Endeavor Group Holdings posted mixed results for its fourth quarter of 2024 as its net losses widened to $237.2 million.
Lower profits and revenue in its events, experiences and rights segment and an operating loss in its sports, data & technology segment weighed down the overall results. Those divisions were offset by strong profit and revenue growth in Endeavor’s representation and owned sports properties divisions, driven by WME, its non-scripted business, WWE, UFC and Professional Bull Riders.
“We closed out 2024 with continued momentum reflecting strong demand for premium content and live events,” Endeavor CEO Ari Emanuel said in a statement. “Over the next few months, our focus remains on completing our sale of IMG, On Location, and PBR to TKO; closing our take-private transaction with Silver Lake; and ensuring Endeavor is well-positioned for long-term success in representation.”
Here are the top-line results:
Net Loss: $237.2 million, widening from $29.3 million a year ago. Net losses for 2024 came in at $1.22 billion, compared to $557.5 million in 2023.
Revenue: $1.57 billion, compared to an estimated $1.5 billion expected by analysts surveyed by Zacks Investment Research. For the full year, revenue came in at $7.1 billion.
Earnings Per Share: A loss of 64 cents per share, compared to a profit of 36 cents per share expected by analysts surveyed by Zacks Investment Research.
Adjusted EBITDA: $277.1 million, compared to $266.2 million a year ago. For the full year, adjusted EBITDA was $1.32 billion, compared to $1.14 billion in 2023.
Silver Lake is set to acquire Endeavor and take it private at an equity value of $13 billion. When consolidating TKO Group Holdings’ value into Endeavor, the private equity firm estimates the company has a total enterprise value of $25 billion.
The transaction, which is expected to close in the first quarter of 2025, is subject to the satisfaction of customary closing conditions and required regulatory approvals. No other stockholder approval is required. TKO is not party to this transaction and will remain a publicly traded company.
Under the terms of the agreement, Silver Lake which holds approximately 71% of Endeavor’s voting power, will acquire 100% of the outstanding shares it does not already own, other than rolled interests. Endeavor stockholders will receive $27.50 per share in cash, representing a 55% premium to the unaffected share price of $17.72 per share at market close on Oct. 25, 2023, the last full day of trading prior to announcing a review of strategic alternatives.
Endeavor is also required to declare and pay a dividend of 6 cents per share in respect of each issued and outstanding share of Class A common stock in each calendar quarter prior to closing.
In October, TKO entered into an agreement to acquire PBR, On Location, and IMG in an all-equity transaction valued at $3.25 billion. Following the transaction’s closing, which is expected within the first half of 2025, Endeavor is expected to own approximately 61% of TKO. The acquisition of IMG does not include businesses associated with the IMG brand in licensing, models and tennis representation, nor IMG’s full events portfolio.
Endeavor also revealed it is reviewing a possible sale of certain events within its portfolio, including but not limited to the Miami Open and Madrid Open tennis tournaments and art platform Frieze. No definitive timetable has been set for completion of the review process, and there’s no assurance the review will result in any specific action.
The Owned Sports Properties segment grew its profit 6% to $237.2 million for the quarter and 54% to $1.28 billion for the year. Revenue for the segment grew 4% to $670.4 million for the quarter and 64% to $2.99 billion for the year, driven by the WWE acquisition in September 2023, which contributed $1 billion, increases at UFC from sponsorships, live event revenue, and site fees, as well as higher media rights fees from contractual escalations and PBR team-related revenue, brand partnerships and ticket sales.
The Representation segment saw profits climb 5% to $108.2 million for the quarter and 4% to $405.7 million for the year. Revenue grew 17% to $501.6 million for the quarter and 9% to $1.69 billion for the year, driven by WME’s growth across talent, music and sports, as well as an increase in its non-scripted business, primarily due to an acquisition in 2024.
The Events, Experiences & Rights segment saw profit fall 20% to $11 million for the quarter and swung to a loss of 29.8 million for the full year. Revenue for the segment fell 1% to $411.9 million for the quarter, but grew 16% to $2.529 billion for the year, driven by the Paris 2024 Olympic and Paralympic Games, Super Bowl LVIII, and the Miami Open and Madrid Open tennis tournaments, partially offset by the sale of IMG Academy in June 2023.
In August, Endeavor revealed it was actively marketing its Sports, Data & Technology segment, which includes OpenBet and IMG Arena. As a result, the businesses are considered held for sale and presented as discontinued operations. During the fourth quarter, the segment posted a loss of $4.29 million, down from a loss of $7.2 million in the year-ago period. In November, Endeavor entered into an agreement to sell the assets to OB Global Holdings LLC in a $450 million management buyout backed by Emanuel with participation from executives of OpenBet.
As of Dec. 31, Endeavor had total cash and cash equivalents of $1.004 billion and total debt of $5.68 billion. Endeavor did not hold an earnings call in connection with the Silver Lake transaction.
