TKO Group (NYSE: TKO) lifts Q2 revenue to $1.55B and boosts profit
TKO Group Holdings reported solid growth for the quarter ended June 30, 2026. Revenue rose to $1,547.1 million from $1,308.4 million a year earlier, with six‑month revenue at $3,144.0 million versus $2,577.2 million. Operating income increased to $429.8 million, and net income was $303.9 million, of which $101.6 million was attributable to TKO stockholders. Diluted EPS for Class A shares was $1.34 for the quarter and $2.46 for the first half.
Media rights and content remained the largest driver, contributing $835.8 million in Q2, while live events and hospitality generated $418.1 million. The company produced strong cash generation, with $1,068.5 million provided by operating activities in the first half. TKO ended the period with $1,552.2 million of cash and restricted cash and $4,629.2 million of total debt, mainly a first‑lien term loan maturing in 2031 that was upsized and refinanced during 2026. Management continued capital returns, repurchasing $967.6 million of Class A stock year‑to‑date and declaring $1.57 per‑share cash dividends for Class A holders, while disclosing contracted remaining performance obligations of $15,970.0 million over future years.
Positive
- None.
Negative
- None.
Filing Explained
By July 22, the May buyback plan was complete; June 30 filings showed EGH-controlled voting power and TKO’s 39% economic stake in TKO OpCo.
Form 10-Q is the company’s unaudited quarterly report. As of
The filing records final delivery of
At quarter-end, Endeavor Group Holdings and its subsidiaries controlled
The March debt amendment added a borrowed
Key Figures
Key Terms
remaining performance obligations financial
accelerated share repurchase agreement financial
First Lien Term Loan financial
common control acquisition financial
non-controlling interests financial
content production incentives financial
AI-generated analysis. How Rhea-AI works. Not financial advice.
FAQ
How did TKO (TKO) perform financially in the quarter ended June 30, 2026?
What were TKO (TKO)’s results for the first six months of 2026?
How is TKO (TKO)’s revenue split across UFC, WWE, IMG, and other operations?
What is TKO (TKO)’s current debt and cash position?
How much stock has TKO (TKO) repurchased and what dividends were declared in 2026?
What future revenue visibility does TKO (TKO) report through remaining performance obligations?
How did the Endeavor Asset Acquisition affect TKO (TKO)’s financial reporting?
Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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For the quarterly period ended |
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or |
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
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For the transition period from ______ to ______ |
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Commission File Number:
(Exact name of registrant as specified in its charter)
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(State or other jurisdiction of incorporation or organization) |
(I.R.S. Employer Identification No.) |
(Address of principal executive offices)
(
(Registrant’s telephone number, including area code)
Not Applicable
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
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Title of each class |
Trading Symbol(s) |
Name of each exchange on which registered |
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Accelerated Filer ☐ |
Non-Accelerated Filer ☐ |
Smaller Reporting Company |
Emerging Growth Company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No
As of July 31, 2026, there were
Table of Contents
TABLE OF CONTENTS
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Page # |
Part I – FINANCIAL INFORMATION |
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Item 1. Financial Statements (unaudited) |
6 |
Consolidated Balance Sheets as of June 30, 2026 and December 31, 2025 |
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Consolidated Statements of Operations for the three and six months ended June 30, 2026 and 2025 |
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Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2026 and 2025 |
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Consolidated Statements of Stockholders’ Equity for the three and six months ended June 30, 2026 and 2025 |
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Consolidated Statements of Cash Flows for the six months ended June 30, 2026 and 2025 |
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Notes to Consolidated Financial Statements |
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations |
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Item 3. Quantitative and Qualitative Disclosures about Market Risk |
47 |
Item 4. Controls and Procedures |
48 |
Part II – OTHER INFORMATION |
48 |
Item 1. Legal Proceedings |
48 |
Item 1A. Risk Factors |
48 |
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds |
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Item 5. Other Information |
48 |
Item 6. Exhibits |
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Signatures |
51 |
2
Table of Contents
FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q (the “Quarterly Report”) contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of present and historical fact contained in this Quarterly Report, including without limitation, statements regarding our expectations for our ability to grow our business and improve our financial position; our expectations regarding strategic transactions, our expectations regarding actions under our capital return program, including the amount and frequency of share repurchases and dividends; our expectations regarding revenue from media rights and content distribution agreements; industry and business trends; the impact of market conditions and other macroeconomic factors on our business, financial condition and results of operations; our future business strategy, plans, market growth and our objectives for future operations; and our competitive market position within our industry are forward-looking statements.
Without limiting the foregoing, you can generally identify forward-looking statements by the use of forward-looking terminology, including the terms “aim,” “anticipate,” “believe,” “could,” “mission,” “may,” “will,” “should,” “expect,” “intend,” “plan,” “estimate,” “project,” “predict,” “potential,” “target,” “contemplate,” or, in each case, their negative, or other variations or comparable terminology and expressions. The forward-looking statements in this Quarterly Report are only predictions and are based on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition, and results of operations. These forward-looking statements speak only as of the date of this Quarterly Report and are subject to a number of known and unknown risks, uncertainties and assumptions, including but not limited to:
These risks could cause our actual results to differ materially from those implied by forward-looking statements in this Quarterly Report. Moreover, we operate in an evolving environment. New risk factors and uncertainties may emerge from time to time, and it is not possible for management to predict all risk factors and uncertainties. Even if our results of operations, financial condition and liquidity and the development of the industry in which we operate are consistent with the forward-looking statements contained in this Quarterly Report, those results or developments may not be indicative of results or developments in subsequent periods.
You should read this Quarterly Report and the documents that we reference herein completely and with the understanding that our actual future results may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements. Except as required by applicable law, we have no obligation to update or revise any forward-looking statements contained herein, whether as a result of any new information, future events, changed circumstances or otherwise.
3
Table of Contents
Available Information and Website Disclosure
We are required to file annual, quarterly and current reports, proxy statements and other information with the SEC. Our filings with the SEC are also available to the public through the SEC’s website at www.sec.gov.
You can also find more information about us online at our investor relations website located at investor.tkogrp.com. Filings we make with the SEC and any amendments to those reports are available free of charge on our website as soon as reasonably practicable after we electronically file such material with the SEC. The information posted on or accessible through our website is not incorporated into this Quarterly Report.
Investors and others should note that we announce material financial and operational information to our investors using press releases, SEC filings and public conference calls and webcasts, and by postings on our investor relations site at investor.tkogrp.com. We may also use our website as a distribution channel for material Company information. In addition, you may automatically receive email alerts and other information about TKO when you enroll your email address by visiting the “Investor Email Alerts” option under the Resources tab on investor.tkogrp.com.
DEFINITIONS
As used in this Quarterly Report, unless we state otherwise or the context otherwise requires:
4
Table of Contents
5
Table of Contents
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
TKO GROUP HOLDINGS, INC.
Consolidated Balance Sheets
(In thousands, except share and per share data)
(Unaudited)
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As of June 30, |
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As of December 31, |
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2026 |
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2025 |
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Assets |
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Current assets: |
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Cash and cash equivalents |
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$ |
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$ |
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Restricted cash |
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Accounts receivable (net of allowance for doubtful accounts of $ |
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Deferred costs |
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Other current assets |
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Total current assets |
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Property, buildings and equipment, net |
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Intangible assets, net |
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Finance lease right-of-use assets, net |
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Operating lease right-of-use assets, net |
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Goodwill |
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Investments |
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Other assets |
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Total assets |
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$ |
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$ |
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Liabilities, Non-controlling Interests and Stockholders' Equity |
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Current liabilities: |
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Accounts payable |
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$ |
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$ |
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Accrued liabilities |
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Current portion of long-term debt |
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Current portion of finance lease liabilities |
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Current portion of operating lease liabilities |
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Deferred revenue |
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Other current liabilities |
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Total current liabilities |
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Long-term debt |
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Long-term finance lease liabilities |
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Long-term operating lease liabilities |
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Deferred tax liabilities |
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Other long-term liabilities |
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Total liabilities |
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Commitments and contingencies (Note 14) |
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Redeemable non-controlling interests |
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Stockholders' equity: |
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Class A common stock: ($ |
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Class B common stock: ($ |
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Additional paid-in capital |
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Accumulated other comprehensive loss |
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Accumulated deficit |
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( |
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Total TKO Group Holdings, Inc. stockholders’ equity |
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Nonredeemable non-controlling interests |
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Total stockholders' equity |
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Total liabilities, redeemable non-controlling interests and stockholders' equity |
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$ |
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$ |
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See accompanying notes to consolidated financial statements.
6
Table of Contents
TKO GROUP HOLDINGS, INC.
Consolidated Statements of Operations
(In thousands, except share and per share data)
(Unaudited)
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Three Months Ended |
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Six Months Ended |
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2026 |
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2025 |
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2026 |
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2025 |
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Revenue |
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$ |
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$ |
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$ |
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$ |
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Operating expenses: |
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Direct operating costs |
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Selling, general and administrative expenses |
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Depreciation and amortization |
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Total operating expenses |
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Operating income |
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Other expenses: |
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Interest expense, net |
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Other income (expense), net |
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Income before income taxes and equity earnings of affiliates |
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Provision for income taxes |
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Income before equity earnings of affiliates |
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Equity (loss) earnings of affiliates, net of tax |
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Net income |
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Less: Net income attributable to non-controlling interests |
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Net income attributable to TKO Group Holdings, Inc. |
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$ |
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$ |
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$ |
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$ |
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Basic net earnings per share of Class A common stock |
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$ |
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$ |
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$ |
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$ |
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Diluted net earnings per share of Class A common stock |
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$ |
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$ |
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$ |
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$ |
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Weighted average number of common shares used in computing basic earnings per share |
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Weighted average number of common shares used in computing diluted net earnings per share |
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See accompanying notes to consolidated financial statements.
7
Table of Contents
TKO GROUP HOLDINGS, INC.
Consolidated Statements of Comprehensive Income
(In thousands)
(Unaudited)
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Three Months Ended |
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Six Months Ended |
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2026 |
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2025 |
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2026 |
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2025 |
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Net income |
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$ |
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$ |
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$ |
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$ |
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Other comprehensive income, net of tax: |
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Foreign currency translation adjustments |
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( |
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Cash flow hedges: |
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Change in net unrealized gains (losses) |
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( |
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( |
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Amortization of cash flow hedge fair value to net income |
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( |
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( |
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( |
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( |
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Total comprehensive income, net of tax |
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Less: Comprehensive income attributable to non-controlling interests |
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Comprehensive income attributable to TKO Group Holdings, Inc. |
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$ |
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$ |
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$ |
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$ |
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See accompanying notes to consolidated financial statements.
8
Table of Contents
TKO GROUP HOLDINGS, INC.
Consolidated Statements of Stockholders’ Equity
(In thousands)
(Unaudited)
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Three Months Ended June 30, 2026 |
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Accumulated |
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Total TKO |
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Nonredeemable |
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Common Stock |
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Additional |
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Other |
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Group Holdings, |
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Non- |
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Total |
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Class A |
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Class B |
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Paid - in |
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Comprehensive |
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Accumulated |
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Inc. Stockholders' |
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Controlling |
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Stockholders' |
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Shares |
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Amount |
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Shares |
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Amount |
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Capital |
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(Loss) Income |
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Deficit |
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Equity |
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Interests |
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Equity |
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Balance, March 31, 2026 |
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$ |
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$ |
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$ |
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$ |
( |
) |
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$ |
( |
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$ |
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$ |
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$ |
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||||||||
Comprehensive income |
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— |
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— |
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— |
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— |
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— |
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Distributions to members |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
) |
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( |
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Distributions to investors |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
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( |
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Contributions from parent |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Stock issuances and other, net |
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— |
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— |
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— |
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— |
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— |
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Repurchase and retirement of common stock |
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( |
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— |
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— |
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— |
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— |
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— |
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( |
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( |
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— |
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( |
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Excise taxes on repurchase of common stock |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
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( |
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— |
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Equity-based compensation |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Cash dividends declared ($ |
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— |
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— |
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— |
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— |
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( |
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— |
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— |
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( |
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— |
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( |
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Equity impacts arising from changes in ownership |
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— |
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— |
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— |
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— |
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— |
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— |
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— |
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Equity reallocation between controlling and non-controlling interests |
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— |
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— |
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— |
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— |
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— |
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— |
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( |
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— |
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Balance, June 30, 2026 |
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$ |
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$ |
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$ |
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$ |
( |
) |
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$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
|
|
Six Months Ended June 30, 2026 |
|
|||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated |
|
|
|
|
|
Total TKO |
|
|
Nonredeemable |
|
|
|
|
||||||||||
|
|
Common Stock |
|
|
Additional |
|
|
Other |
|
|
|
|
|
Group Holdings, |
|
|
Non- |
|
|
Total |
|
|||||||||||||||||||
|
|
Class A |
|
|
Class B |
|
|
Paid - in |
|
|
Comprehensive |
|
|
Accumulated |
|
|
Inc. Stockholders' |
|
|
Controlling |
|
|
Stockholders' |
|
||||||||||||||||
|
|
Shares |
|
|
Amount |
|
|
Shares |
|
|
Amount |
|
|
Capital |
|
|
Loss |
|
|
Deficit |
|
|
Equity |
|
|
Interests |
|
|
Equity |
|
||||||||||
Balance, December 31, 2025 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
Comprehensive income (loss) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Distributions to members |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
Distributions to investors |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
Contributions from parent |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
||
Stock issuances and other, net |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|||||
Repurchase and retirement of common stock |
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
Excise taxes on repurchase of common stock |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
Equity-based compensation |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
|
|||
Taxes paid related to net settlement upon vesting of equity awards |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
Cash dividends declared ($ |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
Equity impacts arising from changes in ownership |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
|
|||
Equity reallocation between controlling and non-controlling interests |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
( |
) |
|
|
— |
|
||
Balance, June 30, 2026 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
See accompanying notes to consolidated financial statements.
9
Table of Contents
TKO GROUP HOLDINGS, INC.
