TKO 10-K & 10-Q changes, risk factors and insider trading

Investing in our Class A common stock involves substantial risks. You should carefully consider the following factors, together with all of the other information included in this Annual Report on Form 10-K,Report, including under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the consolidated financial statements and the related notes included elsewhere in this Annual Report on Form 10-K before investing in our Class A common stock. Any of the risk factors we describe below could adversely affect our business, financial condition or results of operations. The market price of our Class A common stock could decline if one or more of these risks or uncertainties develop into actual events, causing you to lose all or part of your investment. We cannot assure you that any of the events discussed below will not occur. Please also see “Forward-Looking Statements” for more information.

Our business depends on discretionary consumer and corporate spending. Many factors related to corporate spending and discretionary consumer spending, including economic conditions affecting disposable consumer income such as unemployment levels, fuel prices, interest rates, changes in tax rates, tax laws that impact companies or individuals, and inflation, can significantly impact our operating results. While consumer and corporate spending may decline at any time for reasons beyond our control, the risks associated with our businesses become more acute in periods of a slowing economy or recession, which may be accompanied by reductions in corporate sponsorshipsponsorships and advertising, decreases in attendance at live events, and purchasesdecreases ofin pay-per-viewconsumer (“PPV”),spending on merchandising, among other things. There can be no assurance that consumer and corporate spending will not be adversely impacted by economic and geopolitical conditions, or by any future deterioration in economic conditions, thereby possibly impacting our operating results and growth. A prolonged period of reduced consumer or corporate spending, such as those that occurred during the COVID-19 pandemic, could have an adverse effect on our business, financial condition, and results of operations.

We depend on key relationships with television and cable networks, satellite providers, digital streaming partners and other distribution partners. Our failure to maintain, renew or replace key agreements could adversely affect our ability to distribute our media content, WWE Network and/or other of our goods and services, which could adversely affect our operating results.

A key component of our success is our relationships with television and cable networks, satellite providers, digital streaming and other distribution partners, as well as corporate sponsors.partners. We are dependent on maintaining these existing relationships and expanding upon them so that we have a robust network with which we can work to arrange multimedia rights sales and sponsorship engagements,sales, including distribution of our events and media content. Our television programming for our events is distributed by television and cable networks, satellite providers, PPV,pay-per-view (“PPV”), digital streaming, and other media. We have depended on, and will continue to depend on, third parties for many aspects of the operations and distribution of WWE Network. We have an important relationship with ESPN as they are the exclusive domestic distributor of all UFC events. Because a large portion of our revenues are generated, directly and indirectly, from the distribution of our events, any failure to maintain or renew arrangements with distributors and platforms, the failure of distributors or platforms to continue to provide services to us, or the failure to enter into new distribution opportunities on terms favorable to us could adversely affect our business. We regularly engage in negotiations relating to substantial agreements covering the distribution of our television programmingcontent by carriers located in the United States and abroad. We have agreements with multiple PPV providers globally and distribute a portion of our events through PPV, including certain events that are sold exclusively through PPV. BeginningWe Januaryhave 2025,important relationships with (i) Paramount, as the exclusive distributor for all UFC Numbered Events and UFC Fight Nights throughout the U.S. and Latin America and as exclusive distributor of UFC Fight Nights in Australia, as well as the exclusive distributor of Zuffa Boxing throughout the U.S. and distributor of certain PBR programming, (ii) ESPN as the exclusive distributor for all WWE PLEs in the U.S., (iii) Netflix becameas the exclusive global home tofor Raw.RAW Additionally, since January 2025 and(and, as rights become available globally, distribution for all WWE content outside the U.S., including premium live events,events) isand other WWE library content, (iv) USA Network as the exclusive distributor for SmackDown in the U.S., (v) The CW, which carries NXT on Netflix.its cable network stations, and (vi) Peacock as the exclusive distributor of WWE Saturday Night’s Main Event in the U.S. Our agreement with Netflix relating to WWE has an initial 10-year term, with an option for Netflix to extend for an additional 10 years and to opt out after the initial five years. Our failure to maintain the Netflix agreement, including through Netflix exercising its opt-out rights, could adversely affect our ability to distribute WWE content, which could adversely affect our operating results. We also have substantial relationships with NBCU, which carries SmackDown on USA Network, and The CW, which carries NXT on its cable network. WWE Network is distributed exclusively via Peacock in the domestic market. These relationships are expected to continue to constitute a significant percentage of our revenues. We anticipate that we will be involved in negotiations to renew or replace our domestic television distribution rights agreements for UFC content and WWE Network with our current licensee or others before their expiration in December 2025 and March 2026, respectively. These domestic licenses together account for a very significant portion of our media segment revenues and profitability. No assurances can be provided as to the outcome of these negotiations and, if we are unable to renew existing agreements or find alternative streaming or distribution partners on at least as favorable terms, if at all, our results of operations could be adversely impacted.

There is also no guarantee that the growth in value of sports media licensing rights in the recent years will continue or can be maintained or that the current value of our sports media licensing rights will not diminish over time. Any adverse change in these relationships or agreements, including as a result of U.S., European Union and United Kingdom trade and economic sanctions and any counter-sanctions enacted by such sanctioned countries (e.g., Russia), or a deterioration in the perceived value of our sponsorshipspartnerships or these distribution channels, could have an adverse effect on our business, financial condition and results of operations.

The manner in which audio/media content is distributed and viewed is constantly changing, and consumers have increasing options to access entertainment video. Changes in technology require resources including personnel, capital and operating expenses. Conversely, technology changes have also decreased the cost of video production and distribution for certain programmers (such as through social media), which lowers the barriers to entry and increases the competition for viewership and revenues. We must successfully adapt to and manage technological advances in our industry, including the emergence of alternative distribution platforms. If we are unable to adopt or are late in adopting technological changes and innovations, it may lead to a loss of consumers viewing our content, a reduction in revenues from attendance at our live events, a loss of ticket sales, or lower site fee revenue. Our ability to effectively generate revenue from new content distribution platforms and viewing technologies willcould affect our ability to maintain and grow our business. Emerging forms of content distribution may provide different economic models and compete with current distribution methods (such as television, film, and PPV) in ways that are not entirely predictable, which could reduce consumer demand for our content offerings. Additionally, the use of artificial intelligence (AI) technologies in content creation, marketing, and distribution is evolving, and our ability to successfully utilize such technologies is uncertain. Although we are evaluating the use of AI technologies in our operations, we face competition from other companies in our industry in relation to the deployment of such technologies. If we fail to successfully implement these technologies, or if our competitors more rapidly or effectively adopt these technologies, we may be at a competitive disadvantage which could have a materially adverse impact on our operating results, customer relationships, and growth.

We must also adapt to changing consumer behavior driven by advances that allow for time shifting and on-demand viewing, such as digital video recorders and video-on-demand, as well as internet-basedInternet-based and broadband content delivery and mobile devices. Cable and broadcast television distribution constitutes a large part of our revenues. The number of subscribers and ratings of television networks and advertising revenues in general have been impacted by viewers moving to alternative media content providers, a process known as “cord cutting” and “cord shaving”. Developments in technology may have added, and may continue to add, to this shift as consumers’ expectations relative to the availability of video content on demand, their willingness to pay to access content and their tolerance for commercial interruptions evolve. Many well-funded digital companies (such as Amazon, Apple, Facebook, Hulu, Netflix and YouTube) have been competing with the traditional television business model and, while it has been widely reported that they are paying significant amounts for media content, it is not clear that these digital distributors will replace the importance (in terms of money paid for content, viewer penetrationpenetration, and other factors) of television distribution to media content owners such as WWE and UFC. Our media partners’ businesses are affected by their sale of advertising and subscriptions for their services. If they are unable to sell advertising and/or subscriptions either with regard to WWE and UFC programming specifically or all of their programming generally, it could adversely affect our operating results. If we fail to adapt our distribution methods and content to emerging technologies and new distribution platforms, while also effectively preventing digital piracy and the dilution of the value of our content resulting from the creation of similar or fake content on artificial intelligence applications, our ability to generate revenue from our targeted audiences may decline and could result in an adverse effect on our business, financial condition, and results of operations.

