Table of Contents

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________
FORM 10-Q
________________________
(Mark One)
☑
þQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended December 31, 20172023
OR
☐
☐

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from             to
Commission File Number: 1-36900
tmsgclogo1231201710q.jpgmsgslogoa01.jpg
MADISON SQUARE GARDEN SPORTS CORP.
(Exact name of registrant as specified in its charter)
Delaware47-3373056
Delaware47-3373056
(State or other jurisdiction of

incorporation or organization)
(I.R.S. Employer

Identification No.)
_______________________ 
Two Penn Plaza,New York,NY10121
(Address of principal executive offices)(Zip Code)
New York, NY 10121
(212) 465-6000
(Address, including zip code, andRegistrant’s telephone number, including area code,code:(212) 465-4111

Securities registered pursuant to Section 12(b) of registrant's principal executive offices)the Act:
_______________________
Title of each classTrading Symbol(s)Name of each exchange on which registered
Class A Common StockMSGSNew York Stock Exchange


Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. þ☑ Yes ☐ No
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). þ☑ Yes ☐ No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filerþ☑Accelerated filero☐
Non-accelerated filero☐(Do not check if a smaller reporting company)Smaller reporting companyo☐
Emerging growth companyo☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes þ☑ No
Number of shares of common stock outstanding as of January 31, 2018:
February 2, 2024:
Class A Common Stock par value $0.01 per share —19,025,43919,416,405 
Class B Common Stock par value $0.01 per share —4,529,517




Table of Contents





THE MADISON SQUARE GARDEN COMPANYSPORTS CORP.
INDEX TO FORM 10-Q
 
Page
Consolidated Balance Sheets as of December 31, 20172023 (unaudited) and June 30, 20172023
1
Consolidated Statements of Operations for the three and six months ended December 31, 20172023 and 20162022 (unaudited)
23
Consolidated Statements of Comprehensive Income (Loss) for the three and six months ended December 31, 20172023 and 20162022 (unaudited)
34
Consolidated Statements of Cash Flows for the six months ended December 31, 20172023 and 20162022 (unaudited)
45
Consolidated Statements of Equity and Redeemable Noncontrolling Interests for the three and six months ended December 31, 20172023 and 20162022 (unaudited)
56
Notes to Consolidated Financial Statements (unaudited)
710
3227
5636
5637
5738
5838
5939






Table of Contents

PART I – FINANCIAL INFORMATION
Item 1. Financial Statements
THE MADISON SQUARE GARDEN COMPANYSPORTS CORP.
CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data)
December 31,
2023		June 30,
2023
(Unaudited) 
ASSETS
Current Assets:
Cash and cash equivalents$37,880 $40,398 
Restricted cash3,352 61 
Accounts receivable, net of allowance for doubtful accounts of $0 and $0 as of December 31, 2023 and June 30, 2023, respectively72,668 40,139 
Net related party receivables17,334 15,969 
Prepaid expenses55,661 24,768 
Other current assets28,738 27,898 
Total current assets215,633 149,233 
Property and equipment, net of accumulated depreciation and amortization of $50,701 and $49,117 as of December 31, 2023 and June 30, 2023, respectively29,697 30,501 
Right-of-use lease assets706,569 715,283 
Indefinite-lived intangible assets103,644 103,644 
Goodwill226,523 226,523 
Investments62,112 67,374 
Other assets24,271 22,459 
Total assets$1,368,449 $1,315,017 
See accompanying notes to consolidated financial statements.
1
  December 31,
2017		 June 30,
2017
  (Unaudited)  
ASSETS    
Current Assets:    
Cash and cash equivalents $1,125,647
 $1,238,114
Restricted cash 23,332
 34,000
Accounts receivable, net 119,158
 102,085
Net related party receivables 1,524
 2,714
Prepaid expenses 44,132
 23,358
Other current assets 41,475
 49,458
Total current assets 1,355,268
 1,449,729
Investments and loans to nonconsolidated affiliates 247,586
 242,287
Property and equipment, net 1,235,133
 1,159,271
Amortizable intangible assets, net 256,892
 256,975
Indefinite-lived intangible assets 174,850
 166,850
Goodwill 392,621
 380,087
Other assets 51,921
 57,554
Total assets $3,714,271
 $3,712,753
LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY    
Current Liabilities:    
Accounts payable $38,416
 $24,084
Net related party payables 21,197
 17,576
Current portion of long-term debt, net of deferred financing costs 436
 —
Accrued liabilities:    
Employee related costs 69,651
 138,858
Other accrued liabilities 184,131
 191,344
Deferred revenue 390,056
 390,180
Total current liabilities 703,887
 762,042
Long-term debt, net of deferred financing costs 105,464
 105,433
Defined benefit and other postretirement obligations 44,919
 52,997
Other employee related costs 27,894
 29,399
Deferred tax liabilities, net 80,324
 196,436
Other liabilities 72,287
 65,955
Total liabilities 1,034,775
 1,212,262
Commitments and contingencies (see Note 9) 
 
Redeemable noncontrolling interests 77,819
 80,630
The Madison Square Garden Company Stockholders’ Equity:    
Class A Common stock, par value $0.01, 120,000 shares authorized; 19,025 and 19,014 shares outstanding as of December 31, 2017 and June 30, 2017, respectively 204
 204
Class B Common stock, par value $0.01, 30,000 shares authorized; 4,530 shares outstanding as of December 31, 2017 and June 30, 2017 45
 45
Preferred stock, par value $0.01, 15,000 shares authorized; none outstanding as of December 31, 2017 and June 30, 2017 —
 —
Additional paid-in capital 2,838,120
 2,832,516
Treasury stock, at cost, 1,422 and 1,433 shares as of December 31, 2017 and June 30, 2017, respectively (242,495) (242,077)
Retained earnings (accumulated deficit) 27,693
 (148,410)
Accumulated other comprehensive loss (39,449) (34,115)
Total The Madison Square Garden Company stockholders’ equity 2,584,118
 2,408,163
Nonredeemable noncontrolling interests 17,559
 11,698
Total equity 2,601,677
 2,419,861
Total liabilities, redeemable noncontrolling interests and equity $3,714,271
 $3,712,753


See accompanying notes to consolidated financial statements.

Table of Contents

THE MADISON SQUARE GARDEN COMPANYSPORTS CORP.
CONSOLIDATED STATEMENTS OF OPERATIONSBALANCE SHEETS (Continued)
(Unaudited)
(in thousands, except per share data)




  Three Months Ended Six Months Ended
 December 31, December 31,
 2017 2016 2017 2016
Revenues (a)
 $536,302
 $445,150
 $781,517
 $626,845
         
Operating expenses:        
Direct operating expenses (b)
 311,881
 266,673
 435,617
 378,080
Selling, general and administrative expenses (c)
 121,440
 94,260
 227,878
 171,281
Depreciation and amortization 30,544
 25,966
 61,090
 52,076
Operating income 72,437
 58,251
 56,932
 25,408
Other income (expense):        
Earnings (loss) in equity method investments (2,608) (1,188) 2,117
 (2,182)
Interest income (d)
 5,378
 2,692
 9,764
 5,091
Interest expense (3,798) (491) (7,509) (901)
Miscellaneous income (expense) (250) 1,405
 (250) 1,405
  (1,278) 2,418
 4,122
 3,413
Income from operations before income taxes 71,159
 60,669
 61,054
 28,821
Income tax benefit (expense) 116,832
 (3,248) 116,070
 (314)
Net income 187,991
 57,421
 177,124
 28,507
Less: Net income (loss) attributable to redeemable noncontrolling interests (767) —
 133
 —
Less: Net loss attributable to nonredeemable noncontrolling interests (855) (305) (1,515) (593)
Net income attributable to The Madison Square Garden Company’s stockholders $189,613
 $57,726
 $178,506
 $29,100
         
Basic earnings per common share attributable to The Madison Square Garden Company’s stockholders $8.03
 $2.41
 $7.57
 $1.21
Diluted earnings per common share attributable to The Madison Square Garden Company’s stockholders $7.96
 $2.39
 $7.48
 $1.20
Weighted-average number of common shares outstanding:        
Basic 23,621
 23,971
 23,594
 24,013
Diluted 23,813
 24,143
 23,861
 24,192
December 31,
2023		June 30,
2023
(Unaudited) 
LIABILITIES AND EQUITY
Current Liabilities:
Accounts payable$4,969 $9,093 
Net related party payables5,615 5,842 
Debt30,000 30,000 
Accrued liabilities:
Employee related costs90,987 144,310 
League-related accruals110,904 106,926 
Other accrued liabilities9,653 17,561 
Operating lease liabilities, current50,683 49,745 
Deferred revenue257,626 157,051 
Total current liabilities560,437 520,528 
Long-term debt330,000 295,000 
Operating lease liabilities, noncurrent741,003 746,437 
Defined benefit obligations4,539 4,526 
Other employee related costs50,719 49,070 
Deferred tax liabilities, net19,535 24,024 
Deferred revenue, noncurrent1,405 12,666 
Total liabilities1,707,638 1,652,251 
Commitments and contingencies (see Note 11)
Madison Square Garden Sports Corp. Stockholders’ Equity:
Class A Common Stock, par value $0.01, 120,000 shares authorized; 19,412 and 19,364 shares outstanding as of December 31, 2023 and June 30, 2023, respectively204 204 
Class B Common Stock, par value $0.01, 30,000 shares authorized; 4,530 shares outstanding as of December 31, 2023 and June 30, 202345 45 
Preferred stock, par value $0.01, 15,000 shares authorized; none outstanding as of December 31, 2023 and June 30, 2023— — 
Additional paid-in capital11,471 16,846 
Treasury stock, at cost, 1,036 and 1,084 shares as of December 31, 2023 and June 30, 2023, respectively(171,400)(179,410)
Accumulated deficit(178,512)(173,910)
Accumulated other comprehensive loss(997)(1,009)
Total equity(339,189)(337,234)
Total liabilities and equity$1,368,449 $1,315,017 
_________________
(a)
Include revenues from related parties of $41,131 and $39,040 for the three months ended December 31, 2017 and 2016, respectively, and $77,041 and $72,881 for the six months ended December 31, 2017 and 2016, respectively.
(b)
Include net charges from related parties of $425 and $475 for the three months ended December 31, 2017 and 2016, respectively, and $571 and $689 for the six months ended December 31, 2017 and 2016, respectively.
(c)
Include net charges to related parties of $(1,186) and $(1,616) for the three months ended December 31, 2017 and 2016, respectively, and $(2,624) and $(3,204) for the six months ended December 31, 2017 and 2016, respectively.
(d)
Includes interest income from nonconsolidated affiliates of $2,154 and $1,114 for the three months ended December 31, 2017 and 2016, respectively, and $3,317 and $1,979 for the six months ended December 31, 2017 and 2016, respectively.