Consolidated Statements of Stockholders’ Equity
(In thousands)
(Unaudited)
|
|
Three Months Ended June 30, 2025 |
|
|||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated |
|
|
|
|
|
Total TKO |
|
|
Nonredeemable |
|
|
|
|
||||||||||
|
|
Common Stock |
|
|
Additional |
|
|
Other |
|
|
|
|
|
Group Holdings, |
|
|
Non- |
|
|
Total |
|
|||||||||||||||||||
|
|
Class A |
|
|
Class B |
|
|
Paid - in |
|
|
Comprehensive |
|
|
Accumulated |
|
|
Inc. Stockholders' |
|
|
Controlling |
|
|
Stockholders' |
|
||||||||||||||||
|
|
Shares |
|
|
Amount |
|
|
Shares |
|
|
Amount |
|
|
Capital |
|
|
Loss |
|
|
Deficit |
|
|
Equity |
|
|
Interests |
|
|
Equity |
|
||||||||||
Balance, March 31, 2025 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
Comprehensive income |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Distributions to members |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
Distributions to investors |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
Contributions from parent |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
||
Stock issuances and other, net |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Equity-based compensation |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
|
|||
Cash dividends declared ($ |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
Equity impacts arising from changes in ownership |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
Equity reallocation between controlling and non-controlling interests |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
( |
) |
|
|
— |
|
||
Balance, June 30, 2025 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
|
|
Six Months Ended June 30, 2025 |
|
|||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated |
|
|
|
|
|
Total TKO |
|
|
Nonredeemable |
|
|
|
|
||||||||||
|
|
Common Stock |
|
|
Additional |
|
|
Other |
|
|
|
|
|
Group Holdings, |
|
|
Non- |
|
|
Total |
|
|||||||||||||||||||
|
|
Class A |
|
|
Class B |
|
|
Paid - in |
|
|
Comprehensive |
|
|
Accumulated |
|
|
Inc. Stockholders' |
|
|
Controlling |
|
|
Stockholders' |
|
||||||||||||||||
|
|
Shares |
|
|
Amount |
|
|
Shares |
|
|
Amount |
|
|
Capital |
|
|
Loss |
|
|
Deficit |
|
|
Equity |
|
|
Interests |
|
|
Equity |
|
||||||||||
Balance, December 31, 2024 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
Comprehensive income |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Distributions to members |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
Distributions to investors |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
Net transfers from parent |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
Contributions from parent |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
|
||
Stock issuances and other, net |
|
|
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
|
|||||
Equity-based compensation |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
|
|||
Cash dividends declared ($ |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
Equity impacts arising from changes in ownership |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
— |
|
|
|
|
|
|
— |
|
|
|
|
|||
Equity reallocation between controlling and non-controlling interests |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
( |
) |
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
|
|
|
|
|
— |
|
|
Balance, June 30, 2025 |
|
|
|
|
$ |
|
|
|
|
|
$ |
|
|
$ |
|
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
|
|
$ |
|
|
$ |
|
||||||||
See accompanying notes to consolidated financial statements.
10
Table of Contents
TKO GROUP HOLDINGS, INC.
Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
|
|
Six Months Ended |
|
|||||
|
|
June 30, |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
CASH FLOWS FROM OPERATING ACTIVITIES: |
|
|
|
|
|
|
||
Net income |
|
$ |
|
|
$ |
|
||
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
|
|
|
||
Depreciation and amortization |
|
|
|
|
|
|
||
Amortization and impairments of content costs |
|
|
|
|
|
|
||
Amortization and write-off of original issue discount and deferred financing cost |
|
|
|
|
|
|
||
Loss on sale of assets |
|
|
— |
|
|
|
|
|
Equity-based compensation |
|
|
|
|
|
|
||
Income taxes |
|
|
|
|
|
|
||
Other, net |
|
|
|
|
|
( |
) |
|
Changes in operating assets and liabilities, net of acquisition: |
|
|
|
|
|
|
||
Accounts receivable |
|
|
( |
) |
|
|
( |
) |
Other current assets |
|
|
( |
) |
|
|
( |
) |
Other noncurrent assets |
|
|
( |
) |
|
|
|
|
Deferred costs |
|
|
|
|
|
( |
) |
|
Accounts payable, accrued liabilities and other current liabilities |
|
|
|
|
|
|
||
Deferred revenue |
|
|
( |
) |
|
|
|
|
Other liabilities |
|
|
( |
) |
|
|
|
|
Net cash provided by operating activities |
|
|
|
|
|
|
||
CASH FLOWS FROM INVESTING ACTIVITIES: |
|
|
|
|
|
|
||
Purchases of property, buildings and equipment and other assets |
|
|
( |
) |
|
|
( |
) |
Investments in affiliates, net |
|
|
( |
) |
|
|
( |
) |
Proceeds from sales of property and equipment |
|
|
|
|
|
|
||
Proceeds from infrastructure improvement incentives |
|
|
|
|
|
|
||
Proceeds from sales of investments and other |
|
|
— |
|
|
|
|
|
Net cash used in investing activities |
|
|
( |
) |
|
|
( |
) |
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|
|
|
||
Repayment of long-term debt |
|
|
( |
) |
|
|
( |
) |
Proceeds from borrowings |
|
|
|
|
|
— |
|
|
Repurchase of Class A common stock |
|
|
( |
) |
|
|
— |
|
Net transfers to parent |
|
|
— |
|
|
|
( |
) |
Contributions from parent |
|
|
— |
|
|
|
|
|
Distributions to members |
|
|
( |
) |
|
|
( |
) |
Dividends paid |
|
|
( |
) |
|
|
( |
) |
Payments for financing costs |
|
|
( |
) |
|
|
— |
|
Taxes paid related to net settlement upon vesting of equity awards |
|
|
( |
) |
|
|
— |
|
Distributions of non-controlling interests |
|
|
( |
) |
|
|
( |
) |
Net cash used in financing activities |
|
|
( |
) |
|
|
( |
) |
Effects of exchange rate movements on cash |
|
|
( |
) |
|
|
|
|
NET INCREASE IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH |
|
|
|
|
|
|
||
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, BEGINNING OF PERIOD |
|
|
|
|
|
|
||
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH, END OF PERIOD |
|
$ |
|
|
$ |
|
||
SUPPLEMENTAL CASH FLOW INFORMATION: |
|
|
|
|
|
|
||
Cash paid for interest |
|
$ |
|
|
$ |
|
||
Cash payments for income taxes |
|
$ |
|
|
$ |
|
||
NON-CASH INVESTING AND FINANCING TRANSACTIONS: |
|
|
|
|
|
|
||
Capital expenditures included in current liabilities |
|
$ |
|
|
$ |
|
||
Capital contribution from parent |
|
$ |
|
|
$ |
|
||
Accretion of redeemable non-controlling interests |
|
$ |
|
|
$ |
|
||
Excise taxes on repurchases of common stock |
|
$ |
|
|
$ |
— |
|
|
See accompanying notes to consolidated financial statements.
11
Table of Contents
TKO GROUP HOLDINGS, INC.
Notes to Consolidated Financial Statements
(Unaudited)
1. DESCRIPTION OF BUSINESS
TKO Group Holdings, Inc. (the “Company” or “TKO”) is a premium sports and entertainment company that operates leading combat sports and sports entertainment brands. The Company monetizes its media and content properties through four principal activities: (i) Media rights, production and content, (ii) Live events and hospitality, (iii) Partnerships and marketing and (iv) Consumer products licensing.
TKO Formation
TKO was incorporated as a Delaware corporation in March 2023, under the name New Whale Inc., and was formed for the purpose of facilitating the business combination of the Ultimate Fighting Championship (“UFC”) and World Wrestling Entertainment, LLC (f/k/a World Wrestling Entertainment, Inc.) (“WWE”) businesses under TKO Operating Company, LLC (f/k/a Zuffa Parent, LLC) (“Zuffa” or “TKO OpCo”), which owns and operates the UFC and WWE businesses (the “TKO Transactions”), as contemplated within the Transaction Agreement, dated as of April 2, 2023, by and among Endeavor Group Holdings, Inc. (“Endeavor” or “EGH”), Endeavor Operating Company, LLC (“Endeavor OpCo”), TKO OpCo, WWE, TKO, and Whale Merger Sub Inc. (the “Transaction Agreement”). On September 12, 2023, the TKO Transactions were completed with the newly-formed TKO combining the UFC and WWE businesses. TKO OpCo is the accounting acquirer and predecessor to TKO. Under the terms of the Transaction Agreement, at the time of the transaction, (A) EGH and/or its subsidiaries received (1) a
Endeavor Asset Acquisition
On February 28, 2025, TKO OpCo and TKO (together with TKO OpCo, the “TKO Parties”) completed the Endeavor Asset Acquisition, acquiring the IMG business, including certain businesses operating under the IMG brand, On Location, and Professional Bull Riders ("PBR," and collectively, the “Acquired Businesses”), pursuant to a transaction agreement, dated as of October 23, 2024 (as amended, the “Endeavor Asset Acquisition Agreement”), by and among the TKO Parties, Endeavor OpCo, IMG Worldwide, LLC, a Delaware limited liability company (“IMG Worldwide” and, together with Endeavor OpCo, the “EGH Parties”), and Trans World International, LLC, a Delaware limited liability company and subsidiary of EGH (“TWI”). In connection with the Endeavor Asset Acquisition Agreement, the TKO Parties acquired the Acquired Businesses for total consideration of approximately $
On February 28, 2025, prior to the close of the Endeavor Asset Acquisition, EGH, through its subsidiaries, had controlled approximately
In connection with the Endeavor Asset Acquisition, the Company incurred transaction costs of $
Endeavor Take-Private Transaction
On March 24, 2025, Silver Lake Group, LLC (“Silver Lake”) and its affiliates completed the previously announced acquisition (the “Endeavor Take-Private Transaction”) of EGH, as described in a Current Report on Form 8-K filed by EGH on March 24, 2025. Upon the consummation of the Endeavor Take-Private Transaction, Silver Lake, through its ownership of EGH and its subsidiaries, controls TKO. While Silver Lake's control was established in 2025 through the Endeavor Take-Private Transaction, EGH has maintained control over TKO since TKO's original formation. As of the effective time of the Endeavor
12
Table of Contents
Take-Private Transactions, Silver Lake and its affiliates beneficially owned approximately
Financial results and information included in the accompanying interim consolidated financial statements include the financial results and information of TKO and its consolidated subsidiaries.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The accompanying unaudited interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and pursuant to the rules and regulations of the SEC for interim financial reporting. Accordingly, certain information and note disclosures normally included in the annual financial statements prepared in accordance with GAAP have been condensed or omitted. These unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in the Company's 2025 Annual Report. In the opinion of management, the accompanying unaudited interim consolidated financial statements reflect all adjustments, consisting solely of normal and recurring adjustments, necessary for a fair statement of the Company's financial position, results of operations and cash flows for the interim periods presented. The results of operations of any interim period are not necessarily indicative of the results of operations for the full year. All intercompany balances and transactions have been eliminated in consolidation.
Certain prior period amounts have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations.
Combined Financial Statements for Historical Recast Periods
On February 28, 2025, the Company completed the Endeavor Asset Acquisition, pursuant to which the Company acquired the IMG business, including certain businesses operating under the IMG brand, On Location, and PBR (collectively, the “Acquired Businesses”) from EGH and its subsidiaries in a transaction between entities under common control. As such, the financial statements for periods prior to the acquisition reflect the combined results of the Company and the Acquired Businesses as if they had been part of the Company during the historical periods under common control. For periods prior to the February 28, 2025 acquisition date, the historical financial information of the Acquired Businesses was derived from the historical combined financial statements and accounting records of Endeavor Group Holdings, Inc. and presented on a historical cost basis. Such historical financial information may not be indicative of the results that would have been achieved had the Acquired Businesses operated as a separate stand-alone entity during the periods presented, nor is it necessarily indicative of future results. See the Company’s 2025 Annual Report for additional information regarding the transaction and the related retrospective recast.
Principles of Consolidation
TKO is the sole managing member of TKO OpCo and maintains a controlling financial interest in TKO OpCo. As sole managing member, the Company ultimately controls the business affairs of TKO OpCo. As a result, the Company is the primary beneficiary and thus consolidates the financial results of TKO OpCo and reports a non-controlling interest representing the economic interest in TKO OpCo held by the other members of TKO OpCo. As of June 30, 2026, the Company owned
Use of Estimates
The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported and disclosed in the consolidated financial statements and the accompanying disclosures.
Significant accounting policies that contain subjective management estimates and assumptions include those related to revenue recognition, the allowance for doubtful accounts, recoverability of deferred costs, content cost amortization and impairment, the fair value of acquired assets and liabilities associated with acquisitions, the fair value of the Company’s reporting units and the assessment of goodwill, other intangible assets and long-lived assets for impairment, determination of useful lives of intangible assets and long-lived assets acquired, the fair value of equity-based compensation, leases, income taxes and contingencies.
Management evaluates these estimates using historical experience and other factors, including the general economic environment and actions it may take in the future. The Company adjusts such estimates when facts and circumstances dictate. However, these estimates may involve significant uncertainties and judgments and cannot be determined with precision. In addition, these estimates are based on management's best judgment at a point in time and as such, these estimates may ultimately differ from actual results. Changes in estimates resulting from weakness in the economic environment or other factors beyond the Company's control could be material and would be reflected in the Company's consolidated financial statements in future periods.
13
Table of Contents
3. RECENT ACCOUNTING PRONOUNCEMENTS
Recently Adopted Accounting Pronouncements
In July 2025, the Financial Accounting Standards Board (the “FASB”) issued ASU 2025-05, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets. The ASU amends ASC 326-20 to provide a practical expedient (for all entities) which permits an entity to assume the current conditions do not change with respect to the estimation of expected credit losses for current accounts receivable and current contract assets that arise from transactions accounted for under ASC 606, Revenue from Contracts with Customers. The ASU is effective for fiscal years beginning after December 15, 2025, and interim periods within those fiscal years. Early adoption is permitted, and the amendments should be applied prospectively. The Company adopted this guidance on January 1, 2026 and elected the practical expedient with no material effect on the Company's financial position or results of operations.
Recently Issued Accounting Pronouncements
In October 2023, the FASB issued ASU 2023-06, Disclosure Improvements: Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative. This ASU amends the ASC to incorporate certain disclosure requirements from SEC Release No. 33-10532, Disclosure Update and Simplification, which was issued in 2018. The effective date for each amendment will be the date on which the SEC's removal of that related disclosure from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited. If, by June 30, 2027, the SEC has not removed the applicable requirement from Regulation S-X or Regulation S-K, the pending content of the related amendment will be removed from the ASC and will not become effective. The Company is in the process of assessing the impact of this ASU on its consolidated financial statements.
In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. Additionally, in January 2025, the FASB issued ASU 2025-01, Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Clarifying the Effective Date, to clarify the effective date of ASU 2024-03. This ASU improves expense disclosures by requiring disclosure of additional information about specific expense categories in the notes to the financial statements at interim and annual reporting periods. The amendments in this update, as clarified, are effective for public business entities for annual reporting periods beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is in the process of assessing the impact of this ASU on its consolidated financial statements.
In May 2025, the FASB issued ASU 2025-03, Business Combinations (Topic 805) and Consolidation (Topic 810): Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity ("VIE"). This ASU clarifies the guidance in determining the accounting acquirer in a business combination effected primarily by exchanging equity interests when the acquiree is a VIE that meets the definition of a business. The ASU is effective for annual reporting periods beginning after December 15, 2026, including interim periods within those fiscal years. Early adoption is permitted, and the ASU is to be applied prospectively to acquisitions after the adoption date. The Company is in the process of assessing the impact of this ASU on its consolidated financial statements.
In September 2025, the FASB issued ASU 2025‑06, Targeted Improvements to the Accounting for Internal‑Use Software (ASC 350‑40). The update eliminates references to development stages throughout ASC 350-40 and introduces a new capitalization threshold requiring (1) management authorization with funding commitment and (2) a determination that it is probable the project will be completed and used as intended. Additionally, the ASU aligns disclosures with ASC 360‑10 - Property, Plant, and Equipment for all capitalized software. The ASU is effective for fiscal years beginning after December 15, 2027, and interim periods within those fiscal years. Early adoption permitted, and entities may adopt using a retrospective, prospective, or modified transition approach. The Company is in the process of assessing the impact of this ASU on its consolidated financial statements.
