Tko targets $5.79b-$5.83b 2026 revenue as it raises outlook again and plans aggressive buybacks

Earnings Call Insights: TKO Group Holdings, Inc. (TKO) Q3 2026

Management View

• “The third quarter is more validation of the live experience secular tailwinds powering TKO.” (COO, President & Director Mark Shapiro) “The vast majority of our existing revenues are locked in for the next 5 to 7 years.”

• “UFC 329 at T-Mobile Arena in Las Vegas was the highest grossing event in UFC history with a $26 million gate.” (COO, President & Director Shapiro) “We drove nearly 16 million viewers to Paramount+, peaking at 8.3 million concurrent streams, a record-breaking audience on the platform.”

• “We intend to use new debt and cash on hand to complete share repurchases under our previously authorized $3 billion repurchase program.” (COO, President & Director Shapiro) “We will be in the market aggressively buying back stock.”

• “We generated consolidated revenue of $1.36 billion.” (Chief Financial Officer Andrew Schleimer) “Adjusted EBITDA was $556 million, yielding a 41% margin.”

Outlook

• “We have raised our full year outlook for the second consecutive quarter.” (Chief Financial Officer Schleimer) “We are now targeting revenue of $5.79 billion to $5.83 billion and adjusted EBITDA of $2.295 billion to $2.315 billion.”

• “Our full year outlook assumes the slate of events scheduled in the region, including a WWE PLE and 2 UFC Fight Nights, move forward as planned.” (Chief Financial Officer Schleimer) “If we're unable to stage these events, our current outlook would be impacted.”

• “We're not going to be providing formal guidance for '27 until our Q4 call in February.” (Chief Financial Officer Schleimer) “At that day, we look to look past 2027 and articulate our plans for the long-term growth trajectory across each of our revenue streams.”

Financial Results

• “Revenue increased 21%, adjusted EBITDA increased 54% and adjusted EBITDA margin increased approximately 870 basis points as compared to the prior year.” (Chief Financial Officer Schleimer)

• “In the quarter, UFC generated revenue of $519 million, up 60%.” (Chief Financial Officer Schleimer) “Adjusted EBITDA was $285 million… and UFC's adjusted EBITDA margin was 55%.”

• “WWE generated revenue of $399 million in the quarter, down 1%.” (Chief Financial Officer Schleimer) “Adjusted EBITDA was $217 million… [and] adjusted EBITDA margin was 54%.”

• “We generated revenue of $391 million” at IMG and “adjusted EBITDA was $116 million.” (Chief Financial Officer Schleimer) “For the full year, we recorded approximately $90 million of adjusted EBITDA for this event, meaningfully exceeding our estimate of approximately $75 million.”

• “In the third quarter, we generated $450 million of free cash flow.” (Chief Financial Officer Schleimer) “We ended the quarter with $4.647 billion in debt and $631 million in cash and cash equivalents in addition to $959 million of restricted cash.”

Q&A

• Stephen Laszczyk, Goldman Sachs Group, Inc., Research Division: asked about Middle East conflict risk and contingencies; COO, President & Director Shapiro replied, “the risk is extremely minimal… We have 3 events left this year… We are all systems go,” and added on WrestleMania, “we have already been paid half upfront… come rain or shine, we're getting the other half payment.”

• Stephen Laszczyk, Goldman Sachs Group, Inc., Research Division: asked for more color on 2027 growth drivers; Chief Financial Officer Schleimer said, “we're not going to be providing formal guidance for '27 until our Q4 call in February,” and highlighted a planning focus on “margin expansion and free cash flow conversion across our entire portfolio.”

• Brandon Ross, LightShed Partners, LLC: questioned whether lower SummerSlam and WrestleMania ticket performance signaled a ceiling; COO, President & Director Shapiro answered, “there's nothing here. These are ghosts,” and cited recent strength including, “we had our highest gate ever at the Barclays Center.”

• Brandon Ross, LightShed Partners, LLC: asked what becomes possible now that the Skydance deal is closed; COO, President & Director Shapiro said, “we will be maximizing HBO, TNT, Paramount+, CBS, all in the name of expanding eyeballs.”