See accompanying notes to consolidated financial statements.

Table of Contents

THE MADISON SQUARE GARDEN COMPANY
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited)
(in thousands)
  Three Months Ended Six Months Ended
  December 31, December 31,
  2017 2016 2017 2016
Net income   $187,991
   $57,421
   $177,124
   $28,507
Other comprehensive income (loss), before income taxes:                
Pension plans and postretirement plan:                
Amounts reclassified from accumulated other comprehensive loss:                
Amortization of actuarial loss included in net periodic benefit cost $280
   $344
   $620
 
 $688
 
Amortization of prior service credit included in net periodic benefit cost (6) 274
 (13) 331
 (18) 602
 (25) 663
Cumulative translation adjustments   2,277
   —
   2,277
   —
Net changes related to available-for-sale securities   (7,443)   3,433
   (8,213)   10,175
Other comprehensive income (loss), before income taxes   (4,892)   3,764
 
 (5,334)   10,838
Reversal of income tax expense related to items of other comprehensive income   —
   3,126
   —
   —
Other comprehensive income (loss), net of income taxes   (4,892)   6,890
   (5,334)   10,838
Comprehensive income   183,099
   64,311
 
 171,790
   39,345
Less: Comprehensive income (loss) attributable to redeemable noncontrolling interests   (767)   —
   133
   —
Less: Comprehensive loss attributable to nonredeemable noncontrolling interests   (855)   (305)   (1,515)   (593)
Comprehensive income attributable to The Madison Square Garden Company’s stockholders   $184,721
   $64,616
   $173,172
   $39,938


See accompanying notes to consolidated financial statements.


2

Table of Contents

THE MADISON SQUARE GARDEN COMPANYSPORTS CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWSOPERATIONS
(Unaudited)
(in thousands)
thousands, except per share data)
  Six Months Ended
  December 31,
  2017 2016
Cash flows from operating activities:    
Net income $177,124
 $28,507
Adjustments to reconcile net income to net cash provided by operating activities:    
Depreciation and amortization 61,090
 52,076
Provision for (benefit from) deferred income taxes (116,112) 314
Share-based compensation expense 26,816
 20,098
Loss (earnings) in equity method investments (2,117) 2,182
Purchase accounting adjustments associated with rent-related intangibles and deferred rent 2,280
 —
Other non-cash expense 1,133
 90
Change in assets and liabilities, net of acquisitions:    
Accounts receivable, net (16,896) (14,792)
Net related party receivables 1,190
 2,397
Prepaid expenses and other assets (2,637) (1,602)
Accounts payable 14,544
 12,549
Net related party payables 3,621
 996
Accrued and other liabilities (85,407) (31,930)
Deferred revenue (1,362) 39,047
Net cash provided by operating activities 63,267
 109,932
Cash flows from investing activities:    
Capital expenditures, net of acquisitions (127,684) (21,766)
Payments for acquisition of assets (6,000) (1,000)
Payments to acquire available-for-sale securities —
 (23,222)
Payments for acquisition of businesses, net of cash acquired (8,288) (13,468)
Investments and loans to nonconsolidated affiliates (3,000) (3,235)
Loan payments received 2,600
 —
Cash paid for notes receivable (1,500) —
Net cash used in investing activities (143,872) (62,691)
Cash flows from financing activities:    
Repurchases of common stock (11,830) (72,277)
Proceeds from stock option exercises —
 7
Taxes paid in lieu of shares issued for equity-based compensation (12,232) (7,034)
Distributions to noncontrolling interest holders (3,750) —
Payment of contingent consideration (4,000) —
Payments for financing costs (62) (1,909)
Net cash used in financing activities (31,874) (81,213)
Effect of exchange rates on cash and cash equivalents 12
 —
Net decrease in cash and cash equivalents (112,467) (33,972)
Cash and cash equivalents at beginning of period 1,238,114
 1,444,317
Cash and cash equivalents at end of period $1,125,647
 $1,410,345
Non-cash investing and financing activities:    
Investments and loans to nonconsolidated affiliates $14
 $322
Capital expenditures incurred but not yet paid 5,764
 2,961
Accrued earn-out liability and other contingencies 4,504
 —
Acquisition of assets not yet paid 3,000
 —
 Three Months EndedSix Months Ended
December 31,December 31,
2023202220232022
Revenues (a)
$326,898 $353,694 $369,944 $377,783 
Operating expenses:
Direct operating expenses (b)
232,225 225,702 235,745 229,383 
Selling, general and administrative expenses (c)
65,066 75,636 118,622 130,917 
Depreciation and amortization790 838 1,584 1,863 
Operating income28,817 51,518 13,993 15,620 
Other income (expense):
Interest income619 567 1,072 923 
Interest expense(7,419)(6,079)(14,348)(9,391)
Miscellaneous income (expense), net2,991 385 (9,674)219 
(3,809)(5,127)(22,950)(8,249)
Income (loss) before income taxes25,008 46,391 (8,957)7,371 
Income tax (expense) benefit(10,784)(24,555)4,360 (4,062)
Net income (loss)14,224 21,836 (4,597)3,309 
Less: Net loss attributable to nonredeemable noncontrolling interests— (655)— (1,362)
Net income (loss) attributable to Madison Square Garden Sports Corp.’s stockholders$14,224 $22,491 $(4,597)$4,671 
Basic earnings (loss) per common share attributable to Madison Square Garden Sports Corp.’s stockholders$0.59 $0.85 $(0.19)$0.11 
Diluted earnings (loss) per common share attributable to Madison Square Garden Sports Corp.’s stockholders$0.59 $0.84 $(0.19)$0.11 
Weighted-average number of common shares outstanding:
Basic24,017 24,130 23,994 24,213 
Diluted24,065 24,189 23,994 24,306 

_________________
See accompanying notes to consolidated financial statements.

(a)Includes revenues from related parties of $77,658 and $74,950 for the three months ended December 31, 2023 and 2022, respectively, and $86,475 and $83,124 for the six months ended December 31, 2023 and 2022, respectively.
Table(b)Includes net charges from related parties of Contents
$35,683 and $45,485 for the three months ended December 31, 2023 and 2022, respectively, and $38,299 and $47,669 for the six months ended December 31, 2023 and 2022, respectively.

THE MADISON SQUARE GARDEN COMPANY
CONSOLIDATED STATEMENTS OF EQUITY AND REDEEMABLE NONCONTROLLING INTERESTS
(Unaudited)
(in thousands)
  
Common
Stock
Issued
 
Additional
Paid-In
Capital
 
Treasury
Stock
 Retained Earnings (Accumulated Deficit) 
Accumulated
Other
Comprehensive
Loss
 
Total The Madison Square Garden Company Stockholders’ Equity
 
Non -
redeemable
Noncontrolling
Interests
 Total Equity 
Redeemable
Noncontrolling
 Interests
Balance as of June 30, 2017 $249
 $2,832,516
 $(242,077) $(148,410) $(34,115) $2,408,163
 $11,698
 $2,419,861
 $80,630
Change in accounting policy related to share-based forfeiture rates —
 2,403
 —
 (2,403) —
 —
 —
 —
 —
Net income (loss) —
 —
 —
 178,506
 —
 178,506
 (1,515) 176,991
 133
Other comprehensive loss —
 —
 —
 —
 (5,334) (5,334) —
 (5,334) —
Comprehensive income (loss)           173,172
 (1,515) 171,657
 133
Share-based compensation —
 26,845
 —
 —
 —
 26,845
 —
 26,845
 —
Tax withholding associated with shares issued for equity-based compensation —
 (12,232) —
 —
 —
 (12,232) —
 (12,232) —
Common stock issued under stock incentive plans —
 (11,412) 11,412
 —
 —
 —
 —
 —
 —
Repurchases of common stock —
 —
 (11,830) —
 —
 (11,830) —
 (11,830) —
Distributions to noncontrolling interest holders —
 —
 —
 —
 —
 —
 (806) (806) (2,944)
Noncontrolling interests from acquisition —
 —
 —
 —
 —
 —
 8,182
 8,182
 —
Balance as of December 31, 2017 $249
 $2,838,120
 $(242,495) $27,693
 $(39,449) $2,584,118
 $17,559
 $2,601,677
 $77,819

(c)Includes net charges from related parties of $16,630 and $17,433 for the three months ended December 31, 2023 and 2022, respectively, and $28,755 and $30,741 for the six months ended December 31, 2023 and 2022, respectively.
See accompanying notes to consolidated financial statements.

