TKO Group Holdings(NYSE: TKO), the specialty entertainment company that owns both World Wrestling Entertainment (WWE) and the Ultimate Fighting Championship (UFC), had its hand raised in victory Thursday. Its stock raced nearly 7% higher across the day, thanks to a strong second-quarter earnings report. With that performance it put the hurt on the S&P 500 index, which rose by a relatively light 2.3%.
New quarterly revenue record set
That morning before market open, TKO revealed it earned slightly over $851 million for the period, setting a new quarterly record. That was nearly triple the second-quarter 2023 result of $305 million. Net income based on generally accepted accounting principles (GAAP) also bounced well higher, coming in at almost $151 million ($0.72 per share) compared to the year-ago profit of just under $82 million.
According to data compiled by Yahoo! Finance, on average the analysts tracking TKO stock were modeling only $771 million for revenue. On the other hand, they were anticipating a higher bottom-line figure of $0.87 per share.
Of TKO's two component parts, WWE is the larger in terms of revenue. For the period, the wrestling unit brought in nearly $457 million, with the bulk of that revenue -- almost $261 million -- coming from media rights and content. Live events were also a strong source of income, bringing in slightly more than $144 million in the period. That structure was matched by UFC, with the Nos. 1 and 2 revenue generators also being media rights/content and live events. All told, UFC's revenue totaled $394 million and change.
Guidance raised
On the back of that quarter's performance, TKO raised certain elements of its full-year guidance. It now believes it will book $2.67 billion to nearly $2.75 billion in revenue and post non-GAAP (adjusted) earnings before interest, taxes, depreciation, and amortization (EBITDA) of $1.22 billion to $1.24 billion. It did not provide a forecast for net income.
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Eric Volkman has positions in TKO Group Holdings. The Motley Fool recommends TKO Group Holdings. The Motley Fool has a disclosure policy.
