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Liberty Media Corp (FWONK)·Q2 2025 Earnings Summary

Executive Summary

  • Formula One Group delivered a strong Q2: total revenue rose 35.7% year over year to $1.34B and operating income expanded to $273M as the calendar shift (9 races vs. 8) and new sponsors/media uplifts drove growth; Adjusted OIBDA increased to $369M .
  • F1 segment revenue jumped to $1.23B with primary revenue up 40% and other revenue up 47%, aided by additional event mix, sponsorship additions, F1 TV growth, and one-time revenue recognition tied to the Apple F1 movie; F1 operating income reached $293M and Adjusted OIBDA $361M .
  • Management highlighted commercial momentum (PepsiCo partnership, MSC Cruises extension, Canadian GP renewal through 2035, Austrian GP through 2041) and consolidation of MotoGP completed on July 3; Q2 results exclude MotoGP initial accounting, with subsequent debt refinancing improving terms .
  • No share repurchases in the period; authorization remains $1.1B. Formula One Group cash rose $307M quarter-over-quarter to $3.14B; formula one leverage declined to 0.7x, reflecting strong cash generation and derivative proceeds related to MotoGP financing .
  • Stock reaction catalysts: visible near-term revenue visibility from contracted streams, F1 media rights renewal discussions in the U.S., improving Las Vegas GP economics, and MotoGP integration and refinancing, alongside the commercial tailwind from the Apple F1 movie .

What Went Well and What Went Wrong

  • What Went Well
    • F1 primary revenue up 40% YoY as calendar variance and contractual fee increases boosted race promotion, media rights, and sponsorship; new sponsors and F1 TV growth plus one-time movie revenue supported results .
    • Operating leverage: F1 operating income surged to $293M and Adjusted OIBDA to $361M; corporate “other” contributed positively to revenue, including Las Vegas Grand Prix Plaza rental income .
    • Strategic momentum: long-term race renewals (Canada 2035, Austria 2041), new global partners (PepsiCo through 2030), and Disney licensing; management emphasized “excellent financial and operating results at Formula 1” .
    • Quote: “Formula 1’s global strength continues to drive commercial momentum and financial success, with new partners signed and record fan engagement...” — Derek Chang, President & CEO .
    • Quote: “Cultural moments like the F1 movie... generating strong viewership trends and especially robust social and digital engagement...” — Stefano Domenicali, F1 CEO .
  • What Went Wrong
    • Cost pressures: higher freight costs with different event order, increased commissions/partner servicing tied to revenue growth, elevated Paddock Club costs on increased attendance, and expenses for Las Vegas Grand Prix Plaza activations .
    • SG&A up on personnel and marketing (including 75th season launch); F1 team payments higher on pro rata recognition of expected full-year team payments .
    • Q2 did not yet reflect MotoGP consolidation accounting; Dorna financial disclosures remain preliminary, Spanish GAAP-based, and not comprehensive for Q2 understanding .

Financial Results

Metric ($USD Millions unless noted)Q2 2024Q1 2025Q2 2025
Total Revenue$988 $447 $1,341
Operating Income (Loss)$57 $(71) $273
Adjusted OIBDA (Formula One Group)$165 $73 $369
Net Earnings Attributable to Liberty Stockholders (Consolidated)$457 (incl. discontinued ops) $5 $204

Segment revenue breakdown

Segment RevenueQ2 2024Q2 2025
Formula 1$871 $1,226
Corporate & Other$141 $145
Intergroup Elimination$(24) $(30)
Total Formula One Group$988 $1,341

F1 operating results detail

F1 Operating MetricsQ2 2024Q2 2025
Number of Races in Period8 9
Primary F1 Revenue$739 $1,032
Other F1 Revenue$132 $194
Total F1 Revenue$871 $1,226
Adjusted OIBDA$160 $361
Operating Income$84 $293

EPS vs prior periods and estimates

EPS ($, Diluted – Continuing Ops)Q2 2024Q1 2025Q2 2025
EPS$0.15*$0.01*$0.59*

Values retrieved from S&P Global.*

Revenue vs estimates (consensus unavailable)

Revenue ($USD Millions)Q2 2024Q1 2025Q2 2025
Actual$988 $447 $1,341
S&P Global ConsensusN/AN/AN/A