3


Table of Contents

THE MADISON SQUARE GARDEN COMPANYSPORTS CORP.
CONSOLIDATED STATEMENTS OF EQUITY AND REDEEMABLE NONCONTROLLING INTERESTS (Continued)COMPREHENSIVE INCOME (LOSS)
(Unaudited)
(in thousands)
Three Months EndedSix Months Ended
December 31,December 31,
2023202220232022
Net income (loss)$14,224 $21,836 $(4,597)$3,309 
Other comprehensive income, before income taxes:
Pension plans:
Amounts reclassified from accumulated other comprehensive loss:
Amortization of actuarial loss included in net periodic benefit cost9 5 18 9 
Other comprehensive income, before income taxes9 5 18 9 
Income tax expense related to items of other comprehensive income(3)(2)(6)(3)
Other comprehensive income, net of income taxes6 3 12 6 
Comprehensive income (loss)14,230 21,839 (4,585)3,315 
Less: Comprehensive loss attributable to nonredeemable noncontrolling interests— (655)— (1,362)
Comprehensive income (loss) attributable to Madison Square Garden Sports Corp.’s stockholders$14,230 $22,494 $(4,585)$4,677 
  Common Stock Issued Additional
Paid-In
Capital		 Treasury
Stock		 Accumulated Deficit 
Accumulated
Other
Comprehensive
Loss
 
Total The Madison Square Garden Company Stockholders’ Equity
 Non -
redeemable
Noncontrolling
Interests		 Total Equity
Balance as of June 30, 2016 $249
 $2,806,352
 $(101,882) $(75,687) $(42,611) $2,586,421
 $—
 $2,586,421
Net income (loss) —
 —
 —
 29,100
 —
 29,100
 (593) 28,507
Other comprehensive income —
 —
 —
 —
 10,838
 10,838
 —
 10,838
Comprehensive income (loss)           39,938
 (593) 39,345
Exercise of stock options —
 (39) 46
 —
 —
 7
 —
 7
Share-based compensation —
 20,175
 —
 —
 —
 20,175
 —
 20,175
Tax withholding associated with shares issued for equity-based compensation —
 (5,702) (1,332) —
 —
 (7,034) —
 (7,034)
Common stock issued under stock incentive plans —
 (8,630) 8,630
 —
 —
 —
 —
 —
Repurchases of common stock —
 —
 (72,277) —
 —
 (72,277) —
 (72,277)
Noncontrolling interests from acquisition —
 —
 —
 —
 —
 —
 11,394
 11,394
Balance as of December 31, 2016 $249
 $2,812,156
 $(166,815) $(46,587) $(31,773) $2,567,230
 $10,801
 $2,578,031


See accompanying notes to consolidated financial statements.

4

Table of Contents


THE MADISON SQUARE GARDEN COMPANYSPORTS CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)

Six Months Ended
December 31,
20232022
Cash flows from operating activities:
Net (loss) income$(4,597)$3,309 
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:
Depreciation and amortization1,584 1,863 
Provision for deferred income taxes(4,495)4,009 
Share-based compensation expense10,719 18,839 
Unrealized loss (gain) on equity investments with readily determinable fair value and warrants8,397 (346)
Other non-cash adjustments2,120 572 
Change in assets and liabilities:
Accounts receivable, net(32,529)(27,736)
Net related party receivables(1,365)4,749 
Prepaid expenses and other assets(32,117)(21,881)
Investments(1,700)(9,044)
Accounts payable(4,132)(3,495)
Net related party payables(62)(11,654)
Accrued and other liabilities(55,612)4,866 
Deferred revenue89,314 55,722 
Operating lease right-of-use assets and lease liabilities4,218 11,804 
Net cash (used in) provided by operating activities(20,257)31,577 
Cash flows from investing activities:
Capital expenditures(990)(662)
Purchases of investments(4,248)(652)
Net cash used in investing activities(5,238)(1,314)
Cash flows from financing activities:
Accelerated share repurchase— (75,000)
Dividends paid(648)(170,683)
Taxes paid in lieu of shares issued for equity-based compensation(8,084)(15,440)
Proceeds from revolving credit facilities75,000 215,000 
Repayment of revolving credit facilities(40,000)(30,000)
Net cash provided by (used in) financing activities26,268 (76,123)
Net increase (decrease) in cash, cash equivalents and restricted cash773 (45,860)
Cash, cash equivalents and restricted cash at beginning of period40,459 91,018 
Cash, cash equivalents and restricted cash at end of period$41,232 $45,158 
Non-cash investing and financing activities:
Capital expenditures incurred but not yet paid$45 $417 

See accompanying notes to consolidated financial statements.

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MADISON SQUARE GARDEN SPORTS CORP.
CONSOLIDATED STATEMENTS OF EQUITY
(Unaudited)
(in thousands)
Three Months Ended December 31, 2023
Common
Stock
Issued		Additional
Paid-In
Capital		Treasury
Stock		Accumulated DeficitAccumulated
Other
Comprehensive
Loss		Total Equity
Balance as of September 30, 2023$249 $7,553 $(172,605)$(192,737)$(1,003)$(358,543)
Net income— — — 14,224 — 14,224 
Other comprehensive income— — — — 6 6 
Comprehensive income— — — — — 14,230 
Share-based compensation— 6,570 — — — 6,570 
Tax withholding associated with shares issued for equity-based compensation— (1,447)— — — (1,447)
Common stock issued under stock incentive plans— (1,205)1,205 — — — 
Dividends declared ($7.00 per share)— — — 1 — 1 
Balance as of December 31, 2023$249 $11,471 $(171,400)$(178,512)$(997)$(339,189)
See accompanying notes to consolidated financial statements.
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MADISON SQUARE GARDEN SPORTS CORP.
CONSOLIDATED STATEMENTS OF EQUITY (Continued)
(Unaudited)
(in thousands)
Three Months Ended December 31, 2022
Common Stock IssuedAdditional
Paid-In
Capital		Treasury
Stock		Accumulated DeficitAccumulated
Other
Comprehensive Loss
Total Madison Square Garden Sports Corp. Stockholders’ Equity
Non -
redeemable
Noncontrolling
Interests		Total Equity
Balance as of September 30, 2022$249 $— $(109,981)$(62,447)$(1,183)$(173,362)$1,452 $(171,910)
Net income (loss)— — — 22,491 — 22,491 (655)21,836 
Other comprehensive income— — — — 3 3 — 3 
Comprehensive income (loss)— — — — — 22,494 (655)21,839 
Share-based compensation— 11,619 — — — 11,619 — 11,619 
Tax withholding associated with shares issued for equity-based compensation— (211)— — — (211)— (211)
Common stock issued under stock incentive plans— (209)209 — — — — — 
Dividends declared ($7.00 per share)— — — (172,749)— (172,749)— (172,749)
Accelerated share repurchase— (10,658)(60,000)(4,342)— (75,000)— (75,000)
Adjustments to noncontrolling interests— (541)— — — (541)541 — 
Balance as of December 31, 2022$249 $— $(169,772)$(217,047)$(1,180)$(387,750)$1,338 $(386,412)
See accompanying notes to consolidated financial statements.
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MADISON SQUARE GARDEN SPORTS CORP.
CONSOLIDATED STATEMENTS OF EQUITY (Continued)
(Unaudited)
(in thousands)
Six Months Ended December 31, 2023
Common
Stock
Issued		Additional
Paid-In
Capital		Treasury
Stock		Accumulated DeficitAccumulated
Other
Comprehensive
Loss		Total Equity
Balance as of June 30, 2023$249 $16,846 $(179,410)$(173,910)$(1,009)$(337,234)
Net loss— — — (4,597)— (4,597)
Other comprehensive income— — — — 12 12 
Comprehensive loss— — — — — (4,585)
Share-based compensation— 10,719 — — — 10,719 
Tax withholding associated with shares issued for equity-based compensation— (8,084)— — — (8,084)
Common stock issued under stock incentive plans— (8,010)8,010 — — — 
Dividends declared ($7.00 per share)— — — (5)— (5)
Balance as of December 31, 2023$249 $11,471 $(171,400)$(178,512)$(997)$(339,189)
See accompanying notes to consolidated financial statements.
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MADISON SQUARE GARDEN SPORTS CORP.
CONSOLIDATED STATEMENTS OF EQUITY (Continued)
(Unaudited)
(in thousands)
Six Months Ended December 31, 2022
Common Stock IssuedAdditional
Paid-In
Capital		Treasury
Stock		Retained Earnings (Accumulated Deficit)Accumulated
Other
Comprehensive Loss
Total Madison Square Garden Sports Corp. Stockholders’ Equity
Non -
redeemable
Noncontrolling
Interests		Total Equity
Balance as of June 30, 2022$249 $17,573 $(128,026)$(35,699)$(1,186)$(147,089)$1,712 $(145,377)
Net income (loss)— —— 4,671 — 4,671 (1,362)3,309 
Other comprehensive income— — — — 6 6 — 6 
Comprehensive income (loss)— — — — — 4,677 (1,362)3,315 
Share-based compensation— 18,839 — — — 18,839 — 18,839 
Tax withholding associated with shares issued for equity-based compensation— (15,440)— — — (15,440)— (15,440)
Common stock issued under stock incentive plans— (9,326)18,254 (8,928)— — — — 
Dividends declared ($7.00 per share)— — — (172,749)— (172,749)— (172,749)
Accelerated share repurchase— (10,658)(60,000)(4,342)— (75,000)— (75,000)
Adjustments to noncontrolling interests— (988)— — — (988)988 — 
Balance as of December 31, 2022$249 $— $(169,772)$(217,047)$(1,180)$(387,750)$1,338 $(386,412)
See accompanying notes to consolidated financial statements.