• Sean Diffley, Morgan Stanley, Research Division: asked about WWE partnerships drivers and UFC fighter pay; Chief Financial Officer Schleimer said on athlete compensation, “I don't think there's a read-through… where incremental athlete compensation is going to be required, which would impact our margins,” and on WWE partnerships cited “new inventory… inclusive of some of the media that we have on ESPN that we retain commercial inventory in that deal.”

• David Karnovsky, JPMorgan Chase & Co, Research Division: asked about the Saudi relationship timeline and WrestleMania 2027 economics; COO, President & Director Shapiro said, “our partners in Saudi have been stupendous,” while Chief Financial Officer Schleimer added, “our partners in Saudi… do retain the box office,” and “this is an event… legislated in our deal with ESPN and will actually be U.S. prime for a WrestleMania PLE.”

• Peter Supino, Wolfe Research, LLC: asked about Zuffa Boxing building blocks and what could go wrong; Chief Financial Officer Schleimer replied, “boxing… initiatives are ahead of schedule,” and COO, President & Director Shapiro said, “the challenge… you've got to build stars… build storylines… That takes time.”

Sentiment Analysis

• Analyst tone was slightly negative to neutral, led by risk and demand durability probes such as, “how we should be thinking about the risk if the conflict does intensify” (Stephen Laszczyk, Goldman Sachs Group, Inc., Research Division) and “Is there a trend here that you're somehow hitting a ceiling” (Brandon Ross, LightShed Partners, LLC).

• Management tone was positive and assertive, including, “the risk is extremely minimal” (COO, President & Director Shapiro) and “we expect to be aggressively buying back our stock” (Chief Financial Officer Schleimer).

• Versus Q2, management again emphasized execution and visibility, but Q3 showed sharper capital-return language (“aggressively buying back stock”) and a more explicit geopolitical-risk framing tied to guidance (“If we're unable to stage these events, our current outlook would be impacted.”).

Quarter-over-quarter Comparison

• Q3 raised full-year guidance “for the second consecutive quarter” (Chief Financial Officer Schleimer), following Q2’s guidance raise; Q3 described the increase as “$10 million and $15 million… at the midpoint” versus the “$75 million and $25 million” midpoint increase described in Q2.

• Q2 included prepared remarks from “Executive Chair & CEO” Ariel Emanuel; Q3 prepared remarks were led by COO, President & Director Shapiro and Chief Financial Officer Schleimer.

• Q2 discussion highlighted UFC Freedom 250’s “approximately $30 million loss” (Chief Financial Officer Schleimer, Q2) as a margin headwind; Q3 emphasized margin expansion and reiterated expectations that “UFC margin profile” and “WWE margins will increase meaningfully in Q4 and for the full year” (Chief Financial Officer Schleimer).

• Q2 Q&A featured explicit denial of large M&A (“We are not hunting for M&A of any kind.”) (COO, President & Director Shapiro, Q2); Q3 Q&A shifted analyst focus more toward Middle East event continuity and WWE live-event demand signals.

Risks and Concerns

• “We continue to closely monitor developments in the Middle East.” (Chief Financial Officer Schleimer) “If we're unable to stage these events, our current outlook would be impacted.”

• “The challenge is with any sport… You've got to build stars… build storylines… That takes time.” (COO, President & Director Shapiro)

• “Our partners in Saudi… do retain the box office.” (Chief Financial Officer Schleimer)

Final Takeaway

Management described Q3 as another “beat-and-raise” quarter driven by UFC live-event strength, higher media-rights fees under the Skydance agreement, and accelerating partnerships momentum, while reiterating that full-year 2026 guidance assumes Middle East events proceed as scheduled. Executives also emphasized capital returns, stating they plan to use cash and new debt to complete repurchases under the $3 billion authorization and expect to be “aggressively buying back” shares, alongside continued planning for 2027 disclosures and an Investor Day aimed at laying out longer-term growth drivers across partnerships, live events, and Zuffa Boxing.

Read the full Earnings Call Transcript

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