UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

____________________

FORM 10-Q

____________________

	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2024
or
	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ______ to ______

Commission File Number: 001-41797

TKO GROUP HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

Delaware	92-3569035
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

200 Fifth Ave, 7th Floor

New York**,** NY 10010

(Address of principal executive offices)

(646) 558-8333

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A Common Stock, par value $0.00001 per share	TKO	The New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2) has been subject to such filing requirements for the past 90 days. Yes  No 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes  No 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer ¨	Accelerated Filer ¨	Non-Accelerated Filer x	Smaller Reporting Company ¨			Emerging Growth Company ¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes  No 

As of July 31, 2024, there were 81,023,476 shares of the Registrant’s Class A common stock outstanding and 89,616,891 shares of the Registrant’s Class B common stock outstanding.

Table of Contents

TABL****E OF CONTENTS

	Page #
Part I – FINANCIAL INFORMATION
Item 1. Financial Statements (unaudited)	6
Consolidated Balance Sheets as of June 30, 2024 and December 31, 2023	6
Consolidated Statements of Operations for the three and six months ended June 30, 2024 and 2023	7
Consolidated Statements of Comprehensive Income (Loss) for the three and six months ended June 30, 2024 and 2023	8
Consolidated Statements of Stockholders’ Equity for the three and six months ended June 30, 2024 and 2023	9
Consolidated Statements of Cash Flows for the six months ended June 30, 2024 and 2023	10
Notes to Consolidated Financial Statements	11
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	30
Item 3. Quantitative and Qualitative Disclosures about Market Risk	41
Item 4. Controls and Procedures	41
Part II – OTHER INFORMATION	42
Item 1. Legal Proceedings	42
Item 1A. Risk Factors	42
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	42
Item 6. Exhibits	42
Signatures	44

‎

FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (the “Quarterly Report”) contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended (the "Securities Act") and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). All statements other than statements of present and historical fact contained in this Quarterly Report, including without limitation, statements regarding the anticipated benefits of and costs associated with the Transactions (as defined below); our expectations surrounding the Transactions and our ability to grow our business and bolster our financial position; our expected contractual obligations and capital expenditures; our future results of operations and financial position; industry and business trends; the impact of market conditions and other macroeconomic factors on our business, financial condition and results of operations; our future business strategy, plans, market growth and our objectives for future operations; and our competitive market position within our industry are forward-looking statements.

Without limiting the foregoing, you can generally identify forward-looking statements by the use of forward-looking terminology, including the terms “aim,” "anticipate," "believe," "could," “mission,” "may," "will," "should," "expect," "intend," "plan," "estimate," "project," "predict," "potential," “target,” "contemplate," or, in each case, their negative, or other variations or comparable terminology and expressions. The forward-looking statements in this Quarterly Report are only predictions and are based on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition, and results of operations. These forward-looking statements speak only as of the date of this Quarterly Report and are subject to a number of known and unknown risks, uncertainties and assumptions, including but not limited to:

difficulties with the integration and in realizing the expected benefits of the Transactions, including the business combination;

the unfavorable outcome of legal proceedings that may be instituted against TKO Group Holdings, UFC, WWE and their affiliates in connection with the Transactions, including the business combination;

the inability to capture all or part of the anticipated cost and revenue synergies;

potential liabilities that are not known, probable or estimable at this time;

the inability to maintain the listing of our Class A common stock on the NYSE;

the risk of adverse tax consequences of the Merger and the Conversion;

the inability to retain WWE or UFC management, employees and/or talent;

the impact of future domestic and international industry trends on our business and our future growth, business strategy and objectives for future operations;

the inability to renew or replace our distribution rights agreements on equal or more favorable terms;

the possibility we may be adversely affected by other economic, business and/or competitive factors; and

other important factors that could cause actual results, performance or achievements to differ materially from those described in Part I, Item 1A. “Risk Factors” and Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023 (the “2023 Annual Report”), and Part I, Item 2. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this Quarterly Report and in our subsequent filings with the Securities and Exchange Commission (the “SEC”).