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MADISON SQUARE GARDEN SPORTS CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
All amounts included in the following Notes to Consolidated Financial Statements are presented in thousands, except per share data or as otherwise noted.
Note 1. Description of Business and Basis of Presentation
Description of Business
The Madison Square Garden CompanySports Corp. (together with its subsidiaries, collectively, “we,” “us,” “our,” “MSG Sports,” or the “Company” or “Madison Square Garden”) isowns and operates a liveportfolio of assets featuring some of the most recognized teams in all of sports, and entertainment business. The Company classifies its business interests into two reportable segments: MSG Entertainment and MSG Sports. MSG Entertainment includes live entertainment events such as concerts, family shows, performing arts and special events, which are presented or hosted in the Company’s diverse collection of venues along with live offerings through TAO Group Holdings LLC (“TAO Group”) and Boston Calling Events LLC (“BCE”). TAO Group is a hospitality group with globally-recognized entertainment dining and nightlife brands: TAO, Marquee, Lavo, Avenue, The Stanton Social, Beauty & Essex and Vandal. BCE produces New England’s premier Boston Calling Music Festival. MSG Entertainment also includes the Company’s original productions — the Christmas Spectacular Starring the Radio City Rockettes (the “Christmas Spectacular”) and the New York Spectacular Starring the Radio City Rockettes (the “New York Spectacular”). MSG Sports includes the Company’s professional sports franchises:including the New York Knicks (the “Knicks”Knickerbockers (“Knicks”) of the National Basketball Association (the “NBA”(“NBA”), and the New York Rangers (the “Rangers”(“Rangers”) of the National Hockey League (the “NHL”(“NHL”),. Both the New York Liberty (the “Liberty”) ofKnicks and the Women’s National Basketball Association (the “WNBA”Rangers play their home games in Madison Square Garden Arena (“The Garden”),. The Company’s other professional sports franchises include two development league teams — the Hartford Wolf Pack of the American Hockey League (the “AHL”) and the Westchester Knicks of the NBA Gatorade League (the “NBAGL”). The MSG Sports segment also includes other live sporting events, includingG League. These professional boxing, college basketball, college hockey, professional bull riding, mixed martial arts, esports, tennis and college wrestling, all of whichsports franchises are collectively referred to herein as the “sports teams.” In addition, the Company promotes, produces and/or presents. In July 2017, the Company acquiredpreviously owned a controlling interest in Counter Logic Gaming (“CLG”), a premier North American esports organization, which is now part oforganization. In April 2023, the MSG Sports segment.
Company sold its controlling interest in CLG to Hard Carry Gaming Inc. (“NRG”), a professional gaming and entertainment company in exchange for a noncontrolling equity interest in the combined NRG/CLG company. CLG and the sports teams are collectively referred to herein as the “teams.” The Company conductsalso operates a significant portion of its operations at venues that it either owns or operates under long-term leases. The Company ownsprofessional sports team performance center — the Madison Square Garden Arena (“Training Center in Greenburgh, NY.
The Garden”)Company operates and reports financial information in one segment. The Theater at Madison Square GardenCompany’s decision to organize as one operating segment and report in New York City,one segment is based upon its internal organizational structure; the Forummanner in Inglewood, CA and The Chicago Theatre in Chicago. In addition, the Company leases Radio City Music Hallwhich its operations are managed; and the Beacon Theatre in New York City,criteria used by the Company’s Executive Chairman, its Chief Operating Decision Maker (“CODM”), to evaluate segment performance. The Company’s CODM reviews total company operating results to assess overall performance and has a booking agreement with respect to the Wang Theatre in Boston. Additionally, TAO Group operates various restaurants, nightlife and hospitality venues under long-term leases and management contracts in New York, Las Vegas, Los Angeles, Australia and Singapore.allocate resources.
The Company was incorporated on March 4, 2015 as an indirect, wholly-owned subsidiary of MSG Networks Inc. (“MSG Networks”), formerly known as The. All of the outstanding common stock of the Company was distributed to MSG Networks shareholders (the “MSGS Distribution”) on September 30, 2015.
On April 17, 2020, the Company distributed all of the outstanding common stock of Sphere Entertainment Co. (formerly Madison Square Garden Company. Entertainment Corp. and referred to herein as “Sphere Entertainment”) to its stockholders (the “Sphere Distribution”).
On September 11, 2015, MSG Networks’ boardApril 20, 2023 (the “MSGE Distribution Date”), Sphere Entertainment distributed to its stockholders approximately 67% of directors approved the distributionissued and outstanding shares of all the outstanding common stock of Madison Square Garden Entertainment Corp. (referred to herein as “MSG Entertainment”) to its stockholders (the “MSGE Distribution”). All agreements between the Company and MSG Entertainment described herein were between the Company and Sphere Entertainment prior to the MSGE Distribution (except agreements entered into after the MSGE Distribution Date).
Unless the context otherwise requires, all references to MSG Networks’ stockholders (the “Distribution”), which occurred on September 30, 2015. See Note 1Entertainment, Sphere Entertainment and MSG Networks refer to the consolidatedsuch entity, together with its direct and combined financial statements included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2017 for more information regarding the Distribution to its common stockholders.indirect subsidiaries.
Basis of Presentation
The accompanying unaudited consolidated interim financial statements (referred to as the “Financial Statements” herein) have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and Article 10 of Regulation S-X of the U.S. Securities and Exchange Commission (“SEC”(the “SEC”) for interim financial information, and should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended June 30, 2017.2023 (“fiscal year 2023”). The Financial Statements presented in this Quarterly Report on Form 10-Q are unaudited; however, in the opinion of management, the Financial Statements reflect all adjustments, consisting solely of normal recurring adjustments, necessary for a fair presentation of the results for the interim periods presented. The results of operations for the periods presented are not necessarily indicative of the results that might be expected for future interim periods or for the full year. The dependence of the MSG Sports segment on revenues from its NBA and NHL sports teams generally means it earns a disproportionate share of its revenues in the second and third quarters of the Company’s fiscal year. The dependenceyear, which is when the majority of the MSG Entertainment segmentsports teams’ games are played.
Reclassifications
Certain reclassifications have been made in order to conform to the current period’s presentation and relate to the separation of Investments and unrealized loss (gain) on revenues fromequity investments with readily determinable fair value and warrants on the Christmas Spectacular generally means it earns a disproportionate shareconsolidated statements of its revenues incash flows for the second quarter of the Company’s fiscal year.six months ended December 31, 2022.

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THE MADISON SQUARE GARDEN COMPANYSPORTS CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)



Note 2. Accounting Policies
Principles of Consolidation
The consolidated financial statements of the Company include the accounts of The Madison Square Garden CompanySports Corp. and its subsidiaries. All significant intercompany transactions and balances have been eliminated in consolidation. In addition,For consolidated subsidiaries where the consolidated financial statements ofCompany’s ownership is less than 100%, the relevant amounts attributable to investors other than the Company include the accounts from TAO Group, BCE and CLG, in which the Company has controlling voting interests. The Company’s consolidation criteria are based on authoritative accounting guidance for voting interest, controlling interest or variable interest entities. TAO Group, BCE and CLG are consolidated with the equity owned by other shareholders shown as redeemable orreflected under “Nonredeemable noncontrolling interests,” “Net income (loss) attributable to nonredeemable noncontrolling interestsinterests” and “Comprehensive income (loss) attributable to nonredeemable noncontrolling interests” in the accompanying consolidated balance sheets, and the other shareholders’ portion of net earnings (loss) and other comprehensive income (loss) shown as net income (loss) or comprehensive income (loss) attributable to redeemable or nonredeemable noncontrolling interests in the accompanying consolidated statements of operations and consolidated statements of comprehensive income respectively. See Note 2 to the consolidated and combined financial statements included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2017 for more information regarding the classification of redeemable noncontrolling interests of TAO Group. In addition, TAO Group’s results are reported on a three-month lag basis and TAO Group reports on a fiscal year reflecting the retail-based calendar (containing 4-4-5 week calendar quarters). Accordingly, the Company’s results for the three and six months ended December 31, 2017 include TAO Group’s operating results from June 26, 2017 to September 24, 2017 and March 27, 2017 to September 24, 2017,(loss), respectively.
Use of Estimates
The preparation of the accompanying Financial Statements in conformity with GAAP requires management to make estimates and assumptions about future events. These estimates and the underlying assumptions affect the amountamounts of assets and liabilities reported, disclosures about contingent assets and liabilities, and reported amounts of revenues and expenses. Such estimates include the valuation of accounts receivable, investments, goodwill, intangible assets, other long-lived assets, fair value of investments, deferred tax valuation allowance, tax accruals, and other liabilities. In addition, estimates are used in revenue recognition, revenue sharing expense (net of escrow)escrow and excluding playoffs), luxury tax expense, income tax expense, performance and share-based compensation, depreciation and amortization, litigation matters and other matters, as well as in the valuation of contingent consideration and noncontrolling interests resulting from business combination transactions.matters. Management believes its use of estimates in the Financial Statements areto be reasonable.
Management evaluates its estimates on an ongoing basis using historical experience and other factors, including the general economic environment and actions it may take in the future. The Company adjusts such estimates when facts and circumstances dictate. However, these estimates may involve significant uncertainties and judgments and cannot be determined with precision. In addition, these estimates are based on management’s best judgment at a point in time and, as such, these estimates may ultimately differ from actual results. Changes in estimates resulting from weakness in the economic environment or other factors beyond the Company’s control could be material and would be reflected in the Company’s financial statements in future periods.
Summary of Significant Accounting Policies
The following is an update to the Company’s Summary of Significant Accounting Policies disclosed in its Annual Report on Form 10-K for the year ended June 30, 2017:
Revenue Recognition
Deferred revenue reported in the accompanying consolidated balance sheets as of December 31, 2017 and June 30, 2017 includes amounts due to the third-party promoters of $50,414 and $72,400, respectively.
Foreign Currency Translation
The consolidated financial statements are presented in U.S. Dollars. Assets and liabilities of non-U.S. subsidiaries that operate in a local currency environment, where that local currency is the functional currency, are translated to U.S. Dollars at exchange rates in effect at the balance sheet date. Operating results of non-U.S. subsidiaries are translated at weighted-average exchange rates during the year which approximate the rates in effect at the transaction dates. Foreign currency translation gains and losses are included as a component of accumulated other comprehensive income (loss) as changes in cumulative translation adjustments in the accompanying consolidated balance sheet.


