Madison Square 2025 Q4 Earnings Sharp Loss as Net Income Plummets 140.6%

Madison Square (MSGE) reported its fiscal 2025 Q4 earnings on August 13, 2025, showing a significant deterioration in financial performance. The results fell far below expectations, with the company posting a net loss of $27.18 million compared to a net income of $66.93 million in the same period a year earlier. The company’s management provided cautious guidance for fiscal 2026, emphasizing growth drivers such as event volume expansion and premium hospitality.

Revenue

Total revenue for Madison Square declined by 17.2% to $154.14 million in 2025 Q4, compared to $186.07 million in 2024 Q4. The drop was attributed to fewer concerts at Madison Square Garden and reduced food and beverage sales, according to CFO David Collins. While full-year revenue for fiscal 2025 reached $942.7 million, the fourth-quarter performance highlights ongoing challenges in maintaining consistent revenue streams.

Earnings/Net Income

Madison Square swung to a loss of $0.57 per share in 2025 Q4 from a profit of $1.39 per share in 2024 Q4, representing a 141.1% negative change. The company reported a net loss of $27.18 million, a 140.6% deterioration from the previous year’s net income of $66.93 million. The company has posted losses for three consecutive years in the corresponding fiscal quarter, underscoring persistent financial headwinds.

The disappointing earnings reflect a significant decline in profitability. Despite full-year adjusted operating income of $222.5 million, the fourth-quarter loss signals ongoing operational and strategic challenges. The EPS decline is a clear indicator of the company’s struggle to maintain profitability in the short term.

Price Action

The stock price of Madison Square has continued to face downward pressure. Over the latest trading day, the stock dropped 5.38%. The decline has persisted over the past week, with a 3.56% drop during the most recent full trading week and a steeper 9.12% drop month-to-date. The continued price weakness suggests investor skepticism about the company’s short-term outlook and earnings trajectory.

Post-Earnings Price Action Review

The strategy of buying MSGE shares following the revenue drop on the financial report release date and holding for 30 days yielded a -11.47% return, significantly underperforming the benchmark return of 48.84% over the past three years. The strategy’s compound annual growth rate (CAGR) was -5.54%, with a maximum drawdown of 0.00% and a Sharpe ratio of -0.22. These metrics collectively point to a poorly performing strategy with a risk-averse profile, indicating weak market confidence in the stock’s ability to rebound.

CEO Commentary

David Collins, CFO of Madison Square, highlighted strong demand across Madison Square Garden’s entertainment assets in fiscal 2025, despite the Q4 revenue decline. He noted that the company remains optimistic about growth opportunities in fiscal 2026, including event volume expansion, per-event profitability, and the continued growth of the Christmas Spectacular. Collins emphasized strategic priorities such as in-house sponsorship sales, venue renovations, and leveraging strong consumer demand.

Guidance

Looking ahead, Collins outlined a growth-focused strategy for fiscal 2026. The company anticipates revenue and adjusted operating income growth driven by increased event volume, higher per-show revenue, and the expansion of premium hospitality offerings. The Christmas Spectacular is expected to grow with 211 shows and higher per-show revenue. The company plans to allocate capital to venue enhancements at Radio City and the Beacon Theatre while maintaining strong free cash flow despite higher selling, general, and administrative (SG&A) costs. The board also reaffirmed its commitment to share repurchases, with $70 million remaining under the current authorization.

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