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Madison Square Garden Sports Corp. MSGS or MSG Sports witnessed a 3.6% dip in its shares during yesterday’s trading session, following the release of the mixed second-quarter fiscal 2025 (ended Dec. 31, 2024) results. The company’s earnings per share missed the Zacks Consensus Estimate, but revenues surpassed the same. On a year-over-year basis, earnings declined, but revenues increased.
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MSGS gained from the strong demand for the Knicks and the Rangers, as both teams played combined three more regular season games at The Garden during second-quarter fiscal 2025 compared with the prior-year period.
MSGS’ Earnings & Revenue Discussion
MSG Sports reported quarterly earnings of 5 cents per share, which missed the Zacks Consensus Estimate of 25 cents by 80%. The reported figure declined 91.5% from the year-ago quarter’s earnings of 59 cents per share.
The Madison Square Garden Company Price, Consensus and EPS Surprise
The Madison Square Garden Company price-consensus-eps-surprise-chart | The Madison Square Garden Company Quote
Revenues for the quarter amounted to $357.8 million, beating the consensus mark of $350.6 million by 2.1%. The metric also increased 9% year over year, driven by higher ticket sales, suite revenues, sponsorship and signage revenues. It also saw growth in food, beverage and merchandise sales, as well as local media rights fees.
Operating Highlights of MSGS
In the fiscal second quarter, adjusted operating income was $20.2 million, down 45% from $64.4 million reported in the year-ago quarter. Adjusted operating margin contracted 570 basis points to 5.6% year over year.
Direct operating expenses increased 19% to $275.8 million compared with the year-ago quarter. This increase was caused by higher team personnel compensation and higher net provisions for league revenue sharing expense (net of escrow and excluding playoffs). On the other hand, selling, general and administrative expenses were $67.9 million, up 4% on a year-over-year basis. This rise was due to increased operating lease costs and professional fees.
MSGS’ Balance Sheet
As of Dec. 31, 2024, MSG Sports had cash, cash equivalents and restricted cash of $115.9 million, up from $94.9 million as of fiscal 2024-end. As of the second quarter of fiscal 2025-end, the company had long-term debt of $275 million, in-line with the figure as of fiscal 2024-end.
In the first six months of fiscal 2025, net cash provided by operating activities was $35.6 million against net cash used by operating activities of $20.3 million reported in the year-ago comparable period.