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THE MADISON SQUARE GARDEN COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)


Recently Issued Accounting Pronouncements
Recently AdoptedIssued Accounting Pronouncements Not Yet Adopted
In March 2016,2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”ASU”) No. 2016-07, Investments - Equity Method and Joint Ventures2023-01, Leases (Topic 323), Simplifying the Transition842): Common Control Arrangements. This ASU amends certain provisions of Accounting Standards Codification (“ASC”) 842, Leases that apply to the Equity Method of Accounting. ASU No. 2016-07 eliminates the requirementarrangements between related parties under common control. The new guidance is effective for an investor to retrospectively apply the equity method when an investment that it had accounted for by another method qualifies for use of the equity method. This standard was adopted by the Company prospectively in the first quarter of fiscal year 2018. The adoption of the standard did not have an impact on the Company’s consolidated financial statements.
In March 2016, the FASB issued ASU No. 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-based Payment Accounting. ASU No. 2016-09, among other things, (i) requires the income tax effects of all awards to be recognized in the statement of operations when the awards vest or are settled, (ii) allows an employer to repurchase more of an employee’s shares for tax withholding purposes than currently allowable, without triggering liability accounting, and provides companies with the option to make a policy election to account for forfeitures as they occur, and (iii) requires companies to present excess tax benefits as operating activity rather than as financing activity on the statement of cash flows. This standard was adopted by the Company in the first quarter of fiscal year 2018. In connection with the Company’s election to record forfeitures as they occur, the Company used the modified retrospective transition method and recorded a cumulative effect of $2,403, which was an increase in beginning accumulated deficits with the offset by an equal increase in additional paid in capital. In addition, the Company prospectively adopted the provision regarding the presentation of excess tax benefits in the statement of cash flows, which did not result in a change in the net cash provided by operating activities for the six months ended December 31, 2017 because the Company currently maintains a 100% valuation allowance on its deferred tax asset.
In May 2017, the FASB issued ASU No. 2017-09, Compensation - Stock Compensation (Topic 718): Scope of Modification Accounting. ASU No. 2017-09 provides clarification on when modification accounting should be used for changes to the terms or conditions of a share-based payment award. This standard does not change the accounting for modifications but clarifies that modification accounting guidance should only be applied if there is a change to the value, vesting conditions or award classification and would not be required if the changes are considered non-substantive. This standard was early adopted by the Company prospectively in the first quarter of fiscal year 2018. The adoption of the standard did not have an impact on the Company’s consolidated financial statements.
Recently Issued Accounting Pronouncements Not Yet Adopted
In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes the revenue recognition requirements in FASB Accounting Standards Codification (“ASC”) Topic 605, Revenue Recognition. ASC Topic 606, among other things, (i) is based on the principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services, and (ii) requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract. In August 2015, the FASB issued ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date, which defers the effective date of ASU No. 2014-09 for all entities by one year. In March 2016, the FASB issued ASU No. 2016-08, Revenue from Contracts with Customers (Topic 606), Principal versus Agent Considerations (Reporting Revenue versus Net), which clarifies the implementation guidance on principal versus agent considerations in the new revenue recognition standard under ASU No. 2014-09. ASU No. 2016-08 clarifies how an entity should identify the unit of accounting (i.e. the specified good or service) for the principal versus agent evaluation and how it should apply the control principle to certain types of arrangements. In April 2016, the FASB issued ASU No. 2016-10, Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing, which clarifies the principle in ASU No 2014-09 for determining whether a good or service is separately identifiable from other promises in the contract and, therefore, should be accounted for separately. ASU No. 2016-10 also clarifies that entities are not required to identify promised goods or services that are immaterial in the context of the contract and allows entities to elect to account for shipping and handling activities as a fulfillment cost rather than as an additional promised service. In May 2016, the FASB issued ASU No. 2016-12, Revenue from Contracts with Customers (Topic 606) - Narrow-Scope Improvements and Practical Expedients, which clarifies the following aspects in ASU No. 2014-09: collectability, presentation of sales taxes and other similar taxes collected from customers, noncash considerations, contract modifications at transition, completed contracts at


Table of Contents
THE MADISON SQUARE GARDEN COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)


transition, and technical correction. In December, the FASB issued ASU No. 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers, which allows entities not to make quantitative disclosures about remaining performance obligations in certain cases and requires entities that use any of the new or previously existing optional exemptions to expand their qualitative disclosures. ASCTopic 606 and the related updates will be effective for the Company beginning in the first quarter of fiscal year 2019 using one of two retrospective application methods. The Company’s evaluation of the impact this standard will have on its consolidated financial statements is ongoing. Based on the review to date, the Company believes that the adoption of the new standard will impact the quarterly and annual recognition for certain revenue streams. While the Company has made substantial progress in concluding the appropriate treatment for most of its revenue streams, the review is ongoing for a few remaining revenue streams. The Company has not decided whether the retrospective or modified retrospective method will be used in adopting the new standard.
In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities, addresses certain aspects of recognition, measurement, presentation, and disclosure of financial instruments. This standard, among other things, (i) requires equity investments, with certain exceptions, to be measured at fair value with changes in fair value recognized in net income and (ii) simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment. Early adoption is not permitted with the exception of certain provisions related to the presentation of other comprehensive income. This standard will be effective for the Company beginning in the first quarter of fiscal year 2019.2025. The Company is currently evaluating the impact this standard will have on its consolidated financial statements.
In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which supersedes existing guidance on accounting for leases in FASB ASC Topic 840, Leases. ASU No. 2016-02, among other things, (i) requires lessees to account for leases as either finance leases or operating leases and generally requires all leases to be recorded on the balance sheet, including those leases classified as operating leases under previous accounting guidance, through the recognition of right-of-use assets and corresponding lease liabilities, and (ii) requires extensive qualitative and quantitative disclosures about leasing activities. The accounting applied by a lessor is largely unchanged from that applied under previous accounting guidance. This standard will be effective for the Company beginning in the first quarter of fiscal year 2020 and is required to be applied using the modified retrospective approach for all leases existing as of the effective date. Early adoption is permitted; however, the Company currently does not plan to adopt this standard early. The Company’s evaluation of the impact this standard will have on its consolidated financial statements is ongoing. Based on efforts to date, the adoption of the standard will result in the recognition of right of use assets and lease liabilities related to the Company’s operating leases.
In June 2016,November 2023, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses.No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The ASU 2016-13 replacesexpands public entities’ segment disclosures by requiring disclosure of significant segment expenses that are regularly provided to the incurredCODM and included within each reported measure of segment profit or loss, impairment methodology in current U.S. GAAPan amount and description of its composition for other segment items, and interim disclosures of a reportable segment’s profit or loss and assets. All disclosure requirements under ASU 2023-07 are also required for public entities with a methodology that will require the reflection of expected credit losses and will also require consideration of a broader range of reasonable and supportable information to determine credit loss estimates. For most financial instruments, the standard will require the use of a forward-looking expected loss model rather than the incurred loss model for recognizing credit losses, which will generally result in the earlier recognition of credit losses on financial instruments. This standard will besingle reportable segment. The ASU is effective for the Company beginning inCompany’s Annual Report on Form 10-K for the first quarter of fiscal year 2021,ending June 30, 2025 and subsequent interim periods, with early adoption permitted. The Company is currently evaluating the impact this standard will have on its consolidated financial statements.segment disclosures.
In August 2016,December 2023, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230). ASU No. 2016-15 addresses eight specific cash flow issues and is intended to reduce diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows. This standard will be effective for the Company beginning in the first quarter of fiscal year 2019. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial statements.
In October 2016, the FASB issued ASU No. 2016-16, 2023-09, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory.Improvements to Income Tax Disclosures. The ASU No. 2016-16 requires entitiesenhances annual disclosures related to recognizethe effective income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. This standard will berate reconciliation and income taxes paid. The ASU is effective for the Company beginning inCompany’s Annual Report on Form 10-K for the first quarter of fiscal year 2019. Earlyending June 30, 2026 and subsequent interim periods, with early adoption permitted. The Company is permitted as ofcurrently evaluating the beginning of an annual reporting period for which financial statements have not been issued or made available for issuance. The adoption ofimpact this standard is not expected towill have a material impact on the Company’s consolidated financial statements.its income tax disclosures.

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THE MADISON SQUARE GARDEN COMPANYSPORTS CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)



Note 3. Revenue Recognition
In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows: Restricted Cash. The primary purpose of ASU No. 2016-18 is to reduce the diversity in practice that existsContracts with Customers
All revenue recognized in the classification and presentation of changes in restricted cash on the statement of cash flows. This standard will require that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. This standard will be effective retrospectively for the Company beginning in the first quarter of fiscal year 2019, and will result in a change to the Company’s presentation of net cash provided by (used in) operating activities in the statement of cash flows for the impact of changes in restricted cash balances. Early adoption is permitted in any interim or annual period.
In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805) Clarifying the Definition of a Business. The primary purpose of this ASU is to clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses, which will affect many areas of accounting including acquisitions, disposals, goodwill, and consolidation. This standard will be effective for the Company beginning in the first quarter of fiscal year 2019 and is required to be applied prospectively. Early adoption is permitted. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial statements.
In January 2017, the FASB issued ASU No. 2017-04, Intangibles - Goodwill and Other (Topic 350): Simplifying the Accounting for Goodwill Impairment. ASU No. 2017-04 removes Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation. A goodwill impairment will now be the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. This standard will be effective for the Company beginning in the first quarter of fiscal year 2021 and is required to be applied prospectively. Early adoption is permitted for interim or annual goodwill impairment tests performed on testing dates after January 1, 2017. The adoption of this standard is not expected to have a material impact on the Company’s consolidated financial statements.
In March 2017, the FASB issued ASU No. 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. ASU No. 2017-07 requires employers to disaggregate the service cost component from the other components of net benefit cost and disclose by line item the amount of net benefit cost that is included in the statement of operations or capitalized in assets. The standard requires employers to report the service cost component in the same line item(s) as other compensation costs arising from services rendered by the pertinent employees during the period and to report other components of net benefit cost separately and outside the subtotal of operating income. The standard also allows only the service cost component to be eligible for capitalization. This standard will be effective for the Company beginning in the first quarter of fiscal year 2019. The guidance requires application on a retrospective basis for the presentation of the service cost component and the other components of net benefit cost in the statements of operations and on a prospective basis for the capitalization of the service cost component of net benefit cost in assets. Early adoption is permitted as of the beginning of an annual reporting period for which financial statements have not been issued or made available for issuance.considered to be revenue from contracts with customers. For the three months ended December 31, 2017, net periodic pension and other postretirement employee benefit cost reported within operating income totaled to $1,031, of which $53 represented service cost. For the six months ended December 31, 2017, net periodic pension2023 and other postretirement employee benefit cost reported within operating income totaled to $2,093, of which $105 represented service cost.