In December 2025, the FASB issued ASU 2025-10, Government Grants (Topic 832): Accounting for Government Grants Received by Business Entities, which establishes authoritative guidance for the recognition, measurement, and disclosure of government grants to business entities. The ASU provides a single model for determining when a grant is within the scope of Topic 832, when to recognize grant income (based on satisfaction of eligibility requirements), and how to present grant-related assets, liabilities, and income in the financial statements. The amendments also introduce new qualitative and quantitative disclosure requirements regarding the nature, terms, and financial statement effects of government grants. The ASU is effective for fiscal years beginning after December 15, 2028, and interim periods within those fiscal years. Early adoption permitted and the amendments in this update can be applied using a modified prospective approach, a modified retrospective approach, or on a retrospective basis. The Company is in the process of assessing the impact of this ASU on its consolidated financial statements.
In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements, which makes targeted amendments to interim reporting requirements. The ASU is intended to improve the consistency, clarity, and decision usefulness of interim financial information by refining certain disclosure requirements, clarifying the application of existing
14
Table of Contents
guidance, and enhancing alignment between interim and annual reporting requirements. The ASU is effective for interim reporting periods within annual reporting periods beginning after December 15, 2027. Early adoption is permitted and the amendments in this update can be applied either (1) prospectively or (2) retrospectively to any or all prior periods presented in the financial statements. The Company is in the process of assessing the impact of this ASU on its consolidated financial statements.
In December 2025, the FASB issued ASU 2025-12, Codification Improvements. The ASU addresses multiple technical corrections, clarifications, and minor improvements to existing guidance in the Codification to correct unintended application issues and improve the usability of guidance without making substantial changes to existing standards. The ASU is effective for fiscal years beginning after December 15, 2026, and interim periods within those fiscal years. Early adoption permitted and the amendments in this update can be applied prospectively or retrospectively. The Company is in the process of assessing the impact of this ASU on its consolidated financial statements.
4. REVENUE
The Company derives its revenue principally from the following sources: (i) media rights and content fees associated with the production and distribution of content, (ii) ticket sales at live events, hospitality sales and financial incentive packages, (iii) partnerships and marketing, and (iv) consumer products licensing and other.
Disaggregated Revenue
The following table presents the Company’s revenue disaggregated by primary revenue sources (in thousands):
|
|
For the Three Months Ended June 30, 2026 |
|
|||||||||||||||||
|
|
UFC |
|
|
WWE |
|
|
IMG |
|
|
Corp & Other |
|
|
Total |
|
|||||
Media rights, production and content |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
Live events and hospitality |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Partnerships and marketing |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Consumer products licensing and other |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Eliminations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
( |
) |
||||
Total revenue |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
|
For the Six Months Ended June 30, 2026 |
|
|||||||||||||||||
|
|
UFC |
|
|
WWE |
|
|
IMG |
|
|
Corp & Other |
|
|
Total |
|
|||||
Media rights, production and content |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
Live events and hospitality |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Partnerships and marketing |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Consumer products licensing and other |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Eliminations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
( |
) |
||||
Total revenue |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
|
For the Three Months Ended June 30, 2025 |
|
|||||||||||||||||
|
|
UFC |
|
|
WWE |
|
|
IMG |
|
|
Corp & Other |
|
|
Total |
|
|||||
Media rights, production and content |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
Live events and hospitality |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Partnerships and marketing |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Consumer products licensing and other |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Eliminations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
( |
) |
||||
Total revenue |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
|
For the Six Months Ended June 30, 2025 |
|
|||||||||||||||||
|
|
UFC |
|
|
WWE |
|
|
IMG |
|
|
Corp & Other |
|
|
Total |
|
|||||
Media rights, production and content |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
Live events and hospitality |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Partnerships and marketing |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Consumer products licensing and other |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Eliminations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
( |
) |
||||
Total revenue |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
|||||
15
Table of Contents
Remaining Performance Obligations
The transaction price related to the Company’s future performance obligations does not include any variable consideration related to sales or usage-based royalties. The variability related to these sales or usage-based royalties will be resolved in the periods when the licensee generates sales related to the intellectual property license.
The following table presents the aggregate amount of the transaction price allocated to remaining performance obligations for contracts greater than one year with unsatisfied or partially satisfied performance obligations as of June 30, 2026 (in thousands):
Remainder of 2026 |
|
$ |
|
|
2027 |
|
|
|
|
2028 |
|
|
|
|
2029 |
|
|
|
|
2030 |
|
|
|
|
Thereafter |
|
|
|
|
Total remaining performance obligations |
|
$ |
|
Revenue from Prior Period Performance Obligations
The Company did
Contract Assets
Contract assets (i.e., unbilled receivables) are established when revenue is recognized, but due to contractual terms over the timing of invoicing, the Company does not have right to invoice the customer or the right to payment of consideration for goods and services provided from the customer as of the balance sheet date. As of June 30, 2026 and December 31, 2025, contract assets were $
Contract Liabilities (Deferred Revenues)
The Company records deferred revenue when cash payments are received or due in advance of the Company’s performance. The Company’s deferred revenue balance primarily relates to advance payments received related to its content distribution rights agreements, live event and hospitality arrangements, consumer products licensing agreements and partnerships and marketing arrangements, as well as memberships for the Company’s subscription services. Deferred revenue is included within current liabilities and in other long-term liabilities in the consolidated balance sheets. Total deferred revenue as of June 30, 2026 was $
5. SUPPLEMENTARY DATA
Property, Buildings and Equipment, net
As of June 30, 2026, property, buildings and equipment totaled $
Other Current Assets
The following is a summary of other current assets (in thousands):
16
Table of Contents
|
|
As of |
|
|||||
|
|
June 30, |
|
|
December 31, |
|
||
|
|
2026 |
|
|
2025 |
|
||
Prepaid sign-on fee for hospitality rights |
|
|
|
|
|
|
||
Other current receivables |
|
|
|
|
|
|
||
Insurance recovery receivables (Note 14) |
|
|
|
|
|
— |
|
|
Inventory |
|
|
|
|
|
|
||
Prepaid taxes |
|
|
|
|
|
|
||
Prepaid event and production-related costs |
|
|
|
|
|
|
||
Amounts due from the Group (Note 16) |
|
|
|
|
|
|
||
Prepaid insurance |
|
|
|
|
|
|
||
Other |
|
|
|
|
|
|
||
Total |
|
$ |
|
|
$ |
|
||
Accrued Liabilities
The following is a summary of accrued liabilities (in thousands):
|
|
As of |
|
|||||
|
|
June 30, |
|
|
December 31, |
|
||
|
|
2026 |
|
|
2025 |
|
||
Event and production-related costs |
|
$ |
|
|
$ |
|
||
Legal settlements (Note 14) |
|
|
|
|
|
— |
|
|
Payroll-related costs |
|
|
|
|
|
|
||
Legal and professional fees |
|
|
|
|
|
|
||
Interest |
|
|
|
|
|
|
||
Accrued customer refunds |
|
|
|
|
|
|
||
Accrued capital expenditures |
|
|
|
|
|
|
||
Other |
|
|
|
|
|
|
||
Total |
|
$ |
|
|
$ |
|
||
Other Current Liabilities
The following is a summary of other current liabilities (in thousands):
|
|
As of |
|
|||||
|
|
June 30, |
|
|
December 31, |
|
||
|
|
2026 |
|
|
2025 |
|
||
Collections due to third parties (1) |
|
$ |
|
|
$ |
|
||
Amounts due to the Group (Note 16) |
|
|
|
|
|
|
||
Other |
|
|
|
|
|
|
||
Total |
|
$ |
|
|
$ |
|
||
6. GOODWILL AND INTANGIBLE ASSETS
Goodwill
There were
Intangible Assets, net
Amortization expense of finite-lived intangible assets was $
17
Table of Contents
amortization in the consolidated statements of operations. Amortization expense for the six months ended June 30, 2026 includes $
7. INVESTMENTS
The following is a summary of the Company’s investments (in thousands):
|
|
As of |
|
|||||
|
|
June 30, |
|
|
December 31, |
|
||
|
|
2026 |
|
|
2025 |
|
||
Equity method investments |
|
$ |
|
|
$ |
|
||
Nonmarketable equity investments without readily determinable fair values |
|
|
|
|
|
|
||
Nonmarketable equity investments with readily determinable fair values |
|
|
|
|
|
|
||
Total investment securities |
|
$ |
|
|
$ |
|
||
Equity Method Investments
As of June 30, 2026 and December 31, 2025, the Company’s equity method investments include Sports News Television Limited, EverPass Holdco LLC, and Boxing HoldCo, LLC (d/b/a Zuffa Boxing). The Company’s ownership of its equity method investments ranges from
The Company recognized equity losses of $
Nonmarketable Equity Investments Without Readily Determinable Fair Values
As of June 30, 2026 and December 31, 2025, the Company held various investments in nonmarketable equity instruments of private companies.
The Company did
8. DEBT
The following is a summary of the Company’s outstanding debt (in thousands):
|
|
As of |
|
|||||
|
|
June 30, |
|
|
December 31, |
|
||
|
|
2026 |
|
|
2025 |
|
||
First Lien Term Loan (due |
|
$ |
|
|
$ |
|
||
Other Secured Loans |
|
|
|
|
|
|
||
Notes payable |
|
|
|
|
|
|
||
Total principal |
|
|
|
|
|
|
||
Unamortized discount |
|
|
( |
) |
|
|
( |
) |
Unamortized debt issuance cost |
|
|
( |
) |
|
|
( |
) |
Total debt |
|
|
|
|
|
|
||
Less: Current portion of long-term debt |
|
|
( |
) |
|
|
( |
) |
Total long-term debt |
|
$ |
|
|
$ |
|
||
18
Table of Contents
First Lien Term Loan (due November 2031)
As of June 30, 2026 and December 31, 2025, the Company had $
On March 10, 2026, TKO Worldwide Holdings entered into an amendment to the First Lien Credit Agreement (the "First Lien Credit Agreement Amendment") to, among other things, (i) provide for an additional $
On May 28, 2026, TKO Worldwide Holdings entered into the Seventh Refinancing Amendment to the First Lien Credit Agreement (the “Credit Agreement Refinancing Amendment”). The Credit Agreement Refinancing Amendment amended the First Lien Credit Agreement to, among other things, (i) refinance and replace the Prior Term Loans with a new class of first lien secured term loans (the “New Term Loans”), the aggregate principal amount of which was unchanged at $
Following the Credit Agreement Refinancing Amendment, the New Term Loans bear interest at a variable interest rate equal to either, at the option of TKO Worldwide Holdings, Term SOFR or the ABR plus, in each case, an applicable margin. SOFR term loans accrue interest at a rate equal to Term SOFR plus
The Company capitalized $
The loans made pursuant to the upsized Revolving Credit Facility bear interest at a variable interest rate equal to either, at the option of TKO Worldwide Holdings, Term SOFR or the ABR plus, in each case, an applicable margin. Following the Credit Agreement Refinancing Amendment, the leverage-based step-down mechanism previously applicable to the Revolving Credit Facility was eliminated. SOFR revolving loans accrue interest at a rate equal to Term SOFR plus
As of June 30, 2026 and December 31, 2025, there was
The First Lien Credit Agreement contains a financial covenant that requires the Company to maintain, commencing with the fiscal quarter ended June 30, 2025, a First Lien Leverage Ratio of Consolidated First Lien Debt to Consolidated EBITDA of
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The Credit Facilities restrict the ability of certain subsidiaries of the Company to make distributions and other payments to the Company. These restrictions include exceptions for, among other things, (1) amounts necessary to make tax payments, (2) a limited annual amount for employee equity repurchases, (3) distributions required to fund certain parent entities, (4) other specific allowable situations and (5) a general restricted payment basket, which generally provides for no restrictions as long as the Total Leverage Ratio (as defined in the First Lien Credit Agreement) is less than
As of June 30, 2026 and December 31, 2025, TKO Worldwide Holdings had outstanding letters of credit of $
The estimated fair values of the Company’s outstanding term loans are based on quoted market values for the debt. As of June 30, 2026 and December 31, 2025, the face amount of the Company’s term loans approximated their fair value.
Other Secured Loans
As of June 30, 2026 and December 31, 2025, the Company had $
One of the Company's other secured loans contains a financial covenant that requires the Company to maintain a Debt Service Coverage Ratio of consolidated debt to Adjusted EBITDA as defined in the applicable loan agreements of no less than
9. STOCKHOLDERS’ EQUITY
Endeavor Share Purchases
During the six months ended June 30, 2025, Endeavor OpCo purchased
Endeavor Asset Acquisition — Equity Consideration
On February 28, 2025, as consideration paid in connection with the Endeavor Asset Acquisition, the Company issued approximately
Capital Return Program
TKO Share Repurchases
During the six months ended June 30, 2026, the following share repurchases of TKO Class A common stock were made under the Company's previously announced share repurchase program totaling $
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The Company will determine at its discretion the timing and the amount of any repurchases based on its evaluation of market conditions, share price, and other factors. Repurchases under the share repurchase program may be made in the open market, in privately negotiated transactions or otherwise, and the Company is not obligated to acquire any particular amount under the share repurchase program. The share repurchase program has no expiration, and may be modified, suspended, or discontinued at any time.
Quarterly Cash Dividend
In October 2024, the Company announced that its board of directors approved a quarterly cash dividend program pursuant to which holders of TKO Class A common stock would receive their pro rata share of quarterly distributions to be made by TKO OpCo.
For the three months ended June 30, 2026 and 2025, the Company's board of directors declared quarterly cash dividends of $
TKO Ownership Interests
As of June 30, 2026, EGH and its subsidiaries collectively controlled
As of June 30, 2026, the Company owned
10. NON-CONTROLLING INTERESTS
Nonredeemable Non-Controlling Interest in TKO OpCo
In connection with the business acquisition of WWE on September 12, 2023, the Company became the sole managing member of TKO OpCo and, as a result, consolidates the financial results of TKO OpCo. The Company reports a non-controlling interest representing the economic interest in TKO OpCo held by the other members of TKO OpCo. TKO OpCo’s operating agreement provides that holders of membership interests in TKO OpCo (“Common Units”) may, from time to time, require
21
Table of Contents
Redeemable Non-Controlling Interest in the UFC
In July 2018, the Company received an investment of $
11. EARNINGS PER SHARE ("EPS")
Basic earnings per share is calculated utilizing net income available to common stockholders of the Company during the three and six months ended June 30, 2026 and 2025, divided by the weighted average number of shares of TKO Class A common stock outstanding during the same period. Diluted earnings per share is calculated by dividing the net income available to common stockholders by the diluted weighted average shares outstanding during the same period. TKO Class B common shares are included in diluted earnings per share only for periods in which their effect is dilutive and are otherwise excluded as anti-dilutive.
