — — — —

Dividends declared ($ 7.00 per share)

— — — ( 172,749 ) — ( 172,749 ) — ( 172,749 )

Accelerated share repurchase — ( 10,658 ) ( 60,000 ) ( 4,342 ) — ( 75,000 ) — ( 75,000 )

Adjustments to noncontrolling interests — ( 541 ) — — — ( 541 ) 541 —

Balance as of December 31, 2022 $ 249 $ — $ ( 169,772 ) $ ( 217,047 ) $ ( 1,180 ) $ ( 387,750 ) $ 1,338 $ ( 386,412 )

See accompanying notes to consolidated financial statements.

MADISON SQUARE GARDEN SPORTS CORP.

CONSOLIDATED STATEMENTS OF EQUITY (Continued)

(in thousands)

Six Months Ended December 31, 2023

Issued Additional

Capital Treasury

Stock Accumulated Deficit Accumulated

Comprehensive

Loss Total Equity

Balance as of June 30, 2023 $ 249 $ 16,846 $ ( 179,410 ) $ ( 173,910 ) $ ( 1,009 ) $ ( 337,234 )

2 unchanged sentences

Comprehensive loss

— — — — — ( 4,585 )

Share-based compensation

6 unchanged sentences

— — — ( 5 ) — ( 5 )

Balance as of September 30, 2023 $ 249 $ 7,553 $ ( 172,605 ) $ ( 192,737 ) $ ( 1,003 ) $ ( 358,543 )

Balance as of December 31, 2023 $ 249 $ 11,471 $ ( 171,400 ) $ ( 178,512 ) $ ( 997 ) $ ( 339,189 )

See accompanying notes to consolidated financial statements.

2 unchanged sentences

(in thousands)

Three Months Ended September 30, 2022

Six Months Ended December 31, 2022

Common Stock Issued Additional

Capital Treasury

Stock Accumulated Deficit Accumulated

Stock Retained Earnings (Accumulated Deficit) Accumulated

Comprehensive Loss Total Madison Square Garden Sports Corp.

3 unchanged sentences

Balance as of June 30, 2022 $ 249 $ 17,573 $ ( 128,026 ) $ ( 35,699 ) $ ( 1,186 ) $ ( 147,089 ) $ 1,712 $ ( 145,377 )

Net loss — — — ( 17,820 ) — ( 17,820 ) ( 707 ) ( 18,527 )

Net income (loss) — — — 4,671 — 4,671 ( 1,362 ) 3,309

Other comprehensive income — — — — 6 6 — 6

Comprehensive loss — — — — — ( 17,817 ) ( 707 ) ( 18,524 )

Comprehensive income (loss) — — — — — 4,677 ( 1,362 ) 3,315

Share-based compensation

4 unchanged sentences

— ( 9,326 ) 18,254 ( 8,928 ) — — — —

Dividends declared ($ 7.00 per share)

— — — ( 172,749 ) — ( 172,749 ) — ( 172,749 )

Accelerated share repurchase — ( 10,658 ) ( 60,000 ) ( 4,342 ) — ( 75,000 ) — ( 75,000 )

Adjustments to noncontrolling interests — ( 988 ) — — — ( 988 ) 988 —

Balance as of September 30, 2022 $ 249 $ — $ ( 109,981 ) $ ( 62,447 ) $ ( 1,183 ) $ ( 173,362 ) $ 1,452 $ ( 171,910 )

Balance as of December 31, 2022 $ 249 $ — $ ( 169,772 ) $ ( 217,047 ) $ ( 1,180 ) $ ( 387,750 ) $ 1,338 $ ( 386,412 )

See accompanying notes to consolidated financial statements.

29 unchanged sentences

The accompanying unaudited consolidated interim financial statements (referred to as the “Financial Statements” herein) have been prepared in accordance with U.S.

generally accepted accounting principles (“GAAP”) and Article 10 of Regulation S-X of the SEC for interim financial information, and should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended June 30, 2023 (“fiscal year 2023”).

generally accepted accounting principles (“GAAP”) and Article 10 of Regulation S-X of the Securities and Exchange Commission (the “SEC”) for interim financial information, and should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended June 30, 2023 (“fiscal year 2023”).

The Financial Statements presented in this Quarterly Report on Form 10-Q are unaudited;

3 unchanged sentences

Reclassifications

Certain reclassifications have been made in order to conform to the current period’s presentation and relate to the separation of Investments and unrealized loss on equity investments with readily determinable fair value and warrants on the consolidated statements of cash flows for the three months ended September 30, 2022.

Certain reclassifications have been made in order to conform to the current period’s presentation and relate to the separation of Investments and unrealized loss (gain) on equity investments with readily determinable fair value and warrants on the consolidated statements of cash flows for the six months ended December 31, 2022.

MADISON SQUARE GARDEN SPORTS CORP.

19 unchanged sentences

Recently Issued Accounting Pronouncements Not Yet Adopted

In March 2023, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) No.

In March 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No.

2023-01, Leases (Topic 842):

3 unchanged sentences

The Company is currently evaluating the impact this standard will have on its consolidated financial statements.

In November 2023, the FASB issued ASU No.

2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures.

The ASU expands public entities’ segment disclosures by requiring disclosure of significant segment expenses that are regularly provided to the CODM and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items, and interim disclosures of a reportable segment’s profit or loss and assets.

All disclosure requirements under ASU 2023-07 are also required for public entities with a single reportable segment.

The ASU is effective for the Company’s Annual Report on Form 10-K for the fiscal year ending June 30, 2025 and subsequent interim periods, with early adoption permitted.

The Company is currently evaluating the impact this standard will have on its segment disclosures.

In December 2023, the FASB issued ASU No.

2023-09, Income Taxes (Topic 740):

Improvements to Income Tax Disclosures.

The ASU enhances annual disclosures related to the effective income tax rate reconciliation and income taxes paid.

The ASU is effective for the Company’s Annual Report on Form 10-K for the fiscal year ending June 30, 2026 and subsequent interim periods, with early adoption permitted.