We may fail to realize the anticipated benefits of the Endeavor Asset Acquisition and may assume unanticipated liabilities, including in connection with termination of the Services Agreement.Acquisition.

On February 28, 2025, we completed the Endeavor Asset Acquisition. The success of the Endeavor Asset Acquisition will dependdepends on, among other things, our ability to integrate the transferred businesses in a manner that realizes the various benefits, growth opportunities and synergies that we have identified and are currently in the process of identifying.identified. Our ability to achieve the anticipated benefits of the Endeavor Asset Acquisition is subject to a number of risks and uncertainties.

Our professional reputation is essential to our continued success and any decrease in the quality of our reputation could impair our ability to, among other things, recruit and retain qualified and experienced personnel, or enter into multimedia, licensing, and sponsorshippartnership engagements. Our overall reputation may be negatively impacted by a number of factors, including negative publicity concerning Endeavor or us, members of our or Endeavor’s management or other key personnel or the athletes that participate in our events. Many athletes that participate in our events are public personalities with large social media followings whose actions generate significant publicity and public interest. Any adverse publicity relating to such individuals or individuals that we employ or previously employed or have a contractual relationship with, or that otherwise occur at our locations or events, including from reported or actual incidents or allegations of illegal or improper conduct, such as harassment, discrimination, or other misconduct, have resulted and may in the future result in significant media attention, even if not directly relating to or involving us, and could have a negative impact on our professional reputation. This could result in termination of media rights agreements, licensing, sponsorshipsponsorships or other contractual relationships, or our ability to attract new sponsorshippartnerships or other business relationships, or the loss or termination of such employees’ or contractors’ services, all of which could adversely affect our business, financial condition, and results of operations.

We face competition from a variety of other domestic and foreign companies. We also face competition from alternative providers of the content and events that we offer. For UFC, these providers include, but are not limited to, M-1 Global, Professional Fighters League, Combate Global, Invicta FC, Cage Warriors, AMC Fight Nights, ONE Championship, Rizin Fighting Federation, Absolute Championship Akhmat, Pancrase, Caged Steel, Eagle Fighting Championship, KSW andKSW, Extreme Fighting Championship.Championship, and Legacy Fighting Alliance. For WWE, these providers include, but are not limited to, All Elite Wrestling, Impact Wrestling, Ring of Honor andHonor, New Japan Pro-Wrestling.Pro-Wrestling, and Consejo Mundial de Lucha Libre. Additionally, competition exists from other forms of media, entertainment and leisure activities in a rapidly changing and increasingly fragmented environment. Other new and existing professional wrestling leagues also compete with our goods and services. For the sale of our consumer products, we compete with entertainment companies, professional and college sports leagues and other makers of branded apparel and merchandise. Any increased competition, which may not be foreseeable, or our failure to adequately address any competitive factors, could result in reduced demand for our content, live events, or brand, which could have an adverse effect on our business, financial condition, and results of operations.

We depend on the continued services of executive management and other key employees, and of our parent company, Endeavor.employees. The loss or diminished performance of these individuals, or any diminished performance by Endeavor,individuals could adversely affect our business.

Our performance is substantially dependent on the continued services of executive management and other key employeesemployees. asIn welladdition, as our relationship with our parent company, Endeavor, with whom we have various service agreements. Uponfollowing the consummationcompletion of the Endeavor Take-Private, we have continued to utilize Endeavor's services and expect to continuedo utilizing Endeavor's servicesso for a specified period of time. We cannot be sure that any adverse effect on Endeavor’s business would not also have an adverse effect on our business, financial condition, and results of operations. Further, members of our or Endeavor’s executive management may not remain with Endeavor or us and may compete with us in the future. The loss of any member of our or Endeavor’s executive management teamsteam could impair our ability to execute our business plan and growth strategy, have a negative impact on our business, financial condition, and results of operations, or cause employee morale problems or the loss of additional key employees.

Our ability to generate revenues is highly sensitive to rapidly changing consumer preferences and industry trends, as well as the popularity of our brand, events, and the athletes that participate in our events. Our success depends on our ability to offer premium content through popular channels of distribution that meet the changing preferences of the broad consumer market and respond to competition from an expanding array of choices facilitated by technological developments in the delivery of content. Our operations and revenues are affected by consumer tastes and entertainment trends, including the market demand for the distribution rights to live events, which are unpredictable and may be affected by factors such as changes in the social and political climate, global epidemics such as the COVID-19 pandemic or general macroeconomic factors. Changes in consumers’ tastes or a change in the perceptions of our brand and business partners, whether as a result of the social and political climate or otherwise, could adversely affect our operating results. Our failure to avoid a negative perception among consumers, or anticipate and respond to changes in consumer preferences, could result in reduced demand for our events and content offerings, which could have an adverse effect on our business, financial condition and results of operations.

Owning and managing events for which we sell media and sponsorshippartnership rights, ticketing and hospitality exposes us to greater financial risk. Additionally, we may be prohibited from promoting and conducting our live events if we do not comply with applicable regulations. If our live events are not financially successful, our business could be adversely affected.

We act as a principal by owning and managing live events for which we sell media and sponsorshippartnership rights, ticketing and hospitality. Organizing and operating a live event involves significant financial risk as we bear all or most event costs, including a significant amount of up-front costs. In addition, we typically book our live events many months in advance of holding the event and often incur expenses prior to receiving any related revenue. Accordingly, if a planned event fails to occur or there is any disruption in our ability to live stream or otherwise distribute, whether as a result of technical difficulties or otherwise, we could lose a substantial amount of these costs, fail to generate the anticipated revenue, and could be forced to issue refunds for ticket or PPV sales and generate lower than expected media rights, sponsorshippartnership and licensing fees. If we are forced to postpone a planned event, we could incur substantial additional costs in order to stage the event on a new date, may have reduced attendance and revenue, and may have to refund fees. We could be compelled to cancel or postpone all or part of an event for many reasons, including severe weather conditions, issues with obtaining permits or government regulation, athletes failing to participate, as well as operational challenges caused by extraordinary incidents, such as terrorist or other security incidents, mass-casualty incidents, natural disasters, public health concerns including pandemics, or similar events. Such incidents have been shown to cause a nationwide and global disruption of commercial and leisure activities.

In somethe United States and foreign jurisdictions, athletic commissions and other applicable regulatory agencies require us to obtain licenses for promoters, medical clearances and/or other permits or licenses for performers and/or permits for events in order for us to promote and conduct our live events. Foreign jurisdictions require visas for personnel and talent at international live events. In international markets, third-party promoters generally oversee permitting and regulatory matters. In the event that we fail to comply with the regulations of a particular jurisdiction, whether through our acts or omissions or those of our third-party promoters, we may be prohibited from promoting and conducting our live events in that jurisdiction. The inability to present our live events in jurisdiction(s), in addition to the lost revenues and expenses of the missed event(s), could lead to a decline in various revenue streams in such jurisdiction(s).

Subsequent to WWE’s restatement for the Unrecorded Expenses, WWE was informed of certain additional claims, which have been settled by Mr. McMahon. WWE recorded an additional $11.1 million of expenses related to these additional claims prior to the closing of the TKO Transactions. Following the closing of the TKO Transactions, the Company recorded an additional $3.5 million of expenses during the year ended December 31, 2023 related to these additional claims. Mr. McMahon has made all related payments personally.