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
F1 Cash Tax Rate (% of Adjusted OIBDA)FY 2025“Low double-digit” (baseline from Q4 call) Reiterated low double-digit (no update in Q2 materials) Maintained
Team Payments as % of Pre-Team Adj. OIBDAFY 202561.5% in 2024 and “expected to continue to come down” Directional: continue to come down (no numeric in Q2) Maintained (directional)
U.S. Media RightsThrough FY 2025Active discussions; balancing reach with monetization Active and productive discussions; multiple partners engaged Ongoing
Las Vegas GP EconomicsFY 2025Missed 2024 targets; plan to improve Actions underway on pricing/products/costs; integrating operations Improving trajectory
Share RepurchasesN/AAuthorization $1.1B Authorization $1.1B; none executed May–July Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024, Q1 2025)Current Period (Q2 2025)Trend
U.S. Media Rights & F1 TVNegotiations with ESPN and others; F1 TV premium launch; balancing streaming vs reach “Active and productive discussions”; F1 TV subscriber growth and product enhancements continue Positive momentum; product strength supports negotiations
Sponsorship PipelineRobust 2025 sponsor roster; pipeline pulled forward; quality over quantity New partners (PepsiCo), extensions (MSC Cruises), and Disney licensing; continued sponsor revenue growth Strengthening; mix shift to higher-value deals
Las Vegas GP (LVGP)2024 miss; plan for pricing and cost optimization; integrate with London More activity at Grand Prix Plaza; rentals recognized; focus on top/bottom-line improvement Improving execution; ecosystem benefits emphasized
MotoGP Acquisition & FinancingPhase II regulatory; expected close by 6/30/25 Closed 7/3; pro forma cash disclosed; debt refinanced with margin reductions; non-recourse to Liberty Integration and balance sheet optimization underway
Freight/CostsHigher freight and partner servicing costs with event order; SG&A elevated Continued freight cost pressure; higher Paddock Club and servicing costs; SG&A up on marketing/personnel Variable cost headwinds persist but manageable

Management Commentary

  • “We made excellent progress since last quarter on our stated priorities, including completing the acquisition of MotoGP, advancing the split-off of Liberty Live and continuing excellent financial and operating results at Formula 1.” — Derek Chang, President & CEO .
  • “Cultural moments like the F1 movie alongside exciting on-track action are generating strong viewership trends... delivering a record number of social impressions.” — Stefano Domenicali, F1 CEO .
  • On F1 revenue drivers: “Media rights revenue also increased due to continued growth in F1 TV subscriptions and the recognition of one-time revenue associated with the release of the F1 movie.” .
  • Cash and leverage posture: “Formula 1 leverage... 0.7x” as cash increased and debt stable at quarter end .

Q&A Highlights

  • Media rights strategy: Management is open to flexible packaging, including F1 TV considerations, aiming to maximize reach and monetization; multiple partners engaged, with strong U.S. demand evidenced by ~45% linear viewership growth early in the season .
  • Sponsorship durability: Contracts are multi‑year and more defensive than ad‑driven models; pipeline strength and partner quality mitigate macro risks .
  • LVGP economics: Stand-alone miss in 2024 largely isolated to Vegas; ticket/product revisions and cost control expected to improve 2025 results .
  • Team payments & Concorde: Team payments ratio expected to decline under current agreement; next Concorde envisaged as broadly similar in fundamentals, with healthy ecosystem focus .
  • International media rights: Competitive tension rising across LATAM/Asia with digital entrants; regional packaging opportunities considered where value-add exists .

Estimates Context

  • S&P Global consensus estimates for Q2 2025 EPS and revenue were unavailable for FWONK; actual consolidated revenue was $1.34B and diluted EPS (continuing operations) was $0.59* .
  • Given outsized YoY revenue growth driven by calendar mix, sponsorship/media uplifts, and one-time movie revenue recognition, Street models may need to adjust quarterly seasonality assumptions and incorporate incremental sponsorship/media contributions; cost lines (freight, servicing, hospitality) likely revised higher in tandem .

Values retrieved from S&P Global.*

Key Takeaways for Investors

  • Quarterly variability remains high; focus on full-year trajectory with contracted sponsorship/media rights and 24-race calendar—Q2 strength reflects calendar mix and commercial wins .
  • Positive operating leverage in F1 supports margin resilience despite variable cost headwinds; Adjusted OIBDA rose to $369M with operating income at $273M .
  • Near-term catalysts: U.S. media rights renewal, continued partner additions/extensions, Apple F1 movie halo effects, and improving Las Vegas GP economics .
  • Balance sheet robust: Formula One Group cash up to $3.14B; leverage 0.7x; authorization for $1.1B repurchases intact (no activity in period) .
  • MotoGP integration and debt refinancing reduce margins on facilities and extend maturities; non-recourse structure limits corporate risk while adding growth optionality .
  • Expect continued sponsor/media rights growth to underpin revenue; watch freight and servicing costs tied to event sequencing and product expansion (F1 TV premium, hospitality) .
  • Trading lens: Momentum narrative (commercial, media rights, fan engagement) plus balance sheet strength are tailwinds; quarterly seasonality and variable cost profile are primary watch items, with any guidance on U.S. media deal timing likely stock‑moving .