The Company is currently evaluating the impact this standard will have on its income tax disclosures.

MADISON SQUARE GARDEN SPORTS CORP.

3 unchanged sentences

All revenue recognized in the consolidated statements of operations is considered to be revenue from contracts with customers.

For the three months ended September 30, 2023 and 2022, the Company did not have any material impairment losses on receivables or contract assets arising from contracts with customers.

For the three and six months ended December 31, 2023 and 2022, the Company did not have any material impairment losses on receivables or contract assets arising from contracts with customers.

Disaggregation of Revenue

The following table disaggregates the Company’s revenues by type of goods or services in accordance with the required entity-wide disclosure requirements set forth in ASC Subtopic 280-10-50-38 to 40 and the disaggregation of revenue required disclosures in accordance with ASC Subtopic 606-10-50-5 for the three months ended September 30, 2023 and 2022:

Three Months Ended

September 30,

Three Months Ended Six Months Ended

December 31, December 31,

2023 2022 2023 2022

Event-related (a)

1 unchanged sentence

Media rights (b)

122,547 118,158 129,766 125,144

Sponsorship, signage and suite licenses 69,316 81,021 74,630 85,835

3 unchanged sentences

(a) Consists of (i) ticket sales and other ticket-related revenues, and (ii) food, beverage and merchandise sales at The Garden.

(b) Consists of (i) local media rights fees, (ii) revenue from the distribution through league-wide national and international television contracts, and (iii) other local radio rights fees.

(b) Consists of (i) local media rights fees, (ii) revenue from the distribution through league-wide national television contracts, and (iii) other local radio rights fees.

MADISON SQUARE GARDEN SPORTS CORP.

1 unchanged sentence

The timing of revenue recognition, billings and cash collections results in billed receivables, contract assets and contract liabilities on the consolidated balance sheet.

The following table provides information about contract balances from the Company’s contracts with customers as of September 30, 2023 and June 30, 2023.

September 30, June 30,

The following table provides information about contract balances from the Company’s contracts with customers as of December 31, 2023 and June 30, 2023.

December 31, June 30,

Receivables from contracts with customers, net (a)

6 unchanged sentences

(a) Receivables from contracts with customers, net, which are reported in Accounts receivable, net and Net related party receivables in the accompanying consolidated balance sheets, represent the Company’s unconditional rights to consideration under its contracts with customers.

As of December 31, 2023 and June 30, 2023, the Company’s receivables reported above incl uded $ 2,012 and $ 0 , respectively, related to contracts with customers who are related parties.

See Note 16 for further details on related party arrangements.

Receivables from contracts with customers, net, excludes amounts recorded in Accounts receivable, net, associated with amounts due from the NBA and NHL related to escrow and player compensation recoveries and luxury tax payments.

As of September 30, 2023 and June 30, 2023, the Company had receivable balances related to escrow and player compensation recoveries of $ 1,244 and $ 1,544 , respectively, reco rded in Accounts receivable, net.

As of December 31, 2023 and June 30, 2023, the Company had receivable balances related to escrow and player compensation recoveries of $ 2,197 and $ 1,544 , respectively, reco rded in Accounts receivable, net.

(b) Contract assets, current, which are reported as Other current assets in the accompanying consolidated balance sheets, primarily relate to the Company’s rights to consideration for goods or services transferred to the customer, for which the Company does not have an unconditional right to bill as of the reporting date.

2 unchanged sentences

Deferred revenue is reduced and the related revenue is recognized once the underlying goods or services are transferred to a customer.

The Company’s deferred revenue related to local media rights was $ 36,490 and $ 0 as of September 30, 2023 and June 30, 2023, respectively.

The Company’s deferred revenue related to local media rights was $ 10,013 and $ 0 as of December 31, 2023 and June 30, 2023, respectively.

See Note 16 for further details on these related party arrangements.

(d) Revenue recognized for the three months ended September 30, 2023 relating to the deferred revenue balance as of June 30, 2023 was $ 19,233 .

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(d) Revenue recognized for the six months ended December 31, 2023 relating to the deferred revenue balance as of June 30, 2023 was $ 77,945 .

Transaction Price Allocated to the Remaining Performance Obligations

The following table depicts the estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) as of September 30, 2023 and is based on current projections.

The following table depicts the estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) as of December 31, 2023 and is based on current projections.

In developing the estimated revenue, the Company applies the allowable practical expedient and does not disclose information about remaining performance obligations that have original expected durations of one year or less.

6 unchanged sentences

Thereafter 16,936

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Computation of Earnings (Loss) per Common Share

The following table presents a reconciliation of earnings (loss) allocated to common shares and a reconciliation of weighted-average shares used in the calculations of basic and diluted earnings (loss) per common share attributable to the Company’s stockholders (“EPS”) and the number of shares excluded from diluted earnings (loss) per common share, as they were anti-dilutive.

Three Months Ended

September 30,

Three Months Ended Six Months Ended

December 31, December 31,

2023 2022 2023 2022

Net earnings (loss) allocable to common shares, basic and diluted (numerator):

Net loss attributable to Madison Square Garden Sports Corp.’s stockholders $ ( 18,821 ) $ ( 17,820 )

Net income (loss) attributable to Madison Square Garden Sports Corp.’s stockholders $ 14,224 $ 22,491 $ ( 4,597 ) $ 4,671

Dividends to other-than-common stockholders (a)

Net loss allocable to common shares, basic and diluted (numerator):

( 1 ) 2,056 5 2,056

Net earnings (loss) allocable to common shares, basic and diluted (numerator):

$ 14,225 $ 20,435 $ ( 4,602 ) $ 2,615

Weighted-average shares (denominator):

3 unchanged sentences

Weighted-average shares excluded from diluted EPS — — 71 —

Basic loss per common share attributable to Madison Square Garden Sports Corp.’s stockholders $ ( 0.79 ) $ ( 0.73 )

Diluted loss per common share attributable to Madison Square Garden Sports Corp.’s stockholders $ ( 0.79 ) $ ( 0.73 )

Basic earnings (loss) per common share attributable to Madison Square Garden Sports Corp.’s stockholders $ 0.59 $ 0.85 $ ( 0.19 ) $ 0.11

Diluted earnings (loss) per common share attributable to Madison Square Garden Sports Corp.’s stockholders $ 0.59 $ 0.84 $ ( 0.19 ) $ 0.11

_________________

4 unchanged sentences

Direct operating and selling, general and administrative expenses in the accompanying consolidated statements of operations include a net provision or credit for transactions relating to the Company’s teams for waiver/contract termination costs, player trades and season-ending injuries (“Team personnel transactions”).

