TKO Q2 Earnings Grow on Higher Site Fees, Sponsor Sales for UFC and WWE

UPDATED with TKO stock gains

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The UFC and WWE both saw strong gains in site fees, sponsorship dollars and live event demand in the second quarter, which boosted the fortunes of its parent company enough to allow TKO Group Holdings to raise full-year financial guidance for the second consecutive quarter.

Total company revenue came in at $851.2 million, with adjusted earnings before interest, taxes, depreciation and amortization of $420.9 million and net income of $150.7 million. The WWE’s WrestleMania 40 event and the UFC 300 and 303 events busted through expectations. TKO, which is majority-owned by Endeavor, raised its 2024 revenue target by about $60 million to $2.670 billion-$2.745 billion. Adjusted EBIDTA was hiked by about $35 million to $1.220 billion-$1.240 billion, according to TKO.

“TKO generated strong financial results in the quarter, highlighted by record quarterly revenue and
Adjusted EBITDA,” said Ariel Emanuel, executive chair and CEO of TKO, who is also CEO of Endeavor. “In light of this continued momentum, we are raising our full year 2024 guidance for the second quarter in a row. The strength in our underlying business continues to give us great conviction in TKO’s ability to deliver sustainable long-term value for shareholders.”

TKO was formed in September 2023 through the merger of WWE and Endeavor’s UFC mixed martial arts league .

On Thursday, Endeavor also released its separate Q2 earnings report which diclosed its intent to sell assets including OpenBet and IMG Arena. The company is in the process of being taken private by its majority owner, private equity giant Silver Lake. That transaction is on track to close by the first quarter of 2025.

Outside of TKO, Endeavor’s representation division saw revenue grow 8% to $411.4 million while adjusted EBITDA was flat at $107.4 million. All told, Endeavor posted Q2 revenue of $1.75 billion and adjusted EBITDA of $380.7 million and a net loss of $253.8 million.

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UFC’s quarterly numbers were all up year-over-year with the exception of consumer products sales. Total revenue for the quarter soared 29% to $394.4 million, largely from media rights ($250.6 million) and a $15.5 million increase in sponsorship revenue (to $61.7 million). Adjusted EBITDA grew 23% to $231.9 million.

WWE revenue was up 11% for the quarter to $456.8 million. WWE’s coin mostly came from media rights ($260.7 million) and live event ticket sales ($144.1 million). Adjusted EBITDA was $251.3 million, a gain of 45% over the year-ago period.

TKO’s corporate loss ballooned to $62.3 million, compared with $14.6 million a year earlier. Part of the increase was due to higher “service fees” paid to parent company Endeavor. TKO took $29.8 million in restructuring, severance and impairment costs, including a write-down of $24.3 million in the value of assets held by WWE at the time of last year’s merger.

TKO stock has been on a roll, rising 34% for the year to date to close Wednesday at $109.50. Following Thursday’s pre-market earnings release, shares shot up as much 8% during the day.

(Pictured: Women’s champion Bayley in April at WWE’s WrestleMania 40 in Philadelphia)

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