These risks could cause our actual results to differ materially from those implied by forward-looking statements in this Quarterly Report. Moreover, we operate in an evolving environment. New risk factors and uncertainties may emerge from time to time, and it is not possible for management to predict all risk factors and uncertainties. Even if our results of operations, financial condition and liquidity and the development of the industry in which we operate are consistent with the forward-looking statements contained in this Quarterly Report, those results or developments may not be indicative of results or developments in subsequent periods.

You should read this Quarterly Report and the documents that we reference herein completely and with the understanding that our actual future results may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements. Except as required by applicable law, we have no obligation to update or revise any forward-looking statements contained herein, whether as a result of any new information, future events, changed circumstances or otherwise.

Available Information and Website Disclosure

We are required to file annual, quarterly and current reports, proxy statements and other information with the SEC. Our filings with the SEC are also available to the public through the SEC’s website at www.sec.gov.

You can also find more information about us online at our investor relations website located at investor.tkogrp.com. Filings we make with the SEC and any amendments to those reports are available free of charge on our website as soon as reasonably practicable after we electronically file such material with the SEC. The information posted on or accessible through our website is not incorporated into this Quarterly Report.

Investors and others should note that we announce material financial and operational information to our investors using press releases, SEC filings and public conference calls and webcasts, and by postings on our investor relations site at investor.tkogrp.com. We may also use our website as a distribution channel for material Company information. In addition, you may automatically receive email alerts and other information about TKO when you enroll your email address by visiting the “Investor Email Alerts” option under the Resources tab on investor.tkogrp.com.

DEFINITIONS

As used in this Quarterly Report, unless we state otherwise or the context otherwise requires:

“we,” “us,” “our,” “TKO Group Holdings,” “TKO,” the “Company,” and similar references refer (1) prior to the consummation of the Transactions to Zuffa Parent, LLC, and (2) after the consummation of the Transactions to TKO Group Holdings, Inc. and its consolidated subsidiaries.

“Board” refers to the board of directors of TKO Group Holdings.

“business combination” refers to the combination of the businesses of WWE and TKO OpCo.

“Class A common stock” refers to the Class A common stock, par value $0.00001 per share, of TKO.

“Class B common stock” refers to the Class B common stock, par value $0.00001 per share, of TKO.

“DGCL” refers to the General Corporation Law of the State of Delaware.

“Endeavor” refers to Endeavor Group Holdings, Inc., a Delaware corporation.

“Endeavor OpCo” refers to Endeavor Operating Company, LLC, a Delaware limited liability company and subsidiary of Endeavor.

“fully-diluted basis” means on a basis calculated assuming the full cash exercise (and not net settlement but, for the avoidance of doubt, including the conversion of the Convertible Notes (to the extent not converted prior to closing of the Transaction)) of all outstanding options, warrants, restricted stock units, performance stock units, dividend equivalent rights and other rights and obligations (including any promised equity awards and assuming the full issuance of the shares underlying such awards) to acquire voting interests of TKO Group Holdings (without regard to any vesting provisions and, with respect to any promised awards whose issuance is conditioned in full or in part based on achievement of performance goals or metrics, assuming achievement at target performance) and the full conversion, exercise, exchange, settlement of all issued and outstanding securities convertible into or exercisable, exchangeable or settleable for voting interests of TKO Group Holdings, not including any voting interests of TKO Group Holdings reserved for issuance pursuant to future awards under any option, equity bonus, share purchase or other equity incentive plan or arrangement of TKO Group Holdings (other than promised awards described above), and any other interests or shares, as applicable, that may be issued or exercised. For the avoidance of doubt, this definition assumes no net settlement or other reduction in respect of withholding tax obligations in connection with the issuance, conversion, exercise, exchange or settlement of such rights or obligations to acquire interests of TKO Group Holdings as described in the foregoing.

“NYSE” refers to the New York Stock Exchange.

“Services Agreement” means the services agreement dated as of September 12, 2023, by and between Endeavor and TKO OpCo.

“TKO OpCo” refers to TKO Operating Company, LLC (f/k/a Zuffa Parent LLC), a Delaware limited liability company and our direct subsidiary.