Professional costs resulting from WWE’s Special Committee’s investigation and/or related claims have been significant and are expected to continue to be significant as the Company continues to incur costs arising from ongoing and/or potentially new regulatory, investigative and enforcement inquiries, subpoenas, and demands, claims and/or lawsuits. We expect Mr. McMahon to reimburse the Company for reasonable expenses incurred in connection with the investigation and related matters. During the year ended December 31, 2024, Mr. McMahon reimbursed the Company $6.4 million associated with these costs. For further information on related party transactions between Mr. McMahon and the Company, see Note 22, Related Party Transactions, to our audited consolidated financial statements included elsewhere in this Annual Report. Although we are not aware that significant business has been lost to date, it is possible that a change in the perceptions of our business partners could occur as a result of the investigation or other matters described above. In addition, as a result of the investigation, other matters described above or new claims or allegations, certain other operational changes, including without limitation other personnel changes, have occurred and may continue to occur in the future, which may have adverse financial and operational impacts on our business. Any adverse impacts as a result of the investigation and related matters, and any further allegations or investigations, could exacerbate any of the risks described herein.

Our failure to continue to build and maintain our entertainment properties of entertainment could adversely affect our operating results.

We must continue to build and maintain our strong brand identities to attract and retain fans who have a number of entertainment choices. The creation, marketing and distribution of live events and programming content that our fans value and enjoy is at the core of our business. The production of compelling live, televised and streamed content is critical to our ability to generate revenues across our media platforms and product outlets. Also important are effective consumer communications, such as marketing, customer service and public relations. The role of social media use by fans and by us is an important factor in our brand perception. If our efforts to create compelling services and goods and/or otherwise promote and maintain our properties, services and merchandise are not successful, our ability to attract and retain fans may be adversely affected. Such a result would likely lead to a decline in our television ratings, attendance at our live events post-pandemic,events, and/or otherwise impact our sales of goods and services, which would adversely affect our operating results.

Our success depends, in large part, upon our ability to identify, discover and retain athletes and athletic performers who have the physical ability, acting ability and presence or charisma to succeed in our live events, programming content and, with respect to WWE, the portrayal of characters in our live events and programming. We cannot guarantee that we will be able to continue to identify these athletes and performers. Additionally, throughout our history, athletes and performers from time to time have stopped participating in our events for any number of reasons, and we cannot guarantee that we will be able to retain our current athletes and performers either during the terms of their contracts or when their contracts expire. Our failure to attract and retain key athletes and performers, an increase in the costs required to attract and retain such athletes and performers, or a serious or untimely injury to, or the death of, or unexpected or premature loss or retirement for any reason of, any of our key athletes or performers could lead to a decline in the popularity of our brand of entertainment and events. Any of the foregoing issues could adversely affect our operating results.

We rely on hardware, software, technology infrastructure, online sites and networks, and various computer systems (such as our information systems, content distribution systems, ticketing systems, and payment processing systems) (collectively, “IT Systems”), to conduct our business. We also rely on the technology systems of third parties (including Peacock,Paramount+, NetflixNetflix, ESPN, and ESPNPeacock) with which we partner in our operations. Some IT Systems used in our operations are legacy IT systems from businesses we have acquired, which may remain separately managed from other IT Systems of our business, may be difficult to integrate with other portions of our business in the future, or may require additional resources to maintain in a secure and functional manner. We own and manage some of these IT Systems but generally rely on third parties for a range of IT Systems and related products and services, including but not limited to cloud computing services, payment processing, and ticketing services. We and certain of our third-party providers use these IT Systems to collect, maintain and process data about employees, consumers, event participants, business partners and others, including personal information, as well as proprietary information belonging to our business such as trade secrets (collectively, “Confidential Information”). Any of these IT Systems and Confidential Information are vulnerable to service interruptions, security breaches, and other cybersecurity risks that threaten their confidentiality, integrity and availability, including as a result of inadvertent or intentional actions by our employees, partners, and vendors, or from attacks by threat actors or other malicious third parties. Such attacks are of ever-increasing levels of sophistication and are made by groups and individuals with a wide range of motives and expertise, including organized criminal groups, “hacktivists,” state-sponsored organizations, and others. For instance, we may be subject to boycotts, spam, spyware, ransomware, phishing and social engineering, viruses, worms, malware, DDOS attacks, password attacks, man-in-the-middle attacks, cybersquatting, impersonation of employees or officers, abuse of comments and message boards, fake reviews, doxing, and swatting. We are also vulnerable to the risk of malicious code being embedded in open-source software, or misconfigurations, “bugs” or other vulnerabilities in commercial software that is integrated into our (or our suppliers’ or service providers’) IT Systems, products or services. Cyberattacks are expected to accelerate on a global basis in frequency and magnitude, and the techniques and tools (including artificial intelligence) used to breach security safeguards, circumvent security controls, evade detection and remove forensic evidence are evolving rapidly. As a result, cyberattacks may be difficult to detect for an extended period of time, and the measures we take to safeguard our technology may not adequately prevent them.

Our insurance policies covering data security, privacy liability, and cyber-attacks may not be adequate to cover losses arising from incidents, or they may not be available to us in the future on economically reasonable terms or at all. We would also be exposed to a risk of loss or litigation (including class action lawsuits) and potential liability under laws, regulations and contracts that protect the privacy and security of confidential or personal information. For example, the California Consumer Privacy Act, as amended by the California Privacy Rights Act (collectively, the “CCPA”) imposes a private right of action for certain security breaches that could lead to some form of remedy including regulatory scrutiny, fines, private right of action settlements, and other consequences. As a further example, where a security incident involves a breach of security leading to the accidental or unlawful destruction, loss, alternation,alteration, unauthorized disclosure of, or access to, personal data in respect of which we are a controller or processor under the GDPR (as defined below), this could result in fines under the EU GDPR (as defined below), the UK GDPR (as defined below), and other European cyber-security laws, which can be substantial and may be assessed based on a percentage of revenue. Laws and regulations around cybersecurity, including Directive (EU) 2022/2555 or the NIS 2 Directive, continue to expand the scope of, and impose onerous requirements on, covered entities. We also may be required to notify regulators and/or other companies we are contractually obligated to notify about any actual or suspected personal data breach as well as the individuals who are affected by the incident within strict time periods;periods. complyingComplying with ever more numerous and complex regulations in the event of a security incident can be expensive and difficult and failure to comply with notification requirements under applicable regulations could subject us to regulatory scrutiny and additional liability.

Remote and hybrid working arrangements at our company (and at many third-party providers) increase cybersecurity risks due to the challenges associated with managing remote computing assets and security vulnerabilities that are present in many non-corporate and home networks. We rely on technology at live events, the failure or unavailability of which, for any significant period of time, could affect our business, reputation and the success of our live events. We also rely on technology to provide our digital offerings, live streaming, and virtual events, which may be vulnerable to hacking, denial of service attacks, human error and other unanticipated problems or events that could result in interruptions in our service and to unauthorized access to, or alteration of, the content and data contained on our IT Systems and those of our third-party vendors. Interruptions in these IT Systems, or with the Internetinternet in general, whether due to fault by any party or due to weather, natural disasters, terrorist attacks, power loss or other force majeure type events, could make our content unavailable or degraded. These service disruptions or failures could be prolonged. Delivery of video programming over the Internetinternet is done through a series of carriers with switch-overs between carriers. TelevisionVideo content on demand and television delivery is extremely complex and includes satellite, fiberoptic cable, over-the-air delivery and other means. Any point of failure in this distribution chain would cause a disruption or degradation of our signal. Service disruption or degradation for any of the foregoing reasons could diminish the overall attractiveness of our content or subject us to individual or class action claims. We do not carry insurance that would cover us in the event of many types of business interruption that could occur.

Any adverse impact to the availability, integrity or confidentiality of our IT Systems or Confidential Information, or any breach of security, could result in decreased performance and increased operating costs (including refunds to impacted end users), legal claims or proceedings (including class action lawsuits), fines and penalties, regulatory scrutiny, and significant incident response, system restoration or remediation and future compliance costs, all of which could adversely affect our business, financial condition, reputation and results of operations. There can be no assurance that our cybersecurity risk management program and processes, including our policies, controls or procedures, will be fully implemented, complied with or effective in protecting our systems and information.

