Sphere Entertainment (SPHR) AI Stock Analysis

• Market Cap: $1.57B
• Dividend Yield: N/A
• Average Volume (3M): 769.84K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.69
• Revenue Growth: 25.25%
• EPS Growth: -106.76%
• Country: US
• Employees: 1,080
• Sector: Communication Services
• Sector Strength: 90
• Industry: Entertainment
• EPS (TTM): N/A
• Shares Outstanding: 29,132,664
• 10 Day Avg. Volume: 747,176
• 30 Day Avg. Volume: 769,838
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.60
• Enterprise Value/Revenue: 2.30
• Enterprise Value/Gross Profit: 7.52
• Enterprise Value/Ebitda: 7.81
• 1Y Price Target: $45.86
• Price Target Upside: 6.65% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 8

• Rating: 62 Neutral
• Price Target: $45.00 ▲(4.65% Upside)

Sphere Entertainment's overall stock score is driven by strong revenue growth and strategic expansion plans, particularly in the Middle East. However, profitability challenges, negative cash flow, and a high P/E ratio weigh down the score. The technical indicators suggest mixed signals, with short-term bullish momentum but potential bearish pressure. The company's strong liquidity position and strategic initiatives provide a positive outlook, but operational efficiency and profitability need improvement.

Positive Factors

Earnings

Higher and more profitable event-related revenues in the Sphere segment have led to increased estimates.

Financial Performance

Sphere Entertainment delivered generally better consolidated financial results for 2Q25 with total adjusted operating income of $61mn, ahead of the $49mn estimate, paced by a strong beat in the Sphere segment.

Growth Opportunities

The announcement of a franchise in Abu Dhabi is expected to generate recurring license fees and add significant value to shareholders.

Negative Factors

Concentration Risk

Sphere's reliance on The Wizard of Oz film as the primary growth driver creates a high degree of concentration risk, which could materially impact results if performance falls short.

Market Dependence

Management continues to push for global expansion and smaller-scale Spheres under a franchise model, a strategy viewed as fundamentally misaligned with the venue’s dependence on Las Vegas-specific demand dynamics.

Monetization Challenges

Declines in both Sphere Experience and sponsorship/advertising revenues underscore the fragility of these revenue streams.

Sphere Entertainment Business Overview & Revenue Model

Company Description

Sphere Entertainment (SPHR) is a diversified entertainment company primarily engaged in the development and operation of immersive entertainment experiences, live events, and innovative media content. With a focus on creating unique venues and experiences, Sphere Entertainment operates in sectors such as live entertainment, media production, and technology-driven experiences, aiming to leverage cutting-edge technology to captivate audiences worldwide.

How the Company Makes Money

Sphere Entertainment generates revenue through multiple streams including ticket sales for live events, venue rentals, and partnerships with corporations for branded experiences. The company also earns income from media production, where it creates and distributes content across various platforms. Strategic partnerships with technology firms enhance its offerings and broaden its audience reach, contributing significantly to its revenue. Additionally, the company benefits from sponsorship deals and advertising revenues associated with its events and media productions.

Sphere Entertainment Financial Statement Overview

Summary

Sphere Entertainment shows promising revenue growth but faces challenges in profitability and cash flow management. The balance sheet remains strong with low leverage, providing a stable foundation. However, the company must address its cash flow issues and improve operational efficiency to enhance profitability and sustain growth.

Income Statement

Sphere Entertainment's income statement shows a mixed performance. The TTM data indicates a strong revenue growth rate of 85.1%, suggesting a positive trajectory in sales. However, the company struggles with profitability, as evidenced by a negative EBIT margin of -2.33% and a modest net profit margin of 7.50%. The gross profit margin has decreased from previous years, indicating potential cost management issues.

Balance Sheet

The balance sheet reflects a solid financial position with a low debt-to-equity ratio of 0.08 in the TTM period, indicating low leverage and financial stability. The equity ratio is strong, and the return on equity has improved to 3.68%, showing better utilization of equity. However, the company has experienced fluctuations in equity over the years, which could pose a risk if not managed properly.

Cash Flow

Cash flow analysis reveals challenges, with negative operating and free cash flows in the TTM period. Despite a significant improvement in free cash flow growth, the operating cash flow to net income ratio is negative, indicating cash flow issues relative to earnings. The free cash flow to net income ratio is positive, suggesting some ability to generate cash relative to profits, but overall cash flow management needs improvement.

Breakdown	TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Income Statement
Total Revenue	1.10B	1.03B	573.83M	610.05M	647.51M	1.44B
Gross Profit	335.72M	479.06M	231.62M	289.78M	384.65M	645.52M
EBITDA	323.18M	-23.86M	405.62M	-16.38M	-18.37M	210.04M
Net Income	-161.37M	-200.65M	502.77M	-194.40M	-148.15M	181.73M
Balance Sheet
Total Assets	4.20B	4.79B	4.97B	5.52B	5.29B	3.73B
Cash, Cash Equivalents and Short-Term Investments	368.93M	559.76M	131.97M	747.31M	1.52B	1.24B
Total Debt	1.02B	1.52B	1.32B	1.09B	2.01B	261.16M
Total Liabilities	1.89B	2.37B	2.39B	3.36B	2.97B	844.77M
Stockholders Equity	2.31B	2.42B	2.58B	1.96B	2.17B	2.86B
Cash Flow
Free Cash Flow	-44.03M	-309.41M	-905.39M	-615.38M	-514.70M	-149.18M
Operating Cash Flow	-11.88M	-19.66M	153.59M	141.34M	-58.69M	308.12M
Investing Cash Flow	-43.72M	-45.18M	-653.92M	-804.16M	-123.18M	-394.53M
Financing Cash Flow	-148.99M	209.73M	85.54M	-30.39M	592.68M	-113.87M

Sphere Entertainment Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 43.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SPHR, the sentiment is Positive. The current price of 43 is above the 20-day moving average (MA) of 41.25, above the 50-day MA of 42.16, and above the 200-day MA of 38.78, indicating a bullish trend. The MACD of 0.21 indicates Negative momentum. The RSI at 54.19 is Neutral, neither overbought nor oversold. The STOCH value of 75.79 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SPHR.

Sphere Entertainment Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
IMAX	71 Outperform	$1.49B	48.24	11.16%	―	1.25%	55.54%
SPHR	62 Neutral	$1.57B	―	-2.03%	―	25.25%	-106.76%
CNK	61 Neutral	$2.98B	14.20	70.99%	0.93%	13.80%	109.00%
Sector *	60 Neutral	$43.56B	4.52	-12.81%	4.07%	1.87%	-43.08%
PLAY	57 Neutral	$895.17M	25.12	17.57%	―	-3.82%	-56.18%
AMC	51 Neutral	$1.47B	―	20.03%	―	9.42%	39.83%
MSGE	50 Neutral	$1.89B	52.12	1222.83%	―	-1.72%	-75.17%

Sphere Entertainment Corporate Events

Sphere Entertainment Finalizes Abu Dhabi Venue Agreements

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.

Sphere Entertainment Secures New $210M Term Loan

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.

Sphere Entertainment Holds Annual Meeting with Key Votes

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.