Note 3. Acquisitions
On July 28, 2017,2022, the Company acquired a 65% controlling interest in CLG, a premier North American esports organization. CLG’s resultsdid not have any material impairment losses on receivables or contract assets arising from contracts with customers.
Disaggregation of operations since the acquisition date, which are included inRevenue
The following table disaggregates the Company’s consolidated statementsrevenues by type of operationsgoods or services in accordance with the required entity-wide disclosure requirements set forth in ASC Subtopic 280-10-50-38 to 40 and the disaggregation of revenue required disclosures in accordance with ASC Subtopic 606-10-50-5 for the three and six months ended December 31, 2017, were not material. Pro forma information is not provided since2023 and 2022:
Three Months EndedSix Months Ended
December 31,December 31,
2023202220232022
Event-related (a)
$122,449 $142,308 $128,270 $147,654 
Media rights (b)
122,547 118,158 129,766 125,144 
Sponsorship, signage and suite licenses69,316 81,021 74,630 85,835 
League distributions and other12,586 12,207 37,278 19,150 
Total revenues from contracts with customers$326,898 $353,694 $369,944 $377,783 
_________________
(a)Consists of (i) ticket sales and other ticket-related revenues, and (ii) food, beverage and merchandise sales at The Garden.
(b)Consists of (i) local media rights fees, (ii) revenue from the acquisition was not material when compared with the Company’s consolidated financial statements.distribution through league-wide national television contracts, and (iii) other local radio rights fees.
On November 20, 2017, the Company acquired a 100% controlling interest in Obscura Digital (“Obscura”), a creative studio, globally-recognized for its work in designing and developing next-generation immersive experiences. Obscura’s results of operations since the acquisition date, which are included in the Company’s consolidated statements of operations for the three and six months ended December 31, 2017, were not material. Pro forma information is not provided since the acquisition was not material when compared with the Company’s consolidated financial statements. In addition, the Obscura financial results of operations will be reflected in the MSG Entertainment segment. Any costs incurred by Obscura that are associated with the Company’s venue development initiatives will be reported in “Corporate and Other.”


12

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THE MADISON SQUARE GARDEN COMPANYSPORTS CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)



The timing of revenue recognition, billings and cash collections results in billed receivables, contract assets and contract liabilities on the consolidated balance sheet. The following table provides information about contract balances from the Company’s contracts with customers as of December 31, 2023 and June 30, 2023.
December 31,June 30,
20232023
Receivables from contracts with customers, net (a)
$65,963 $20,134 
Contract assets, current (b)
19,134 19,465 
Deferred revenue, including non-current portion (c), (d)
259,031 169,717 
_________________
(a)Receivables from contracts with customers, net, which are reported in Accounts receivable, net and Net related party receivables in the accompanying consolidated balance sheets, represent the Company’s unconditional rights to consideration under its contracts with customers. As of December 31, 2023 and June 30, 2023, the Company’s receivables reported above included $2,012 and $0, respectively, related to contracts with customers who are related parties. See Note 16 for further details on related party arrangements. Receivables from contracts with customers, net, excludes amounts recorded in Accounts receivable, net, associated with amounts due from the NBA and NHL related to escrow and player compensation recoveries and luxury tax payments. As of December 31, 2023 and June 30, 2023, the Company had receivable balances related to escrow and player compensation recoveries of $2,197 and $1,544, respectively, recorded in Accounts receivable, net.
(b)Contract assets, current, which are reported as Other current assets in the accompanying consolidated balance sheets, primarily relate to the Company’s rights to consideration for goods or services transferred to the customer, for which the Company does not have an unconditional right to bill as of the reporting date. Contract assets are transferred to accounts receivable once the Company’s right to consideration becomes unconditional.
(c)Deferred revenue, including non-current portion, primarily relates to the Company’s receipt of consideration from customers or billing customers in advance of the Company’s transfer of goods or services to those customers. Deferred revenue is reduced and the related revenue is recognized once the underlying goods or services are transferred to a customer. The Company’s deferred revenue related to local media rights was $10,013 and $0 as of December 31, 2023 and June 30, 2023, respectively. See Note 16 for further details on these related party arrangements.
(d)Revenue recognized for the six months ended December 31, 2023 relating to the deferred revenue balance as of June 30, 2023 was $77,945.

Transaction Price Allocated to the Remaining Performance Obligations
The following table depicts the estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) as of December 31, 2023 and is based on current projections. In developing the estimated revenue, the Company applies the allowable practical expedient and does not disclose information about remaining performance obligations that have original expected durations of one year or less. Additionally, the Company has elected to exclude variable consideration from its disclosure related to the remaining performance obligations under its local media rights arrangements, league-wide national and international television contracts, and certain other arrangements with variable consideration.
Fiscal Year 2024 (remainder)$112,924 
Fiscal Year 2025123,978 
Fiscal Year 202677,120 
Fiscal Year 202738,711 
Fiscal Year 202819,697 
Thereafter16,936 
$389,366 

13
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MADISON SQUARE GARDEN SPORTS CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)

Note 4. Computation of Earnings (Loss) per Common Share
The following table presents a reconciliation of earnings (loss) allocated to common shares and a reconciliation of weighted-average shares used in the calculations of basic and diluted earnings (loss) per common share attributable to the Company’s stockholders (“EPS”). and the number of shares excluded from diluted earnings (loss) per common share, as they were anti-dilutive.
Three Months EndedSix Months Ended
 December 31,December 31,
 2023202220232022
Net earnings (loss) allocable to common shares, basic and diluted (numerator):
Net income (loss) attributable to Madison Square Garden Sports Corp.’s stockholders$14,224 $22,491 $(4,597)$4,671 
Less: Dividends to other-than-common stockholders (a)
(1)2,056 5 2,056 
Net earnings (loss) allocable to common shares, basic and diluted (numerator):$14,225 $20,435 $(4,602)$2,615 
Weighted-average shares (denominator):
Weighted-average shares for basic EPS24,017 24,130 23,994 24,213 
Dilutive effect of shares issuable under share-based compensation plans48 59 — 93 
Weighted-average shares for diluted EPS24,065 24,189 23,994 24,306 
Weighted-average shares excluded from diluted EPS— — 71 — 
Basic earnings (loss) per common share attributable to Madison Square Garden Sports Corp.’s stockholders$0.59 $0.85 $(0.19)$0.11 
Diluted earnings (loss) per common share attributable to Madison Square Garden Sports Corp.’s stockholders$0.59 $0.84 $(0.19)$0.11 
_________________
(a)Dividends to other-than-common stockholders consists of forfeitable rights to dividends declared and payable to holders of the Company’s unvested restricted stock units and performance restricted stock units.

14
  Three Months Ended Six Months Ended
  December 31, December 31,
  2017 2016 2017 2016
Weighted-average shares (denominator):        
Weighted-average shares for basic EPS 23,621
 23,971
 23,594
 24,013
Dilutive effect of shares issuable under share-based compensation plans 192
 172
 267
 179
Weighted-average shares for diluted EPS 23,813
 24,143
 23,861
 24,192
  Anti-dilutive shares 19
 7
 10
 6
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MADISON SQUARE GARDEN SPORTS CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)

Note 5. Team Personnel Transactions
Direct operating and selling, general and administrative expenses in the accompanying consolidated statements of operations include a net provisionsprovision or credit for transactions relating to players on the Company’s sports teams for waiver/contract termination costs, player trades and a player tradeseason-ending injuries (“Team Personnel Transactions”personnel transactions”). There were no Team Personnel Transactionspersonnel transactions for the three and six months ended December 31, 2023. Team personnel transactions were $2,758 and $980a net provision of $29 for the three months ended December 31, 20172022 and 2016, respectively, and $2,858 and $5,990net credit of $300 for the six months ended December 31, 20172022.
Note 6. Cash, Cash Equivalents and 2016, respectively.Restricted Cash
The following table provides a summary of the amounts recorded as cash, cash equivalents and restricted cash.
As of
December 31,
2023		June 30,
2023		December 31,
2022		June 30,
2022
Captions on the consolidated balance sheets:
Cash and cash equivalents$37,880 $40,398 $43,912 $91,018 
Restricted cash (a)
3,352 61 1,246 — 
Cash, cash equivalents and restricted cash on the consolidated statements of cash flows$41,232 $40,459 $45,158 $91,018 
_________________
(a)Restricted cash as of December 31, 2023, June 30, 2023 and December 31, 2022 included cash deposited in an escrow account (see Note 62 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2023 for more information). Investments
Note 7. Leases
As of December 31, 2023, the Company’s leases primarily consist of the lease of the Company’s principal executive offices under the Sublease Agreement with MSG Entertainment (the “Sublease Agreement”) and Loansa lease agreement for an aircraft. Prior to Nonconsolidated Affiliatesthe MSGE Distribution Date, the Sublease Agreement was between the Company and Sphere Entertainment. In addition, the Company accounts for the rights of use of The Garden pursuant to the Arena License Agreements (as defined below) as leases under the ASC Topic 842, Leases. See Note 7 to the consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2023 for more information regarding the Company’s accounting policies associated with its leases.
As of December 31, 2023, the Company’s existing operating leases, which are recorded in the accompanying financial statements, have remaining lease terms ranging from 10 months to 32 years. In certain instances, leases include options to renew, with varying option terms. The exercise of lease renewals, if available under the lease options, is generally at the Company’s discretion and is considered in the Company’s assessment of the respective lease term. The Company’s investments and loans to nonconsolidated affiliates which are accounted for under the equity method and cost method of accounting in accordance with ASC Topic 323, Investments - Equity Method and Joint Ventures, and ASC Topic 325, Investments - Other, respectively, consisted of the following:lease agreements do not contain material residual value guarantees or material restrictive covenants.

15
  Ownership Percentage Investment 
Loan (a)
  Total
December 31, 2017         
Equity method investments:         
Azoff MSG Entertainment LLC (“AMSGE”) 50% $107,496
 $97,500
  $204,996
Tribeca Enterprises LLC (“Tribeca Enterprises”) 50% 11,535
 17,892
(b) 
 29,427
Other 50% 2,638
 —
  2,638
Cost method investments   10,525
 —
  10,525
Total investments and loans to nonconsolidated affiliates   $132,194
 $115,392
  $247,586
          
June 30, 2017         
Equity method investments:         
AMSGE 50% $104,024
 $97,592
(c) 
 $201,616
Brooklyn Bowl Las Vegas, LLC (“BBLV”) 
(d) 

 —
 2,662
(e) 
 2,662
Tribeca Enterprises 50% 12,864
 14,370
(b) 
 27,234
Cost method investments   10,775
 —
  10,775
Total investments and loans to nonconsolidated affiliates   $127,663
 $114,624
  $242,287
_________________
(a)
In connection with the Company’s investments in AMSGE and Tribeca Enterprises, the Company provides $100,000 and $17,500 revolving credit facilities to these entities, respectively. Pursuant to their terms, the AMSGE and Tribeca Enterprises revolving credit facilities will terminate on September 20, 2020 and June 30, 2021, respectively.


