TKO delivered 26% revenue growth and 32% EBITDA growth in Q1 2026 as UFC, WWE, and IMG all expanded. The stock still earns only a Hold because valuation is rich and leverage remains meaningful.
TKO Group Holdings, Inc. (TKO) owns a rare collection of global sports and entertainment properties, and its Q1 2026 results show that the monetization engine is still accelerating. Revenue reached $1.60B, up 26% year over year, while adjusted EBITDA rose 32% to $550M. UFC, WWE, and IMG all contributed double-digit revenue growth, and management reaffirmed 2026 guidance for revenue of $5.68B to $5.78B and adjusted EBITDA of $2.24B to $2.29B.
The investment case rests on scarce live content, long-term media rights, global distribution, and multiple ways to monetize each property. UFC and WWE provide the highest-margin core, while IMG, On Location, PBR, and Zuffa Boxing add event, hospitality, rights-management, and expansion opportunities. The counterweight is equally concrete: trailing P/E is 67.6x, forward P/E is 46.3x, gross debt reached $4.69B at March 31, 2026, and the earnings history shows only 2 beats in 7 recorded quarters.
For a moderate-risk investor with a medium-term horizon, TKO merits a Hold rather than an aggressive purchase. The business has the quality and growth to justify a premium, but the current valuation framework leaves less room for execution errors, event disruption, or weaker media-rights economics.
TKO was incorporated in 2023 and is based in New York. The company operates in Communication Services and owns or manages UFC, WWE, IMG, On Location, PBR, and Zuffa Boxing-related activities. TKO employs approximately 4,000 people and is a subsidiary of WME Group.
The company reports three principal segments: UFC, WWE, and IMG. PBR and certain boxing-related fees sit in Corporate and Other. TKO monetizes its properties through media rights and content, live events and hospitality, partnerships and marketing, and consumer products licensing.
UFC generated Q1 revenue of $401M, up 12% year over year, and adjusted EBITDA of $255M, also up 12%. Its 63% adjusted EBITDA margin remained unchanged from the prior-year quarter. Media rights, production, and content revenue rose 23% to $275M, helped by the Paramount agreement that began in January.
WWE produced Q1 revenue of $476M, up 22%, and adjusted EBITDA of $256M, up 32%. Its adjusted EBITDA margin expanded to 54% from 50%. Live events and hospitality revenue rose 62% to $123M, while media rights, production, and content revenue increased 12% to $282M through higher fees tied to ESPN and Netflix.
IMG generated Q1 revenue of $655M, up 38%, and adjusted EBITDA of $97M, up 32%. Its 15% adjusted EBITDA margin was unchanged. The main revenue driver was On Location hospitality tied to the Milano Cortina Winter Olympics, while pre-spending for LA28 partially offset the benefit at the earnings level.
Corporate and Other produced $74M of revenue and an adjusted EBITDA loss of $58M. Higher PBR revenue, boxing management fees, and the removal of $22M in former Endeavor corporate expense allocations improved the result. That improvement was partly offset by the cost of rebuilding services previously provided by Endeavor.
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UFC and WWE are TKO's flagship products because they combine global brands, recurring live programming, and premium rights value. UFC 326 became the most watched live UFC event since 2016, while the CBS audience alone was more than 270% above the prior year's UFC average on linear television before Paramount+ streaming was included.
The UFC distribution change matters because it expands sampling while retaining a streaming outlet. Q1 media-rights revenue increased to $275M even though UFC held two fewer Fight Nights than in the prior-year quarter. Management also reported sellouts across Las Vegas, London, Sydney, and Seattle, with Seattle producing the highest Fight Night gate in North America.
WWE adds a different form of monetization. WrestleMania 42 drew more than 106,000 fans over two nights in Las Vegas, and the event included a record 32 partners. Netflix acquired the U.S. WWE archive, while the CW agreed to carry all NXT premium live events, adding roughly 20 live broadcasts to its existing NXT relationship.