There were no Team personnel transactions for the three months ended September 30, 2023 and Team personnel transactions were a net credit of $ 329 for the three months ended September 30, 2022.

There were no Team personnel transactions for the three and six months ended December 31, 2023.

Team personnel transactions were a net provision of $ 29 for the three months ended December 31, 2022 and net credit of $ 300 for the six months ended December 31, 2022.

Cash, Cash Equivalents and Restricted Cash

The following table provides a summary of the amounts recorded as cash, cash equivalents and restricted cash.

September 30,

2023 June 30,

2023 September 30,

2023 December 31,

2022 June 30,

2 unchanged sentences

Restricted cash (a)

3,352 61 1,246 —

Cash, cash equivalents and restricted cash on the consolidated statements of cash flows

1 unchanged sentence

_________________

(a) Restricted cash as of September 30, 2023 and June 30, 2023 primarily included cash deposited in an escrow account (see Note 2 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2023 for more information).

As of September 30, 2023, the Company’s leases primarily consist of the lease of the Company’s principal executive offices under the Sublease Agreement with MSG Entertainment (the “Sublease Agreement”) and a lease agreement for an aircraft.

(a) Restricted cash as of December 31, 2023, June 30, 2023 and December 31, 2022 included cash deposited in an escrow account (see Note 2 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2023 for more information).

As of December 31, 2023, the Company’s leases primarily consist of the lease of the Company’s principal executive offices under the Sublease Agreement with MSG Entertainment (the “Sublease Agreement”) and a lease agreement for an aircraft.

Prior to the MSGE Distribution Date, the Sublease Agreement was between the Company and Sphere Entertainment.

In addition, the Company accounts for the rights of use of The Garden pursuant to the Arena License Agreements as leases under the ASC Topic 842, Leases.

In addition, the Company accounts for the rights of use of The Garden pursuant to the Arena License Agreements (as defined below) as leases under the ASC Topic 842, Leases.

See Note 7 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2023 for more information regarding the Company’s accounting policies associated with its leases.

As of September 30, 2023, the Company’s exis ting operating leases, which are recorded in the accompanying financial statements, have remaining lease terms ranging from 1 month to 32 years.

As of December 31, 2023, the Company’s exis ting operating leases, which are recorded in the accompanying financial statements, have remaining lease terms ranging from 10 months to 32 years.

In certain ins tances, leases include options to renew, with varying option terms.

3 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The following table summarizes the right-of-use assets and lease liabilities recorded in the accompanying consolidated balance sheets as of September 30, 2023 and June 30, 2023:

Line Item in the Company’s Consolidated Balance Sheet September 30,

The following table summarizes the right-of-use assets and lease liabilities recorded in the accompanying consolidated balance sheets as of December 31, 2023 and June 30, 2023:

Line Item in the Company’s Consolidated Balance Sheet December 31,

2023 June 30,

9 unchanged sentences

_________________

(a) As of September 30, 2023, Operating lease liabilities, current and Operating lease liabilities, noncurrent included balances o f $ 43,952 and $ 696,559 , r espectively, that are payable to MSG Entertainment.

(a) As of December 31, 2023, Operating lease liabilities, current and Operating lease liabilities, noncurrent included balances o f $ 44,104 and $ 704,361 , r espectively, that are payable to MSG Entertainment.

As of June 30, 2023, Operating lease liabilities, current and Operating lease liabilities, noncurrent included balances of $ 43,700 and $ 707,124 , respectively, that are payable to MSG Entertainment.

The following table summarizes the activity recorded within the accompanying consolidated statements of operations for the three months ended September 30, 2023 and 2022:

Line Item in the Company’s Consolidated Statement of Operations Three Months Ended September 30,

The following table summarizes the activity recorded within the accompanying consolidated statements of operations for the three and six months ended December 31, 2023 and 2022:

Line Item in the Company’s Consolidated Statement of Operations Three Months Ended December 31, Six Months Ended December 31,

2023 2022 2023 2022

Operating lease cost Direct operating expenses $ 24,362 $ 31,811 $ 25,673 $ 33,214

Operating lease cost Selling, general and administrative expenses

2,320 613 4,640 1,226

Short-term lease cost Direct operating expenses — 70 — 115

1 unchanged sentence

Supplemental Information

For the three months ended September 30, 2023 and 2022, cash paid for amounts included in the measurement of lease liabilities was $ 13,072 and $ 11,263 , respectively.

The weighted average remaining lease term for operating leases recorded in the accompanying consolidated balance sheet as of September 30, 2023 was 30.3 years.

The weighted average discount rate was 7.1 % as of September 30, 2023 and represented the Company’s estimated incremental borrowing rate, assuming a secured borrowing, based on the remaining lease term at the time of either (i) adoption of the standard or (ii) the period in which the lease term expectation commenced or was modified.

Maturities of operating lease liabilities as of September 30, 2023 are as follows:

For the six months ended December 31, 2023 and 2022, cash paid for amounts included in the measurement of lease liabilities was $ 26,095 and $ 22,526 , respectively.

The weighted average remaining lease term for operating leases recorded in the accompanying consolidated balance sheet as of December 31, 2023 was 30.2 years.

The weighted average discount rate was 7.1 % as of December 31, 2023 and represented the Company’s estimated incremental borrowing rate, assuming a secured borrowing, based on the remaining lease term at the time of either (i) adoption of the standard or (ii) the period in which the lease term expectation commenced or was modified.

