Paramount Skydance (PSKY) Secures $7.7B UFC Deal After Merger with Skydance Media

Paramount Skydance Corp. (PSKY) signed a $7.7 billion deal with TKO Group for exclusive US streaming rights to all UFC events starting in 2026. The deal follows the merger between Paramount Global and Skydance Media. PSKY stock jumped on the news but ended the day down 3.7%, while TKO Group stock surged over 10%. Analysts currently prefer to remain sidelined on PSKY stock.

Paramount Skydance Corp. (PSKY) has signed a $7.7 billion deal with TKO Group for exclusive U.S. streaming rights to all UFC events starting in 2026. The agreement follows the recent merger between Paramount Global and Skydance Media. While PSKY stock initially jumped on the news, it ended the day down 3.7%, while TKO Group stock surged over 10%. Analysts currently prefer to remain sidelined on PSKY stock.

Under the terms of the seven-year deal, Paramount will exclusively distribute UFC's full slate of 13 marquee numbered events and 30 Fight Nights via its direct-to-consumer streaming platform, Paramount+. Select numbered events will be simulcast on CBS, Paramount's leading broadcast network. This shift in distribution strategy aims to unlock greater accessibility and discoverability for sports fans and drive further engagement and subscriber growth for Paramount+ [1].

The deal marks a significant shift in the distribution strategy of UFC from cable and Pay-Per-View (PPV) to streaming. While the current agreement with ESPN had a major PPV element, the new deal will make premium events available at no additional cost to the U.S. subscriber base of Paramount+. This move is expected to enhance the viewing experience and potentially attract new subscribers [2].

David Ellison, Chairman and CEO of Paramount, expressed excitement about the partnership, highlighting the global recognition and cultural impact of UFC. He noted that Paramount's advantage lies in the expansive reach of its linear and streaming platforms. The addition of UFC's year-round must-watch events to Paramount+ is a significant win for the company [1].

Ariel Emanuel, Executive Chair and CEO of TKO, described the deal as a milestone moment for UFC, solidifying its position as a preeminent global sports asset. The agreement is an important realization of TKO's strategy and will provide meaningful economics for investors, expanded premium inventory for global brand partners, and deeper engagement for UFC's passionate fanbase [1].

The seven-year term of the agreement has an average annual value (AAV) of $1.1 billion, with the payment schedule weighted more toward the back end of the deal. This structure suggests a significant long-term commitment from both parties [1].

Despite the initial stock jump, analysts remain cautious about PSKY stock. The deal's long-term impact on subscriber growth and engagement will be key factors to watch. Investors should closely monitor Paramount's ability to capitalize on the increased accessibility and discoverability of UFC content [3].

References:
[1] https://investor.tkogrp.com/news/news-details/2025/PARAMOUNT-AND-TKO-ANNOUNCE-HISTORIC-UFC-MEDIA-RIGHTS-AGREEMENT/default.aspx
[2] https://www.tradingview.com/news/reuters.com,2025:newsml_L4N3U30ZG:0-tko-group-up-paramount-skydance-down-after-7-7-bln-us-rights-deal-for-ufc/
[3] https://www.tvtechnology.com/news/paramount-inks-usd7-7-billion-ufc-rights-deal-with-tko-group