Daniel Duran

An analyst, identified by the operator as Daniel Duran, asked about the largest opportunities for cost leverage or synergies once a second Sphere location opens.

Answer

Executive Chairman and CEO James Dolan responded that much of the company's current overhead, including its construction, development, and content creation divisions, is built to support a global network of Spheres. He explained that each new venue allows the company to better utilize this initial investment, which is why the Abu Dhabi project is significant and why they are seeking the next one.

Carlos Daniel Duran asked about the company's preference between stock buybacks and dividends for capital return in 2025 and questioned the sustainability of recent market share gains.

Answer

CFO Melissa Thomas stated that both dividends and buybacks are being evaluated as part of the 2025 budgeting process, with the goal of maximizing long-term shareholder value. She also noted that while market share can fluctuate quarterly, the company believes maintaining a 100-basis-point improvement over pre-pandemic levels is a reasonable full-year expectation as the box office recovers and capacity constraints increase.

Daniel Duran from Morgan Stanley questioned the decision to not raise season ticket prices for renewing holders after a successful season and asked about the expected implications for revenue and adjusted operating income (AOI) in fiscal 2025.

Answer

COO Jamaal Lesane explained the decision as a long-term strategy to reward loyal season ticket holders. He clarified that the company will still opportunistically price new season ticket packages, individual, and group tickets. As a result, he stated that MSG Sports believes it has the opportunity to drive 'modest ticket revenue growth' in fiscal 2025 and will reevaluate pricing annually.