For example, in Europe, member states have adopted or modified data privacy and security laws and regulations that may apply to our business, such as the General Data Protection Regulation 2016/679 and applicable national supplementing laws (“EU GDPR”) and in the United Kingdom, the United Kingdom data protection regime consisting primarily of the U.K. General Data Protection Regulation and Data Protection Act of 2018 (“UK GDPR”, and together with the EU GDPR, the “GDPR”). The GDPR imposes comprehensive data privacy compliance obligations and creates requirements for in-scope businesses regarding the processing of personal data, broadly defined as information relating to an identifiable person including a principle of accountability and the obligation to demonstrate compliance through policies, procedure,procedures, training and audit. EU member states also have some flexibility to supplement the GDPR with their own laws and regulations and may apply stricter requirements for certain data processing activities. As a result of the exit of the United Kingdom from the European Union, the UK GDPR will not automatically incorporate any future changes made to the EU GDPR going forward (which would need to be specifically incorporated by the United Kingdom government). Moreover, the United Kingdom government has publicly announced plans to reform the UK GDPR in ways that, if formalized, are likely to deviate from the EU GDPR in certain areas, which creates a risk of divergent parallel regimes and related uncertainty, along with the potential for increased compliance costs and risks for affected businesses. We are monitoring such developments and the impact this may have on our business.

We currently generally rely on the standard contractual clauses issued by the EU Commission and the UK government as well as other data sharing agreements to legitimize transfers of personal information outside the EEA and the UK, including to the United States. A replacement for the Privacy Shield Framework, the EU-US Data Privacy Framework, became effective in 2023; however, this framework is already facing challenges similar to those that resulted in the invalidation of the Privacy Shield Framework. We expect the existing legal complexity and uncertainty regarding international data transfers to continue. As supervisory authorities within the EEA issue further guidance on international data transfers under the GDPR, and as enforcement actions continue, we could suffer additional costs, complaints and/or regulatory investigations or fines, and/or it could affect our operations and the manner in which we provide our services (for example, we may have to stop using certain tools and vendors and make other operational changes). ). In particular, given the complexity and constantly evolving nature of our cross-border data transfers, safeguards to remain in compliance with the standard contractual clauses and associated safeguards will need to be updated over time to fully legitimize our data transfers, and a failure to do so could result in enforcement action from regulators. Although the United Kingdom currently has an adequacy decision from the European Commission, such that standard contractual clauses are not required for the transfer of personal data from the EEA to the UK, that decision will sunset in JuneDecember 20252031 unless extended and it may be revoked in the future by the European Commission if the UK data protection regime is reformed in ways that deviate substantially from the EU GDPR. There can be no assurances that we will be successful in our efforts to comply with the GDPR or other privacy and data protection laws and regulations, or that violations will not occur, particularly given the complexity of both these laws and our business, as well as the uncertainties that accompany new laws.laws and the inconsistencies between these various regulatory regimes. In addition, cloud service providers upon which our services depend are experiencing heightened scrutiny from EU regulators, which may lead to significant shifts or unavailability of cloud services to transfer personal information outside the EU, which may significantly impact our costs or ability to operate.

In addition, in recent years, in the United States certain states have adopted or modified data privacy and security laws and regulations that may apply to our business. For example, the CCPA requires businesses that process the personal information of California residents to among other things provide certain disclosures to California residents regarding the business’s collection, use and disclosure of their personal information; receive and respond to requests from California residents to access, delete, and correct their personal information, and opt-out of certain disclosures of their personal information; and enter into specific contractual provisions with service providers that process California resident personal information on the business’s behalf. The effects of this legislation are far-reaching and have required and may continue to require us to modify our data processing practices and policies and to incur significant costs and expenses in an effort to comply. The enactment of the CCPA has also prompted a wave of similar data privacy laws in other states across the United States. For example, since the CCPA went into effect, general data privacy statutes that share similarities with the CCPA are now in effect and enforceable in Virginia, Colorado, Connecticut, Utah, Florida, Texas, Montana, Oregon, Delaware, Iowa, New Hampshire, NebraskaNebraska, Kentucky, Indiana, Rhode Island, Minnesota, Tennessee, Maryland, and New Jersey, and will soon be enforceable in several other states as well. Similar laws have been proposed in many other states and at the federal level as well. Recent, new, and proposed state and federal legislation relating to data privacy may add additional complexity, variation in requirements, restrictions and potential legal risk, require additional compliance programs, could impact strategies and availability of previously useful information, and could result in increased compliance costs and/or changes in business practices and policies.

Besides the UK, EEA and the United States, our global reach means we may be or become subject to other privacy regimes, and new laws are being enacted regularly, including laws which may have potentially conflicting requirements that would make compliance challenging. If the trend of increasing enforcement by regulators of such laws by regulators as reflected in recent guidance and decisions continues, this could lead to substantial costs, require significant systems changes, limit the effectiveness of our marketing activities, divert the attention of our technology personnel, adversely affect our margins, increase costs and subject us to additional liabilities. For example, UFC operates a UFC Performance Institute, among other significant operations, in China. As such, we may be subject to various aspects of the country’s onerous data compliance regime, which can include the Cybersecurity Law, the Data Security Law and the Personal Information Protection Law (“PIPL”). In addition, the relevant government authorities of China promulgated several regulations or released a number of draft regulations for public comments that are designed to provide further implementation guidance in accordance with these laws. We cannot predict what impact the new laws and regulations or the increased costs of compliance, if any, will have on our operations in China, in particular the Data Security Law or PIPL, due to their recent enactment and the limited guidance available. It is also generally unclear how the laws will be interpreted and enforced in practice by the relevant government authorities as these laws are drafted broadly and, thus, leave great discretion to the relevant government authorities to exercise.

Finally, regulation of cookies and similar technologies, and any use of cookies or similar online tracking technologies as a means to identify and potentially target users, may lead to broader restrictions and impairments on our marketing and personalization activities and may negatively impact our efforts to better understand users. Recent U.S. and European court and regulator decisions are driving increased attention to cookies and tracking technologies and privacy activists are referring allegedly non-compliant companies to regulators. In the EU and the UK, informed consent is required for the placement of certain cookies or similar technologies on a customer’s or user’s device and for direct electronic marketing. The GDPR also imposes conditions on obtaining valid consent, such as a prohibition on pre-checked consents and a requirement to ensure separate consents are sought for each type of cookie or similar technology. Regulators are increasingly focusing on strict compliance with current national laws that implement the EU's ePrivacy Directive. If the trend of increasing enforcement by regulators of the strict approach including opt-in consent for all but essential use cases, as seen in recent guidance and decisions continues, this could lead to substantial costs, require significant systems changes, limit the effectiveness of our marketing activities, divert the attention of our technology personnel, adversely affect our margins, and subject us to additional liabilities.

The effects of any applicable U.S. federal, state and local laws and regulations, and international laws and regulations that are currently in effect or that may go into effect in the future, are significant (and penalties for non-compliance may be assessed based on a percentage of global revenue) and may require us to modify our data processing practices and policies and to incur substantial costs and potential liability in an effort to comply with such laws and regulations. Responding to allegations of non-compliance, whether or not true, could be costly, time consuming, distracting to management, and cause reputational harm. In addition to government regulation, privacy advocates and industry groups may propose new and different self-regulatory standards. Because the interpretation and application of privacy and data protection laws are still uncertain, it is possible that these laws may be interpreted and applied in a manner that is inconsistent with one another or inconsistent with our existing data management practices or the features of our products and services. Any actual or perceived failure to comply with these and other data protection and privacy laws and regulations could result in regulatory scrutiny and increased exposure to the risks of litigation (including class action lawsuits) or the imposition of consent orders, enforcement notices, assessment notices (for a compulsory audit), resolution agreements, orders to cease/change our processing of personal data, requirements to take particular actions with respect to training, policies or other activities, and civil and criminal penalties, including fines, which could harm our business. In addition, we or our third-party service providers could be required to fundamentally change our business activities and practices or modify our products and services, which could harm our or our third-party service providers’ businesses. Any of the foregoing could result in additional cost and liability to us, damage our reputation, inhibit sales, and harm our business.

