Live Sports, WME Gains Drive Endeavor’s Q3 Revenues As Silver Lake Acquisition Looms

Endeavor, the parent company of agency giant WME, posted a third-quarter loss nearly three times larger than the same period last year, but saw revenue gains driven by its live sports and talent representation sectors.

Revenues hit $2.03 billion, up 66% year-over-year, a slight miss with analysts expecting $2.13 billion. The owned-sports segment — which includes TKO, the parent company of wrestling giant WWE and MMA leader UFC, along with Professional Bull Riders, which will soon be sold to TKO — increased revenue by 53% to $735.2 million.

The representation segment was up 11 % to $429.2 million, attributed to growth in WME’s talent and music businesses. The strong growth in those sectors offset losses in unscripted content production.

The events, experiences and rights segment surged to $899.8 million — a 145% year-over-year increase — due to On Location’s hospitality business at the Paris Olympics.

Still, the company posted a loss of $420.4 million — 262% larger than the same period in 2023 — or 86 cents per share. That’s a major miss, as the analysts’ consensus predicted a 62 cents per share profit.

All this comes as major changes are afoot. In October, Endeavor announced it was selling PBR, On Location and event management, digital services, consulting and media rights company IMG to TKO in a $3.25 all-stock deal expected to close early next year. The deal will increase Endeavor’s stake in TKO by 6% to 59%.

Endeavor is shedding assets as private-equity firm Silver Lake, which already owns 71% of the company, acquires the remainder of its shares with the intent to take it private next year in a $13 billion deal. Subject to the usual closing conditions and regulatory approvals, that deal is also set to close in Q1 2025.

After spiking in after-hours trading Wednesday to $29.78, Endeavor was trading at $28.92 midday Thursday, off slightly from its Wednesday closing price.