Maturities of operating lease liabilities as of December 31, 2023 are as follows:

Fiscal Year 2024 (remainder) $ 26,047

11 unchanged sentences

During the first quarter of fiscal year 2024, the Company performed its annual impairment test of goodwill and determined that there were no impairments identified as of the impairment test date.

The carrying amount of goodwill as of September 30, 2023 and June 30, 2023 was $ 226,523 .

The Company’s indefinite-lived intangible assets as of September 30, 2023 and June 30, 2023 are as follows:

The carrying amount of goodwill as of December 31, 2023 and June 30, 2023 was $ 226,523 .

The Company’s indefinite-lived intangible assets as of December 31, 2023 and June 30, 2023 are as follows:

Sports franchises $ 102,564

1 unchanged sentence

During the first quarter of fiscal year 2024, the Company performed its annual impairment test of identifiable indefinite-lived intangible assets and determined that there were no impairments identified as of the impairment test date.

For the three months ended September 30, 2022, amortization expense o f intangible assets was $ 108 .

There was no amortization expense for the three months ended September 30, 2023 as a result of the disposal of CLG in April 2023.

For the three and six months ended December 31, 2022, amortization expense o f intangible assets was $ 30 and $ 138 , respectively.

There was no amortization expense for the three and six months ended December 31, 2023 as a result of the disposal of CLG in April 2023.

The Company’s investments in nonconsolidated affiliates which are accounted for under the equity method of accounting, equity investments with readily determinable fair values, equity investments without readily determinable fair values, and derivative instruments, which are reported within Investments in the accompanying consolidated balance sheets, consisted of the following:

September 30,

2023 June 30,

1 unchanged sentence

NRG $ 11,091 $ 11,948

Other equity method investments 2,000 —

Equity investments with readily determinable fair values:

7 unchanged sentences

_________________

(a) For the three months ended September 30, 2023 and 2022, the Company did not record any impairment charges or changes in carrying value of its equity securities without readily determinable fair values in the accompanying consolidated statements of operations.

(a) For the three and six months ended December 31, 2023 and 2022, the Company did not record any impairment charges or changes in carrying value of its equity securities without readily determinable fair values in the accompanying consolidated statements of operations.

Equity Method Investments

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The Company deconsolidated the CLG business and recorded the investment in NRG at fair value as an equity method investment in the fourth quarter of fiscal year 2023.

During the three months ended September 30, 2023, the Company recognized its net share of losses of $ 415 in Miscellaneous expense, net within the Company’s consolidated statement of operations.

As of September 30, 2023 and June 30, 2023, the Company’s ownership in NRG was approximately 25 %.

During the three and six months ended December 31, 2023, the Company recognized its net share of losses of $ 442 and $ 857 , respectively, in Miscellaneous income (expense), net within the Company’s consolidated statement of operations.

As of December 31, 2023 and June 30, 2023, the Company’s ownership in NRG was approximately 25 %.

MADISON SQUARE GARDEN SPORTS CORP.

9 unchanged sentences

The cost basis and carrying value of equity investments with readily determinable fair values are as follows:

September 30, 2023 June 30, 2023

December 31, 2023 June 30, 2023

Cost Basis Carrying Value/Fair Value Cost Basis Carrying Value/Fair Value

2 unchanged sentences

$ 22,301 $ 34,458 $ 20,555 $ 36,814

The following table summarizes the realized and unrealized gains (losses) on equity investments with readily determinable fair values, recorded within Miscellaneous expense, net within the Company’s consolidated statement of operations, for the three months ended September 30, 2023 and 2022.

Three Month Ended September 30,

Unrealized loss - Xtract One common stock $ ( 6,553 ) $ —

Unrealized loss - other equity investments with readily determinable fair values ( 130 ) ( 103 )

The following table summarizes the realized and unrealized gains (losses) on equity investments with readily determinable fair values, recorded within Miscellaneous income (expense), net within the Company’s consolidated statement of operations, for the three and six months ended December 31, 2023 and 2022.

Three Months Ended December 31, Six Months Ended December 31,

2023 2022 2023 2022

Unrealized gain (loss) - Xtract One common stock $ 1,761 $ — $ ( 4,792 ) $ —

Unrealized gain - other equity investments with readily determinable fair values 821 449 691 346

Realized gain - other equity investments with readily determinable fair values 18 — 44 —

2 unchanged sentences

The following table presents the Company’s assets that are measured at fair value on a recurring basis, which include cash equivalents:

Fair Value Hierarchy September 30,

Fair Value Hierarchy December 31,

2023 June 30,

13 unchanged sentences

The Company’s warrants are included within Investments in the accompanying consolidated balance sheets.

Changes in the fair value of derivative instruments are measured at each reporting date and are recorded within Miscellaneous expense, net in the accompanying consolidated statements of operations.

Changes in the fair value of derivative instruments are measured at each reporting date and are recorded within Miscellaneous income (expense), net in the accompanying consolidated statements of operations.

The fair value of the Company’s warrants in Xtract One were determined using the Black-Scholes option pricing model.

The following are key assumptions used to calculate the fair value of the warrants as of September 30, 2023 and June 30, 2023:

September 30,

The following are key assumptions used to calculate the fair value of the warrants as of December 31, 2023 and June 30, 2023:

2023 June 30,

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The following table presents additional information about our assets for which we utilize Level III inputs to determine fair value:

Three Months Ended

September 30,

Three Months Ended Six Months Ended

December 31, 2023 December 31, 2023

Balance at beginning of period $ 7,680 $ 13,098

Unrealized losses on warrants ( 5,418 )

Unrealized gain (loss) on warrants 1,122 ( 4,296 )

Balance at end of period $ 8,802 $ 8,802

The carrying value and fair value of the Company’s financial instruments reported in the accompanying consolidated balance sheets are as follows:

September 30, 2023 June 30, 2023

The carrying value and fair value of the Company’s debt reported in the accompanying consolidated balance sheets are as follows:

December 31, 2023 June 30, 2023

Value Carrying

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Knicks Revolving Credit Facility

On September 30, 2016, New York Knicks, LLC (“Knicks LLC”), a wholly owned subsidiary of the Company, entered into a credit agreement (the “2016 Knicks Credit Agreement”) with a syndicate of lenders providing for a senior secured revolving credit facility of up to $ 200,000 with a term of five years (the “2016 Knicks Revolving Credit Facility”) to fund working capital needs and for general corporate purposes.

