TKO Group Holdings Reports Full Year 2023 Financial Results

Submitted by Jeff Whalen on

-- The following press release was issued today by TKO:

TKO Reports Full Year 2023 Results

TKO Transaction Highlights

On September 12, 2023, Endeavor and WWE closed the transaction to combine UFC and WWE to form a new, publicly listed company, TKO Group Holdings, Inc. The reported results presented in this earnings release cover the period from January 1, 2023 through December 31, 2023 for UFC and the period from September 12, 2023 through December 31, 2023 for WWE.

Full Year 2023 Highlights and Recent Developments

  • The UFC segment delivered record financial results. Revenue increased 13% to $1.3 billion and Adjusted EBITDA1 increased 11% to $756 million
  • UFC live events revenue increased 34% to a record $168 million, driven by growth in ticket revenues and site fees. UFC held 43 events that generated significant viewership gains and set several all-time records for gross revenue at respective arenas
  • UFC sponsorship revenue increased 18% to a record $196 million, driven by new brand partners and renewal increases
  • UFC celebrated its 30th anniversary with a series of events commemorating its history and current standing as the world’s premier mixed martial arts organization
  • Each WWE premium live event set a viewership record; total WWE domestic viewership and hours viewed on Peacock increased 25% and 22%, respectively, as compared to the prior year
  • WWE live event average attendance increased 34%
  • In January 2024, WWE entered into a long-term media rights agreement with Netflix beginning in January 2025 for Raw in the United States and all WWE shows and specials outside the United States

Full Year 2024 Guidance

  • The Company is targeting revenue of $2.575 billion to $2.650 billion
  • The Company is targeting Adjusted EBITDA of $1.150 billion to $1.170 billion
  • The Company is targeting Free Cash Flow Conversion2 in excess of 50%

February 27, 2024 04:05 PM Eastern Standard Time

NEW YORK--(BUSINESS WIRE)--TKO Group Holdings, Inc. (“TKO” or the “Company”) (NYSE: TKO) today announced financial results for its year ended December 31, 2023. The reported results presented in this earnings release cover the period from January 1, 2023 through December 31, 2023 for Ultimate Fighting Championship (“UFC”) and the period from September 12, 2023 through December 31, 2023 for World Wrestling Entertainment, Inc. (“WWE”).

“TKO is off to a strong start following record financial performance in 2023 at both UFC and WWE,” said Ariel Emanuel, CEO of TKO. “We secured Anheuser-Busch as the official beer partner of UFC, delivered a transformative deal to bring WWE’s Raw to Netflix beginning in 2025, and expanded our international footprint in important growth markets. We have more conviction than ever in the combination of these businesses and TKO’s ability to drive topline growth and margin expansion, generate meaningful free cash flow, and deliver sustainable long-term value for shareholders.”

Full Year Consolidated Results

Revenue increased 47%, or $534.9 million, to $1.7 billion. The increase reflected an increase of $152.1 million at UFC, to $1.3 billion, and the contribution of $382.8 million of revenue at WWE associated with the period from September 12, 2023 through December 31, 2023.

Net Income was $175.7 million, a decrease of $213.3 million from $389.0 million in the prior year period. The decrease primarily reflected an increase in operating expenses partially offset by the increase in revenue. The increase in operating expenses primarily reflected an increase in selling, general and administrative expenses of $339.0 million, an increase in direct operating costs of $189.0 million, an increase in depreciation and amortization of $104.6 million, and an increase in interest expense of $99.4 million. To a lesser extent, higher income taxes also contributed to the decrease in net income.

Adjusted EBITDA1 increased 29%, or $180.4 million, to $809.1 million, due to an increase of $75.1 million at UFC and the contribution of $163.0 million of Adjusted EBITDA at WWE associated with the period from September 12, 2023 through December 31, 2023, partially offset by an increase of $57.7 million in corporate expenses.

Cash flows generated by operating activities were $468.4 million, a decrease of $33.3 million from $501.7 million, primarily due to lower net income.

Free Cash Flow2 was $419.8 million, a decrease of $69.5 million from $489.3 million, primarily due to the decrease in cash flows generated by operating activities and an increase in capital expenditures, which was primarily related to WWE’s new headquarter facility.

Cash and cash equivalents were $235.8 million as of December 31, 2023. Gross debt was $2.761 billion as of December 31, 2023.