TKO tops Q3 profit estimates but misses on revenue

TKO Group Holdings said on Nov. 4 that third-quarter diluted earnings of $1.33 per share topped the $1.21 consensus estimate, while revenue of $1.36 billion came in below the $1.39 billion estimate.

The company also raised its full-year 2026 revenue and Adjusted EBITDA guidance, and said it intends to commence additional share repurchases.

Adjusted EBITDA, or earnings before interest, taxes, depreciation and amortization, plus specified adjustments, rose to $555.7 million.

Here's how the company did:

• Revenue: $1.36 billion vs. $1.12 billion a year earlier, below the $1.39 billion estimate
• Diluted EPS: $1.33 vs. $0.47 a year earlier, topped the $1.21 estimate
• Net income: $277.9 million vs. $106.8 million a year earlier
• Adjusted EBITDA: $555.7 million vs. $360.2 million a year earlier

Revenue rose 21%, or $240.2 million, from a year earlier. Adjusted EBITDA margin increased to 41% from 32%.

Segment results

UFC revenue rose 60%, or $194.0 million, to $519.2 million. The company said the increase reflected a new distribution agreement with Skydance that began in January 2026.

WWE revenue decreased 1%, or $2.8 million, to $399.3 million, as live events and hospitality revenue fell.

IMG revenue increased 16%, or $54.6 million, to $391.3 million. The company said the gain was primarily driven by FIFA World Cup 2026 hospitality sales at On Location.

Adjusted EBITDA was $285.3 million at UFC, $217.2 million at WWE and $115.9 million at IMG.

Cash flow and debt

Cash generated by operating activities was $472.1 million, up from $416.8 million a year earlier. Free cash flow was $449.9 million, compared with $398.9 million.

As of Sept. 30, the company held $630.9 million in cash and cash equivalents and had gross debt of $4.647 billion.

2026 guidance

The company raised its revenue forecast to $5.790 billion to $5.830 billion, from the $5.775 billion to $5.825 billion range it gave on Aug. 3. Its Adjusted EBITDA forecast now stands at $2.295 billion to $2.315 billion, up from $2.275 billion to $2.305 billion.

The company said the forecast assumes it stages all live events, including those in the Middle East region, as currently planned.

Share repurchases

President and COO Mark Shapiro said the raised guidance was “the clearest expression of our conviction across the entire portfolio.”

As of Nov. 4, the company had about $936.0 million left under its $3 billion share repurchase authorization. It expects to repurchase the balance and intends to fund it primarily from additional debt and cash on hand.

The company paid a quarterly dividend of $0.79 per share on Sept. 30.