“TKO OpCo Units” refers to all of the existing equity interests in TKO OpCo.

“Transactions” refer, collectively, to the transactions pursuant to the Transaction Agreement (defined below) pursuant to which: (i) WWE undertook certain internal restructuring steps; (ii) Whale Merger Sub Inc. (“Merger Sub”) merged with and into WWE (the “Merger”), with WWE surviving the Merger (the “Surviving Entity”) and becoming a direct wholly owned subsidiary of the Company; (iii) immediately following the Merger, the Company caused the Surviving Entity to be converted into a Delaware limited liability company (“WWE LLC”) and the Company became the sole managing member of WWE LLC (the “Conversion”); and (iv) following the Conversion, TKO Group Holdings, Inc. (x) contributed all of the equity interests of WWE LLC to TKO OpCo in exchange for 49% of the membership interests in TKO OpCo on a fully diluted basis, and (y) issued to Endeavor OpCo and certain of Endeavor’s other subsidiaries a number of shares of our Class B common stock representing, in the aggregate, approximately 51% of the total voting power of the Company’s stock on a fully-diluted basis, in exchange for a payment equal to the par value of such Class B common stock.

“Transaction Agreement” refers to the transaction agreement, dated as of April 2, 2023, by and among Endeavor, Endeavor OpCo, TKO OpCo, WWE, the Company, and Merger Sub.

“UFC” refers to the Ultimate Fighting Championship.

“WWE” refers to World Wrestling Entertainment, Inc. (n/k/a World Wrestling Entertainment, LLC).

“Zuffa” refers to Zuffa Parent, LLC (n/k/a TKO Operating Company, LLC or TKO OpCo).

Table of Contents

PART I. FINANCIAL INFORMATION

TKO GROUP HOLDINGS, INC.

Consolidated Balance Sheets

(In thousands, except share data)

(Unaudited)

		As of June 30,			As of December 31,
		2024			2023
Assets
Current assets:
Cash and cash equivalents		$	277,532		$	235,839
Accounts receivable (net of allowance for doubtful accounts of $2,145 and $1,093, respectively)			294,715			135,436
Other current assets			176,919			121,155
Total current assets			749,166			492,430
Property, buildings and equipment, net			548,105			608,416
Intangible assets, net			3,401,891			3,563,663
Finance lease right-of-use assets, net			236,266			255,709
Operating lease right-of-use assets, net			34,530			35,508
Goodwill			7,665,280			7,666,485
Investments			15,956			16,392
Other assets			68,618			52,136
Total assets		$	12,719,812		$	12,690,739
Liabilities, Non-controlling Interests and Stockholders' Equity
Current liabilities:
Accounts payable		$	31,879		$	42,040
Accrued liabilities			571,141			267,363
Current portion of long-term debt			22,247			22,367
Current portion of finance lease liabilities			10,308			8,135
Current portion of operating lease liabilities			4,570			4,246
Deferred revenue			99,545			118,992
Other current liabilities			13,498			8,997
Total current liabilities			753,188			472,140
Long-term debt			2,702,820			2,713,948
Long-term finance lease liabilities			225,578			245,288
Long-term operating lease liabilities			31,269			32,911
Deferred tax liabilities			372,953			372,860
Other long-term liabilities			5,860			3,046
Total liabilities			4,091,668			3,840,193
Commitments and contingencies (Note 17)
Redeemable non-controlling interests			13,079			11,594
Stockholders' equity:
Class A common stock: ($0.00001 par value; 5,000,000,000 shares authorized; 80,712,758 and 82,292,902 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively)			1			1
Class B common stock: ($0.00001 par value; 5,000,000,000 shares authorized; 89,616,891 and 89,616,891 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively)			1			1
Additional paid-in capital			4,339,217			4,244,537
Accumulated other comprehensive loss			(1,174)			(332)
Accumulated deficit			(346,425)			(135,227)
Total TKO Group Holdings, Inc. stockholders’ equity			3,991,620			4,108,980
Nonredeemable non-controlling interests			4,623,445			4,729,972
Total stockholders' equity			8,615,065			8,838,952
Total liabilities, redeemable non-controlling interests and stockholders' equity		$	12,719,812		$	12,690,739

See accompanying notes to consolidated financial statements.

