Strong Consolidated Financial Results
Q1 revenue of $1.597 billion (+26% year-over-year) and adjusted EBITDA of $550 million (+32% YoY); adjusted EBITDA margin of 34% (≈+150 bps YoY).
TKO Group Holdings
· TKO
May 6th, 2026
Summary
- Earnings Call Date:
- 2026-05-06
- Change Since:
- +7.26%
- Next Earnings Date:
- 2026-08-06
Earnings Call Sentiment
PositiveThe call presented multiple material positives: robust consolidated growth (revenue +26%, adjusted EBITDA +32%), strong segment performances (WWE, IMG, UFC media rights lift), healthy cash generation and an active capital return program, plus confirmed full-year guidance with significant margin expansion. Lowlights were largely timing- and event-specific (fewer UFC Fight Nights, higher launch and one-off event costs including an expected ~$30M loss on Freedom 250), near-term cost pressure from talent and international events, and geopolitical uncertainty in the Middle East which management says is being managed with committed partners. On balance, achievements and momentum materially outweigh the challenges discussed.
Company Guidance
TKO reaffirmed full‑year 2026 guidance targeting $5.675–$5.775 billion of revenue and $2.24–$2.29 billion of adjusted EBITDA (implying ~21% revenue growth, ~43% EBITDA growth and ~600 bps of margin expansion to ~39.6% at the midpoint); Q1 results were $1.597 billion revenue and $550 million adjusted EBITDA (34% margin), up 26% and 32% YoY respectively (margin +150 bps), with LTM adjusted EBITDA of $1.718 billion. Management expects UFC and WWE margins to meaningfully outpace 2025, Q2 to feature 11 UFC events (including Freedom 250, on which they expect an approximate $30 million loss) and WWE’s Q2 to be the largest revenue/EBITDA quarter; they also reiterated media‑rights step‑ups from Paramount and ESPN will drive results. Cash generation and capital returns remain a priority: Q1 free cash flow was $675 million (123% adj EBITDA conversion), they returned ~ $1 billion to shareholders in Q1 (including a ~$150 million/$0.78 per‑share dividend), the Board approved an incremental $1 billion buyback (on top of prior $2 billion), they repurchased $38 million of shares under a 10b5‑1, entered an $800 million ASR (initial ~3.1M shares delivered), closed a $900 million term‑loan add‑on, and finished the quarter with $4.671 billion debt, $789 million cash (+$937 million restricted) and net debt $3.882 billion (net leverage 2.3x).
Reaffirmed Full-Year Guidance with Material Upside
Reaffirmed FY2026 guidance: revenue $5.675B–$5.775B and adjusted EBITDA $2.24B–$2.29B, implying ~21% revenue growth, ~43% adjusted EBITDA growth and ~600 bps margin expansion at the midpoint.
UFC Growth and Media Rights Lift
UFC revenue $401M (+12% YoY) and adjusted EBITDA $255M (+12% YoY); media rights/production revenue up 23% to $275M driven by Paramount+ partnership and CBS simulcast (UFC 326 was the most-watched live UFC event since 2016; CBS audience ~270% above last year's UFC linear average).
WWE Revenue and Margin Expansion
WWE revenue $476M (+22% YoY) and adjusted EBITDA $256M (+32% YoY); adjusted EBITDA margin improved to 54% (+4 percentage points). Media rights revenue +12% to $282M and live events/hospitality revenue +62% to $123M (benefiting from Royal Rumble in Saudi).
IMG Outperformance Driven by Major Events
IMG revenue $655M (+38% YoY) and adjusted EBITDA $97M (+32% YoY); growth driven by On Location (Milano Cortina Olympics) and strong bookings for LA28 and FIFA World Cup experiential hospitality (World Cup sales >2x any prior World Cup).
Zuffa Boxing Early Traction
Zuffa Boxing signed >100 fighters, staged five events with solid Paramount+ viewership, secured a multiyear Sky Sports deal for U.K./Ireland and media rights in 15+ territories—exceeding internal growth plans.
Robust Free Cash Flow and Capital Returns
Generated $675M of free cash flow in Q1 with free cash flow conversion of adjusted EBITDA at 123% (includes $582M net collections for On Location). Returned ~ $1B to shareholders in the quarter via dividends and buybacks; Board authorized an additional $1B repurchase program.
Healthy Balance Sheet and Comfortable Leverage
Ended Q1 with $4.671B debt, $789M cash, $937M restricted cash; net debt $3.882B and net leverage ~2.3x (LTM adjusted EBITDA $1.718B). Management comfortable with leverage profile and expects deleveraging over time.
Live Event Demand and Global Expansion
Multiple sellouts and arena records across UFC and WWE (e.g., >106,000 fans at WrestleMania 42 over two nights; UFC Fight Night highest-ever North America Fight Night gate in Seattle); expanding live events into new markets (Azerbaijan, Serbia, Philadelphia) and leaning into FIP pipeline.
Strategic Partnerships and Distribution Wins
New/expanded deals including Netflix (WWE archive), CW (NXT PLEs), Sky Sports (Zuffa Boxing), Apple/IMG F1 production, and a long-term World Rugby partnership—broadening monetization channels and global reach.
Operator
Hello, everyone. Thank you for joining us, and welcome to TKO's First Quarter 2026 Earnings Call. [Operator Instructions] I will now hand the call over to Seth Zaslow, Head of Investor Relations.
Seth Zaslow
Good afternoon, and welcome to TKO's First 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, will 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 first 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 ongo...
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