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THE MADISON SQUARE GARDEN COMPANYSPORTS CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)



(b)
Includes outstanding payments-in-kind (“PIK”) interest of $1,392 and $870 as of December 31, 2017 and June 30, 2017, respectively. PIK interest owed does not reduce availability under the revolving credit facility.
(c)
Represents the outstanding loan balance, inclusive of amounts due to the Company for interest of $92 as of June 30, 2017.
(d)
As of June 30, 2017, the Company was entitled to receive back its capital, which was 74% of BBLV’s total capital, plus a preferred return, after which the Company would own a 20% interest in BBLV. As of December 31, 2017, the Company now owns a 35% interest in BBLV with no preferred return, as a result of an amendment to the BBLV’s operating agreement.
(e)
Represents the outstanding loan balance, inclusive of amounts due to the Company for interest of $62 as of June 30, 2017. In December 2017, in connection with the amendment of the BBLV’s operating agreement, the Company received a payment of $2,662, which represented the outstanding loan principal and accrued interest balance. In addition, the Company recognized interest income of $938 for the three and six months ended December 31, 2017, which was received in connection with the repayment of the loan receivable since the loan balance was on a nonaccrual status.
See Note 9 for more information regarding a legal matter associated with AMSGE.
The following table summarizes the right-of-use assets and lease liabilities recorded in the accompanying consolidated balance sheets as of December 31, 2023 and June 30, 2023:
Line Item in the Company’s Consolidated Balance SheetDecember 31,
2023		June 30,
2023
Right-of-use assets:
Operating leasesRight-of-use lease assets$706,569 $715,283 
Lease liabilities:
Operating leases, current (a)
Operating lease liabilities, current$50,683 $49,745 
Operating leases, noncurrent (a)
Operating lease liabilities, noncurrent741,003 746,437 
Total lease liabilities$791,686 $796,182 
_________________
Note 7. Property and Equipment
(a)As of December 31, 20172023, Operating lease liabilities, current and Operating lease liabilities, noncurrent included balances of $44,104 and $704,361, respectively, that are payable to MSG Entertainment. As of June 30, 2017, property2023, Operating lease liabilities, current and equipment consistedOperating lease liabilities, noncurrent included balances of the following assets:
  December 31,
2017		 June 30,
2017
Land $177,855
 $91,678
Buildings 1,112,527
 1,110,366
Leasehold improvements 177,679
 176,786
Equipment 315,903
 292,935
Aircraft 38,090
 38,090
Furniture and fixtures 50,045
 49,622
Construction in progress 37,848
 22,880
  1,909,947
 1,782,357
Less accumulated depreciation and amortization (674,814) (623,086)
  $1,235,133
 $1,159,271
$43,700 and $707,124, respectively, that are payable to MSG Entertainment.
The increase in gross propertyfollowing table summarizes the activity recorded within the accompanying consolidated statements of operations for the three and equipment duringsix months ended December 31, 2023 and 2022:
Line Item in the Company’s Consolidated Statement of OperationsThree Months Ended December 31,Six Months Ended December 31,
2023202220232022
Operating lease costDirect operating expenses$24,362 $31,811 $25,673 $33,214 
Operating lease costSelling, general and administrative expenses2,320 613 4,640 1,226 
Short-term lease costDirect operating expenses— 70 — 115 
Total lease cost$26,682 $32,494 $30,313 $34,555 
Supplemental Information
For the six months ended December 31, 2017 was primarily due to the purchase of land in London. The purchase price of the land was $79,518 (£60,000), excluding transactional taxes of $20,661 (£15,590). The transactional taxes include a value-added tax of $15,904 (£12,000), which the Company expects to recover2023 and is2022, cash paid for amounts included in other current assetsthe measurement of lease liabilities was $26,095 and $22,526, respectively.
The weighted average remaining lease term for operating leases recorded in the accompanying consolidated balance sheet as of December 31, 2017.
Depreciation and amortization expense on property and equipment2023 was $25,532 and $24,350 for the three months ended30.2 years. The weighted average discount rate was 7.1% as of December 31, 20172023 and 2016, respectively, and $51,544 and $48,844 forrepresented the six months endedCompany’s estimated incremental borrowing rate, assuming a secured borrowing, based on the remaining lease term at the time of either (i) adoption of the standard or (ii) the period in which the lease term expectation commenced or was modified.
Maturities of operating lease liabilities as of December 31, 2017 and 2016, respectively.2023 are as follows:
Fiscal Year 2024 (remainder)$26,047 
Fiscal Year 202551,681 
Fiscal Year 202652,155 
Fiscal Year 202753,516 
Fiscal Year 202854,919 
Thereafter2,041,609 
Total lease payments2,279,927 
Less imputed interest(1,488,241)
Total lease liabilities$791,686 

16

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THE MADISON SQUARE GARDEN COMPANYSPORTS CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)



Note 8. Goodwill and Intangible Assets
The carrying amounts of goodwill, by reportable segment, as of December 31, 2017 and June 30, 2017 are as follows:
  December 31,
2017		 June 30,
2017
MSG Entertainment $165,666
 $161,900
MSG Sports 226,955
 218,187
  $392,621
 $380,087
The net increase in the carrying amounts of goodwill, as compared to June 30, 2017, primarily reflects: (i) purchase price allocations for the CLG and Obscura acquisitions in the MSG Sports segment and MSG Entertainment segment, respectively, and (ii) measurement period adjustments for certain assets and liabilities for the TAO Group acquisition in the MSG Entertainment segment.
During the first quarter of fiscal year 2018,2024, the Company performed its annual impairment test of goodwill and determined that there were no impairments identified as of the impairment test date. The carrying amount of goodwill identified for anyas of its reporting units.December 31, 2023 and June 30, 2023 was $226,523.
The Company’s indefinite-lived intangible assets as of December 31, 20172023 and June 30, 20172023 are as follows:
  December 31,
2017		 June 30,
2017
Sports franchises (MSG Sports segment) $109,429
 $101,429
Trademarks (MSG Entertainment segment) 62,421
 62,421
Photographic related rights (MSG Sports segment) 3,000
 3,000
  $174,850
 $166,850
Sports franchises$102,564 
Photographic related rights1,080 
$103,644 
The increase in the carrying amount of indefinite-lived intangible assets in MSG Sports segment reflects a franchise fee associated withCLG’s membership in the “League of Legends” North American League Championship Series.
During the first quarter of fiscal year 2018,2024, the Company performed its annual impairment test of identifiable indefinite-lived intangible assets and determined that there were no impairments identified.identified as of the impairment test date.
For the three and six months ended December 31, 2022, amortization expense of intangible assets was $30 and $138, respectively. There was no amortization expense for the three and six months ended December 31, 2023 as a result of the disposal of CLG in April 2023.
Note 9. Investments
The Company’s intangible assets subjectinvestments in nonconsolidated affiliates which are accounted for under the equity method of accounting, equity investments with readily determinable fair values, equity investments without readily determinable fair values, and derivative instruments, which are reported within Investments in the accompanying consolidated balance sheets, consisted of the following:
December 31,
2023		June 30,
2023
Equity method investments:
NRG$11,091 $11,948 
Other equity method investments2,000 — 
Equity investments with readily determinable fair values:
Xtract One Technologies Inc. (“Xtract One”) common stock17,616 22,408 
Other equity investments with readily determinable fair values held in trust under the Company’s Executive Deferred Compensation Plan16,842 14,406 
Equity investments without readily determinable fair values (a)
5,761 5,514 
Derivative instruments:
Xtract One warrants8,802 13,098 
Total investments$62,112 $67,374 
_________________
(a)For the three and six months ended December 31, 2023 and 2022, the Company did not record any impairment charges or changes in carrying value of its equity securities without readily determinable fair values in the accompanying consolidated statements of operations.
Equity Method Investments
The Company determined that it has the ability to amortization areexert significant influence over the investee and therefore accounts for this investment under the equity method of accounting.
NRG
In April 2023, the Company sold its controlling interest in CLG to NRG, a professional gaming and entertainment company, in exchange for a noncontrolling equity interest in the combined NRG/CLG company. The Company received preferred shares representing approximately 25% of the capital stock of NRG. The Company deconsolidated the CLG business and recorded the investment in NRG at fair value as follows:an equity method investment in the fourth quarter of fiscal year 2023. During the three and six months ended December 31, 2023, the Company recognized its net share of losses of $442 and $857, respectively, in Miscellaneous income (expense), net within the Company’s consolidated statement of operations. As of December 31, 2023 and June 30, 2023, the Company’s ownership in NRG was approximately 25%.
17
December 31, 2017 Gross 
Accumulated
Amortization
 Net
Trade names $101,830
 $(3,792) $98,038
Venue management contracts 79,000
 (3,042) 75,958
Favorable lease assets 54,253
 (3,249) 51,004
Season ticket holder relationships 50,032
 (42,539) 7,493
Non-compete agreements 11,400
 (1,243) 10,157
Festival rights 9,080
 (1,108) 7,972
Other intangibles 10,417
 (4,147) 6,270
  $316,012
 $(59,120) $256,892


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THE MADISON SQUARE GARDEN COMPANYSPORTS CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)