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TKO GROUP HOLDINGS, INC.

Consolidated Stateme****nts of Operations

(In thousands, except share and per share data)

(Unaudited)

		Three Months Ended June 30,						Six Months Ended June 30,
		2024			2023			2024			2023
Revenue		$	851,161		$	305,185		$	1,480,872		$	611,915
Operating expenses:
Direct operating costs			259,792			82,789			460,807			171,941
Selling, general and administrative expenses			232,602			63,476			764,482			119,822
Depreciation and amortization			103,819			15,050			210,980			30,202
Total operating expenses			596,213			161,315			1,436,269			321,965
Operating income			254,948			143,870			44,603			289,950
Other expenses:
Interest expense, net			(65,758)			(57,895)			(130,224)			(111,803)
Other income (expense), net			775			(535)			504			(864)
Income (loss) before income taxes and equity (earnings) losses of affiliates			189,965			85,440			(85,117)			177,283
Provision for income taxes			39,574			2,869			14,052			6,499
Income (loss) before equity (earnings) losses of affiliates			150,391			82,571			(99,169)			170,784
Equity (earnings) losses of affiliates, net of tax			(273)			717			(323)			980
Net income (loss)			150,664			81,854			(98,846)			169,804
Less: Net income (loss) attributable to non-controlling interests			91,557			440			(54,113)			788
Less: Net income attributable to TKO Operating Company, LLC prior to the Transactions			—			81,414			—			169,016
Net income (loss) attributable to TKO Group Holdings, Inc.		$	59,107		$	—		$	(44,733)		$	—
Basic net earnings (loss) per share of Class A common stock (1)		$	0.73			N/A		$	(0.55)			N/A
Diluted net earnings (loss) per share of Class A common stock (1)		$	0.72			N/A		$	(0.55)			N/A
Weighted average number of common shares used in computing basic earnings (loss) per share			80,884,513			N/A			81,618,084			N/A
Weighted average number of common shares used in computing diluted net earnings (loss) per share			81,851,388			N/A			81,618,084			N/A

(1)Basic and diluted net earnings (loss) per share of Class A common stock is applicable only for the period from January 1, 2024 through June 30, 2024, which is the period following the Transactions (as defined in Note 1 to the unaudited consolidated financial statements). See Note 14, Earnings Per Share, for the calculation of the number of shares used in computation of net earnings (loss) per share of Class A common stock and the basis for computation of net earnings (loss) per share.

‎

See accompanying notes to consolidated financial statements.

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TKO GROUP HOLDINGS, INC.

Consolidated Statements of Compreh****ensive Income (Loss)

(In thousands)

(Unaudited)

		Three Months Ended June 30,						Six Months Ended June 30,
		2024			2023			2024			2023
Net income (loss)		$	150,664		$	81,854		$	(98,846)		$	169,804
Other comprehensive income (loss), net of tax:
Foreign currency translation adjustments			912			(1,101)			(1,276)			(1,132)
Cash flow hedges:
Change in net unrealized gains (losses)			49			(252)			586			201
Amortization of cash flow hedge fair value to net income			(76)			(76)			(152)			(152)
Total comprehensive income (loss), net of tax			151,549			80,425			(99,688)

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Our business, financial condition and operating results can be affected by a number of factors, whether currently known or unknown, including but not limited to those described as risk factors, any one or more of which could, directly or indirectly, cause our actual operating results and financial condition to vary materially from past, or anticipated future, operating results and financial condition. For a discussion of these potential risks and uncertainties, see Part I, Item 1A. "Risk Factors" in our 2023 Annual Report. Any of these factors, in whole or in part, could materially and adversely affect our business, financial condition, operating results and the price of our common stock. There have been no material changes in our risk factors to those included in our 2023 Annual Report.

