Liberty Formula One A 2025 Q1 Earnings Misses Targets as Net Income Declines 98%

Liberty Formula One A (FWONA) reported its fiscal 2025 Q1 earnings on May 07th, 2025. The results showed a significant decline in earnings compared to the previous year, missing market expectations. Despite a challenging quarter, the company maintained its guidance, expressing confidence in future performance. Liberty Media anticipates continued growth, bolstered by new commercial partnerships and strong demand in the live music sector, positioning it well against the current macroeconomic backdrop.

Revenue
Liberty Formula One A saw a 27.3% decline in total revenue, falling to $400 million in Q1 2025 from $550 million in Q1 2024. This decline was primarily due to reduced revenue from Formula 1, which totaled $400 million, and other segments contributing $47 million, leading to a combined revenue of $447 million.

Earnings/Net Income
The earnings per share for Liberty Formula One A plummeted by 95.3%, dropping to $0.01 in Q1 2025 from $0.31 in Q1 2024. Concurrently, net income decreased dramatically to $5 million, representing a 98.0% fall from $245 million in the previous year. The quarter's EPS performance was notably weak.

Price Action
The stock price of Liberty Formula One A has shown some resilience, edging up 1.57% during the latest trading day, climbing 5.36% over the past week, and surging 16.76% over the month to date.

Post-Earnings Price Action Review
The post-earnings period for Liberty Formula One A saw a strategy of buying shares after a quarterly revenue drop and holding for 30 days, resulting in a return of 12.77%. However, this performance significantly underperformed the benchmark's return of 84.08%. The strategy's compound annual growth rate stood at 2.44%, with a maximum drawdown of -15.46% and a Sharpe ratio of 0.25, indicating moderate risk with limited returns. Despite the revenue decline, the stock's price action has shown some positive momentum, reflecting investor confidence in the company's long-term prospects, backed by strong fundamentals and strategic partnerships.

CEO Commentary
“2025 is off to a strong start. Formula 1 is benefiting from exciting racing on the track and financial momentum underpinned by new commercial partnerships that took effect this year,” said Derek Chang, Liberty Media President & CEO. He noted that the diversified revenue streams of Formula 1 position it well against the current macro backdrop, emphasizing strong business fundamentals and confidence in delivering long-term value. Chang also highlighted Live Nation's strong first quarter results and indicators pointing to another record year, reflecting sustained demand for live music and growth in the global experience economy.

Guidance
The company expressed confidence in its future performance, stating, “We believe Formula 1’s contracted and diversified revenue streams position it well against the current macro and consumer backdrop.” Liberty Media anticipates continued growth, with strong indicators suggesting a robust year ahead for Live Nation, driven by sustained demand in the live music sector and the global experience economy.

Additional News
Recent developments for Liberty Formula One A include renewed agreements for the Mexico Grand Prix through 2028 and the Miami Grand Prix through 2041, ensuring long-term stability for these events. The company has also secured new sponsorship deals with Barilla Pasta and PwC as official partners, enhancing its commercial portfolio. Furthermore, Formula 1 and all ten teams have signed the 2026 Concorde Commercial Agreement, which promises financial stability for the sport's stakeholders. Additionally, the Grand Prix Plaza in Las Vegas, which opened on May 2nd, offers immersive F1 attractions year-round, adding a new dimension to fan engagement. Liberty Media is also engaging with the European Commission on the regulatory process for acquiring MotoGP, which could further expand its motorsport portfolio.