TKO Group Holdings, Inc. 2026 Q2 Earnings Call

Seth, please go ahead. Good afternoon, and welcome to TKO's second quarter 2026 earnings call.

A short while ago, we issued a press release, which you can view on our investor relations website. A recording of this call will also be available via our website for at least 30 days. After prepared remarks from Ari Emanuel, TKO's Executive Chair and Chief Executive Officer, Mark Shapiro, TKO's President and Chief Operating Officer, and Andrew Schleimer, TKO's Chief Financial Officer, we'll open the call for questions. Mark and Andrew will be handling the Q&A. The purpose of this call is to provide you with information regarding our second quarter 2026 performance. I want to remind everyone that the information discussed will include forward-looking statements and/or projections that involve risks, uncertainties, and assumptions. Please see our filings with the Securities and Exchange Commission for further detail.

If these risks or uncertainties were to materialize or any assumptions prove incorrect, our results may differ materially from those expressed or implied on this call. Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update them in light of new information or future events, except as legally required. Our commentary today will also include non-GAAP financial measures, which we believe provide an additional tool for investors to use in evaluating ongoing operating results and trends. These measures should not be considered in isolation from or as a substitute for financial information prepared in accordance with GAAP. Reconciliations between GAAP and non-GAAP metrics can be found in our press release issued today, as well as the information posted on our IR website. With that, I'll now turn the call over to Ari.

Thanks, Seth. TKO's unique ability to deliver one-of-one live events and experiences was front and center in the second quarter. Nothing illustrates this better than UFC Freedom 250, held in June. This event was a roaring success for our company, the UFC brand, and the sport of mixed martial arts. Exposure, earned media, audience expansion, and a weekend-long fan experience. TKO also played an integral role in the success of this year's record-breaking FIFA World Cup, where On Location staged the largest hospitality program in the tournament's history. Fans from 154 countries purchased more than 600,000 hospitality packages across 104 matches in 16 host cities. The qualitative feedback on our delivery bodes well for the continued growth of On Location, and affirmatively sets the table for what will be a historic LA28 Olympic Games. TKO is poised for monumental growth at a time when consumers are deliberately choosing in-person experiences.

Our content can't be manufactured or automated. As the rise of AI inevitably changes how we spend our time, live events built on scarcity, marketable IP, and durable repricing power win out. Physical experiences still command the biggest share of the wallet, and we're one of the very few companies that actually lead in this space, across multiple properties at scale and globally. As we look to the back half of 2026, we're raising our full year guidance with conviction in our businesses stronger than ever. With that, Mark will take you through the quarter.

Thanks, Ari. We've consistently stated that 2026 is a year of execution for TKO. The second quarter confirmed that. From WrestleMania 42 in Las Vegas in April, to WWE's Clash in Italy in May, to UFC Freedom 250 in our nation's capital in June, to crowded stadiums around North America for the FIFA World Cup, to IMG's partnership with the EuroLeague Final Four in Athens, TKO has served and captured fans while demonstrating excellence from every corner of the business. There was no bigger headline or spotlight this quarter than UFC Freedom 250 at the White House. The card, the production, the storytelling was a once-in-a-lifetime spectacle on the biggest stage possible. Fans turned out and tuned in. The Ellipse Fan Fest was attended by more than 130,000 fans over two days.

The 7-bout fight card itself reached more than 34 million total viewers in reported markets, including 17 million viewers across the U.S. and Latin America on Paramount+. This goes well beyond a single event. Since the start of the year, 20 million subscriber households have watched more than 200 million hours of UFC programming on Paramount+, delivering viewership more than 23 times the average UFC pay-per-view event over the past two years. That's the strength of the Paramount partnership at work in just six short months, and proof that removing the double paywall was indeed the right decision. TKO Properties' outsized impact on conversation, subscriber acquisition, and retention is undeniable. Beyond the audience numbers, the event generated more than $1 billion in earned media value, the kind of exposure only a handful of events in the world can command.