We have invested significant resources in clearing, registering and maintaining trademarks associated with our properties including, but not limited to, “UFC,” “OCTAGON,” “ULTIMATE FIGHTING CHAMPIONSHIP,” “AS REAL AS IT GETS,” “ULTIMATE FIGHTER,” “ZUFFA BOXING,” “ZBXG,” “WWE,” “RAW,” “SMACKDOWN,” “NXTNXT,” “WRESTLEMANIA,” “WRESTLEPALOOZA”, “IMG”, “ON LOCATION,” “PBR,” and “WRESTLEMANIA,PROFESSIONAL BULL RIDERS” as well as the UFC and WWE logos andlogos, the 2two dimensional octagon shape, and the names and logos of WWE Superstars, in an attempt to obtain and protect our properties and their public recognition. During trademarkintellectual property registration proceedings, we may receive rejections of our applications by the United States Patent and Trademark Office, United States Copyright Office or equivalent authorities in other foreign jurisdictions. Although we would be given an opportunity to respond to those rejections, we may be unable to overcome such rejections and, consequently, may be unable to obtain sufficient protection for certain trademarks and other intellectual property in certain jurisdictions where we operate. Further, our intellectual property rights may be challenged, opposed, and/or invalidated by third parties andor such rights may not be strong enoughsufficient to provide a meaningful commercial competitive advantage. If we fail to secure intellectual property rights or maintain our intellectual property rights, competitors might be able to use our brands or other intellectual property, which may have adverse financial and operational impacts on our business.

If we are unable to adequately maintain andor protect our intellectual property rights adequately,rights, we may lose an important competitive advantage in the markets where we operate, which may have adverse financial and operational impacts on our business. In particular, the laws of certain foreign countries do not protect intellectual property rights in the same manner as do the laws of the United States and, accordingly, our intellectual property rights are at greater risk in thosesuch countries even where we take additional steps to protect our intellectual property. We cannot guarantee that the available legal steps we have taken, and take in the ordinary course of business, to reasonably protect our intellectual property will be successful in all jurisdictions, or predict whether these steps will be adequate to prevent infringement or misappropriation of these rights. In addition, we may be required to forgo protections or rights to technology, data andor intellectual property in order to operate in or access markets in foreign jurisdictions. Any such direct or indirect loss of rights in these assets may have adverse financial and operational impacts on our business.

We may license our trademarks and trade names to third parties, such as distributors, consumer product licensees and sponsors.corporate partners. Although these license agreements may provide guidelines for how our trademarks and trade names may be used, a breach of these agreements or misuse of our trademarks and trade names by our licensees may jeopardizeaffect our rights in or diminish the goodwill associated with our trademarks and trade names.

Our efforts to clear, police, enforce or protect our proprietary rights and intellectual property rightsrights, including those related to trademarks, trade names, and service marks may be ineffective and could result in substantial costs and diversion of resources and which, if material, may have adverse financial and operational impacts on our business. Policing unauthorized use and other violations of our intellectual property is difficult and costly, particularly given our global scope. Our technology, data and intellectual property are subject to a heightened risk of theft, unauthorized use or compromise to the extent that we engage in operations outside the United States, particularly in those jurisdictions that do not have comparable levels of protection of proprietary information and assets, such as trademarks, copyrights, trade secrets, know-how and customer information and records. The unauthorized use of intellectual property in the sports and sports entertainment industry generally continues to be a significant challenge for intellectual property rights holders. Piracy, in particular, threatens to damage our business as piracy services are subject to rapid global growth. The success of our streaming video solutions with respect to both live and video-on-demand content (e.g., UFC FIGHT PASS) is directly threatened by the availability and use of pirated alternatives, which we may not detectdetect, or be able to prevent,prevent or take down in real time, including the streaming of our events on social media and other platforms. The value that streaming services are willing to pay for content that we develop may be reduced if piracy prevents these services from realizing adequate revenues. The value individual consumers are willing to pay for content that we develop may be reduced if piracy presents a sufficiently compelling consumer proposition. These activities could result in lost revenue and a reduction in the value of our media rights which may materially and adversely affect our business, results of operation, financial condition and prospects.

Further, we may seek to oppose, cancel and/or invalidate a third party’s attempt to register or otherwise protect its intellectual property rights if we deem such intellectual property is not eligible for protection or if such intellectual property infringes, dilutes, misappropriates or otherwise violates our intellectual property rights, but we may be unsuccessful in doing so or may cease such efforts if we believe that proceeding would require us to expend more resources than is commercially reasonable.

We may be subject to intellectual property rights claims by third parties, which are costly to defend, could require us to pay significant damages and could limit our ability to use our intellectual propertyproperty.

We operate in various jurisdictions abroad, including through joint ventures, and we expect to continue to expand our international presence. We face, and expect to continue to face, and may face new and unexpected additional risks in the case of our existing and future international operations, including:

limitations on the scope, strength, of intellectual property ownership, and enforcementability ofto enforce intellectual property rights;

We review our goodwill and indefinite-lived intangible assets for impairment annually as of October 1 and at any time upon the occurrence of certain events or substantive changes in circumstances that indicate the carrying amount of goodwillamounts may not be recoverable. Additionally, we assess if impairment indicators exist related to finite-lived intangible assets at each reporting period within our asset groups. To the extent an event occurs suggesting that an asset group’s carrying amount is not recoverable, an impairment assessment is performed. If such goodwill or intangible assets are deemed to be impaired, an impairment loss equal to the amount by which the carrying amount exceeds the fair value of the assets would be recognized. Adverse impacts to our business could result in impairments and significant charges to earnings.

We hold numerous live events each year. This schedule exposes our athletes, performers and employees who are involved in the production of those events to the risk of travel and performance-related accidents. There are inherent risks to participants and spectators involved with producing, attending, or participating in live events. Injuries and accidents have occurred and may occur from time to time in the future, which could subject us to substantial claims and liabilities for injuries. Incidents in connection with our live events at any of our venues or venues that we rent could also result in claims or a reduction in operating income or attendance at our events, causing a decrease in our revenues. There can be no assurance that the insurance we maintain will be adequate to cover any potential losses.losses given the wider litigation environment.

licensing laws for athletes and laws and regulations regarding the promotion and operation of MMA and boxing events;

compliance with current and future privacy and data protection laws imposing requirements for the collecting, processing, storing and protection of personal or sensitive information, including the Federal Trade Commission Act, the CCPA and other state privacy laws, the GDPRGDPR, the PIPL and the E.U. e-Privacy Regulation;

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the information set forth in our audited consolidated financial statements and related notes included elsewhere in this Annual Report. The historical financial data discussed below reflects our historical results of operations and financial position and relates to periods prior to the Transactions (as defined below). As a result, the following discussion does not reflect the significant impact that such events will have on us. This discussion contains forward-looking statements based upon management’s current plans, expectations and beliefs that involve risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various known and unknown factors, including those set forth under Part I, Item 1A. “Risk Factors” and in other sections of this Annual Report.

The following is a discussion and analysis of, and a comparison between, our results of operations for the years ended December 31, 20242025 and 2023.2024. A discussion and analysis of, and a comparison between, our results of operations for the years ended December 31, 20232024 and 20222023 is set forth underin PartExhibit II,99.1, titled, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” infiled with our AnnualCurrent Report on Form 10-K8-K for the year ended December 31, 2023,2024, filed with the SEC on FebruaryMay 27,8, 2024.2025.

