tiprankstipranks
Trending News
More News >
Sphere Entertainment (SPHR)
NYSE:SPHR
US Market
Advertisement

Sphere Entertainment (SPHR) AI Stock Analysis

Compare
314 Followers

Top Page

SPHR

Sphere Entertainment

(NYSE:SPHR)

Rating:62Neutral
Price Target:
$46.00
▲(11.06% Upside)
Sphere Entertainment's overall stock score is primarily impacted by its financial challenges, which weigh heavily on its performance. However, positive developments in corporate events and moderately favorable technical analysis provide some optimism. The company's valuation remains a concern due to negative earnings. The absence of earnings call data limits a full assessment of future guidance.
Positive Factors
Earnings
The Sphere is disrupting the traditional venue model with awe-inspiring and immersive live events and unique original shows, which can charge premium pricing and have significantly better utilization.
Financial Performance
Significant progress has been made over the past few years, leading to positive adjustments in operating income and favorable restructuring.
Negative Factors
Market Strategy
Management's strategy to expand through mini-Spheres fundamentally misreads the uniqueness of the Vegas market.
Revenue
Sphere Experience revenue declined 14%, while advertising and sponsorship fell 16%, despite a fully operational flagship venue in Las Vegas.

Sphere Entertainment (SPHR) vs. SPDR S&P 500 ETF (SPY)

Sphere Entertainment Business Overview & Revenue Model

Company DescriptionSphere Entertainment Co. engages in the entertainment business. It produces, presents, or hosts various live entertainment events, including concerts, family shows, and special events, as well as sporting events, such as professional boxing, college basketball and hockey, professional bull riding, mixed martial arts, and esports and wrestling in its venues, including The Garden, Hulu Theater, Radio City Music Hall, and the Beacon Theatre in New York City; and The Chicago Theatre. The company also operates 70 entertainment dining and nightlife venues spanning 20 markets across five continents under the Tao, Marquee, Lavo, Beauty & Essex, Cathédrale, Hakkasan, and Omnia brand names; and creates and operates New England's premier music festival. In addition, it features the Radio City Rockettes, which serves as the star for its Christmas Spectacular at Radio City Music Hall. The company was formerly known as Madison Square Garden Entertainment Corp. and changed its name to Sphere Entertainment Co. in April 2023. Sphere Entertainment Co. was founded in 2006 and is based in New York, New York.
How the Company Makes MoneySphere Entertainment Co. generates revenue primarily through ticket sales for its immersive events and live performances held at its venues. The company also earns income from partnerships and sponsorships with brands seeking to associate with its unique entertainment offerings. Additionally, Sphere Entertainment capitalizes on merchandising opportunities, selling branded products and memorabilia to enhance the customer experience. The company's strategic partnerships with artists, production companies, and technology providers further expand its revenue potential by enabling a diverse range of shows and spectacles. Venue bookings for private events and collaborations with other entertainment entities also contribute to its income.