TKO's advantage is not a single technology product. It is the ownership and distribution of scarce live intellectual property. Ariel Emanuel described TKO's content as live, communal, and scarce, while Mark Shapiro said the company benefits from defensive business characteristics. Those statements are supported by Q1 results, including a 63% UFC adjusted EBITDA margin and a 54% WWE adjusted EBITDA margin.
The company is also widening its portfolio. Zuffa Boxing has signed more than 100 fighters, staged five events with solid Paramount+ viewership, secured a multiyear Sky Sports agreement in the U.K. and Ireland, and signed media-rights deals in more than 15 additional territories across EMEA and APAC.
PBR provides another option. Management expects the PBR Team Series to expand from 10 teams to 12 teams for the 2027 season. Team sale prices rose from roughly $3M at launch to more than $22M in the first expansion round in 2024. That increase demonstrates the commercial value of TKO's ability to build and package sports properties, although the future valuation of new teams remains an execution issue rather than a reported result.
IMG strengthens the advantage through media-rights sales, production, brand partnerships, consulting, and event management. Its work on Apple's U.S. Formula 1 broadcasts and its long-term World Rugby partnership show how TKO can monetize expertise beyond UFC and WWE.
TKO's operating system is an event calendar supported by athletes, production crews, venues, broadcasters, sponsors, hospitality providers, and local partners. Q1 included nine UFC events, sellouts across multiple markets, the Milano Cortina hospitality program for more than 100,000 guests, and a 12-day WWE European tour.
The calendar creates both operating leverage and volatility. UFC's Q1 revenue benefited from higher media-rights fees, but two fewer Fight Nights reduced high-flow-through revenue. WWE's international events raised travel and logistics costs, while Royal Rumble in Saudi Arabia carried a higher cost structure than other premium live events.
Management plans 11 UFC events in Q2, including two numbered events and eight Fight Nights. UFC Freedom 250 at the White House is expected to lose approximately $30M because expanded production costs exceed the partnership inventory sold. That event illustrates the central operating tradeoff: spectacle can strengthen brand value while reducing near-term event profitability.
The February 25, 2026 10-K also identifies revenue recognition for contracts with multiple performance obligations as a critical audit matter. TKO recorded $4.74B of 2025 revenue, and the auditor highlighted the judgment required to allocate consideration across media rights, live events, partnerships, and other obligations.
TKO operates inside a large entertainment market that is shifting toward digital distribution, advertising, and live experiences. PwC projects global entertainment and media revenue of $4.2T by 2030, while its 2024 outlook estimated $2.8T in 2023 revenue rising to $3.4T by 2028.
The faster-growing subsegments are digital. Mordor Intelligence projects the over-the-top market to grow from $700B in 2025 to $1.47T in 2030. MarketsandMarkets projects video-on-demand revenue to rise from $211.82B in 2026 to $390.24B in 2031.
TKO is positioned well for the shift because UFC and WWE can be distributed through linear television, streaming services, and simulcasts. Q1 provided direct evidence: UFC's CBS simulcast reached its largest live audience since 2016, and WWE expanded distribution through ESPN, Netflix, and the CW.
The market still has a price ceiling. Deloitte reported that 47% of consumers believe they pay too much for streaming services and 41% believe the content is not worth the price. TKO's live properties help platforms justify subscriptions, but fan criticism about ticket prices and commercial load shows that monetization has a limit.
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TKO serves several customer groups. Broadcasters and streaming platforms buy media rights. Fans buy tickets, subscriptions, merchandise, and hospitality. Sponsors buy in-venue, broadcast, and digital exposure. Governments and event partners pay financial incentive packages to attract major events. Rights holders also hire IMG for media-rights management, production, and brand partnerships.
The customer base is global. TKO says its properties reach more than 1 billion households across 210 countries and territories. UFC content reaches more than 950 million television households across more than 170 countries and territories, while UFC reports more than 700 million fans and approximately 350 million social followers.
