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Segment Information
 12 Months Ended
Jun. 30, 2024
Segment Reporting [Abstract]  
Segment Information Segment Information
As of June 30, 2024, the Company was comprised of two reportable segments: Sphere and MSG Networks. The Company takes into account whether two or more operating segments can be aggregated together as one reportable segment as well as the type of discrete financial information that is available and regularly reviewed by its Chief Operating Decision Maker.
The Company incurs non-capitalizable content development and technology costs associated with the Company’s Sphere business, which are reported in the Sphere segment. Sphere also includes other expenses such as (a) corporate and supporting department operating costs that are attributable to Sphere development, including charges under the MSGE TSA and (b) non-event related operating expenses such as (i) insurance, (ii) utilities, (iii) repairs and maintenance, (iv) labor related to the overall management of Sphere segment and (v) depreciation and amortization expense related to certain corporate property, equipment and leasehold improvements.
The Company evaluates segment performance based on several factors, of which the key financial measure is adjusted operating income (loss), a non-GAAP financial measure. We define adjusted operating income (loss) as operating income (loss) excluding:
(i) depreciation, amortization and impairments of property and equipment, goodwill and intangible assets,
(ii) amortization for capitalized cloud computing arrangement costs,
(iii) share-based compensation expense,
(iv) restructuring charges or credits,
(v) merger and acquisition-related costs, net of insurance recoveries,
(vi) gains or losses on sales or dispositions of businesses and associated settlements,
(vii) the impact of purchase accounting adjustments related to business acquisitions, and
(viii) gains and losses related to the remeasurement of liabilities under the Company’s Executive Deferred Compensation Plan (which was established in November 2021).
The Company believes that the exclusion of share-based compensation expense or benefit allows investors to better track the performance of the Company’s business without regard to the settlement of an obligation that is not expected to be made in cash. The Company eliminates merger and acquisition-related costs, when applicable, because the Company does not consider such costs to be
indicative of the ongoing operating performance of the Company as they result from an event that is of a non-recurring nature, thereby enhancing comparability. In addition, management believes that the exclusion of gains and losses related to the remeasurement of liabilities under the Company’s Executive Deferred Compensation Plan provides investors with a clearer picture of the Company’s operating performance given that, in accordance with GAAP, gains and losses related to the remeasurement of liabilities under the Company’s Executive Deferred Compensation Plan are recognized in Operating loss (income) whereas gains and losses related to the remeasurement of the assets under the Company’s Executive Deferred Compensation Plan, which are equal to and therefore fully offset the gains and losses related to the remeasurement of liabilities, are recognized in Other income (expense), net, which is not reflected in Operating loss (income).
The Company believes adjusted operating income (loss) is an appropriate measure for evaluating the operating performance of its business segments and the Company on a consolidated basis. Adjusted operating income (loss) and similar measures with similar titles are common performance measures used by investors and analysts to analyze the Company’s performance. The Company uses revenues and adjusted operating income (loss) measures as the most important indicators of its business performance, and evaluates management’s effectiveness with specific reference to these indicators.
Adjusted operating income (loss) should be viewed as a supplement to and not a substitute for operating income (loss), net income (loss), cash flows from operating activities, and other measures of performance and/or liquidity presented in accordance with GAAP. Since adjusted operating income (loss) is not a measure of performance calculated in accordance with GAAP, this measure may not be comparable to similar measures with similar titles used by other companies. The Company has presented the components that reconcile operating income (loss), the most directly comparable GAAP financial measure, to adjusted operating income (loss).
Information as to the operations of the Company’s reportable segments is set forth below.
Year Ended June 30, 2024
SphereMSG NetworksTotal
Revenues$497,159 $529,730 $1,026,889 
Direct operating expenses(205,307)(342,517)(547,824)
Selling, general and administrative expenses(393,039)(39,814)(432,853)
Depreciation and amortization(248,248)(8,246)(256,494)
Impairment and other losses, net(121,473)— (121,473)
Restructuring charges(9,476)(10)(9,486)
Operating (loss) income(480,384)139,143 (341,241)
Interest income25,687 
Interest expense(79,868)
Other income, net