On March 10, 2026, the Company entered into an ASR Agreement with Morgan Stanley & Co. LLC to repurchase $
The following table presents the computation of basic and diluted net earnings per share and weighted average number of shares of the Company’s common stock outstanding for the periods presented (dollars in thousands, except share and per share data):
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Numerator |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net income attributable to TKO Group Holdings, Inc. |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Effect of dilutive securities: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Adjustment to net income attributable to TKO Group Holdings, Inc. from the assumed conversion of Class B shares |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net income attributable to TKO Group Holdings, Inc. used in computing diluted earnings per share |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Denominator |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Weighted average Class A Common Shares outstanding - Basic |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Effect of dilutive securities: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Additional shares from RSUs and PSUs, as calculated using the treasury stock method |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Additional shares from the assumed conversion of Class B shares |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Weighted average number of shares used in computing diluted earnings per share |
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic earnings per share |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Diluted earnings per share |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Securities that are anti-dilutive this period |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Unvested RSUs |
|
|
|
|
|
|
|
|
|
|
|
|
||||
TKO Class B Common Shares |
|
|
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
ASR Agreement |
|
|
|
|
|
— |
|
|
|
|
|
|
— |
|
||
22
Table of Contents
12. INCOME TAXES
TKO Group Holdings, Inc. was incorporated as a Delaware corporation in March 2023. As the sole managing member of TKO OpCo, TKO Group Holdings, Inc. ultimately controls the business affairs of TKO OpCo. TKO Group Holdings, Inc. is subject to corporate income taxes on its share of taxable income of TKO OpCo. TKO OpCo is treated as a partnership for U.S. federal income tax purposes and is therefore generally not subject to U.S. corporate income tax. TKO OpCo’s foreign subsidiaries are subject to entity-level taxes. TKO OpCo’s U.S. subsidiaries are subject to withholding taxes on sales in certain foreign jurisdictions which are included as a component of foreign current taxes. TKO OpCo is subject to entity-level income taxes in certain U.S. state and local jurisdictions.
In accordance with ASC 740, each interim period is considered integral to the annual period and tax expense is generally determined using an estimate of the annual effective income tax rate (“AETR”). The Company records income tax expense each quarter using the estimated AETR to provide for income taxes on a current year-to-date basis, adjusted for discrete items that are noted in the relevant period. In accordance with the authoritative guidance for accounting for income taxes in interim periods, the Company computed its income tax provision for the three and six months ended June 30, 2026 and 2025, respectively, adjusted for discrete items as noted.
The provision for income taxes for the three months ended June 30, 2026 and 2025 was $
The Company’s effective tax rate differs from the U.S. federal statutory rate primarily due to state and local income taxes, non-controlling interest, withholding taxes in foreign jurisdictions that are not based on net income, and increased income subject to tax in foreign jurisdictions which differ from the U.S. federal statutory income tax rate.
As of June 30, 2026 and December 31, 2025, the Company had unrecognized tax benefits of $
The Company records valuation allowances against its net deferred tax assets when it is more likely than not that all, or a portion, of a deferred tax asset will not be realized. The Company evaluates the realizability of its deferred tax assets by assessing the likelihood that its deferred tax assets will be recovered based on all available positive and negative evidence, including historical results, reversals of deferred tax liabilities, estimates of future taxable income, tax planning strategies and results of operations.
13. CONTENT PRODUCTION INCENTIVES
The Company has access to various governmental programs that are designed to promote content production within the United States of America and certain international jurisdictions. These programs primarily consist of nonrefundable tax credits issued by a jurisdiction on an annual basis for qualifying expenses incurred during the year in the production of certain entertainment content created in whole or in part within the jurisdiction. The Company recognizes these benefits when it has reasonable assurance regarding the realizable amount of the tax credits.
During the three and six months ended June 30, 2026, the Company recorded content production incentives of $
During the three and six months ended June 30, 2025, the Company recorded infrastructure improvement incentives of $
23
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media production facilities. These incentives are recorded as an offset to property, buildings and equipment, net in the consolidated balance sheets. The Company did not record any infrastructure improvement incentives during the three and six months ended June 30, 2026.
14. COMMITMENTS AND CONTINGENCIES
Legal Proceedings
The Company is involved in legal proceedings, claims and governmental investigations arising in the normal course of business. The types of allegations that arise in connection with such legal proceedings vary in nature, but can include, among others, contract, employment, tax and intellectual property matters. The Company evaluates all cases and records liabilities for losses from legal proceedings when the Company determines that it is probable that the outcome will be unfavorable and the amount, or potential range, of loss can be reasonably estimated. While any outcome related to litigation or such governmental proceedings cannot be predicted with certainty, management believes that the outcome of these matters, except as otherwise may be discussed below, individually or in the aggregate, will not have a material adverse effect on the Company’s financial position, results of operations or cash flows.
UFC Legal Proceedings
On June 24, 2021, another lawsuit, Johnson et al. v. Zuffa, LLC et al., No. 2:21-cv-1189-RFB-BNW (D. Nev.) (the “Johnson” case), was filed by a putative class of former UFC fighters and covering the period from July 1, 2017, to the present. The Johnson case alleges substantially similar claims to the Le case and seeks both damages and injunctive relief. No trial date has been set in the Johnson action and the parties are in the midst of the discovery process.
On May 23, 2025, Cirkunovs v. Zuffa, LLC et al., No. 2:25-cv-00914-RFB-BNW (D. Nev.) (the “Cirkunovs” case), was filed by a putative class of former UFC fighters who signed contracts with arbitration clauses and class action waiver agreements during the period July 1, 2017, to the present. The complaint in Cirkunovs contains nearly identical allegations to Johnson and further alleges that the arbitration clauses and class action waivers contained in the fighters’ contracts are unenforceable. The Cirkunovs complaint seeks injunctive relief invalidating these arbitration clauses and class action waivers, as well as treble damages under the antitrust laws and attorneys’ fees and costs. Zuffa filed a motion to compel arbitration, and the Court has allowed Plaintiffs to seek discovery regarding the arbitration clause before ruling on Zuffa’s motion. Defendants appealed the district court’s order permitting discovery rather than ruling on Zuffa’s motion to compel arbitration. Cirkunovs has been stayed pending resolution of Defendants’ appeal. No trial date has been set in Cirkunovs.
On May 29, 2025, a similar complaint was filed by a current Professional Fighters League fighter, Phil Davis. Davis v. Zuffa, LLC et al., No. 2:25-cv-00946-RFB-BNW (D. Nev.) (the “Davis” case). The Davis complaint also asserts nearly identical allegations as in Johnson and Cirkunovs, except Davis seeks to represent a class of fighters who competed in U.S.-bouts for non-UFC promotions from May 29, 2021, onward, excluding all currently contracted UFC fighters, as well as the Johnson and Cirkunovs class members. The Davis case alleges UFC’s alleged anticompetitive conduct impairs the ability of non-UFC fighters to advance their careers and artificially suppresses non-UFC fighter pay. The Davis case does not seek monetary damages and instead seeks injunctive relief. On March 31, 2026, the district court denied Zuffa’s motion to dismiss Davis. No trial date has been set in Davis, and the parties are in the midst of the discovery process.
On February 26, 2026,
24
Table of Contents
either (i) purchased UFC pay per view events through January 1, 2026, or (ii) subscribed to Paramount+ from January 1, 2026 to the present. They also seek to assert equitable relief claims on behalf of a purported nationwide class of Paramount+ subscribers. On July 21, 2026, Zuffa moved to dismiss Costantino and to compel the matter to arbitration.
WWE Legal Proceedings
As announced in June 2022, a Special Committee of independent members of WWE’s board of directors (the “Special Committee”) was formed to investigate alleged misconduct by WWE’s then-Chief Executive Officer, Vincent K. McMahon (the “Special Committee investigation”). The Special Committee investigation is complete and, in January 2024, Mr. McMahon resigned from his position as Executive Chair and member of the Company's board of directors, as well as other positions, employment and otherwise, at TKO and its subsidiaries. No charges have been brought against the Company.
On January 25, 2024, a former WWE employee filed a lawsuit against WWE, Mr. McMahon and another former WWE executive, John Laurinaitis, in the United States District Court for the District of Connecticut alleging, among other things, that she was sexually assaulted by Mr. McMahon and Mr. Laurinaitis and asserting claims under the Trafficking Victims Protection Act. On May 30, 2025, Mr. Laurinaitis was dismissed from the matter with prejudice pursuant to a stipulation of dismissal. WWE has moved to compel the matter to arbitration, and its motion is pending. On July 20, 2026, the parties executed an agreement under which the former employee agreed to submit her claims to arbitration. On July 24, 2026, consistent with that agreement, the former employee filed a stipulation of voluntary dismissal with prejudice of her federal lawsuit.
On October 23, 2024,
On November 17, 2023, a purported former stockholder of WWE, Laborers’ District Council and Contractors’ Pension Fund of Ohio, filed a verified class action complaint on behalf of former WWE stockholders in the Court of Chancery of the State of Delaware (“Delaware Court”). On November 20, 2023, another purported former WWE stockholder, Dennis Palkon, filed a substantially similar verified class action complaint. Both complaints allege breach of fiduciary duty claims against former WWE directors Mr. McMahon, Nick Khan, Paul Levesque, George A. Barrios, Steve Koonin, Michelle D. Wilson, and Frank A. Riddick III (collectively, the “Individual Defendants”), arising out of the TKO Transactions. On April 24, 2024, the City of Pontiac Reestablished General Employees’ Retirement System, a third purported former WWE stockholder, filed another verified class action complaint, which similarly alleges breach of fiduciary duty claims against the Individual Defendants and added claims against WWE and TKO for denying stockholders their appraisal rights under DGCL § 262, as well as claims against EGH for aiding and abetting the alleged breaches of fiduciary duties and for civil conspiracy to violate DGCL § 262. On May 2, 2024, the Court entered an order consolidating all actions under the caption In re World Wrestling Entertainment, Inc. Merger Litigation, C.A. No. 2023-1166-JTL (“Consolidated Action”). Lead plaintiffs subsequently designated the Palkon complaint as operative. As a result, WWE, TKO and EGH are no longer defendants. On October 24, 2024, the Delaware Court entered a stipulation dismissing all claims against Messrs. Koonin and Riddick, who, therefore, are no longer defendants. The remaining Individual Defendants filed answers to the complaint on October 28, 2024. Fact discovery closed on December 19, 2025, and expert discovery closed on April 10, 2026.
In early June 2026, the parties reached an agreement in principle to resolve all claims against all defendants. The overall settlement amount is expected to be primarily funded by insurance recoveries, with a portion being funded by WWE as a result of pre-existing indemnification obligations owed by WWE to the directors. WWE's portion of the overall settlement amount is $
IMG Legal Proceedings
As set forth in the Endeavor Asset Acquisition Agreement and pursuant to other agreements between the Company and Endeavor Group Holdings, Inc., Endeavor Group Holdings, Inc. is obligated to indemnify the Company for, and pay directly, any judgment entered against IMG or settlement entered into with respect to IMG, including with respect to claims or actions brought by other parties related to the proceedings described below.
In July 2017, the Italian Competition Authority (“ICA”) issued a decision opening an investigation into alleged breaches of competition law in Italy, involving inter alia IMG, and relating to bidding for certain media rights of the Serie A and Serie B football leagues. In April 2018, the European Commission conducted on-site inspections at a number of companies that are involved
25
Table of Contents
with sports media rights, including IMG. The inspections were part of an ongoing investigation into the sector and into potential violations of certain antitrust laws that may have taken place within it. IMG investigated these ICA matters, as well as other regulatory compliance matters. In May 2019, the ICA completed its investigation and fined IMG approximately EUR
At the end of April 2026, the parties agreed to settle all claims asserted in the above-described litigation. As of June 30, 2026, the settlement, which includes any obligations of IMG, has been paid directly by a subsidiary of Endeavor Group Holdings, Inc. pursuant to its indemnification obligations.
Endeavor Asset Acquisition Litigation
On March 27, 2026, a purported stockholder of TKO, Jonathan Jordan, filed a verified stockholder derivative complaint on behalf of TKO in the Court of Chancery of the State of Delaware, captioned Jordan v. Endeavor Group Holdings, Inc., et al., C.A. No. 2026-0422-LWW (the “Jordan” case). Jordan alleges breach of fiduciary duty and unjust enrichment claims arising out of the Endeavor Asset Acquisition against Endeavor Group Holdings, Inc.; Silver Lake Group, L.L.C. and various affiliate funds; TKO directors Ariel Emanuel, Egon Durban, Dwayne Johnson, Nick Khan, Mark Shapiro, Peter Bynoe, Steven Koonin, Nancy Tellem, Carrie Wheeler, Bradley Keywell, Jonathan Kraft, and Sonya Medina; and TKO officers Ariel Emanuel, Seth R. Krauss, Andrew Schleimer, and Mark Shapiro. Jordan also alleges claims against Moelis & Company LLC for aiding and abetting the alleged breaches of fiduciary duties. Among other things, Jordan seeks equitable relief and monetary damages. On July 10, 2026, all defendants moved to dismiss the complaint, which will be briefed according to a schedule entered by the court. No trial date has been set.
15. SEGMENT INFORMATION
The Company has
The Company also reports the results for the “Corporate and Other” group. The Corporate and Other group reflects operations not allocated to the UFC, WWE or IMG segments and primarily consists of general and administrative expenses as well as operations of PBR and boxing. Boxing includes the joint venture with Sela for the Zuffa Boxing brand as well as promotional services TKO provides for boxing events.
Revenue from our Corporate and Other group principally consists of media rights fees associated with the distribution of PBR's programming content; ticket sales and financial incentive packages associated with live events; partnerships and marketing; and consumer products licensing agreements of PBR-branded products. Revenue also consists of management and promotional fees for services primarily related to boxing.
26
Table of Contents
General and administrative expenses relate largely to corporate activities, including information technology, facilities, legal, human resources, finance and accounting, treasury, investor relations, corporate communications, community relations and compensation to TKO’s management and board of directors, which support all reportable segments. Corporate and Other expenses also include service fees paid by the Company to EGH and its subsidiaries under the Services Agreement, inclusive of fees paid for revenue producing services related to the segments. On the closing date of the Endeavor Asset Acquisition, the Services Agreement between EGH and TKO OpCo was terminated and the Transition Services Agreement was entered into between the EGH Parties, TWI and the TKO Parties.
As disclosed within Note 2, Summary of Significant Accounting Policies, the historical financial data includes the recast combined results of TKO and the Acquired Businesses for all periods prior to February 28, 2025. All prior period amounts related to the segment change have been retrospectively reclassified to conform to the new presentation.
The Company does not disclose assets by segment information. The Company does not provide assets by segment information to the Company’s CODM, as that information is not typically used in the determination of resource allocation and assessing business performance of each reportable segment. A significant portion of the Company’s assets following the TKO Transactions are comprised of goodwill and intangible assets arising from the TKO Transactions and the Endeavor Asset Acquisition.
