Sphere posts $98.4m operating loss during period in which it opened

Las Vegas’ Sphere venue

Featured Image Credit: Sphere Entertainment Co

Las Vegas’ Sphere brought in $4m in event-related revenues during the first two days after it opened, but posted an operating loss of $98.4m.

The Sphere, the spectacular 18,600-capacity arena, announced takings of $4.1m during the three months to September 30, despite only hosting its first concert the day before.

In total, the venue generated revenue of $7.8m during the Q1 2024 period, with $2.6m of income coming from sponsorship, signage, Exosphere advertising and suite licence fees.

However, the venue posted a Q1 operating loss of $98.4m. This increased by $19.4m year-on-year primarily reflecting higher depreciation and amortisation, direct operating expenses, and selling, general and administrative expenses, partially offset by the increase in revenues.

U2 opened the venue on September 29, with all the band’s concerts so far sold out. U2 will continue their residency until February, with 36 dates planned so far.

Sphere Entertainment as a whole generated revenue of $118.0m during Q1, which was down slightly year-on-year. The group, which also includes the MSG Networks regional cable and satellite television service, made a total adjusted operating loss of $57.9m during the period.

Executive chairman and CEO James L. Dolan said: “Sphere’s opening in Las Vegas in September represented a significant milestone, generating worldwide attention and marking the beginning of a new chapter for our company. We are building positive momentum across Sphere and remain confident that we are well positioned to drive long-term value for shareholders.”

For the fiscal 2024 first quarter, the Las Vegas Sphere segment had direct operating expenses of $7.8m, as compared to no direct operating expenses in the prior year quarter. This primarily included $2.8m of venue operating costs and $2.2m of event-related expenses, both reflecting the opening of Sphere on September 29. In addition, direct operating expenses included $2.1m in costs associated with The Sphere Experience, reflecting advertising expenses ahead of the October 6 debut of The Sphere Experience featuring Darren Aronofsky’s Postcard from Earth.