The Q1 revenue mix shows the economic value of this customer diversity. UFC generated $275M from media rights and content, $49M from live events and hospitality, and $67M from partnerships and marketing. WWE generated $282M from media rights and content and $123M from live events and hospitality.
TKO's strongest customers are those seeking reliable, premium live audiences. The risk is that excessive ticket pricing or sponsorship density can weaken the fan relationship that makes those audiences valuable.
UFC's clearest direct MMA competitor is Professional Fighters League, which absorbed Bellator. WWE competes most directly with All Elite Wrestling, with TNA also relevant in professional wrestling. TKO also competes with professional and college sports, scripted entertainment, social video, and other live experiences for attention and advertising budgets.
TKO has a scale advantage over smaller combat-sports and wrestling rivals. UFC and WWE each hold category-leading positions, while IMG and On Location add rights-management and hospitality capabilities that competitors such as PFL and AEW do not match at the same breadth.
The main competitive threat is broader than any one rival. Deloitte says social platforms are competing more directly with studios for entertainment time and are drawing more than half of U.S. advertising spending. TKO's response is to offer live programming that cannot be fully replaced by an on-demand library or short-form social feed.
The moat is strongest when TKO owns the event, the brand, the audience relationship, and the distribution rights. It weakens when the company depends on a single distributor, a single venue, or a narrow group of talent.
TKO's macro exposure is tied to advertising budgets, consumer spending, travel, media-rights demand, and interest costs. PwC expects global advertising revenue to reach $1T in 2026, which supports TKO's partnerships and marketing business. At the same time, Deloitte's streaming value data shows that consumers remain sensitive to entertainment costs.
Geopolitical risk is visible in the 2026 event calendar. Management said UFC Fight Night Baku and WWE Night of Champions in Riyadh were scheduled for June 27, followed by six additional Middle East events across UFC, WWE, and Zuffa Boxing. TKO said partners in Saudi Arabia had confirmed their commitment despite the withdrawal of Saudi funding from LIV Golf.
Management also said it was tracking government advisories and security assessments. The direct financial risk is event postponement, cancellation, higher security spending, or weaker attendance. The direct opportunity is the continued use of financial incentive packages to expand into new markets.
The 2026 FIFA World Cup provides a separate macro tailwind for On Location. Management reported hospitality sales at more than twice the level of any previous World Cup program in company history, while the event was scheduled to begin on June 11.
Gross debt reached $4.69B at March 31, 2026, leaving TKO with a C+ balance sheet grade despite strong operating momentum.
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Get Full Access →Revenue climbed to $1.60B in Q1 2026 and adjusted EBITDA rose to $550M, with UFC, WWE, and IMG all posting double-digit growth.
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Get Full Access →Management reaffirmed 2026 guidance for $5.68B-$5.78B of revenue and $2.24B-$2.29B of adjusted EBITDA after a strong first quarter.
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Get Full Access →Trailing P/E of 67.6x and forward P/E of 46.3x leave TKO priced for execution, which is why valuation only earns a C+.
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Get Full Access →With a Hold recommendation and fair value set at $210, the report sees quality and growth offset by limited margin for error.
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Get Full Access →TKO is a high-quality sports and entertainment platform with two unusually durable flagship brands. Q1 2026 confirmed the strength of the model: revenue rose 26%, adjusted EBITDA rose 32%, UFC and WWE maintained exceptional segment margins, and IMG benefited from Olympic hospitality demand.
The next phase depends on conversion rather than discovery. Paramount, ESPN, Netflix, the CW, the 2026 World Cup, Zuffa Boxing, PBR expansion, and LA28 hospitality provide identifiable growth channels. Management's $5.68B to $5.78B revenue target and $2.24B to $2.29B adjusted EBITDA target put numbers behind that opportunity.
The stock does not offer a clean margin of safety at a 67.6x trailing P/E, and debt has risen alongside the buyback program. That combination makes discipline more valuable than enthusiasm. TKO remains a credible medium-term compounder, but the $210 fair value estimate and Hold recommendation better reflect the balance between exceptional intellectual property and an already demanding financial profile.
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