The following tables present summarized financial information for each of the Company’s reportable segments (in thousands):
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
June 30, |
|
|
June 30, |
|
||||||||||
UFC: |
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Revenue |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Direct operating costs (1) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Selling, general and administrative expenses (1) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Adjusted EBITDA |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
June 30, |
|
|
June 30, |
|
||||||||||
WWE: |
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Revenue |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Direct operating costs (1) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Selling, general and administrative expenses (1) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Adjusted EBITDA |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
June 30, |
|
|
June 30, |
|
||||||||||
IMG: |
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Revenue |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Direct operating costs (1) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Selling, general and administrative expenses (1) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Adjusted EBITDA |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
27
Table of Contents
Revenue
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
June 30, |
|
|
June 30, |
|
||||||||||
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
UFC |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
WWE |
|
|
|
|
|
|
|
|
|
|
|
|
||||
IMG |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total revenue from reportable segments |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Corporate and Other |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Eliminations |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Total revenue |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Reconciliation of segment profitability
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
June 30, |
|
|
June 30, |
|
||||||||||
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
UFC |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
WWE |
|
|
|
|
|
|
|
|
|
|
|
|
||||
IMG |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Total Adjusted EBITDA from reportable segments |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Corporate and Other |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Total Adjusted EBITDA |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Reconciling items: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Equity loss (earnings) of affiliates |
|
|
|
|
|
( |
) |
|
|
|
|
|
( |
) |
||
Interest expense, net |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Depreciation and amortization |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Equity-based compensation expense (1) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Merger, acquisition and earn out costs (2) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Certain legal costs (3) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Restructuring, severance and impairment (4) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
|
|
( |
) |
Debt transaction costs (5) |
|
|
( |
) |
|
|
— |
|
|
|
( |
) |
|
|
— |
|
Foreign exchange gains and (losses) (6) |
|
|
( |
) |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
Other adjustments (7) |
|
|
( |
) |
|
|
|
|
|
( |
) |
|
|
( |
) |
|
Income before income taxes and equity earnings of affiliates |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
28
Table of Contents
16. RELATED PARTY TRANSACTIONS
EGH and its subsidiaries
EGH and its subsidiaries (collectively, the “Group”), which collectively own approximately
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
June 30, |
|
|
June 30, |
|
||||||||||
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Event and other licensing revenues earned from the Group |
|
$ |
|
|
$ |
|
|
$ |
|
|
$ |
|
||||
Expenses incurred with the Group included in direct operating costs (1) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Expenses incurred with the Group included in selling, general and administrative expenses (2) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest expense (income) with the Group, net (3) |
|
|
|
|
|
|
|
|
( |
) |
|
|
( |
) |
||
Net expense resulting from Group transactions included within net income (loss) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
|
$ |
( |
) |
Outstanding amounts due to and from the Group were as follows (in thousands):
|
|
|
|
As of |
|
|||||
|
|
|
|
June 30, |
|
|
December 31, |
|
||
|
|
Classification |
|
2026 |
|
|
2025 |
|
||
Amounts due from the Group |
|
Other current assets |
|
$ |
|
|
$ |
|
||
Amounts due from the Group |
|
Other assets |
|
$ |
|
|
$ |
|
||
Amounts due to the Group |
|
Other current liabilities |
|
$ |
( |
) |
|
$ |
( |
) |
Prior to February 28, 2025, the Company reimbursed the Group for third-party costs incurred on the Company’s behalf under the Services Agreement, which was terminated effective that date. During the six months ended June 30, 2025, the Company reimbursed $
Corporate Allocations in Recast Historical Combined Periods
In connection with the Company’s common control acquisition of the Acquired Businesses from Endeavor Group Holdings, Inc. and its subsidiaries on February 28, 2025, the historical financial statements have been retrospectively recast to include the combined results of TKO and the Acquired Businesses. During these historical combined periods, general corporate expenses incurred by EGH and its subsidiaries were allocated to the Acquired Businesses. These expenses related to centralized support functions provided by EGH and its subsidiaries, such as finance, human resources, information technology, facilities, and legal services (collectively, “General Corporate Expenses”). General Corporate Expense allocations apply to periods prior to the Endeavor Asset Acquisition on February 28, 2025. These allocations, which totaled $
While management believes the allocation methodologies used for the historical combined periods are reasonable, the amounts may not reflect the actual costs that would have been incurred had the Acquired Businesses operated as standalone companies.
29
Table of Contents
Non-Controlling Interests
Prior to the Endeavor Asset Acquisition on February 28, 2025, all significant related party transactions between the Acquired Businesses and Endeavor Group Holdings, Inc. and its subsidiaries were included in the historical combined financial statements of the Acquired Businesses and were considered to be effectively settled for cash when the transactions were recorded. Accordingly, the net effect of the settlement of these related party transactions was reflected as a financing activity in the historical combined statements of cash flows and as a component of nonredeemable non-controlling interest in the historical combined balance sheets.
In the historical combined financial statements, nonredeemable non-controlling interests and net transfers from parent represented EGH's historical investment in the Acquired Businesses and included the Acquired Businesses' net earnings (loss) after taxes, the net effect of these transactions with and cost allocations from EGH and its subsidiaries, and parent contributions. Following the Endeavor Asset Acquisition on February 28, 2025, this historical combined presentation ceased to apply. Amounts reflected for the three and six months ended June 30, 2025 relate only to the period prior to February 28, 2025.
The following table summarizes the components of the net transfers to parent in nonredeemable non-controlling interests for the six months ended June 30, 2025 (for the applicable periods prior to the Endeavor Asset Acquisition on February 28, 2025):
|
|
Six Months Ended |
|
|
|
|
June 30, |
|
|
|
|
2025 |
|
|
Cash pooling and general financing activities (1) |
|
$ |
( |
) |
Corporate allocations |
|
|
|
|
Net transfers from/(to) parent per the Combined Statements of Equity |
|
$ |
( |
) |
Equity based compensation expense (2) |
|
|
( |
) |
Currency translation adjustments on intercompany transactions |
|
|
|
|
Taxes deemed settled with Parent |
|
|
|
|
Net loss on foreign currency transactions |
|
|
|
|
Contract balances retained by Parent and other |
|
|
|
|
Net transfers from/(to) parent per the Combined Statements of Cash Flows |
|
$ |
( |
) |
Other Related Parties
During the third quarter of 2025, the Company divested its equity-method investment in Euroleague Ventures S.A. (“Euroleague”). Accordingly, related-party transactions connected with Euroleague are presented through the date of divestiture. For the three and six months ended June 30, 2025, the Company recognized revenue of $
30
Table of Contents
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the information set forth in our unaudited consolidated financial statements and related notes included in this Quarterly Report and with our audited financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2025 (“2025 Annual Report”). This discussion contains forward-looking statements based upon management’s current plans, expectations and beliefs that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various known and unknown factors, including those set forth under Part I, Item 1A. “Risk Factors” of our 2025 Annual Report or in other sections of the 2025 Annual Report and this Quarterly Report.
On February 28, 2025, TKO Operating Company, LLC, a Delaware limited liability company (“TKO OpCo”), and TKO Group Holdings, Inc., a Delaware corporation (together with TKO OpCo, the “TKO Parties”), completed the Endeavor Asset Acquisition, acquiring the IMG business, including certain businesses operating under the IMG brand, On Location, and Professional Bull Riders (“PBR”) (collectively, the “Acquired Businesses”), pursuant to a transaction agreement, dated as of October 23, 2024 (as amended, the “Endeavor Asset Acquisition Agreement”), by and among the TKO Parties, Endeavor OpCo, IMG Worldwide, LLC, a Delaware limited liability company (“IMG Worldwide” and, together with Endeavor OpCo, the “EGH Parties”), and Trans World International, LLC, a Delaware limited liability company and subsidiary of EGH (“TWI”).
The Endeavor Asset Acquisition was treated as a merger between entities under common control, due to EGH’s control of both TKO and the Acquired Businesses. As a result of the common control acquisition, the net assets of the Acquired Businesses were combined with those of TKO at their historical carrying amounts, and the financial statements have been retrospectively recast on a combined basis for historical periods prior to February 28, 2025 because they were under common control for all periods presented.
The following is a discussion and analysis of, and a comparison between, our results of operations for the three and six months ended June 30, 2026 and 2025. Certain prior period amounts have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations.
Overview
TKO is a premium sports and entertainment company which operates leading combat sports and sports entertainment companies. The Company monetizes its brands through four principal activities: (i) Media rights, production and content, (ii) Live events and hospitality, (iii) Partnerships and marketing, and (iv) Consumer products licensing.
TKO was formed through the combination of Zuffa Parent, LLC (n/k/a TKO Operating Company, LLC) which owns and operates the Ultimate Fighting Championship (“UFC”), a preeminent combat sports brand, and World Wrestling Entertainment, Inc. (n/k/a World Wrestling Entertainment, LLC) (“WWE”), a renowned sports entertainment business (the “TKO Transactions”). The TKO Transactions unite two complementary sports and sports entertainment properties in a single company.
Endeavor Asset Acquisition
In connection with the Endeavor Asset Acquisition Agreement, the TKO Parties acquired the Acquired Businesses for total consideration of approximately $3.25 billion plus a $50 million purchase price adjustment (based on the volume-weighted average sales price of TKO Class A common stock for the twenty five trading days ending on October 23, 2024). The EGH Parties received approximately 26.54 million common units of TKO OpCo and subscribed for an equivalent number of corresponding shares of TKO’s Class B common stock.
With respect to the historical financial data of the Acquired Businesses for the periods prior to the completion of the Endeavor Asset Acquisition, the historical financial data has been derived from the combined financial statements and accounting records of Endeavor Group Holdings, Inc. and were prepared on a standalone basis in accordance with U.S. generally accepted accounting principles (“GAAP”) and may not be indicative of what they would have been had the Acquired Businesses been independent standalone companies, nor are they necessarily indicative of the Acquired Businesses’ future financial data.
With respect to the historical combined financial statements of the Company, they include all revenues and costs directly attributable to the Acquired Businesses and reflect allocations of certain Endeavor Group Holdings, Inc.'s corporate, infrastructure and shared services expenses, including centralized research, legal, human resources, payroll, finance and accounting, employee benefits, real estate, insurance, information technology, telecommunications, treasury, and other expenses. Where possible, these charges were allocated based on direct usage, with the remainder allocated on a pro rata basis of headcount and gross profit, or other allocation methodologies that are considered to be a reasonable reflection of the utilization of services provided or the benefit received by the Acquired Businesses during the periods presented. The allocations may not, however, reflect the expense the Acquired Businesses would have incurred as standalone companies for the periods presented. These costs also may not be indicative
31
Table of Contents
of the expenses that the Acquired Businesses will incur in the future or would have incurred if the Acquired Businesses had obtained these services from a third party.
Accordingly, as discussed above, the historical financial data presented within this discussion and analysis of our financial condition and results of operations includes the consolidated historical financial data of TKO and the Acquired Businesses for all periods presented.
Segments
As of June 30, 2026, we operated our business under three reportable segments, UFC, WWE and IMG. In addition, we also report results for the “Corporate and Other” group, which incurs revenue and expenses that are not allocated to the business segments. Refer to Note 15, Segment Information, within the unaudited consolidated financial statements included within this Quarterly Report on Form 10-Q.
UFC
The UFC segment reflects the business operations of UFC. Revenue from our UFC segment principally consists of media rights fees associated with the distribution of its programming content; ticket sales and financial incentive packages associated with the business’s global live events; partnerships and marketing; and consumer products licensing agreements of UFC-branded products.
WWE
The WWE segment reflects the business operations of WWE. Revenue from our WWE segment principally consists of media rights fees associated with the distribution of its programming content; ticket sales and financial incentive packages associated with the business’s global live events; partnerships and marketing; and consumer products licensing agreements of WWE-branded products.
IMG
The IMG segment reflects the operations of the following businesses:
Revenue from our IMG segment principally consists of media rights sales, commissions, production services and studio fees; ticket and premium experience sales; and partnerships and marketing.
Corporate and Other
Corporate and Other reflects operations not allocated to the UFC, WWE or IMG segments and primarily consists of general and administrative expenses as well as operations of PBR and boxing. PBR owns the Professional Bull Riders brand, which organizes bull riding competitions, promotes the sport and its athletes through live events and broadcasts. Boxing includes the joint venture with Sela for the Zuffa Boxing brand as well as promotional services TKO provides for boxing events.
Revenue from our Corporate and Other group principally consists of media rights fees associated with the distribution of PBR's programming content; ticket sales and financial incentive packages associated with live events; partnerships and marketing; and consumer products licensing agreements of PBR-branded products. Revenue also consists of management and promotional fees for services primarily related to boxing.
General and administrative expenses relate largely to corporate activities, including information technology, facilities, legal, human resources, finance and accounting, treasury, investor relations, corporate communications, community relations and compensation to TKO’s management and board of directors, which support all reportable segments. Corporate and Other expenses also include service fees paid by the Company to Endeavor Group Holdings, Inc. under the Services Agreement, inclusive of fees paid for revenue producing services related to the segments. On the closing date of the Endeavor Asset Acquisition, the Services Agreement between EGH and TKO OpCo was terminated and the Transition Services Agreement was entered into between the EGH Parties, TWI and the TKO Parties.
32
Table of Contents
Components of Our Operating Results
Revenue
TKO primarily generates revenue via domestic and international media rights fees, production services and studio fees, ticket sales at live events, hospitality sales and financial incentive packages, partnerships and marketing, and consumer products licensing.
Direct Operating Costs
TKO’s direct operating costs primarily include costs associated with our athletes and talent, marketing, venue costs related to live events, expenses associated with the production of events and experiences, event ticket sales and fees for media rights. These costs include required payments related to media sales agency contracts when minimum sales guarantees are not met, materials and related costs associated with consumer product merchandise sales, commissions and direct costs with distributors, as well as certain service fees paid to Endeavor Group Holdings, Inc. under the Services Agreement and Transition Services Agreement.
Selling, General and Administrative
TKO’s selling, general and administrative expenses primarily include personnel costs as well as rent, travel, professional service costs, overhead required to support operations, and certain service fees paid to Endeavor Group Holdings, Inc. under the Services Agreement and Transition Services Agreement.
Provision for Income Taxes
TKO Group Holdings, Inc. was incorporated as a Delaware corporation in March 2023. As the sole managing member of TKO OpCo, TKO Group Holdings, Inc. ultimately controls the business affairs of TKO OpCo. TKO Group Holdings, Inc. is subject to corporate income taxes on its share of taxable income of TKO OpCo. TKO OpCo is treated as a partnership for U.S. federal income tax purposes and is therefore generally not subject to U.S. corporate income tax. TKO OpCo’s foreign subsidiaries are subject to entity-level taxes. TKO OpCo’s U.S. subsidiaries are subject to withholding taxes on sales in certain foreign jurisdictions which are included as a component of foreign current taxes. TKO OpCo is subject to entity-level income taxes in certain U.S. state and local jurisdictions. For the periods prior to the Endeavor Asset Acquisition, the Acquired Businesses primarily consisted of U.S. flow through entities that are not themselves subject to U.S. federal income taxes as well as some foreign subsidiaries and U.S. regarded corporations subject to entity level taxes. Income taxes related to the Acquired Businesses reflected in the consolidated tax provision are attributable to U.S. regarded entities and foreign entities subject to tax in their respective jurisdictions.
33
Table of Contents
RESULTS OF OPERATIONS
(dollars in millions, except where noted)
The following is a discussion of our consolidated results of operations for the three and six months ended June 30, 2026 and 2025. This information is derived from our accompanying consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”).