On September 30, 2016, New York Knicks, LLC (“Knicks LLC”), a wholly owned subsidiary of the Company, entered into a credit agreement (the “2016 Knicks Credit Agreement”) with a syndicate of lenders providing for a senior secured revolving credit facility of up to $ 200,000 with a term of five years to fund working capital needs and for general corporate purposes.

On November 6, 2020, the Company amended and restated the 2016 Knicks Credit Agreement in its entirety (the “2020 Knicks Credit Agreement”).

On December 14, 2021, Knicks LLC entered into Amendment No.

2 to the 2020 Knicks Credit Agreement, which amended and restated the 2020 Knicks Credit Agreement (the “Knicks Credit Agreement”).

2 to the 2020 Knicks Credit Agreement, which amended and restated the 2020 Knicks Credit Agreement (as amended and restated, the “Knicks Credit Agreement”).

The Knicks Credit Agreement provides for a senior secured revolving credit facility of up to $ 275,000 (the “Knicks Revolving Credit Facility”) to fund working capital needs and for general corporate purposes.

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Knicks LLC is required to pay a commitment fee ranging from 0.250 % to 0.300 % per annum in respect of the average daily unused commitments under the Knicks Revolving Credit Facility.

During the three months ended September 30, 2023, the Company borrowed an additional $ 40,000 under the Knicks Revolving Credit Facility.

The outstanding balance under the Knicks Revolving Credit Facility was $ 275,000 as of September 30, 2023, which was recorded as Long-term debt in the accompanying consolidated balance sheet.

The interest rate on the Knicks Revolving Credit Facility as of September 30, 2023 was 6.67 % .

During the three months ended September 30, 2023 the Company made interest payments of $ 4,340 in respect of the Knicks Revolving Credit Facility.

During the six months ended December 31, 2023, the Company borrowed an additional $ 40,000 under the Knicks Revolving Credit Facility.

The outstanding balance under the Knicks Revolving Credit Facility was $ 275,000 as of December 31, 2023, which was recorded as Long-term debt in the accompanying consolidated balance sheet.

The interest rate on the Knicks Revolving Credit Facility as of December 31, 2023 was 6.71 % .

During the six months ended December 31, 2023 the Company made interest payments of $ 9,073 in respect of the Knicks Revolving Credit Facility.

All obligations under the Knicks Revolving Credit Facility are secured by a first lien security interest in certain of Knicks LLC’s assets, including, but not limited to, (i) the Knicks LLC’s membership rights in the NBA, (ii) revenues to be paid to Knicks LLC by the NBA pursuant to certain U.S.

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The Knicks Revolving Credit Facility requires Knicks LLC to comply with a debt service ratio of at least 1.5 :1.0 over a trailing four quarter period.

As of September 30, 2023, Knicks LLC was in compliance with this financial covenant.

As of December 31, 2023, Knicks LLC was in compliance with this financial covenant.

MADISON SQUARE GARDEN SPORTS CORP.

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Rangers Revolving Credit Facility

On January 25, 2017, New York Rangers, LLC (“Rangers LLC”), a wholly owned subsidiary of the Company, entered into a credit agreement (the “2017 Rangers Credit Agreement”) with a syndicate of lenders providing for a senior secured revolving credit facility of up to $ 150,000 with a term of five years (the “2017 Rangers Revolving Credit Facility”) to fund working capital needs and for general corporate purposes.

On January 25, 2017, New York Rangers, LLC (“Rangers LLC”), a wholly owned subsidiary of the Company, entered into a credit agreement (the “2017 Rangers Credit Agreement”) with a syndicate of lenders providing for a senior secured revolving credit facility of up to $ 150,000 with a term of five years to fund working capital needs and for general corporate purposes.

On November 6, 2020, the Company amended and restated the 2017 Rangers Credit Agreement in its entirety (the “2020 Rangers Credit Agreement”).

On December 14, 2021, Rangers LLC entered into Amendment No.

3 to the 2020 Rangers Credit Agreement, which amended and restated the 2020 Rangers Credit Agreement (the “Rangers Credit Agreement”).

3 to the 2020 Rangers Credit Agreement, which amended and restated the 2020 Rangers Credit Agreement (as amended and restated, the “Rangers Credit Agreement”).

The Rangers Credit Agreement provides for a senior secured revolving credit facility of up to $ 250,000 (the “Rangers Revolving Credit Facility”) to fund working capital needs and for general corporate purposes.

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Rangers LLC is required to pay a commitment fee ranging from 0.375 % to 0.625 % per annum in respect of the average daily unused commitments under the Rangers Revolving Credit Facility.

During the three months ended September 30, 2023, the Company borrowed an additional $ 35,000 under the Rangers Revolving Credit Facility.

The outstanding balance under the Rangers Revolving Credit Facility wa s $ 95,000 as of September 30, 2023, which was recorded as Long-term debt in the accompanying consolidated balance sheet.

The interest rate on the Rangers Revolving Credit Facility as of September 30, 2023 wa s 7.17 % .

During the three months ended September 30, 2023 the Company made interest payments of $ 1,077 in respect of the Rangers Revolving Credit Facility.

During the six months ended December 31, 2023, the Company borrowed an additional $ 35,000 and made principal repayments of $ 40,000 under the Rangers Revolving Credit Facility.

The outstanding balance under the Rangers Revolving Credit Facility wa s $ 55,000 as of December 31, 2023, which was recorded as Long-term debt in the accompanying consolidated balance sheet.

The interest rate on the Rangers Revolving Credit Facility as of December 31, 2023 wa s 7.21 % .

During the six months ended December 31, 2023 the Company made interest payments of $ 2,815 in respect of the Rangers Revolving Credit Facility.

