Madison Square Garden Entertainment Corp.

Fiscal 2026 full-year revenue was more than $1 billion and adjusted operating income was $262 million, up 13% and 18% year over year, respectively. For the fiscal 2026 fourth quarter, revenue was $196.3 million, up 27% year over year, and adjusted operating income was $18.6 million versus an adjusted operating loss of $1.3 million in the prior-year quarter. Management said fourth-quarter revenue growth was driven by more concerts at the Garden, higher food, beverage and merchandise revenue, higher shared economics with MSG Sports tied to the Knicks championship run, and growth in sponsorship, signage, and suite license fees. For fiscal 2027, the company expects continued growth in revenues and AOI, with about $47 million of cash arena license fees, continued 3% annual growth on those fees, and significant underlying free cash flow driven by AOI, partially offset by interest, taxes, capex, and working capital timing.

David J. Collins framed fiscal 2026 as an outstanding year and said the company is entering fiscal 2027 with strong operating momentum. He emphasized growth across all key areas, including more live events, higher per-event profitability, another record Christmas Spectacular, and continued expansion in sponsorship and premium hospitality. His tone was confident and constructive, with repeated references to strong demand from consumers and partners and the ability to create long-term shareholder value through the Penn Station redevelopment-related theater transfer.

Collins reported fiscal 2026 revenue above $1 billion and AOI of $262 million, plus fourth-quarter revenue of $196.3 million and AOI of $18.6 million. He also noted $294 million of unrestricted cash and about $579 million of debt at June 30, while pointing out that the cash balance includes a significant amount due to promoters. On capital allocation, the company repurchased about 623 thousand shares for $25 million in fiscal 2026, and since the 2023 spin-off it has repurchased about 6.1 million shares for $205 million. He said fiscal 2027 free cash flow should be strong on an underlying basis, but will be affected by net interest payments of $32 million in fiscal 2026, taxes, capex including technology investments and suite renovations, and working capital timing.

Analysts focused heavily on the proposed Infosys Theater transfer, asking about the status, how much of the business could be recaptured elsewhere, and how proceeds might be used while limiting tax leakage. Management said it is working through definitive documents, believes the transaction could create long-term value, and is evaluating ways to shift events and sponsorships to other assets; Collins added that reinvesting proceeds in another venue would be the main way to reduce tax leakage, but no decisions have been made. Questions also centered on 2027 booking pacing and the Christmas Spectacular, where management said bookings are tracking well at the Garden but more behind at theaters, and that the holiday show is on sale with 230 performances versus 215 last year, with expectations for higher ticketing revenue from both more shows and higher average yields.