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
June 30, |
|
|
June 30, |
|
||||||||||
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Revenue |
|
$ |
1,547.1 |
|
|
$ |
1,308.4 |
|
|
$ |
3,144.0 |
|
|
$ |
2,577.2 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Direct operating costs |
|
|
556.1 |
|
|
|
476.4 |
|
|
|
1,290.5 |
|
|
|
1,044.0 |
|
Selling, general and administrative expenses |
|
|
462.7 |
|
|
|
364.3 |
|
|
|
842.9 |
|
|
|
727.6 |
|
Depreciation and amortization |
|
|
98.5 |
|
|
|
99.4 |
|
|
|
242.3 |
|
|
|
199.9 |
|
Total operating expenses |
|
|
1,117.3 |
|
|
|
940.1 |
|
|
|
2,375.7 |
|
|
|
1,971.5 |
|
Operating income |
|
|
429.8 |
|
|
|
368.3 |
|
|
|
768.3 |
|
|
|
605.7 |
|
Other expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest expense, net |
|
|
(70.6 |
) |
|
|
(48.2 |
) |
|
|
(131.2 |
) |
|
|
(93.0 |
) |
Other income (expense), net |
|
|
2.3 |
|
|
|
(7.8 |
) |
|
|
6.6 |
|
|
|
(16.2 |
) |
Income before income taxes and equity earnings of affiliates |
|
|
361.5 |
|
|
|
312.3 |
|
|
|
643.7 |
|
|
|
496.5 |
|
Provision for income taxes |
|
|
53.2 |
|
|
|
46.5 |
|
|
|
87.2 |
|
|
|
67.7 |
|
Income before equity earnings of affiliates |
|
|
308.3 |
|
|
|
265.8 |
|
|
|
556.5 |
|
|
|
428.8 |
|
Equity (loss) earnings of affiliates, net of tax |
|
|
(4.4 |
) |
|
|
7.3 |
|
|
|
(2.8 |
) |
|
|
9.8 |
|
Net income |
|
|
303.9 |
|
|
|
273.1 |
|
|
|
553.7 |
|
|
|
438.6 |
|
Less: Net income attributable to non-controlling interests |
|
|
202.3 |
|
|
|
174.8 |
|
|
|
362.7 |
|
|
|
281.9 |
|
Net income attributable to TKO Group Holdings, Inc. |
|
$ |
101.6 |
|
|
$ |
98.3 |
|
|
$ |
191.0 |
|
|
$ |
156.7 |
|
Revenue
Revenue increased by $238.7 million, or 18%, to $1,547.1 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025.
34
Table of Contents
Revenue increased by $566.8 million, or 22%, to $3,144.0 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025.
Direct Operating Costs
Direct operating costs increased by $79.7 million, or 17%, to $556.1 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025.
35
Table of Contents
Direct operating costs increased by $246.5 million, or 24%, to $1,290.5 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025.
Selling, General and Administrative Expenses
Selling, general and administrative expenses increased by $98.4 million, or 27%, to $462.7 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025.
Selling, general and administrative expenses increased by $115.3 million, or 16%, to $842.9 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025.
36
Table of Contents
Depreciation and Amortization
Depreciation and amortization decreased by $0.9 million, or 1%, to $98.5 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025.
Depreciation and amortization increased $42.4 million, or 21%, to $242.3 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. The increase was primarily driven by a $40.8 million increase in amortization expense attributable to the acceleration of WWE customer relationship assets following the modification of a related media revenue arrangement during the third quarter of 2025.
Interest Expense, Net
Interest expense, net increased by $22.4 million, or 46%, to $70.6 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. This increase was driven primarily by incremental interest expense from higher debt levels maintained during the current year as compared to the prior year due to the $1.0 billion and $900.0 million incremental first lien term loans entered in September 2025 and March 2026, respectively, partially offset by the impact of lower interest rates effective May 28, 2026 associated with the debt refinancing transaction which repriced the facility.
Interest expense, net increased by $38.2 million, or 41%, to $131.2 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. This increase was driven primarily by incremental interest expense from higher debt levels maintained during the current year as compared to the prior year due to the $1.0 billion and $900.0 million incremental first lien term loans entered in September 2025 and March 2026, respectively, partially offset by the impact of lower interest rates effective May 28, 2026 associated with the debt repricing transaction which repriced the facility.
Other Income (Expense), Net
Other income (expense), net for the three and six months ended June 30, 2026 and 2025 includes net gains and losses on foreign currency transactions and other miscellaneous nonoperating gains and losses. During the three months ended June 30, 2025, other income (expense), net also includes a net gain of $2.2 million related to the sale of certain equity method investments. During the six months ended June 30, 2025, other income (expense), net also includes a net loss of $2.5 million on the sale of certain equity method investments, partially offset by a gain of $1.3 million on the sale of PBR’s former headquarters.
Provision for Income Taxes
For the three months ended June 30, 2026, TKO recorded a provision for income taxes of $53.2 million compared to a provision of $46.5 million for the three months ended June 30, 2025. This change was primarily related to increased pretax income for the three months ended June 30, 2026.
For the six months ended June 30, 2026, TKO recorded a provision for income taxes of $87.2 million compared to a provision of $67.7 million for the six months ended June 30, 2025. This change was primarily related to increased pretax income for the six months ended June 30, 2026.
37
Table of Contents
Segment Results of Operations
As described above, the following discussion and analysis of our financial condition and results of operations presents three reportable segments as of June 30, 2026: UFC, WWE and IMG, which were determined to be our reportable segments following the close of the Endeavor Asset Acquisition. Our chief operating decision maker evaluates the performance of our segments based on segment Revenue and segment Adjusted EBITDA. Management believes segment Adjusted EBITDA is indicative of operational performance and ongoing profitability, and Adjusted EBITDA is used to evaluate the operating performance of our segments and for planning and forecasting purposes, including the allocation of resources and capital. Segment operating results reflect earnings before corporate expenses. These segment results of operations should be read in conjunction with our discussion of the Company’s consolidated results of operations included above.
The following tables set forth Revenue and Adjusted EBITDA for each of our segments for the three and six months ended June 30, 2026 and 2025:
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
June 30, |
|
|
June 30, |
|
||||||||||
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
UFC |
|
$ |
535.7 |
|
|
$ |
415.9 |
|
|
$ |
936.9 |
|
|
$ |
775.6 |
|
WWE |
|
|
620.9 |
|
|
|
556.2 |
|
|
|
1,096.6 |
|
|
|
947.7 |
|
IMG |
|
|
354.7 |
|
|
|
306.6 |
|
|
|
1,010.1 |
|
|
|
782.9 |
|
Total revenue from reportable segments |
|
|
1,511.3 |
|
|
|
1,278.7 |
|
|
|
3,043.6 |
|
|
|
2,506.2 |
|
Corporate and Other |
|
|
48.5 |
|
|
|
44.6 |
|
|
|
122.4 |
|
|
|
99.0 |
|
Eliminations |
|
|
(12.7 |
) |
|
|
(14.9 |
) |
|
|
(22.0 |
) |
|
|
(28.0 |
) |
Total Revenue |
|
$ |
1,547.1 |
|
|
$ |
1,308.4 |
|
|
$ |
3,144.0 |
|
|
$ |
2,577.2 |
|
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
June 30, |
|
|
June 30, |
|
||||||||||
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Adjusted EBITDA: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
UFC |
|
$ |
280.4 |
|
|
$ |
244.8 |
|
|
$ |
534.9 |
|
|
$ |
472.2 |
|
WWE |
|
|
368.3 |
|
|
|
329.8 |
|
|
|
624.4 |
|
|
|
523.7 |
|
IMG |
|
|
78.6 |
|
|
|
29.0 |
|
|
|
175.9 |
|
|
|
102.5 |
|
Total Adjusted EBITDA from reportable segments |
|
|
727.3 |
|
|
|
603.6 |
|
|
|
1,335.2 |
|
|
|
1,098.4 |
|
Corporate and Other |
|
|
(77.4 |
) |
|
|
(77.1 |
) |
|
|
(135.5 |
) |
|
|
(154.5 |
) |
Total Adjusted EBITDA |
|
$ |
649.9 |
|
|
$ |
526.5 |
|
|
$ |
1,199.7 |
|
|
$ |
943.9 |
|
38
Table of Contents
UFC
The following table sets forth our UFC segment results for the three and six months ended June 30, 2026 and 2025:
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
June 30, |
|
|
June 30, |
|
||||||||||
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Media rights, production and content |
|
$ |
325.2 |
|
|
$ |
260.5 |
|
|
$ |
600.5 |
|
|
$ |
484.6 |
|
Live events and hospitality |
|
|
47.8 |
|
|
|
58.5 |
|
|
|
96.3 |
|
|
|
117.1 |
|
Partnerships and marketing |
|
|
144.8 |
|
|
|
85.8 |
|
|
|
211.9 |
|
|
|
150.1 |
|
Consumer products licensing and other |
|
|
17.9 |
|
|
|
11.1 |
|
|
|
28.2 |
|
|
|
23.8 |
|
Total Revenue |
|
$ |
535.7 |
|
|
$ |
415.9 |
|
|
$ |
936.9 |
|
|
$ |
775.6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Direct operating costs |
|
$ |
192.2 |
|
|
$ |
116.3 |
|
|
$ |
290.8 |
|
|
$ |
206.0 |
|
Selling, general and administrative expenses |
|
$ |
63.1 |
|
|
$ |
54.8 |
|
|
$ |
111.2 |
|
|
$ |
97.4 |
|
Adjusted EBITDA |
|
$ |
280.4 |
|
|
$ |
244.8 |
|
|
$ |
534.9 |
|
|
$ |
472.2 |
|
Adjusted EBITDA margin |
|
|
52 |
% |
|
|
59 |
% |
|
|
57 |
% |
|
|
61 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
UFC Operating Metrics: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Number of events |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Numbered events |
|
|
3 |
|
|
|
4 |
|
|
|
6 |
|
|
|
7 |
|
Fight Nights |
|
|
9 |
|
|
|
7 |
|
|
|
15 |
|
|
|
15 |
|
Total events |
|
|
12 |
|
|
|
11 |
|
|
|
21 |
|
|
|
22 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Location of events |
|
|
|
|
|
|
|
|
|
|
|
|
||||
United States |
|
|
8 |
|
|
|
9 |
|
|
|
14 |
|
|
|
16 |
|
International |
|
|
4 |
|
|
|
2 |
|
|
|
7 |
|
|
|
6 |
|
Total events |
|
|
12 |
|
|
|
11 |
|
|
|
21 |
|
|
|
22 |
|
39
Table of Contents
WWE
The following table sets forth our WWE segment results for the three and six months ended June 30, 2026 and 2025:
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
June 30, |
|
|
June 30, |
|
||||||||||
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Media rights, production and content |
|
$ |
359.7 |
|
|
$ |
278.9 |
|
|
$ |
641.4 |
|
|
$ |
530.5 |
|
Live events and hospitality |
|
|
152.0 |
|
|
|
185.7 |
|
|
|
275.5 |
|
|
|
262.0 |
|
Partnerships and marketing |
|
|
63.2 |
|
|
|
58.3 |
|
|
|
89.4 |
|
|
|
83.9 |
|
Consumer products licensing and other |
|
|
46.0 |
|
|
|
33.3 |
|
|
|
90.3 |
|
|
|
71.3 |
|
Total Revenue |
|
$ |
620.9 |
|
|
$ |
556.2 |
|
|
$ |
1,096.6 |
|
|
$ |
947.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Direct operating costs |
|
$ |
159.0 |
|
|
$ |
142.6 |
|
|
$ |
297.6 |
|
|
$ |
264.7 |
|
Selling, general and administrative expenses |
|
$ |
93.6 |
|
|
$ |
83.8 |
|
|
$ |
174.6 |
|
|
$ |
159.3 |
|
Adjusted EBITDA |
|
$ |
368.3 |
|
|
$ |
329.8 |
|
|
$ |
624.4 |
|
|
$ |
523.7 |
|
Adjusted EBITDA margin |
|
|
59 |
% |
|
|
59 |
% |
|
|
57 |
% |
|
|
55 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
WWE Operating Metrics: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Number of events |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Premium live events |
|
|
7 |
|
|
|
8 |
|
|
|
10 |
|
|
|
11 |
|
Televised events |
|
|
45 |
|
|
|
40 |
|
|
|
89 |
|
|
|
80 |
|
Non-televised events |
|
|
28 |
|
|
|
12 |
|
|
|
61 |
|
|
|
30 |
|
Total events |
|
|
80 |
|
|
|
60 |
|
|
|
160 |
|
|
|
121 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Location of events |
|
|
|
|
|
|
|
|
|
|
|
|
||||
United States |
|
|
58 |
|
|
|
58 |
|
|
|
117 |
|
|
|
105 |
|
International |
|
|
22 |
|
|
|
2 |
|
|
|
43 |
|
|
|
16 |
|
Total events |
|
|
80 |
|
|
|
60 |
|
|
|
160 |
|
|
|
121 |
|
40
Table of Contents
IMG
The following table sets forth our IMG segment results for the three and six months ended June 30, 2026 and 2025:
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
June 30, |
|
|
June 30, |
|
||||||||||
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Revenue: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Media rights, production and content |
|
$ |
147.2 |
|
|
$ |
163.4 |
|
|
$ |
307.4 |
|
|
$ |
324.7 |
|
Live events and hospitality |
|
|
198.5 |
|
|
|
132.1 |
|
|
|
666.2 |
|
|
|
420.6 |
|
Partnerships and marketing |
|
|
3.5 |
|
|
|
7.9 |
|
|
|
25.0 |
|
|
|
30.2 |
|
Consumer products licensing and other |
|
|
5.5 |
|
|
|
3.2 |
|
|
|
11.5 |
|
|
|
7.4 |
|
Total Revenue |
|
$ |
354.7 |
|
|
$ |
306.6 |
|
|
$ |
1,010.1 |
|
|
$ |
782.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Direct operating costs |
|
$ |
188.6 |
|
|
$ |
202.8 |
|
|
$ |
651.8 |
|
|
$ |
527.8 |
|
Selling, general and administrative expenses |
|
$ |
87.5 |
|
|
$ |
74.8 |
|
|
$ |
182.4 |
|
|
$ |
152.6 |
|
Adjusted EBITDA |
|
$ |
78.6 |
|
|
$ |
29.0 |
|
|
$ |
175.9 |
|
|
$ |
102.5 |
|
Adjusted EBITDA margin |
|
|
22 |
% |
|
|
9 |
% |
|
|
17 |
% |
|
|
13 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
IMG Business Operating Metrics: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Number of clients with events (1) |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Rights |
|
|
80 |
|
|
|
77 |
|
|
|
97 |
|
|
|
97 |
|
Studios |
|
|
58 |
|
|
|
91 |
|
|
|
80 |
|
|
|
118 |
|
Event management |
|
|
16 |
|
|
|
18 |
|
|
|
25 |
|
|
|
27 |
|
Total |
|
|
154 |
|
|
|
186 |
|
|
|
202 |
|
|
|
242 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
(1) Represents unique clients generating revenue in the period; quarterly counts may include repeats. |
|
|||||||||||||||
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||||||||||||||||||
On Location Operating Metrics (1) |
|
June 30, 2026 |
|
|
June 30, 2025 |
|
|
June 30, 2026 |
|
|
June 30, 2025 |
|
||||||||||||||||||||
|
|
Number of Events |
|
|
Packages Sold |
|
|
Number of Events |
|
|
Packages Sold |
|
|
Number of Events |
|
|
Packages Sold |
|
|
Number of Events |
|
|
Packages Sold |
|
||||||||
NFL |
|
|
1 |
|
|
|
1,772 |
|
|
|
1 |
|
|
|
1,211 |
|
|
|
25 |
|
|
|
35,086 |
|
|
|
27 |
|
|
|
33,536 |
|
Collegiate Sports |
|
|
5 |
|
|
|
33,436 |
|
|
|
5 |
|
|
|
46,960 |
|
|
|
55 |
|
|
|
105,296 |
|
|
|
63 |
|
|
|
118,961 |
|
Combat Sports |
|
|
14 |
|
|
|
3,420 |
|
|
|
20 |
|
|
|
9,449 |
|
|
|
25 |
|
|
|
5,330 |
|
|
|
35 |
|
|
|
14,138 |
|
Other Sports |
|
|
12 |
|
|
|
8,822 |
|
|
|
8 |
|
|
|
7,077 |
|
|
|
22 |
|
|
|
22,677 |
|
|
|
17 |
|
|
|
17,101 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
(1) On Location metrics do not include non-recurring events (e.g., Olympics, FIFA, etc.). |
|
|||||||||||||||||||||||||||||||
41
Table of Contents
Corporate and Other
Corporate and Other revenue primarily relates to media rights fees associated with the distribution of PBR's programming content; ticket sales and financial incentive packages associated with live events; partnerships and marketing; and consumer products licensing agreements of PBR-branded products. Revenue also consists of management and promotional fees for services primarily related to boxing. Corporate and Other expenses relate to direct operating costs and general and administrative expenses attributable to PBR as well as general and administrative expenses largely related to corporate activities, including information technology, facilities, legal, human resources, finance and accounting, treasury, investor relations, corporate communications, community relations and compensation to TKO’s management and board of directors, which support each of the reportable segments. Corporate and Other expenses also include service fees paid by the Company to Endeavor related to corporate activities as well as revenue generating activities under the Services Agreement, prior to its termination on February 28, 2025. As discussed above, on the closing date of the Endeavor Asset Acquisition, the Services Agreement between TKO OpCo and Endeavor was terminated and a Transition Services Agreement has been entered into between the EGH Parties, TWI and the TKO Parties.