All obligations under the Rangers Revolving Credit Facility are, subject to the Rangers NHL Advance Agreement (as defined below), secured by a first lien security interest in certain of Rangers LLC’s assets, including, but not limited to, (i) Rangers LLC’s membership rights in the NHL, (ii) revenues to be paid to Rangers LLC by the NHL pursuant to certain U.S.

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The Rangers Revolving Credit Facility requires Rangers LLC to comply with a debt service ratio of at least 1.5 :1.0 over a trailing four quarter period.

As of September 30, 2023, Rangers LLC was in compliance with this financial covenant.

As of December 31, 2023, Rangers LLC was in compliance with this financial covenant.

Rangers NHL Advance Agreement

On March 19, 2021, Rangers LLC, Rangers Holdings, LLC and MSG NYR Holdings LLC entered into an advance agreement with the NHL (the “Rangers NHL Advance Agreement”) pursuant to which the NHL advanced $ 30,000 to Rangers LLC.

The advance is to be utilized solely and exclusively to pay for Rangers LLC operating expenses.

The advance is required to be utilized solely and exclusively to pay for Rangers LLC operating expenses.

All obligations under the Rangers NHL Advance Agreement are senior to and shall have priority over all secured and other indebtedness of Rangers LLC, Rangers Holdings, LLC and MSG NYR Holdings LLC.

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It is expected that the advanced amount will be set off against funds that would otherwise be paid, distributed or transferred by the NHL to Rangers LLC.

The outstanding balance under the Rangers NHL Advance Agreement was $ 30,000 as of September 30, 2023 and was recorded as Debt in the accompanying consolidated balance sheet.

During the three months ended September 30, 2023 the Company made interest p ayments of $ 450 .

The outstanding balance under the Rangers NHL Advance Agreement was $ 30,000 as of December 31, 2023 and was recorded as Debt in the accompanying consolidated balance sheet.

During the six months ended December 31, 2023 the Company made interest p ayments of $ 675 .

Deferred Financing Costs

The following table summarizes deferred financing costs, net of amortization, related to the Company’s credit facilities as reported in the accompanying consolidated balance sheets:

September 30,

2023 June 30,

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Existing account balances under the Excess Cash Balance Plan are credited with monthly interest in accordance with the terms of the plan.

The following table presents components of net periodic benefit cost for the Pension Plans included in the accompanying consolidated statements of operations for the three months ended September 30, 2023 and 2022.

Components of net periodic benefit cost are reported in Miscellaneous expense, net.

Three Months Ended

September 30,

The following table presents components of net periodic benefit cost for the Pension Plans included in the accompanying consolidated statements of operations for the three and six months ended December 31, 2023 and 2022.

Components of net periodic benefit cost are reported in Miscellaneous income (expense), net.

Three Months Ended Six Months Ended

December 31, December 31,

2023 2022 2023 2022

Interest cost $ 68 $ 60 $ 136 $ 120

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In addition, the Company sponsors the MSG Sports LLC, Excess Savings Plan (the “Excess Savings Plan”), which provides non-qualified retirement benefits to eligible MSG Sports employees.

Expense related to the 401(k) Plan and Excess Savings Plan for the three months ended September 30, 2023 and 2022 was $ 1,294 and $ 1,065 , respectively.

Expense related to the 401(k) Plan and Excess Savings Plan for the three and six months ended December 31, 2023 was $ 1,314 and $ 2,608 , respectively, and $ 1,072 and $ 2,137 for the three and six months ended December 31, 2022, respectively .

MADISON SQUARE GARDEN SPORTS CORP.

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See Note 14 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2023 for more information regarding the Company’s E xecutive Deferred Compensation Plan (the “Deferred Compensation Plan”).

The Company recorded compensation cost credits of $ 104 and $ 103 for the three months ended September 30, 2023 and 2022, respectively, within Selling, general and administrative expenses to reflect the remeasurement of the Deferred Compensation Plan liability.

In addition, the Company recorded losses of $ 104 and $ 103 for the three months ended September 30, 2023 and 2022, respectively, within Miscellaneous expense, net to reflect t he remeasurement of the fair value of assets under the Deferred Compensation Plan.

The Company recorded compensation expense of $ 839 and $ 735 for the three and six months ended December 31, 2023 , respectively, and $ 449 and $ 346 for the three and six months ended December 31, 2022, respectively, within Selling, general and administrative expenses to reflect the remeasurement of the Deferred Compensation Plan liability.

In addition, the Company recorded gains of $ 839 and $ 735 for the three and six months ended December 31, 2023 , respectively, and $ 449 and $ 346 for the three and six months ended December 31, 2022, respectively, within Miscellaneous income (expense), net to reflect t he remeasurement of the fair value of assets under the Deferred Compensation Plan.

The following table summarizes amounts recognized related to the Deferred Compensation Plan in the consolidated balance sheets:

September 30,

2023 June 30,

Non-current assets (included in other assets) $ 15,783 $ 14,406

Non-current assets (included in investments) $ 16,842 $ 14,406

Current liabilities (included in accrued employee related costs) ( 476 ) ( 1,358 )

3 unchanged sentences

Share-based compensation expense is recognized in the consolidated statements of operations as a component of Selling, general and administrative expenses.

Share-based compensation expense was $ 4,149 and $ 7,220 for the three months ended September 30, 2023 and 2022, respectively.

There were no costs related to share-based compensation that were capitalized for the three months ended September 30, 2023 and 2022, respectively.

Share-based compensation expense was $ 6,570 and $ 10,719 for the three and six months ended December 31, 2023, respectively and $ 11,619 and $ 18,839 for the three and six months ended December 31, 2022, respectively.

There were no costs related to share-based compensation that were capitalized for the three and six months ended December 31, 2023 and 2022, respectively.

Restricted Stock Units Award Activity

The following table summarizes activity related to the Company’s restricted stock units and performance restricted stock units, collectively referred to as “RSUs,” held by current and former employees of the Company and non-employee directors, for the three months ended September 30, 2023:

Number of Weighted-Average

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Forfeited / Cancelled ( 3 ) ( 3 ) $ 176.52

Unvested award balance, September 30, 2023 129 155 $ 172.76

Unvested award balance, December 31, 2023 127 153 $ 172.64

_____________________

(a) Weighted-average fair value per share at date of grant does not reflect any adjustments to awards granted prior to the Sphere Distribution.