35,197 
Loss from operations before income taxes$(360,225)
Reconciliation of operating (loss) income to adjusted operating (loss) income:
Operating (loss) income$(480,384)$139,143 $(341,241)
Add back:
Share-based compensation40,514 6,330 46,844 
Depreciation and amortization248,248 8,246 256,494 
Restructuring charges9,476 10 9,486 
Impairment and other losses, net121,473 — 121,473 
Merger and acquisition related costs, net of insurance recoveries(1,176)(11,542)(12,718)
Amortization for capitalized cloud computing costs— 87 87 
Remeasurement of deferred compensation plan liabilities306 — 306 
Adjusted operating (loss) income$(61,543)$142,274 $80,731 
Other information:
Capital expenditures

$259,642 $6,555 $266,197 
Year Ended June 30, 2023
SphereMSG NetworksTotal
Revenues$2,610 $571,221 $573,831 
Direct operating expenses(5,545)(336,666)(342,211)
Selling, general and administrative expenses
(325,660)(126,482)(452,142)
Depreciation and amortization
(24,048)(6,668)(30,716)
Impairment and other gains (losses), net6,229 (109)6,120 
Restructuring charges(23,136)(4,788)(27,924)
Operating (loss) income(369,550)96,508 (273,042)
Interest income11,585 
Interest expense— 
Other income, net536,887 
Income from operations before income taxes$275,430 
Reconciliation of operating (loss) income to adjusted operating (loss) income:
Operating (loss) income$(369,550)$96,508 $(273,042)
Add back:
Share-based compensation36,188 6,419 42,607 
Depreciation and amortization24,048 6,668 30,716 
Restructuring charges23,136 4,788 27,924 
Impairment and other (gains) losses, net(6,229)109 (6,120)
Merger and acquisition related costs(189)55,236 55,047 
Amortization for capitalized cloud computing costs— 161 161 
Remeasurement of deferred compensation plan liabilities187 — 187 
Adjusted operating (loss) income$(292,409)$169,889 $(122,520)
Other information:
Capital expenditures

$1,025,700 $9,185 $1,034,885 
Year Ended June 30, 2022
SphereMSG NetworksTotal
Revenues$1,900 $608,155 $610,055 
Direct operating expenses— (320,278)(320,278)
Selling, general and administrative expenses
(293,664)(126,129)(419,793)
Depreciation and amortization
(13,168)(9,394)(22,562)
Impairment and other gains245 — 245 
Restructuring charges(12,952)(452)(13,404)
Operating (loss) income(317,639)151,902 (165,737)
Interest income3,575 
Interest expense— 
Other expense, net

(5,518)
Loss from operations before income taxes$(167,680)
Reconciliation of operating (loss) income to adjusted operating (loss) income:
Operating (loss) income$(317,639)$151,902 (165,737)
Add back:
Share-based compensation39,668 17,092 56,760 
Depreciation and amortization13,168 9,394 22,562 
Restructuring charges12,952 452 13,404 
Impairment and other gains(245)— (245)
Merger and acquisition related costs20,834 27,683 48,517 
Amortization for capitalized cloud computing costs95 176 271 
Adjusted operating (loss) income$(231,167)$206,699 $(24,468)
Other information:
Capital expenditures

$717,093 $3,673 $720,766 
Accounts receivable, net on the accompanying consolidated balance sheets as of June 30, 2024 and 2023 included amounts due from the following individual customers, substantially derived from the MSG Networks segment, which accounted for the noted percentages of the gross balance:
As of June 30,
20242023
Customer A10 %23 %
Customer B10 %22 %
Customer CN/A17 %
Revenues in the accompanying consolidated statements of operations for Fiscal Years 2024, 2023 and 2022 included amounts from the following individual customers, primarily derived from the MSG Networks segment, which accounted for the noted percentages of the total:
Years Ended June 30,
202420232022
Customer 114 %26 %27 %
Customer 213 %26 %26 %
Customer 310 %21 %21 %
As of June 30, 2024, the Company employed approximately 3,100 full-time and part-time employees, of which approximately 18% are subject to CBAs. Approximately 5% are subject to CBAs that expired as of June 30, 2024 and approximately 39% are subject to CBAs that will expire by June 30, 2025, if they are not extended prior thereto.