The following table sets forth results for Corporate and Other for the three and six months ended June 30, 2026 and 2025:
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
June 30, |
|
|
June 30, |
|
||||||||||
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Revenue |
|
$ |
48.5 |
|
|
$ |
44.6 |
|
|
$ |
122.4 |
|
|
$ |
99.0 |
|
Adjusted EBITDA |
|
$ |
(77.4 |
) |
|
$ |
(77.1 |
) |
|
$ |
(135.5 |
) |
|
$ |
(154.5 |
) |
The following table sets forth our operating metrics for PBR for the three and six months ended June 30, 2026 and 2025:
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
June 30, |
|
|
June 30, |
|
||||||||||
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
PBR Operating Metrics: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Number of events: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Unleash The Beast ("UTB") |
|
|
4 |
|
|
|
5 |
|
|
|
17 |
|
|
|
18 |
|
Teams |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
Velocity/Challenger |
|
|
3 |
|
|
|
6 |
|
|
|
24 |
|
|
|
33 |
|
Other |
|
|
5 |
|
|
|
11 |
|
|
|
7 |
|
|
|
18 |
|
Total events |
|
|
12 |
|
|
|
22 |
|
|
|
48 |
|
|
|
69 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Location of events: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
United States |
|
|
9 |
|
|
|
18 |
|
|
|
43 |
|
|
|
63 |
|
International |
|
|
3 |
|
|
|
4 |
|
|
|
5 |
|
|
|
6 |
|
Total events |
|
|
12 |
|
|
|
22 |
|
|
|
48 |
|
|
|
69 |
|
Adjusted EBITDA for the three months ended June 30, 2026 decreased by $0.3 million compared to the three months ended June 30, 2025. This decrease was primarily driven by $7.9 million of higher personnel and other operating expenses compared to the prior year. Partially offsetting these costs were $2.9 million of incremental revenue from higher management fees for services primarily related to boxing. Additionally, PBR revenue increased by $1.0 million due to higher live event revenue, while expenses at PBR declined by $3.7 million primarily due to lower event-related costs from holding fewer events.
Adjusted EBITDA for the six months ended June 30, 2026 increased by $19.0 million, or 12%, compared to the six months ended June 30, 2025. This increase was primarily driven by the impact of $21.7 million of lower corporate allocated costs from Endeavor Group Holdings, Inc. to the Acquired Businesses and incremental revenue from $12.9 million of higher management fees for services primarily related to boxing. Additionally, PBR revenue increased by $10.5 million due to higher media rights fees and partnerships revenue, while expenses at PBR declined by $2.9 million primarily due to lower event-related costs from holding fewer events. These increases were partially offset by $29.0 million of higher personnel and other operating expenses compared to the prior year.
42
Table of Contents
NON-GAAP FINANCIAL MEASURES
Adjusted EBITDA is a non-GAAP financial measure and is defined as net income, excluding income taxes, net interest expense, depreciation and amortization, equity-based compensation, merger, acquisition and earnout costs, certain legal costs, restructuring, severance and impairment charges, foreign exchange (gains) losses, and certain other items when applicable. Adjusted EBITDA margin is a non-GAAP financial measure defined as Adjusted EBITDA divided by Revenue.
TKO management believes that Adjusted EBITDA and Adjusted EBITDA margin are useful to investors as these measures eliminate the significant level of non-cash depreciation and amortization expense that results from its capital investments and intangible assets, and improve comparability by eliminating the significant level of interest expense associated with TKO’s debt facilities, as well as income taxes which may not be comparable with other companies based on TKO’s tax and corporate structure.
Adjusted EBITDA and Adjusted EBITDA margin are used as the primary bases to evaluate TKO’s consolidated operating performance.
Adjusted EBITDA and Adjusted EBITDA margin have limitations as analytical tools, and you should not consider them in isolation or as a substitute for analysis of TKO’s results as reported under GAAP. Some of these limitations are:
TKO management compensates for these limitations by using Adjusted EBITDA and Adjusted EBITDA margin along with other comparative tools, together with GAAP measurements, to assist in the evaluation of TKO’s operating performance.
Adjusted EBITDA and Adjusted EBITDA margin should not be considered substitutes for the reported results prepared in accordance with GAAP and should not be considered in isolation or as alternatives to net income as indicators of TKO’s financial performance, as measures of discretionary cash available to it to invest in the growth of its business or as measures of cash that will be available to TKO to meet its obligations. Although TKO uses Adjusted EBITDA and Adjusted EBITDA margin as financial measures to assess the performance of its business, such use is limited because it does not include certain material costs necessary to operate TKO’s business. TKO’s presentation of Adjusted EBITDA and Adjusted EBITDA margin should not be construed as indications that its future results will be unaffected by unusual or nonrecurring items. These non-GAAP financial measures, as determined and presented by TKO, may not be comparable to related or similarly titled measures reported by other companies. Set forth below are reconciliations of TKO’s most directly comparable financial measures calculated in accordance with GAAP to these non-GAAP financial measures on a consolidated basis.
43
Table of Contents
Adjusted EBITDA and Adjusted EBITDA Margin
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
June 30, |
|
|
June 30, |
|
||||||||||
|
|
2026 |
|
|
2025 |
|
|
2026 |
|
|
2025 |
|
||||
Reconciliation of Net Income to Adjusted EBITDA |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Net income |
|
$ |
303.9 |
|
|
$ |
273.1 |
|
|
$ |
553.7 |
|
|
$ |
438.6 |
|
Provision for income taxes |
|
|
53.2 |
|
|
|
46.5 |
|
|
|
87.2 |
|
|
|
67.7 |
|
Interest expense, net |
|
|
70.6 |
|
|
|
48.2 |
|
|
|
131.2 |
|
|
|
93.0 |
|
Depreciation and amortization |
|
|
98.5 |
|
|
|
99.4 |
|
|
|
242.3 |
|
|
|
199.9 |
|
Equity-based compensation expense (1) |
|
|
40.4 |
|
|
|
33.0 |
|
|
|
80.0 |
|
|
|
63.3 |
|
Merger, acquisition and earnout costs (2) |
|
|
7.0 |
|
|
|
4.2 |
|
|
|
9.4 |
|
|
|
44.0 |
|
Certain legal costs (3) |
|
|
71.1 |
|
|
|
9.7 |
|
|
|
94.3 |
|
|
|
16.2 |
|
Restructuring, severance and impairment (4) |
|
|
0.7 |
|
|
|
4.3 |
|
|
|
1.1 |
|
|
|
5.8 |
|
Debt transaction costs (5) |
|
|
2.5 |
|
|
|
— |
|
|
|
2.5 |
|
|
|
— |
|
Foreign exchange (gains) and losses (6) |
|
|
0.7 |
|
|
|
10.1 |
|
|
|
(2.6 |
) |
|
|
15.0 |
|
Other adjustments (7) |
|
|
1.3 |
|
|
|
(2.0 |
) |
|
|
0.6 |
|
|
|
0.4 |
|
Total Adjusted EBITDA |
|
$ |
649.9 |
|
|
$ |
526.5 |
|
|
$ |
1,199.7 |
|
|
$ |
943.9 |
|
Net income margin |
|
|
20 |
% |
|
|
21 |
% |
|
|
18 |
% |
|
|
17 |
% |
Adjusted EBITDA margin |
|
|
42 |
% |
|
|
40 |
% |
|
|
38 |
% |
|
|
37 |
% |
Liquidity and Capital Resources
Sources and Uses of Cash
Cash flows from operations are used to fund TKO’s day-to-day operations, revenue-generating activities, and routine capital expenditures, as well as service its long-term debt, and are expected to be used to fund our capital return programs.
First Lien Term Loan (due November 2031)
As of June 30, 2026 and December 31, 2025, we had $4.6 billion and $3.7 billion, respectively, outstanding under a credit agreement dated August 18, 2016 (as amended and/or restated, the “First Lien Credit Agreement”). On March 10, 2026, TKO Worldwide Holdings entered into an amendment to the First Lien Credit Agreement to, among other things, (i) provide for an additional $900.0 million incremental first lien secured term loan (“Incremental Term Loan”) as a fungible increase to the existing first lien secured term loans of $3.7 billion (collectively, the “Prior Term Loans”), (ii) upsize the revolving credit facility under the existing credit agreement from $205.0 million to $350.0 million (the “Revolving Credit Facility” and together with term loans provided under the First Lien Credit Agreement, the “Credit Facilities”), and (iii) make certain other changes to the First Lien Credit Agreement.
On May 28, 2026, TKO Worldwide Holdings entered into the Seventh Refinancing Amendment to the First Lien Credit Agreement (the “Credit Agreement Refinancing Amendment”). The Credit Agreement Refinancing Amendment amended the First
44
Table of Contents
Lien Credit Agreement to, among other things, (i) refinance and replace the outstanding Prior Term Loans with a new class of first lien secured term loans (the “New Term Loans”), the aggregate principal amount of which was unchanged at $4.6 billion, (ii) reduce the applicable interest margin on the New Term Loans by 25 basis points, (iii) reduce the applicable interest rate margin on the Revolving Credit Facility by 25 basis points and (iv) make certain other changes to the First Lien Credit Agreement. In connection with the Credit Agreement Refinancing Amendment, approximately $29.9 million of Prior Term Loans held by lenders that did not participate in the modified syndication was repaid and replaced with an equal amount funded by new lenders. The Credit Facilities are secured by liens on substantially all of the assets of TKO Guarantor and TKO Worldwide Holdings and certain subsidiaries thereof.
Following the Credit Agreement Refinancing Amendment, the New Term Loans bear interest at a variable interest rate equal to either, at the option of TKO Worldwide Holdings, Term SOFR or the ABR plus, in each case, an applicable margin. SOFR term loans accrue interest at a rate equal to Term SOFR plus 1.75%, with a SOFR floor of 0.00%. The New Term Loans' interest rate totaled 5.41% as of June 30, 2026. ABR term loans accrue interest at a rate equal to (i) the highest of (a) the Federal Funds Effective Rate plus 0.5%, (b) the prime rate in effect for such day, and (c) Term SOFR for a one-month interest period plus (ii) 0.75%, with an ABR floor of 1.00%. The New Term Loans have the same amortization schedule as the Prior Term Loans they replaced, amortizing at 1% per annum, and maturing on November 21, 2031.
The loans made pursuant to the upsized Revolving Credit Facility bear interest at a variable interest rate equal to either, at the option of TKO Worldwide Holdings, Term SOFR or the ABR plus, in each case, an applicable margin. Following the Credit Agreement Refinancing Amendment, the leverage-based step-down mechanism previously applicable to the Revolving Credit Facility was eliminated. SOFR revolving loans accrue interest at a rate equal to Term SOFR plus 1.50%, with a SOFR floor of 0.00%. ABR revolving loans accrue interest at a rate equal to (i) the highest of (a) the Federal Funds Effective Rate plus 0.5%, (b) the prime rate in effect for such day, and (c) Term SOFR for a one-month interest period plus (ii) 0.50%, with an ABR floor of 1.00%. The Revolving Credit Facility matures on September 15, 2030.
As of June 30, 2026 and December 31, 2025, there were no borrowings outstanding under the Revolving Credit Facility.
The Company capitalized $14.8 million in transaction costs related to the First Lien Credit Agreement amendment during the six months ended June 30, 2026. Of these amounts, $11.0 million was capitalized as a component of long-term debt related to the Incremental Term Loan and $3.8 million was capitalized as a component of other assets related to increasing the borrowing capacity of the Revolving Credit Facility. In addition, in connection with the Credit Agreement Refinancing Amendment, the Company incurred transaction costs of approximately $2.5 million during the three and six months ended June 30, 2026. Substantially all of these costs related to debt modification and were expensed as incurred, with an immaterial amount capitalized as a component of long-term debt related to new term loan lenders and the modification of the Revolving Credit Facility.
Other Secured Loans
As of June 30, 2026 and December 31, 2025, the Company had $61.3 million and $63.1 million, respectively, of other secured loans outstanding, which were entered into in order to finance the purchase of certain assets. Principal amortization is payable in monthly installments with any remaining balance payable on the final maturity dates of November 1, 2028 and January 1, 2031.