The fair value of RSUs that vested during the three months ended September 30, 2023 was $ 16,637 .

The fair value of RSUs that vested during the six months ended December 31, 2023 was $ 19,195 .

Upon delivery, RSUs granted under the Employee Stock Plan were net share-settled to cover the required statutory tax withholding obligations.

To fulfill the Company’s current and former employees’ required statutory tax withholding obligations for the applicable income and other employment taxes, 37 of these RSUs, with an aggregate value of $ 6,637 , inclusive of $ 4 related to the Company’s former employees (who vested in the Company’s RSUs), were retained by the Company and the taxes paid are reflected as a financing activity in the accompanying consolidated statement of cash flows for the three months ended September 30, 2023.

The fair value of RSUs that vested during the three months ended September 30, 2022 was $ 31,766 .

The weighted-average fair value per share at grant date of RSUs granted during the three months ended September 30, 2022 was $ 161.58 .

To fulfill the Company’s current and former employees’ required statutory tax withholding obligations for the applicable income and other employment taxes, 46 of these RSUs, with an aggregate value of $ 8,084 , inclusive of $ 4 related to the Company’s former employees (who vested in the Company’s RSUs), were retained by the Company and the taxes paid are reflected as a financing activity in the accompanying consolidated statement of cash flows for the six months ended December 31, 2023.

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

The fair value of RSUs that vested during the six months ended December 31, 2022 was $ 34,233 .

The weighted-average fair value per share at grant date of RSUs granted during the six months ended December 31, 2022 was $ 161.41 .

Stock Options Award Activity

The following table summarizes activity related to the Company’s stock options for the three months ended September 30, 2023:

The following table summarizes activity related to the Company’s stock options for the six months ended December 31, 2023:

Time Vesting Options Weighted-Average Exercise Price Per Share Weighted-Average Remaining Contractual Term (In Years) Aggregate Intrinsic Value

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Cancelled — $ —

Balance as of September 30, 2023 94 $ 138.78 4.21 $ 3,520

Exercisable as of September 30, 2023 94 $ 138.78 4.21 $ 3,520

Balance as of December 31, 2023 94 $ 138.78 3.96 $ 4,039

Exercisable as of December 31, 2023 94 $ 138.78 3.96 $ 4,039

Stock Repurchase Program

Effective as of October 1, 2015, the Company’s board of directors authorized the repurchase of up to $ 525,000 of the Company’s Class A Common Stock.

Amounts in this footnote are in thousands, except for the number of shares repurchased and per share data.

Effective as of October 1, 2015, the Company’s board of directors authorized the repurchase of up to $ 525,000 of the Company’s Class A Common Stock (“Class A Common Stock”).

Under the authorization, shares of Class A Common Stock may be purchased from time to time in open market or private transactions, block trades or such other manner as the Company may determine, in accordance with applicable insider trading and other securities laws and regulations.

The timing and amount of purchases will depend on market conditions and other factors.

During the three months ended September 30, 2023 and 2022, the Company did not make any share repurchases under its share repurchase program.

As of September 30, 2023, the Company had $ 184,639 of availability remaining under its stock repurchase authorization .

On October 6, 2022, the Company’s Board of Directors authorized a $ 75,000 accelerated share repurchase (“ASR”) program under the Company’s existing share repurchase authorization.

On October 28, 2022, the Company entered into a $ 75,000 ASR agreement with JPMorgan Chase Bank, National Association (“JP Morgan”).

Pursuant to the ASR agreement, the Company made a payment of $ 75,000 to JP Morgan and JP Morgan delivered 388,777 initial shares of Class A Common Stock to the Company on November 1, 2022, representing 80 % of the total shares expected to be repurchased under the ASR (determined based on the closing price of the Company’s Class A Common Stock of $ 154.33 on October 28, 2022).

The ASR was completed on January 31, 2023 with JP Morgan delivering 67,681 additional shares of Class A Common Stock to the Company upon final settlement.

The average purchase price per share for shares of Class A Common Stock purchased by the Company pursuant to the ASR was $ 164.31 .

The ASR was accounted for as a repurchase of shares and as an equity forward contract indexed to the Company’s Class A Common Stock.

The equity forward contract was classified as an equity instrument under ASC Subtopic 815-40.

The Company has treated the initial and final shares of Class A Common Stock delivered as treasury shares as of the date the shares were physically delivered in computing the weighted average shares of outstanding Class A Common Stock for both basic and diluted earnings per share.

During the six months ended December 31, 2023 , the Company did not make any share repurchases under its share repurchase program.

As of December 31, 2023, the Company had $ 184,639 of availability remaining under its stock repurchase authorization .

Related Party Transactions

As of September 30, 2023, for purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended, members of the Dolan family, including trusts for members of the Dolan family (collectively, the “Dolan Family Group”), collectively beneficially own 100 % of the Company’s outstanding Class B Common Stock and own approximately 3.3 % of the Company’s outstanding Class A Common Stock.

As of December 31, 2023, for purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended, members of the Dolan family, including trusts for members of the Dolan family (collectively, the “Dolan Family Group”), collectively beneficially own 100 % of the Company’s outstanding Class B Common Stock and own approximately 3.3 % of the Company’s outstanding Class A Common Stock.

Such shares of the Company’s Class A Common Stock and Class B Common Stock, collectively, represent approximately 71.0 % of the aggregate voting power of the Company’s outstanding common stock.

1 unchanged sentence

(“AMC Networks”).