Sphere Entertainment Earnings Call Summary

Earnings Call Date:May 07, 2025
(Q2-2025)
|
% Change Since: 42.88%|
Next Earnings Date:Aug 11, 2025
Earnings Call Sentiment Neutral
The earnings call highlights strong revenue performance and growth in the Sphere segment, successful concert residencies, and robust sponsorship demand. However, there are challenges with MSG Networks' declining revenue and subscriber base, a significant goodwill impairment charge, and an operating loss in the Sphere segment. Despite these challenges, the company's strong liquidity position and strategic initiatives suggest a positive outlook.
Q2-2025 Updates
Positive Updates
Total Revenue and Adjusted Operating Income
Sphere Entertainment Company generated total revenues of $308.3 million and adjusted operating income of $32.9 million for the December quarter.
Sphere Segment Revenue Growth
Sphere segment generated $169 million in revenue, with $87 million from Sphere experience across 190 shows in the December quarter, showing strong performance.
Successful Concert Residencies
Kenny Chesney and Backstreet Boys announced for 15 and 18-show residencies, respectively, highlighting strong interest from artists.
Strong Sponsorship and Advertising Demand
Solid advertising demand for the Exosphere at the end of 2024 continues into the new year, indicating robust sponsorship interest.
Cash and Liquidity Position
Company holds $502 million in unrestricted cash and cash equivalents, with $400 million at the Sphere segment, indicating a strong liquidity position.
Negative Updates
MSG Networks Revenue Decline
Revenue decreased to $139.3 million in the December quarter from $146.4 million in the prior year, driven by an approximately 11.5% decrease in subscribers.
Noncash Goodwill Impairment Charge
A $61.2 million noncash goodwill impairment charge was recorded due to ongoing industry challenges facing MSG Networks.
Adjusted Operating Loss in Sphere Segment
Sphere segment reported an adjusted operating loss of $800,000 for the December quarter, reflecting challenges in achieving profitability.
Content Production Costs for Residencies
High content production costs for bands remain a concern, although offset by residency benefits.
Company Guidance
During the Sphere Entertainment Company's earnings call for the fiscal period ending December 31, 2024, the company provided guidance focused on driving profitable growth through several strategic initiatives. Jim Dolan, the Executive Chairman and CEO, highlighted the development of new productions to expand their original content library and the promotion of concert residencies, including upcoming shows by Kenny Chesney and the Backstreet Boys. The company reported total revenues of $308.3 million and an adjusted operating income of $32.9 million for the December quarter. The Sphere segment alone generated $169 million in revenue, though it reported an adjusted operating loss of $800,000. The Sphere experience in Las Vegas has generated over $450 million in high-margin revenue, indicating strong demand and successful pricing strategies. Robert Langer, the new EVP and CFO, mentioned that the company is optimistic about revenue growth and cost efficiencies for the upcoming year, aiming to improve adjusted operating income significantly. The call also touched on expansion plans, with ongoing work on a second Sphere in Abu Dhabi and potential designs for smaller Spheres in other markets. The company ended the year with approximately $502 million in unrestricted cash and cash equivalents, and a debt balance of about $1.36 billion.

Sphere Entertainment Financial Statement Overview

Summary
Sphere Entertainment faces significant financial challenges, particularly in profitability and cash flow management. While gross profit margins are relatively healthy, the company struggles with negative net income and cash flow inefficiencies. The balance sheet remains stable, but overall, the company must address operational inefficiencies and improve cash flow generation to enhance financial health.
Income Statement
55
Neutral
Sphere Entertainment shows a mixed performance in its income statement. The TTM data reveals a gross profit margin of 38.59%, indicating moderate profitability. However, a concerning trend is evident with a negative net profit margin of -32.99% and a declining revenue growth rate from the previous year at 6.16%. The company faces challenges in EBIT and EBITDA margins, both in negative territory at -34.97% and -4.18%, respectively, reflecting operational inefficiencies.
Balance Sheet
62
Positive
The balance sheet presents a stable yet cautious outlook. The debt-to-equity ratio is at 0.68, suggesting a manageable level of leverage. The equity ratio stands at 48.17%, supporting a stable capital structure. However, the return on equity is negative at -16.79%, indicating difficulties in generating returns for shareholders.
Cash Flow
48
Neutral
Sphere Entertainment’s cash flow statement displays considerable challenges. The free cash flow growth rate is negative, and both the operating cash flow to net income and free cash flow to net income ratios are unfavorable, reflecting cash flow inefficiencies. The operating cash flow to net income ratio is -0.07, underscoring difficulties in converting sales into cash.
BreakdownTTMDec 2023Dec 2022Dec 2021Dec 2020Dec 2019
Income Statement
Total Revenue1.09B1.03B573.83M610.05M647.51M1.44B
Gross Profit309.80M484.79M231.62M289.78M384.65M645.52M
EBITDA-43.02M-23.86M405.62M-16.38M193.75M210.04M
Net Income-359.77M-200.65M502.77M-194.40M-148.15M181.73M
Balance Sheet
Total Assets4.45B4.79B4.97B5.52B5.29B3.73B
Cash, Cash Equivalents and Short-Term Investments465.02M559.76M131.97M747.31M1.52B1.24B
Total Debt1.46B1.52B1.32B1.09B2.01B261.16M
Total Liabilities2.31B2.37B2.39B3.36B2.97B844.77M
Stockholders Equity2.14B2.42B2.58B1.96B2.17B2.86B
Cash Flow
Free Cash Flow-57.52M-309.41M-905.39M-615.38M-514.70M-149.18M
Operating Cash Flow-25.26M-19.66M153.59M141.34M-58.69M308.12M
Investing Cash Flow-102.67M-45.18M-653.92M-804.16M-123.18M-394.53M
Financing Cash Flow-87.51M209.73M85.54M-30.39M592.68M-113.87M