Covenants and Restrictions on Dividends
The First Lien Credit Agreement contains a financial covenant that requires the Company to maintain, commencing with the fiscal quarter ended June 30, 2025, a First Lien Leverage Ratio of Consolidated First Lien Debt to Consolidated EBITDA of 8.25-to-1; however, the Company is only required to comply with this covenant if outstanding borrowings under the Revolving Credit Facility, excluding letters of credit, exceed specified thresholds. In addition, one of the Company’s other secured loans contains a financial covenant that requires the Company to maintain a Debt Service Coverage Ratio of no less than 1.15-to-1, as defined in the applicable loan agreement. The Credit Facilities also restrict the ability of certain subsidiaries of the Company to make distributions and other payments to the Company, subject to various exceptions, including amounts necessary to make tax payments, a limited annual amount for employee equity repurchases, distributions required to fund certain parent entities and a general restricted payment basket that generally provides for no restrictions as long as the Total Leverage Ratio (as defined in the First Lien Credit
45
Table of Contents
Agreement) is less than 5.0x. As of June 30, 2026, the Company was not subject to the financial covenant under the First Lien Credit Agreement and was in compliance with the financial covenant under its other secured loan.
For additional information regarding the Company's debt arrangements, see Note 8, Debt, to the accompanying interim consolidated financial statements.
Capital Return Program
On May 6, 2026, the Company announced that its board of directors has authorized up to an additional $1.0 billion of repurchases of its Class A common stock. This authorization is incremental to the Company's previously announced $2.0 billion share repurchase program.
During the three and six months ended June 30, 2026, we continued to return capital to shareholders through share repurchases and dividends. From January 1, 2026 through February 26, 2026, we repurchased 187,819 shares for $38.3 million under our previously existing Rule 10b5-1 trading plan, which expired on February 26, 2026. We entered into a new Rule 10b5-1 trading plan on March 10, 2026 for up to $200.0 million of additional repurchases. This plan was subsequently amended on May 11, 2026 to change the commencement date to May 14, 2026. During the period from May 14, 2026 through June 30, 2026, we repurchased 648,919 shares for $129.3 million under the new Rule 10b5-1 trading plan. The new 10b5-1 Plan was completed on July 22, 2026, with the repurchase of 373,515 shares of TKO Class A common stock for an aggregate purchase price of $70.7 million occurring during July 2026.
On March 10, 2026, we entered into an accelerated share repurchase agreement (the “ASR Agreement”) to repurchase $800.0 million of our Class A common stock, and received an initial delivery of 3,136,179 shares on March 11, 2026. The valuation period under the ASR Agreement ended on June 30, 2026, and we received final delivery of 1,031,119 shares on July 1, 2026.
For the three months ended June 30, 2026 and 2025, the Company's board of directors declared quarterly cash dividends of $0.79 per share and $0.38 per share, respectively. For the six months ended June 30, 2026 and 2025, aggregate cash dividends declared were $1.57 per share and $0.76 per share, respectively. These dividend payments represented TKO’s portion of the pro rata distributions from TKO OpCo to its equity holders
Cash Flows Overview
|
|
Six Months Ended |
|
|||||
|
|
June 30, |
|
|||||
|
|
2026 |
|
|
2025 |
|
||
Net cash provided by operating activities |
|
$ |
1,068.5 |
|
|
$ |
559.0 |
|
Net cash used in investing activities |
|
$ |
(47.9 |
) |
|
$ |
(49.7 |
) |
Net cash used in financing activities |
|
$ |
(651.0 |
) |
|
$ |
(346.0 |
) |
Operating activities increased from $559.0 million of cash provided in the six months ended June 30, 2025 to $1,068.5 million of cash provided in the six months ended June 30, 2026. Cash provided in the six months ended June 30, 2026 was primarily due to net income for the period of $553.7 million, which included certain non-cash items, including depreciation and amortization of $242.3 million and equity-based compensation of $80.0 million, as well as an increase in restricted cash of $604.8 million related to On Location for the FIFA World Cup 2026. These increases were partially offset by the timing of revenue recognition in advance of cash collections from customers as well as the timing of annual bonus payments. Cash provided in the six months ended June 30, 2025 was primarily due to net income for the period of $438.6 million, which included certain non-cash items, including depreciation and amortization of $199.9 million and equity-based compensation of $63.3 million, as well as an increase in restricted cash of $265.1 million related to On Location for the FIFA World Cup 2026. This increase was partially offset by a decline in accounts payable and accrued liabilities primarily driven by the $250.0 million payments under the settlement agreement in the UFC antitrust lawsuits and the timing of bonus payments.
Investing activities decreased from $49.7 million of cash used in the six months ended June 30, 2025 to $47.9 million of cash used in the six months ended June 30, 2026. Cash used in the six months ended June 30, 2026 primarily reflects payments for property, buildings and equipment of $44.4 million and investments in affiliates of $4.0 million. Cash used in the six months ended June 30, 2025 primarily reflects payments for property, buildings and equipment of $48.6 million and investments in affiliates of $13.8 million, partially offset by proceeds from the sale of assets of $5.8 million and infrastructure improvement incentives received of $5.4 million.
Financing activities increased from $346.0 million of cash used in the six months ended June 30, 2025 to $651.0 million of cash used in the six months ended June 30, 2026. Cash used in the six months ended June 30, 2026 primarily reflects payments for share repurchases of $967.6 million, distributions to EGH and its subsidiaries of $408.0 million, dividends paid to holders of TKO Class A common stock of $117.3 million, and net payments of $78.5 million to repay our outstanding debt and refinance our existing first lien term loan. These payments were partially offset by proceeds of $929.9 million received from the upsizing and repricing of
46
Table of Contents
the Company's existing first lien term loan. Cash used in the six months ended June 30, 2025 primarily reflects distributions to EGH and its subsidiaries of $166.7 million, net transfers to Endeavor Group Holdings, Inc. of $122.5 million, dividends paid to holders of TKO Class A common stock of $62.1 million and net payments on debt of $20.8 million. These decreases were partially offset by contributions of $26.5 million from Endeavor Group Holdings, Inc. in connection with the Endeavor Asset Acquisition.
Future Sources and Uses of Liquidity
TKO’s sources of liquidity are (1) unrestricted cash on hand, (2) cash flows from operations and (3) available borrowings under the Credit Facilities (which borrowings would be subject to certain restrictive covenants contained therein). Based on our current expectations, we believe that these sources of liquidity will be sufficient to fund our working capital requirements and to meet our commitments, including long-term debt service, for at least the next 12 months.
TKO expects that its primary liquidity needs will be cash to (1) provide capital to facilitate organic growth of its business, (2) pay operating expenses, including cash compensation to its employees, athletes and talent, (3) fund capital expenditures and strategic investments, (4) pay interest and principal when due on the Credit Facilities, (5) pay income taxes, (6) reduce its outstanding indebtedness under the Credit Facilities, (7) fund share repurchases as authorized by the Board and (8) make distributions to members and, in accordance with the Company’s cash management policy, to TKO stockholders, including the planned quarterly dividend when declared by the Board.
Recent Accounting Pronouncements
See Note 3, Recent Accounting Pronouncements, to our unaudited consolidated financial statements included in this Quarterly Report for further information on certain accounting standards that have been recently adopted or that have not yet been required to be implemented and may be applicable to our future operations.
Critical Accounting Estimates
For a description of our policies regarding our critical accounting estimates, see “Critical Accounting Estimates” in our 2025 Annual Report. During the six months ended June 30, 2026, there were no significant changes in our critical accounting policies and estimates or the application or the results of the application of those policies to our unaudited consolidated financial statements from those previously disclosed in the 2025 Annual Report.
Item 3. Quantitative and Qualitative Disclosures about Market Risk
TKO is exposed to market risks in the ordinary course of its business. Market risk represents the risk of loss that may impact TKO’s financial position due to adverse changes in financial market prices and rates.
Interest Rate Risk
Our exposure to changes in interest rates relates primarily to the floating interest component on our long-term debt. The Credit Facilities bear interest at floating rates and we regularly monitor and manage interest rate risks. Holding debt levels constant as of June 30, 2026, a 1% increase in the effective interest rates would have increased our annual interest expense by approximately $46 million.
Foreign Currency Risk
We have operations in several countries outside of the United States, and certain of our operations are conducted in foreign currencies, principally the British Pound. The value of these currencies fluctuates relative to the U.S. dollar. These changes could adversely affect the U.S. dollar equivalent of TKO’s non-U.S. dollar revenue and operating costs and expenses and reduce international demand for its content and services, all of which could negatively affect TKO’s business, financial condition and results of operations in a given period or in specific territories.
Holding other variables constant (such as interest rates and debt levels), if the U.S. dollar appreciated by 10% against the foreign currencies used by TKO’s operations in the six months ended June 30, 2026, revenues would have decreased by approximately $51.5 million and operating income would have decreased by approximately $7.6 million.
We regularly review our foreign exchange exposures that may have a material impact on our business and from time to time use foreign currency forward exchange contracts or other derivative financial instruments to hedge the effects of potential adverse fluctuations in foreign currency exchange rates arising from these exposures. TKO does not enter into foreign exchange contracts or other derivatives for speculative purposes.
47
Table of Contents
Credit Risk
TKO maintains its cash and cash equivalents with various major banks and other high quality financial institutions, and its deposits at these institutions exceed insured limits. Market conditions can impact the viability of these institutions and the failure of any of the financial institutions where we maintain our cash and cash equivalents or any inability to access or delays in our ability to access our funds could adversely affect our business and financial position.
Item 4. Controls and Procedures
Limitations on Effectiveness of Controls and Procedures
In designing and evaluating our disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. In addition, the design of disclosure controls and procedures must reflect the fact that there are resource constraints and that management is required to apply judgment in evaluating the benefits of possible controls and procedures relative to their costs.
Evaluation of Disclosure Controls and Procedures
The Company’s management has evaluated, with the participation of the Chief Executive Officer and the Chief Financial Officer, the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this Quarterly Report. Based on this evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective at the reasonable assurance level as of June 30, 2026.
Changes in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the quarter ended June 30, 2026 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
From time to time, we may be involved in claims and proceedings arising in the course of our business. The outcome of any such claims or proceedings, regardless of the merits, is inherently uncertain. For a description of our legal proceedings, refer to Note 14, Commitments and Contingencies, to our unaudited consolidated financial statements included in this Quarterly Report, which is incorporated herein by reference.
Item 1A. Risk Factors
Our business, financial condition and operating results can be affected by a number of factors, whether currently known or unknown, including but not limited to those described as risk factors, any one or more of which could, directly or indirectly, cause our actual operating results and financial condition to vary materially from past, or anticipated future, operating results and financial condition. For a discussion of these potential risks and uncertainties, see Part I, Item 1A. "Risk Factors" in our 2025 Annual Report on Form 10-K. Any of these factors, in whole or in part, could materially and adversely affect our business, financial condition, operating results and the price of our common stock. There have been no material changes in our risk factors to those included in our 2025 Annual Report on Form 10-K.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Report of Offering of Securities and Use of Proceeds Therefrom
None.
Purchases of Equity Securities by the Issuer and Affiliated Purchasers
The following table presents information with respect to purchases of the Company's Class A common stock by the
48
Table of Contents
Company and its affiliated purchasers made during the three months ended June 30, 2026:
Period |
|
Total Number |
|
|
Average Price |
|
|
Total Number |
|
|
Approximate |
|
||||
April 1, 2026 to April 30, 2026 |
|
|
— |
|
|
$ |
— |
|
|
|
— |
|
|
$ |
294,844 |
|
May 1, 2026 to May 31, 2026 |
|
|
271,958 |
|
|
$ |
191.50 |
|
|
|
247,650 |
|
|
$ |
1,247,264 |
|
June 1, 2026 to June 30, 2026 |
|
|
401,269 |
|
|
$ |
203.69 |
|
|
|
401,269 |
|
|
$ |
1,165,531 |
|
Total |
|
|
673,227 |
|
|
|
|
|
|
648,919 |
|
|
|
|
||
Unregistered Sales of Equity Securities
None.
Item 5. Other Information
(a) Disclosure in lieu of reporting on a Current Report on Form 8-K.
None.
(b) Material changes to the procedures by which security holders may recommend nominees to the Board.
None.
(c) Insider trading arrangements and policies.
During the three months ended June 30, 2026, no director or "officer" (as defined under 16a-1(f) of the Exchange Act) of the Company
49
Table of Contents
Item 6. Exhibits
|
|
|
|
|
|
|
Exhibit Number |
Description |
Form |
File No. |
Exhibit |
Filing Date |
Filed/Furnished Herewith |
2.1# |
Transaction Agreement, dated April 2, 2023, by and among Endeavor Group Holdings, Inc., Endeavor Operating Company, LLC, Zuffa Parent, LLC, World Wrestling Entertainment, Inc., New Whale Inc., and Whale Merger Sub Inc. |
424(b)(3) |
333-271893 |
Annex A |
08/22/2023 |
|
3.1 |
Amended and Restated Certificate of Incorporation of TKO Group Holdings, Inc. |
S-8 |
333-274480 |
4.1 |
09/12/2023 |
|
3.2 |
Amended and Restated Bylaws of TKO Group Holdings, Inc. |
S-8 |
333-274480 |
4.2 |
09/12/2023 |
|
4.1 |
Registration Rights Agreement, dated as of September 12, 2023, by and among TKO Group Holdings, Inc., Endeavor Group Holdings, Inc. and Vincent K. McMahon. |
8-K |
001-41797 |
4.1 |
09/12/2023 |
|
10.1# |
Seventh Refinancing Amendment, dated as of May 28, 2026, to the First Lien Credit Agreement, dated as of August 18, 2016, among TKO Guarantor, LLC, as holdings, TKO Worldwide Holdings, LLC, as borrower, the lenders party thereto and Goldman Sachs Bank USA, as administrative agent. |
|
|
|
|
* |
10.2 |
Employment Agreement, dated as of May 4, 2026, by and between World Wrestling Entertainment, LLC and Nick Khan |
8-K |
001-41797 |
10.2 |
05/06/2026 |
|
10.3 |
Amended and Restated Non-Employee Director Compensation Policy |
|
|
|
|
* |
31.1 |
Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
|
|
|
|
* |
31.2 |
Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
|
|
|
|
* |
32.1 |
Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
|
|
|
|
** |
32.2 |
Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
|
|
|
|
** |
101.INS |
Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. |
|
|
|
|
* |
101.SCH |
Inline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents. |
|
|
|
|
* |
104 |
Cover Page Interactive Data File – formatted as Inline XBRL and contained in Exhibit 101. |
|
|
|
|
* |
* Filed herewith.
** Furnished herewith.
# Annexes, schedules and/or exhibits have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Registrant undertakes to furnish supplemental copies of any of the omitted schedules or similar attachments upon request by the SEC.
50
Table of Contents
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
|
|
|
|
|
|
|
TKO GROUP HOLDINGS, INC.
|
||
|
|
|
|
|
Date: |
August 3, 2026 |
By: |
/s/ ANDREW SCHLEIMER |
|
|
|
|
Andrew Schleimer |
|
|
|
|
Chief Financial Officer |
|
|
|
|
(principal financial officer and authorized |
|
|
|
|
signatory) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Date: |
August 3, 2026 |
By: |
/s/ SHANE KAPRAL |
|
|
|
|
Shane Kapral |
|
|
|
|
Deputy Chief Financial Officer |
|
|
|
|
(principal accounting officer and authorized |
|
|
|
|
signatory) |
|
|
|
|
|
|
51