Ite****m 2. Unregistered Sales of Equity Securities and Use of Proceeds

The following table presents information with respect to purchases of Class A common stock of the Company made during the three months ended June 30, 2024:

Period		Total Number of Shares Purchased (1)		Average Price Paid Per Share			Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (in Thousands)
April 1, 2024 to April 30, 2024		1,853,724		$	89.01		1,853,724		$	—
May 1, 2024 to May 31, 2024		—		$	—		—		$	—
June 1, 2024 to June 30, 2024		—		$	—		—		$	—
Total		1,853,724					1,853,724

(1)On April 7, 2024, we entered into a stock purchase agreement with Vincent McMahon, pursuant to which we agreed to purchase 1,853,724 shares of TKO Class A common stock held by Mr. McMahon at a per share price of $89.01 for an aggregate of $165.0 million (the “Share Repurchase”). The Company funded the Share Repurchase with approximately $150.0 million of borrowings under the Revolving Credit Facility and with cash on hand. See Note 11, Stockholders’ Equity, to our unaudited consolidated financial statements included in this Quarterly Report for additional information regarding the Share Repurchase.

Item 6. Exhibits

Exhibit Number	Description	Form	File No.	Exhibit	Filing Date	Filed/Furnished Herewith
2.1#	Transaction Agreement, dated April 2, 2023, by and among Endeavor Group Holdings, Inc., Endeavor Operating Company, LLC, Zuffa Parent, LLC, World Wrestling Entertainment, Inc., New Whale Inc., and Whale Merger Sub Inc.	424(b)(3)	333-271893	Annex A	08/22/2023
3.1	Amended and Restated Certificate of Incorporation of TKO Group Holdings, Inc.	S-8	333-274480	4.1	09/12/2023
3.2	Amended and Restated Bylaws of TKO Group Holdings, Inc.	S-8	333-274480	4.2	09/12/2023
4.1	Registration Rights Agreement, dated as of September 12, 2023, by and among TKO Group Holdings, Inc., Endeavor Group Holdings, Inc. and Vincent K. McMahon.	8-K	001-41797	4.1	09/12/2023
4.2	Indenture between World Wrestling Entertainment, Inc. and U.S. Bank National Association, as trustee, dated December 16, 2016.	8-K	001-16131	4.1	12/16/2016
4.3	Form of 3.375% Convertible Senior Note due 2023.	8-K	001-16131	4.1	12/16/2016
4.4	First Supplemental Indenture, among World Wrestling Entertainment, Inc., New Whale Inc. and U.S. Bank Trust Company, National Association, as trustee.	8-K	001-16131	4.2	09/12/2023

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10.1#	Fourth Refinancing Agreement, dated as of May 1, 2024, among Zuffa Guarantor, LLC, UFC Holdings, LLC, the lenders party thereto and Goldman Sachs Bank USA, as administrative agent.	10-Q	001-41797	10.1	05/08/2024
10.9	TKO Stock Purchase Agreement, dated April 7, 2024. by and between TKO Group Holdings, Inc. and Vincent K. McMahon.	10-Q	001-41797	10.9	05/08/2024
31.1	Certification of Principal Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.					*
31.2	Certification of Principal Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.					*
32.1	Certification of Principal Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.					**
32.2	Certification of Principal Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.					**
101.INS	Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.					*
101.SCH	Inline XBRL Taxonomy Extension Schema Document.					*
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document.					*
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document.					*
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document.					*
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document.					*
104	Cover Page Interactive Data File – formatted as Inline XBRL and contained in Exhibit 101.					*

• Filed herewith.

** Furnished herewith.

Annexes, schedules and/or exhibits have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Registrant undertakes to furnish supplemental copies of any of the omitted schedules or similar attachments upon request by the SEC.

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SIGNAT****URES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

		TKO GROUP HOLDINGS, INC.
Date:	August 8, 2024	By:	/s/ ANDREW SCHLEIMER
			Andrew Schleimer
			Chief Financial Officer
			(principal financial officer and authorized
			signatory)
Date:	August 8, 2024	By:	/s/ SHANE KAPRAL
			Shane Kapral
			Chief Accounting Officer
			(principal accounting officer and authorized
			signatory)