The Company was party to the following agreements and/or arrangements with MSG Entertainment as of September 30, 2023:

• Arena License Agreements, entered into in April 2020, pursuant to which MSG Entertainment (i) provides the right to use The Garden for games of the Knicks and the Rangers for a 35-year term in exchange for arena license fees, (ii) shares revenues collected for suite licenses, (iii) operates and manages the sale of the sports teams’ merchandise at The Garden for a commission, (iv) operates and manages the sales of food and beverage concessions in exchange for 50 % of net profits from sales and catering services during Knicks and Rangers home games, (v) provides day of game services, and (vi) provides other general services within The Garden;

The Company was party to the following agreements and/or arrangements with MSG Entertainment as of December 31, 2023:

• Arena license agreements, entered into in April 2020 (the “Arena License Agreements”), pursuant to which MSG Entertainment (i) provides the right to use The Garden for games of the Knicks and the Rangers for a 35-year term in exchange for arena license fees, (ii) shares revenues collected for suite and club licenses, (iii) operates and manages

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

the sale of the sports teams’ merchandise at The Garden for a commission, (iv) operates and manages the sales of food and beverage concessions in exchange for 50 % of net profits from sales and catering services during Knicks and Rangers home games, (v) shares revenues collected for the sale of venue indoor signage space and sponsorship rights at The Garden that are not specific to our teams, (vi) provides day of game services, and (vii) provides other general services within The Garden;

• Sponsorship sales and service representation agreements pursuant to which MSG Entertainment has the exclusive right and obligation to sell the Company’s sponsorships for an initial stated term of 10 years for a commission.

2 unchanged sentences

• Services agreement (the “Services Agreement”) pursuant to which the Company (i) receives certain services from MSG Entertainment, such as information technology, accounts payable, payroll, human resources, and other corporate functions and executive support services, in exchange for service fees and (ii) provides certain services to MSG Entertainment, such as certain communications, legal and ticketing services, in exchange for service fees;

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

• Arrangements pursuant to which the Company provides certain sponsorship, premium hospitality and other business operations services;

• Sublease agreement, pursuant to which the Company leases office space from MSG Entertainment;

• The Sublease Agreement, pursuant to which the Company leases office space from MSG Entertainment;

• Group ticket sales representation agreement, pursuant to which MSG Entertainment appointed the Company as its sales and service representative to sell group ticket packages related to MSG Entertainment events in exchange for a commission;

• Single night rental commission agreement, pursuant to which the Company may, from time to time, sell (or make referrals for sales of) licenses for the use of suites at The Garden for individual MSG Entertainment events in exchange for a commission and reimbursement for sales and service staff and overhead associated with the ticket sales on behalf of MSG Entertainment;

• Interest-bearing advances to MSG Entertainment in connection with the construction of new premium hospitality suites at The Garden;

• Other agreements with MSG Entertainment entered into in connection with the Sphere Distribution, including a trademark license agreement and certain other arrangements.

The Company is also party to the following agreements and/or arrangements with Sphere Entertainment (including through its subsidiary MSG Networks) as of September 30, 2023 :

• Media rights agreements between the Company and MSG Networks, entered into in July 2015, with stated terms of 20 years providing MSG Networks with local telecast right for Knicks and Rangers games in exchange for media rights fees;

The Company is also party to the following agreements and/or arrangements with Sphere Entertainment (including through its subsidiary MSG Networks) as of December 31, 2023 :

• Media rights agreements between the Company and MSG Networks, entered into in July 2015, with stated terms of 20 years providing MSG Networks with local telecast rights for Knicks and Rangers games in exchange for media rights fees;

• Arrangements with MSG Networks pursuant to which the Knicks and the Rangers have allocated revenues with MSG Networks related to virtual advertising inventory;

• Arrangements pursuant to which the Company provides Sphere Entertainment with certain sponsorship and other business operations services;

• Arrangements pursuant to which the Company provides sponsorship rights to Sphere Entertainment;

• Other agreements with Sphere Entertainment in connection with the Sphere Distribution, including a distribution agreement, a tax disaffiliation agreement and an employee matters agreement and certain other arrangements;

1 unchanged sentence

The Company is also party to arrangements with MSG Entertainment and Sphere Entertainment pursuant to which the three companies have agreed to allocate expenses in connection with the use by each company of aircraft owned or leased by the Company and MSG Entertainment.

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

In addition, the Company shares certain executive support costs, including office space, executive assistants, security and transportation costs for:

2 unchanged sentences

Additionally, the Company, Sphere Entertainment, AMC Networks, and, following the MSGE Distribution, MSG Entertainment, allocate the costs of certain personal aircraft and helicopter usage by their shared executives.

MADISON SQUARE GARDEN SPORTS CORP.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

Revenues and Operating Expenses

The following table summarizes the composition and amounts of the transactions with the Company’s affiliates.

These amounts are reflected in revenues and operating expenses in the accompanying consolidated statements of operations for the three months ended September 30, 2023 and 2022:

Three Months Ended September 30,

These amounts are reflected in revenues and operating expenses in the accompanying consolidated statements of operations for the three and six months ended December 31, 2023 and 2022:

Three Months Ended December 31, Six Months Ended December 31,

2023 2022 2023 2022

$ 77,658 $ 74,950 $ 86,475 $ 83,124

Operating expenses:

10 unchanged sentences

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

Income tax benefit for the three months ended September 30, 2023 of $ 15,144 reflects an effective tax rate of 45 % .

Income tax benefit for the three months ended September 30, 2022 of $ 20,493 reflects an effective tax rate of 53 %.

Income tax expense for the three months ended December 31, 2023 of $ 10,784 reflects an effective tax rate of 43 %.

Income tax benefit for the six months ended December 31, 2023 of $ 4,360 reflects an effective tax rate of 49 %.

Income tax expense for the three and six months ended December 31, 2022 of $ 24,555 and $ 4,062 , respectively, reflects an effective tax rate of 53 % and 55 %, respectively.

The Company was notified in April 2020 that the City of New York was commencing an audit of the local income tax returns for the fiscal years ended June 30, 2016 and 2017.

The Company does not expect the examinations, when finalized, to result in material changes.

During the three months ended September 30, 2023, the Company made income tax payments, net of refunds, of $ 8,029 .

The audit was finalized in January 2024 and resulted in no material changes.

During the six months ended December 31, 2023, the Company made income tax payments, net of refunds, of $ 14,259 .

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 1. Financial Statements