It also deepened our commercial relationships, adding 25 new marketing partners to our roster, many signing multi-year or multi-event deals. Andrew will cover the event's financials in more detail, but I can tell you unequivocally that our investment in this event, time, energy, focus, delivered results as designed. While we won't hold another event in the backyard of the White House, we will continue to be bold and creative, on the hunt for new audiences, new venues, and new experiences that make the UFC truly singular. Looking beyond our White House event, UFC sold out arenas and secured financial incentive packages around the globe, including in Perth, Macau, and Newark, New Jersey, where our return to the Prudential Center became the highest-grossing event in arena history. Similarly, in Azerbaijan, our return to Baku drew more than 10,500 fans, with 40% of those fans traveling in from more than 70 countries.

UFC 329 in Las Vegas last month was also a standout, becoming the highest-grossing event in UFC history. The same June evening that UFC returned to Baku, WWE returned to Riyadh for a successful Night of Champions, drawing a sold-out crowd of more than 18,000 fans. Building on last month's successful return to Abu Dhabi, our remaining events in the Middle East are all systems go as planned for the remainder of 2026. WrestleMania 42 drew more than 106,000 fans and one of the highest all-time gates in WWE history. WWE Backlash sold out in Tampa, Saturday Night's Main Event sold out in Fort Wayne, Indiana, WWE staged a run of successful events across Europe, spanning the U.K., Spain, France, and Portugal, headlined by the aforementioned Clash in Italy, WWE's first-ever premium live event in the country.

Coinciding with our local launch on Netflix, Clash sold out Turin's Inalpi Arena and set the record for the highest-grossing entertainment event ever at that arena. This is a long way of saying that demand for WWE events is insatiable, we're in the position of being at the controls of creating this demand. We have full autonomy over where we bring every event, we can be surgical in our approach to growing our fan base for the long term. Our decision-making is deliberate. SummerSlam is a prime example. Following last year's record two-day event at MetLife Stadium, we decided to take this premium live event to Minneapolis this summer for our first-ever stadium show in the city, backed by a meaningful financial incentive package. The two-day show was extraordinary. The sold-out corresponding WWE Fan Fest delivered strong engagement metrics.

Across TKO, we prioritize both the fan experience and improving profitability. They are not mutually exclusive, they are not always in that order. Which brings me to recent chatter around WWE viewership. On Netflix, WWE Raw was a global top 10 title every single week of the second quarter. Beyond our expansion with Netflix into Italy, we recently launched premium live events with the streamer in Germany, Austria, and Switzerland as markets continue to come online. With ESPN in the U.S., WrestleMania Night 1 is the number one program on ESPN2 this year, while Backlash and Clash in Italy both had strong viewership. Meanwhile, SmackDown on USA Network was a top three Friday cable show in the U.S. among adults 18 to 49 in 9 of 13 weeks in the quarter, with three number one finishes. These numbers tell the real story.

I would add that TKO properties like UFC, WWE, PBR, and increasingly, Zuffa Boxing are purpose-built for our current social media environment. Social media amplifies our events. Shared highlights and content don't substitute for the event itself. They market the next one. Our financial incentive packages strategy is also gaining meaningful traction. Our properties deliver real economic impact and cultural connection for cities, that value increasingly shows up in the deals we strike with tourism boards, states and local municipalities, and private partners. We're still early, the runway to scale this in more markets and cities across all our properties and for bigger commitments is significant. Our strategy is working, our target of $380 million-$420 million by the year 2030 is on plan.

To that point, in May, we signed a landmark three-year, seven-event agreement with the Arizona Sports & Events Alliance, spanning UFC, WWE, PBR, and Zuffa Boxing, one of the broadest multi-property financial incentive package deals we've put together to date. Next week, UFC 330 brings the championship bout back to the City of Brotherly Love, Philadelphia, for the first time in 15 years as part of the city's America 250 celebration, another market investing in TKO to drive economic impact. The value of our live events is undeniable, and it's only going to grow from here. As already mentioned, while AI makes content cheaper and easier to produce, what can't be manufactured becomes scarcer and more valuable. That is live, communal events that people crave and organize their calendars to travel to and from. There's no bigger example of that than the FIFA World Cup 2026.