Sphere Entertainment Technical Analysis

Technical Analysis Sentiment
Neutral
Last Price41.42
Price Trends
50DMA
41.39
Positive
100DMA
36.31
Positive
200DMA
38.98
Positive
Market Momentum
MACD
0.02
Positive
RSI
45.46
Neutral
STOCH
30.11
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SPHR, the sentiment is Neutral. The current price of 41.42 is below the 20-day moving average (MA) of 43.62, above the 50-day MA of 41.39, and above the 200-day MA of 38.98, indicating a neutral trend. The MACD of 0.02 indicates Positive momentum. The RSI at 45.46 is Neutral, neither overbought nor oversold. The STOCH value of 30.11 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SPHR.

Sphere Entertainment Risk Analysis

Sphere Entertainment disclosed 57 risk factors in its most recent earnings report. Sphere Entertainment reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Sphere Entertainment Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
72
Outperform
$1.35B40.8311.16%1.25%55.54%
65
Neutral
$2.93B13.9970.99%0.64%13.80%109.00%
62
Neutral
$1.49B-15.64%-5.04%-155.66%
62
Neutral
$1.80B13.961222.83%5.81%133.05%
61
Neutral
$915.23M24.8517.57%-3.82%-56.18%
61
Neutral
$41.49B-3.35-10.67%4.00%2.69%-42.23%
49
Neutral
$1.23B20.03%-5.43%26.07%
* Communication Services Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
SPHR
Sphere Entertainment
41.42
1.00
2.47%
CNK
Cinemark Holdings
24.99
-0.83
-3.21%
IMAX
IMAX
24.65
4.43
21.91%
AMC
AMC Entertainment
2.81
-2.27
-44.69%
PLAY
Dave & Busters Entertainment
25.69
-6.35
-19.82%
MSGE
Madison Square Garden Entertainment Corp.
38.05
0.27
0.71%

Sphere Entertainment Corporate Events

Business Operations and Strategy
Sphere Entertainment Finalizes Abu Dhabi Venue Agreements
Positive
Jul 28, 2025

On July 25, 2025, Sphere Entertainment Group, a subsidiary of Sphere Entertainment Co., finalized agreements with the Department of Culture and Tourism – Abu Dhabi to construct and operate the second Sphere venue in Abu Dhabi. The agreements grant DCT exclusive rights to build and operate Sphere venues in the Middle East and North Africa for at least 10 years, with Sphere Entertainment Group receiving fees and royalties based on intellectual property usage and venue revenues.

The most recent analyst rating on (SPHR) stock is a Buy with a $57.00 price target. To see the full list of analyst forecasts on Sphere Entertainment stock, see the SPHR Stock Forecast page.

Private Placements and FinancingBusiness Operations and Strategy
Sphere Entertainment Secures New $210M Term Loan
Neutral
Jun 27, 2025

Sphere Entertainment‘s subsidiary, MSG Networks, along with its associated entities, has entered into a second amended and restated credit agreement with JPMorgan Chase Bank, replacing its previous credit facility with a new $210 million term loan maturing in December 2029. This agreement includes various financial and operational covenants, mandatory prepayment conditions, and amendments to media rights agreements, which impact the company’s financial structure and its dealings with professional sports teams, notably reducing annual rights fees for the New York Knicks and Rangers.

The most recent analyst rating on (SPHR) stock is a Buy with a $57.00 price target. To see the full list of analyst forecasts on Sphere Entertainment stock, see the SPHR Stock Forecast page.

Executive/Board ChangesShareholder Meetings
Sphere Entertainment Holds Annual Meeting with Key Votes
Neutral
Jun 5, 2025

Sphere Entertainment held its Annual Meeting on June 4, 2025, where Class A and Class B stockholders voted on several key proposals. The election of directors for both classes was completed, with Class A electing four directors and Class B electing eleven directors. Additionally, stockholders ratified the appointment of the independent registered public accounting firm for the fiscal year ending December 31, 2025, approved executive compensation in a non-binding vote, and agreed to redomesticate the company from Delaware to Nevada.

The most recent analyst rating on (SPHR) stock is a Buy with a $57.00 price target. To see the full list of analyst forecasts on Sphere Entertainment stock, see the SPHR Stock Forecast page.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 29, 2025