Madison Square 2025 Q3 Earnings Revenue Beats, Net Income Up 187.5%

Madison Square Garden Entertainment Corp. (MSGE) reported fiscal 2025 Q3 results, revealing a 6% year-over-year revenue increase, surpassing analyst expectations of $231.13 million with $242.47 million. However, EPS of $0.17 missed the consensus estimate of $0.23. MSGE maintains optimism for fiscal 2025 with expectations for mid- to high single-digit adjusted operating income growth. Despite challenges in concert bookings, the company anticipates strong performance in the fourth quarter, particularly from the Christmas Spectacular, with advanced ticket sales showing promising results.

Revenue

Madison Square's total revenue climbed 6.2% to $242.47 million in Q3 2025, up from $228.31 million in the same quarter of 2024. Ticketing and venue license fees contributed $78.50 million, with sponsorship, signage, suite licenses, and advertising commissions adding $80.85 million. Food, beverage, and merchandise sales reached $45.81 million, while arena license fees and other leasing revenues amounted to $36.44 million. Other revenue sources accounted for $869,000, collectively driving the robust overall revenue performance.

Earnings/Net Income

Madison Square's earnings per share increased by 183.3% to $0.17 in Q3 2025 from $0.06 in Q3 2024, showcasing continued earnings growth. Net income rose 187.5% to $8.04 million in Q3 2025, reflecting strengthened profitability. Despite the positive earnings trajectory, EPS underperformed against expectations, indicating mixed results.

Price Action

The stock price of Madison Square has climbed 3.82% during the latest trading day, has jumped 8.60% during the most recent full trading week, and has jumped 13.56% month-to-date.

Post-Earnings Price Action Review

Over the past five years, investing in Madison Square shares following a revenue increase quarter-over-quarter and holding for 30 days has yielded moderate returns. This strategy achieved a 25.97% return, slightly underperforming the benchmark's 30.72% return, resulting in an excess return of -4.75%. The strategy's Sharpe ratio stood at 0.63, indicating a reasonable risk-adjusted return. However, it carried moderate risk with a maximum drawdown of -17.24% and a volatility of 19.53%. The compound annual growth rate (CAGR) was 12.31%, reflecting steady growth over the period. Despite the moderate risk, the strategy has shown consistent growth, but with returns slightly below industry standards.

CEO Commentary

Lee Weinberg, SVP of Business and Financial Operations, expressed satisfaction with MSGE's performance, noting strong demand for live entertainment. He emphasized the successful Christmas Spectacular, which generated over $170 million, and reaffirmed the commitment to shareholder returns through buybacks. Weinberg acknowledged a decline in concert events but maintained optimism for mid- to high single-digit AOI growth this fiscal year.

Guidance

The company expects mid- to high single-digit AOI growth for fiscal 2025. While facing challenges in concert bookings, MSGE remains optimistic about fourth-quarter events and monitors trends for potential improvements. The Christmas Spectacular is expected to continue growing, with advanced ticket sales pacing over 60% in gross revenue compared to previous periods.

Additional News

Recent developments at Madison Square Garden Entertainment Corp. include significant leadership changes and strategic partnerships. David Collins has been appointed as Executive Vice President and Chief Financial Officer, effective April 14, 2025, bringing extensive financial experience to the role. MSGE also announced a multi-year partnership with Liquid Death, establishing it as the Official Sparkling Water Partner across MSG venues, including Madison Square Garden and Radio City Music Hall. Additionally, Snapple® has been named the Official Tea Partner of the New York Knicks, New York Rangers, and Madison Square Garden, enhancing its presence with thematic concession stands and promotional activities at MSG events.