TKO is a premium sports and entertainment company which operates leading combat sports and sports entertainment companies. The Company monetizes its media and content propertiesbrands through four principal activities: (i) Media rightsrights, production and content, (ii) Live events, Sponsorshipevents and hospitality, (iii) Partnerships and marketing, and (iv) Consumer products licensing.

TKO was formed through the combination of Zuffa Parent, LLC (n/k/a TKO Operating Company, LLC) which owns and operates the Ultimate Fighting Championship (“UFC”), a preeminent combat sports brand and a subsidiary of Endeavor Group Holdings, Inc. (“Endeavor”), a global sports and entertainment company,brand, and World Wrestling Entertainment, Inc. (n/k/a/ World Wrestling Entertainment, LLC) (“WWE”), a renowned sports entertainment business.business (the "TKO Transactions"). The TKO Transactions unite two complementary sports and sports entertainment properties in a single company. For additional information regarding the terms of the TKO Transactions, see Note 4, Acquisition of WWE, to our audited consolidated financial statements included in this Annual Report.

As of December 31, 2024,2025, we operated our business under twothree reportable segments, UFCUFC, WWE and WWE.IMG. In addition, we also report results for the “Corporate and Other” group, which incurs revenue and expenses that are not allocated to the business segments. Refer to Note 19, Segment Information, within the audited consolidated financial statements included elsewhere within this Annual Report.

The UFC segment reflects the business operations of UFC. Revenue from our UFC segment principally consists of media rights fees associated with the distribution of its programming content; ticket sales and site fees associated with the business’s global live events; sponsorshippartnerships and marketing; and consumer products licensing agreements of UFC-branded products.

The WWE segment reflects the business operations of WWE. Revenue from our WWE segment principally consists of media rights fees associated with the distribution of its programming content; ticket sales and site fees associated with the business’s global live events; sponsorshippartnerships and marketing; and consumer products licensing agreements of WWE-branded products.

Corporate reflects operations not allocated to the UFC or WWE segments and primarily consists of generalGeneral and administrative expenses. These expenses relate largely to corporate activities, including information technology, facilities, legal, human resources, finance,finance and accounting, treasury, investor relations, corporate communications, community relations and compensation to TKO’s management and board of directors, which support bothall reportable segments. Corporate and Other expenses also include service fees paid by the Company to Endeavor Group Holdings, Inc. under the Services Agreement, inclusive of fees paid for revenue producing services related to the segments. On the closing date of the Endeavor Asset Acquisition, the Services Agreement between Endeavor Group Holdings, Inc. and TKO OpCo was terminated and the Transition Services Agreement was entered into between the EGH Parties, TWI and the TKO Parties.

TKO primarily generates revenue via domestic and international media rights fees, production services and studio fees, ticket sales at live events, hospitality sales and site feesfees, atpartnerships ourand live events, sponsorships,marketing, and consumer products licensing.

TKO’s direct operating costs primarily include costs associated with our athletes and talent, production, marketing, venue costs related to live events, expenses associated with the production of events and experiences, event ticket sales and fees for media rights. These costs include required payments related to media sales agency contracts when minimum sales guarantees are not met, materials and related costs associated with consumer product merchandise sales, commissions and direct costs with distributors, as well as certain service fees paid to Endeavor.Endeavor Group Holdings, Inc. under the Services Agreement and Transition Services Agreement.

TKO’s selling, general and administrative expenses primarily include personnel costs as well as rent, travel, professional service costscosts, overhead required to support operations, and certain service fees paid to Endeavor.Endeavor Group Holdings, Inc. under the Services Agreement and Transition Services Agreement.

TKO Group Holdings, Inc. was incorporated as a Delaware corporation in March 2023. As the sole managing member of TKO OpCo, TKO Group Holdings, Inc. ultimately controls the business and affairs of UFCTKO and WWE.OpCo. TKO Group Holdings, Inc. is subject to corporate income taxes on its share of taxable income of TKO OpCo. TKO OpCo is treated as a partnership for U.S. federal income tax purposes and is therefore generally not subject to U.S. corporate income tax. TKO OpCo’s foreign subsidiaries are subject to entity-level taxes. TKO OpCo’s U.S. subsidiaries are subject to withholding taxes on sales in certain foreign jurisdictions which are included as a component of foreign current taxes. TKO OpCo is subject to entity-level income taxes in certain U.S. state and local jurisdictions. For the periods prior to the Endeavor Asset Acquisition, the Acquired Businesses primarily consisted of U.S. flow through entities that are not themselves subject to U.S. federal income taxes as well as some foreign subsidiaries and U.S. regarded corporations subject to entity level taxes. Income taxes related to the Acquired Businesses reflected in the consolidated tax provision are attributable to U.S. regarded entities and foreign entities subject to tax in their respective jurisdictions.

Revenue increaseddecreased by $1,129.3$149.0 million, or 67.4%,3%, to $2,804.3$4,735.2 million for the year ended December 31, 20242025 compared to the year ended December 31, 2023.2024.

UFC revenue increased by $114.0$96.0 million, or 9%.7%. This increase was primarily drivendue byto $55.1$62.9 million of higher sponsorshippartnerships revenue from new sponsors and increases in fees from renewals,renewals. asAdditionally, wellUFC asgenerated $52.5$28.3 million of increased media rights, production and content revenue from higher media rights fees resulting from increases in contractual revenues, partially offset by a year-over-year shift in event mix featuring one fewer numbered event despite the same total event count. This increase was also driven by $12.5 million of greater live event revenue driven by higher attendance and higher site fee revenuesrevenue primarilyassociated fromwith UFCcertain 302international inevents, Newark, New Jersey, UFC 307 in Salt Lake City, Utah andincluding Fight Night events held in Riyadh,Baku, Saudi ArabiaAzerbaijan and AbuDoha, DhabiQatar, partially offset by lower ticket sales revenue driven by holding one less numbered event as comparedwell toas the impact of UFC 306 in the prior year.year, Thewhich currentwas yeara alsomarquee includesevent $8.8at million of increased media rights and content from higher domestic and international rights fees resulting from increasesSphere in contractualLas revenues despite having one fewer Fight Night event.Vegas. These revenue stream increases were partially offset by a decrease of $2.4$7.7 million in consumer products licensing revenue from lower royalties on UFC-branded products.products compared to the prior year.

Direct operating costs increaseddecreased by $385.3$720.7 million, or 74.9%,27%, to $899.9$1,903.2 million for the year ended December 31, 20242025 compared to the year ended December 31, 2023.2024.

UFC direct operating costs increased by $46.8$3.0 million, or 12%.1%. This increase was primarily due to $17.1 million of higher variable costs of $30.5revenue, including commissions and other event-related costs. These increases were partially offset by $15.8 million fromof differentlower production and athlete matchups,costs driven by holding one less numbered event as well as increasedthe productionimpact costs primarily forof UFC 306,306 in the prior year, which was a marquee event at the Sphere in Las Vegas. These increases were partially offset by lower expenses from direct costs of revenue resulting from having one less Fight Night event in the current year.

Corporate and Other direct operating costs increaseddecreased by $14.4$10.3 million.million, or 7%. This increasedecrease was primarily relateddriven toby service fees paid to EndeavorEGH in the prior year for various operational functions that support revenue generating activities pursuant to the Services Agreement. The costsServices associatedAgreement withwas WWE'sterminated portionduring the first quarter of 2025. Additionally, lower costs of $4.6 million from PBR were primarily driven by lower rider and marketing costs compared to the serviceprior fees did not commence until March 2024.year.

Selling, general and administrative expenses increaseddecreased by $679.6$259.5 million, or 123.8%,15%, to $1,228.7$1,512.0 million for the year ended December 31, 20242025 compared to the year ended December 31, 2023.2024.

UFC selling, general and administrative expenses increased by $15.5$55.5 million, or 9%.29%. This increase was primarily due to higher cost of personnel from greater headcount driven by the$51.6 openingmillion of thehigher UFC Performance Institute in Mexico City in February 2024personnel and greatertravel bonuses and sales commissions due to financial performance ascosts compared to the prior year.

For the year ended December 31, 2024,2025, TKO recorded a provision for income taxes of $25.7$73.8 million compared to a provision of $31.5$37.3 million for the year ended December 31, 2023.2024. This change was primarily related to increased pretax income for the changeyear inended impactDecember from31, foreign operations.2025.

Net Income (Loss) Attributable to Non-Controlling Interests

Net income (loss) attributable to non-controlling interests was $3.0income of $350.8 million and $32.5a loss of $255.1 million for the years ended December 31, 20242025 and 2023,2024, respectively. The change was primarily due to the change in the amount of reported net income for the year ended December 31, 20242025 as compared to the reported net incomeloss for the year ended December 31, 20232024 as well as the impact of the Endeavor Asset Acquisition. See Note 11, Non-Controlling Interests, to our audited consolidated financial statements included in this Annual Report for further details on the effect of the Transactions.Endeavor Asset Acquisition to this line item.

As described above, the following discussion and analysis of our financial condition and results of operations presents three reportable segments as of December 31, 2024,2025: weUFC, classifiedWWE and IMG, which were determined to be our business into two reportable segments: UFCfollowing andthe WWE.close of the Endeavor Asset Acquisition. Our chief operating decision maker evaluates the performance of our segments based on segment Revenue and segment Adjusted EBITDA. Management believes segment Adjusted EBITDA is indicative of operational performance and ongoing profitability, and Adjusted EBITDA is used to evaluate the operating performance of our segments and for planning and forecasting purposes, including the allocation of resources and capital. Segment operating results reflect earnings before corporate expenses. These segment results of operations should be read in conjunction with our discussion of the Company’s consolidated results of operations included above.

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 2025 Annual Report.Report on Form 10-K. 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 2025 Annual Report.Report on Form 10-K.

The following is a discussion and analysis of, and a comparison between, our results of operations for the three and six months ended MarchJune 31,30, 2026 and 2025. Certain prior period amounts have been reclassified for consistency with the current year presentation. These reclassifications had no effect on the reported results of operations.

As of MarchJune 31,30, 2026, we operated our business under three reportable segments, UFC, WWE and IMG. In addition, we also report results for the “Corporate and Other” group, which incurs revenue and expenses that are not allocated to the business segments. Refer to Note 14,15, Segment Information, within the unaudited consolidated financial statements included within this Quarterly Report on Form 10-Q.

Corporate and Other reflects operations not allocated to the UFC, WWE or IMG segments and primarily consists of general and administrative expenses as well as operations of PBR and boxing. PBR owns the Professional Bull Riders brand, which organizes bull riding competitions, promotes the sport and its athletes through live events and broadcasts. Boxing includes the joint venture with Sela Company for the Zuffa Boxing brand as well as promotional services TKO provides for boxing events.

The following is a discussion of our consolidated results of operations for the three and six months ended MarchJune 31,30, 2026 and 2025. This information is derived from our accompanying consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

Revenue increased by $328.1$238.7 million, or 26%,18%, to $1,596.9$1,547.1 million for the three months ended MarchJune 31,30, 2026 compared to the three months ended MarchJune 31,30, 2025.

UFC revenue increased by $41.5$119.8 million, or 12%.29%. This increase was primarily due to $51.2$64.7 million of increased media rights, production and content revenue from higher media rights fees resulting from increases in contractual revenues, including the new content distribution agreement with Paramount that became effective in January 2026, partially offset by twothe impact of one fewer FightNumbered Night eventsEvent compared to the prior year. Additionally, UFC generated $2.8$59.0 million of higher partnerships revenue, largely driven by the UFC Freedom 250 event held at the White House, as well as revenue from new sponsors and increases in fees from renewals,renewals. partiallyThe offsetincrease byin therevenue impactwas also attributable to higher consumer products licensing revenue of two$6.8 fewermillion, Fightprimarily Night events compareddue to thehigher priorroyalties year.on UFC-branded products, including collectibles and event merchandise. These increases were partially offset by a decline of $10.1$10.7 million decrease in live event revenue which was driven primarily by lower ticket revenue due to the absence of ticket sales for UFC Freedom 250 and one fewer Numbered Event, partially offset by increased financial incentive packages whichand werehaving associatedone with a Fight Nightincremental event held in Saudi Arabia in the prior year, which more than offset higher ticket sales revenueoverall compared to the prior year. Further, a decrease of $2.4 million in consumer products licensing revenue resulted from lower royalties on UFC-branded products compared to the prior year.

WWE revenue increased by $84.2$64.7 million, or 22%.12%. This increase was due to $47.2 million of increased live event revenue, primarily driven by the financial incentive package for Royal Rumble in Riyadh, Saudi Arabia. The increase was also due to $30.1$80.8 million of higher media rights, production and content revenue from media rights fees resulting from increases in contractual revenues, includingmost notably the content distribution agreements with NetflixESPN and ESPN.Netflix. Additionally, WWE generated $6.3$12.7 million of increased consumer products licensing revenue related to the sale of WWE-branded products, including mobiletrading gamescards and other collectibles, as well as $4.9 million of higher partnerships revenue from new sponsors and increases in fees from renewals, compared to the prior year. These increases were partially offset by a $33.7 million decline in live event revenue due to lower ticket sales revenue almost exclusively associated with WrestleMania in Las Vegas, which was revisited for a second consecutive year.

Corporate and Other revenue increased by $19.5$3.9 million, or 36%.9%. This increase was primarily driven by $9.9$2.9 million of higher management fees for services primarily related to boxing. Additionally, PBR revenue increased by $9.5$1.0 million, or 17%,2%, primarily due to higher medialive rightsevent fees primarilyrevenue driven by the contentfinancial distributionincentive agreementpackage associated with Paramountthe thatPBR becameSpace effectiveCowboys inevent Novemberat 2025,the asU.S. wellAir asForce higher partnerships revenue from new sponsors and increases in fees from renewals.Academy.

Direct operating costs increased by $166.8$79.7 million, or 29%,17%, to $734.4$556.1 million for the three months ended MarchJune 31,30, 2026 compared to the three months ended MarchJune 31,30, 2025.

UFC direct operating costs increased by $9.0$75.9 million, or 10%.65%. This increase was due to $8.6$77.2 million of higher athlete, production, marketingathlete, and other event-related costscosts, which were primarily associated with the UFC 324,Freedom which250 wasevent held at the inauguralWhite House with no such comparable event underin the newprior contentyear, distributionpartially agreementoffset withby Paramount.the impact of one fewer Numbered Event compared to the prior year.

WWE direct operating costs increased by $16.6$15.5 million, or 13%.11%. This increase was primarily driven by $18.3$14.9 million of higher talenttalent, production, and productionevent-related costs associated with WWE's weekly television programming and premium live events, including RoyalWrestleMania Rumble42 in Riyadh,Las SaudiVegas Arabiaand higher logistics costs for additional international events compared to that event being held domestically in the prior year.

IMG segment direct operating costs increased by $138.2$124.0 million, or 42%.23%. This increase was primarily driven by incremental costs of $139.4 million from On Location, largely related to the impact of the 2026 Milano Cortina Olympics.Olympics Directand operatingthe costsFIFA declinedWorld Cup 2026 at On Location, partially offset by $1.2the millionend inof a contract for professional cycling at the IMG business ascompared to the biennialprior impact of the Arabian Gulf Cup was partially offset by increased costs associated with new production agreements.year.

Corporate and Other direct operating costs decreased by $2.5$4.3 million, or 7%.6%. This decrease was primarily driven by service fees paid to EGH in the prior year for various operational functions that support revenue generating activities pursuant to the Services Agreement. The Services Agreement was terminated during the first quarter of 2025. Direct operating costs also declined $1.0 million driven by lower event-related costs at PBR from holding fewer events due to a strategic review to remove non-core events compared to the prior year.

Selling, general and administrative expenses increased by $16.9$98.4 million, or 5%,27%, to $380.2$462.7 million for the three months ended MarchJune 31,30, 2026 compared to the three months ended MarchJune 31,30, 2025.

WWEUFC selling, general and administrative expenses increased by $3.2$9.4 million, or 4%.15%. TheThis increase iswas primarily attributabledriven toby $3.6$6.1 million of higher travel costs drivenlargely byassociated with the increase in numberstaging of the UFC Freedom 250 event at the White House and additional international events compared to the prior year.

IMG segmentWWE selling, general,general and administrative expenses increased by $17.5$4.5 million, or 22%.5%. ThisThe increase wasis primarily drivenattributable byto $10.4$10.3 million of higher personnel and travel costs, as well as other costs associateddriven withby the 2026increase Milanoin Cortinanumber Olympicsof atinternational Onevents Location.compared to the prior year, partially offset by $6.1 million of lower personnel costs.

Corporate and OtherWWE selling, general and administrative expenses decreasedincreased by $7.4$7.7 million, or 5%.4%. ThisThe decreaseincrease wasis primarily attributable to $13.9 million of higher travel costs driven by $37.4the millionincrease in number of lowerinternational professional fees associated with strategic transactions, primarily the Endeavor Asset Acquisition, and the impact of $21.7 million of lower corporate allocated costs from EGH to the Acquired Businesses,events compared to the prior year.year, These decreases were mostlypartially offset by $35.0$8.5 million of higherlower personnel and other operating expenses, as well as $16.7 million of higher legal fees associated with certain litigation matters.costs.

Depreciation and amortization increaseddecreased by $43.3$0.9 million, or 43%,1%, to $143.8$98.5 million for the three months ended MarchJune 31,30, 2026 compared to the three months ended MarchJune 31,30, 2025. The increase was primarily driven by a $44.1 million acceleration of WWE customer relationship assets following the modification of a related media revenue arrangement during the third quarter of 2025.

Interest expense, net increased by $15.8$22.4 million, or 35%,46%, to $60.6$70.6 million for the three months ended MarchJune 31,30, 2026 compared to the three months ended MarchJune 31,30, 2025. This increase was driven primarily by incremental interest expense from higher debt levels maintained during the current year period as compared to the prior year period due to the $1.0 billion and $900.0 million incremental first lien term loans entered in September 2025 and March 2026, respectively.respectively, partially offset by the impact of lower interest rates effective May 28, 2026 associated with the debt refinancing transaction which repriced the facility.

Other income (expense), net for the three and six months ended MarchJune 31,30, 2026 and 2025 includes net gains and losses on foreign currency transactions and other miscellaneous nonoperating gains and losses. During the three months ended MarchJune 31,30, 2025, other income (expense), net also includes a net gain of $2.2 million related to the sale of certain equity method investments. During the six months ended June 30, 2025, other income (expense), net also includes a net loss of $4.7$2.5 million on the sale of certain equity method investments, partially offset by a gain of $1.3 million on the sale of PBR'sPBR’s former headquarters.

For the three months ended MarchJune 31,30, 2026, TKO recorded a provision for income taxes of $34.0$53.2 million compared to $21.2a provision of $46.5 million for the three months ended MarchJune 31,30, 2025. This change was primarily related to increased pretax income for the three months ended MarchJune 31,30, 2026.

As described above, the following discussion and analysis of our financial condition and results of operations presents three reportable segments as of MarchJune 31,30, 2026: UFC, WWE and IMG, which were determined to be our reportable segments following the close of the Endeavor Asset Acquisition. Our chief operating decision maker evaluates the performance of our segments based on segment Revenue and segment Adjusted EBITDA. Management believes segment Adjusted EBITDA is indicative of operational performance and ongoing profitability, and Adjusted EBITDA is used to evaluate the operating performance of our segments and for planning and forecasting purposes, including the allocation of resources and capital. Segment operating results reflect earnings before corporate expenses. These segment results of operations should be read in conjunction with our discussion of the Company’s consolidated results of operations included above.

The following tables set forth Revenue and Adjusted EBITDA for each of our segments for the three and six months ended MarchJune 31,30, 2026 and 2025:

The following table sets forth our UFC segment results for the three and six months ended MarchJune 31,30, 2026 and 2025:

The following table sets forth our WWE segment results for the three and six months ended MarchJune 31,30, 2026 and 2025:

The following table sets forth our IMG segment results for the three and six months ended MarchJune 31,30, 2026 and 2025:

The following table sets forth results for Corporate and Other for the three and six months ended MarchJune 31,30, 2026 and 2025:

The following table sets forth our operating metrics for PBR for the three and six months ended MarchJune 31,30, 2026 and 2025:

Adjusted EBITDA for the three months ended MarchJune 31,30, 2026 increaseddecreased by $19.3$0.3 million, or 25%,million compared to the three months ended MarchJune 31,30, 2025. This increasedecrease was primarily driven by the impact of $21.7$7.9 million of lowerhigher corporatepersonnel allocatedand costsother fromoperating Endeavorexpenses Group Holdings, Inc.compared to the Acquiredprior Businessesyear. andPartially $9.9offsetting these costs were $2.9 million of incremental revenue from higher management fees for services primarily related to boxing. Additionally, PBR revenue increased by $9.5$1.0 million, or 17%,million due to higher medialive rightsevent feesrevenue, andwhile partnershipsexpenses revenue.at ThesePBR revenue increases were partially offsetdeclined by $21.8$3.7 million ofprimarily higher cost of personnel and other operating expenses compareddue to thelower priorevent-related year.costs from holding fewer events.

Includes costs, net of insurance recoveries, related to certain litigation matters including antitrust lawsuits for UFC and stockholder litigation related to WWE and Endeavor. For the three and six months ended June 30, 2026, these costs include an estimated loss of $30.0 million reflecting the Company’s liability net of probable insurance recoveries, as well as $25.6 million and $42.0 million, respectively, of professional fees, associated with stockholder litigation related to WWE.

Includes other miscellaneous nonoperating gains and losses. During the three and six months ended MarchJune 31,30, 2026, other adjustments include a $4.4 million impairment of an equity method investment, partially offset by miscellaneous nonoperating income. During the three months ended June 30, 2025, other adjustments include a net gain of $2.2 million related to the sale of certain equity method investments. During the six months ended June 30, 2025, other adjustments includes a net loss of $4.7$2.5 million on the sale of certain equity method investments, partially offset by a gain of $1.3 million on the sale of PBR’s former headquarters.

As of MarchJune 31,30, 2026 and December 31, 2025, we had $4.6 billion and $3.7 billion, respectively, outstanding under a credit agreement dated August 18, 2016 (as amended and/or restated, the “First Lien Credit Agreement”). On March 10, 2026, TKO Worldwide Holdings entered into an amendment to the First Lien Credit Agreement to, among other things, (i) provide for an additional $900.0 million incremental first lien secured term loan (“Incremental Term Loan”) as a fungible increase to the existing first lien secured term loans of $3.7 billion (the “Existing Term Loans” and together with the Incremental Term Loan,collectively, the “Prior Term Loans”), (ii) upsize the revolving credit facility under the existing credit agreement from $205.0 million to $350.0 million (the “Revolving Credit Facility” and together with term loans provided under the TermFirst Loans,Lien Credit Agreement, the “Credit Facilities”), and (iii) make certain other changes to the First Lien Credit Agreement. As of March 31, 2026 and December 31, 2025, there were no borrowings outstanding under the Revolving Credit Facility.