Equity Investments with Readily Determinable Fair Values
The Company holds investments in equity instruments with readily determinable fair value:
June 30, 2017 Gross 
Accumulated
Amortization
 Net
Trade names $98,530
 $(1,003) $97,527
Venue management contracts 79,000
 (761) 78,239
Favorable lease assets 54,253
 (812) 53,441
Season ticket holder relationships 50,032
 (40,871) 9,161
Non-compete agreements 9,000
 (261) 8,739
Festival rights 9,080
 (739) 8,341
Other intangibles 4,217
 (2,690) 1,527
  $304,112
 $(47,137) $256,975
•Xtract One, a technology-driven threat detection and security solution company that is listed on the Toronto Stock Exchange under the symbol “XTRA”. The Company holds common stock of Xtract One and holds warrants entitling the Company to acquire additional shares of common stock of Xtract One which are considered derivative instruments. Refer to Note 10 for further details regarding the Company’s warrants, including the inputs used in determining the fair value of the warrants.
Amortization expense•Other equity investments held in trust under the Company’s Executive Deferred Compensation Plan. Refer to Note 13 for intangible assets, excludingfurther details regarding the amortizationplan.
The fair value of favorable lease assetsthe Company’s investments in common stock of $1,218Xtract One and other investments held in trust are determined based on quoted market prices in active markets, which are classified within Level I of the fair value hierarchy.
The cost basis and carrying value of equity investments with readily determinable fair values are as follows:
December 31, 2023June 30, 2023
Cost BasisCarrying Value/Fair ValueCost BasisCarrying Value/Fair Value
Xtract One common stock$6,783 $17,616 $6,783 $22,408 
Other equity investments with readily determinable fair values15,518 16,842 13,772 14,406 
$22,301 $34,458 $20,555 $36,814 
The following table summarizes the realized and unrealized gains (losses) on equity investments with readily determinable fair values, recorded within Miscellaneous income (expense), net within the Company’s consolidated statement of operations, for the three months ended December 31, 2017, which is reported in rent expense, was $5,012 and $1,616 for the three months ended December 31, 2017 and 2016, respectively. For the six months ended December 31, 20172023 and 2016, amortization expense2022.
Three Months Ended December 31,Six Months Ended December 31,
2023202220232022
Unrealized gain (loss) - Xtract One common stock$1,761 $— $(4,792)$— 
Unrealized gain - other equity investments with readily determinable fair values821 449 691 346 
Realized gain - other equity investments with readily determinable fair values18 — 44 — 
$2,600 $449 $(4,057)$346 
Note 10. Fair Value Measurements
The following table presents the Company’s assets that are measured at fair value on a recurring basis, which include cash equivalents:
Fair Value HierarchyDecember 31,
2023		June 30,
2023
Assets:
Money market accountsI$36,842 $17,330 
Time depositI353 1,457 
Equity investmentsI34,458 36,814 
WarrantsIII8,802 13,098 
Total assets measured at fair value$80,455 $68,699 
Level I Inputs
Assets that are classified within Level I of the fair value hierarchy are valued using observable inputs that reflect quoted prices for intangibleidentical assets excludingin active markets. The carrying amount of the amortizationCompany’s money market accounts and time deposit approximates fair value due to their short-term maturities. Refer to Note9for further details regarding equity investments.
18
Table of favorable leaseContents
MADISON SQUARE GARDEN SPORTS CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)

Level III Inputs
The Company’s level III assets consist of $2,437 forwarrants entitling the six months endedCompany to acquire additional common stock of Xtract One. The Company’s warrants are included within Investments in the accompanying consolidated balance sheets. Changes in the fair value of derivative instruments are measured at each reporting date and are recorded within Miscellaneous income (expense), net in the accompanying consolidated statements of operations. The fair value of the Company’s warrants in Xtract One were determined using the Black-Scholes option pricing model. The following are key assumptions used to calculate the fair value of the warrants as of December 31, 2017,2023 and June 30, 2023:
December 31,
2023		June 30,
2023
Expected term2.09 years2.34 years
Expected volatility75.87 %74.43 %
Risk-free interest rate4.23 %4.68 %
The following table presents additional information about our assets for which iswe utilize Level III inputs to determine fair value:
Three Months EndedSix Months Ended
December 31, 2023December 31, 2023
Balance at beginning of period$7,680 $13,098 
Unrealized gain (loss) on warrants1,122 (4,296)
Balance at end of period$8,802 $8,802 
The carrying value and fair value of the Company’s debt reported in rent expense, was $9,546 and $3,232, respectively. the accompanying consolidated balance sheets are as follows:
December 31, 2023June 30, 2023
Carrying
Value		Fair
Value		Carrying
Value		Fair
Value
Liabilities
Debt, current (a)
$30,000 $30,000 $30,000 $30,000 
Long-term debt (b)
$330,000 $330,000 $295,000 $295,000 
_________________
(a)The increases in amortization expense reflectsCompany’s debt, current is classified within Level II of the purchase accounting adjustmentsfair value hierarchy as it is valued using quoted indices of similar securities for which the TAO Group, CLG and Obscura acquisitions.inputs are readily observable. The fair value of the Company’s debt, current is the same as its carrying amount based on valuation of similar securities. See Note 12 for further details.
(b)The Company’s long-term debt is classified within Level II of the fair value hierarchy as it is valued using quoted indices of similar securities for which the inputs are readily observable. The fair value of the Company’s long-term debt is the same as its carrying amount as the debt bears interest at a variable rate indexed to current market conditions. See Note 12 for further details.
Note 9.11. Commitments and Contingencies
Commitments
As more fully described in Note 812 to the consolidated and combined financial statements included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2017,2023, the Company’s commitments consist primarily of (i) the MSG Sports segment’sCompany’s obligations under employment agreements that the Company has with its professional sports teams’ personnel that are generally guaranteed regardless of employee injury or termination, (ii) long-term noncancelable operatingtermination. In addition, see Note 7 for more information on the contractual obligations related to future lease agreements primarily for entertainment venues, and corporate offices, and (iii) revolving credit facilities provided by the Company to AMSGE and Tribeca Enterprises (see Note 6).payments. The Company did not have any material changes in its contractual obligations, including off-balance sheet commitments, since the end of fiscal year 20172023 other than activities in the ordinary course of business.
In connection with the TAO Group and CLG acquisitions, the Company has accrued contingent consideration as part of the purchase price allocation. See Note 10 for further details of the amount recorded in the accompanying consolidated balance sheet as of December 31, 2017. In addition, see Note 10 to the consolidated and combined financial statements included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2017 regarding the principal repayments required under the TAO Group’s senior secured term loan facility.
Legal Matters
The Company owns 50% of AMSGE, which in turn owns a majority interest in Global Music Rights, LLC (“GMR”). GMR is primarily a performance rights organization, whose business includes obtaining the right to license the public performance rights of songs composed by leading songwriters. GMR engaged in negotiations with the Radio Music Licensing Committee (“RMLC”), which represents over ten thousand commercial radio stations. On November 18, 2016, RMLC filed a complaint against GMR in the United States District Court for the Eastern District of Pennsylvania alleging that GMR is violating Section 2 of the Sherman Antitrust Act and seeking an injunction, requiring, among other things, that GMR issue radio stations licenses for GMR’s repertory, upon request, at a rate set through a judicial rate-making procedure, that GMR offer “economically viable alternatives to blanket licenses,” and that GMR offer only licenses for songs which are fully controlled by GMR. GMR and RLMC agreed to an interim license arrangement through September 30, 2017, which has been extended through March 31, 2018. GMR has advised the Company that it believes that the RMLC Complaint is without merit and is vigorously defending itself. On January 20, 2017, GMR filed a motion to dismiss or to transfer venue, asserting that the Eastern District of Pennsylvania is not a proper venue for the matter, lacks personal jurisdiction of GMR and that in any event the complaint fails to state a claim. On December 6, 2016, GMR filed a complaint against RMLC in the United States District Court for the Central District of California, alleging that RMLC operates as an illegal cartel that unreasonably restrains trade in violation of Section 1 of the Sherman Antitrust Act and California state law, and seeking an injunction restraining RMLC and its co-conspirators from enforcing or establishing agreements that unreasonably restrict competition for public performance licenses. The judge in the

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THE MADISON SQUARE GARDEN COMPANYSPORTS CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)



Central District of California denied RMLC’s motion to dismiss GMR’s claim for lack of ripeness and, on the basis that the two cases involve similar facts, stayed the California action in order to assess the status of the Pennsylvania case. On July 21, 2017, RMLC filed a preliminary injunction motion in the United States District Court for the Eastern District of Pennsylvania to extend the duration of the interim licenses which GMR had granted to certain radio stations. The district court determined that the jurisdictional matter should be decided prior to addressing the motion for preliminary injunction and referred the jurisdictional questions to the Magistrate Judge in the United States District Court Eastern District of Pennsylvania. On November 29, 2017, the Magistrate Judge issued a report and recommendation that personal jurisdiction was not appropriate over GMR in the Eastern District of Pennsylvania and recommending the dismissal ofthe RMLC’s action without prejudice. The RMLC has filed objectionsto the Magistrate Judge’s report and recommendation.Legal Matters
The Company is a defendant in various other lawsuits. Although the outcome of these other lawsuits cannot be predicted with certainty (including the extent of available insurance, if any)insurance), management does not believe that resolution of these other lawsuits will have a material adverse effect on the Company.
Note 10. Fair Value Measurements12. Debt
The following table presents the Company’s assets that are measured at fair value on a recurring basis, which include cash equivalents and available-for-sale securities:
  Fair Value Hierarchy December 31,
2017		 June 30,
2017
Assets:      
Commercial Paper I $105,307
 $105,476
Money market accounts I 174,774
 102,884
Time deposits I 811,450
 1,007,302
Available-for-sale securities I 24,638
 32,851
Total assets measured at fair value   $1,116,169
 $1,248,513
All assets listed above are classified within Level I of the fair value hierarchy as they are valued using observable inputs that reflect quoted prices for identical assets in active markets. The carrying amounts of the Company’s commercial paper, money market accounts and time deposits approximate fair value due to their short-term maturities.
The carrying value and fair value of the Company’s financial instruments reported in the accompanying consolidated balance sheets are as follows:
  December 31, 2017 June 30, 2017
  
Carrying
Value
 
Fair
Value
 Carrying
Value		 Fair
Value
Assets        
Notes receivable, including interest accruals $4,114
 $4,114
 $2,610
 $2,610
Available-for-sale securities (a)
 24,638
 24,638
 32,851
 32,851
Liabilities        
Long-term debt, including current portion (b)
 $110,000
 $108,826
 $110,000
 $110,091
_________________
(a)
Aggregate cost basis for available-for-sale securities, including transaction costs, was $23,222 as of December 31, 2017. The unrealized gain recorded in accumulated other comprehensive loss was $1,416 as of December 31, 2017. The fair value of the available-for-sale securities is determined based on quoted market prices in an active market at the New York Stock Exchange, which is classified within Level I of the fair value hierarchy.


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THE MADISON SQUARE GARDEN COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)


(b)
On January 31, 2017, TAO Group Intermediate Holdings LLC (“TAOIH”), TAO Group Operating LLC (“TAOG”) and certain of its subsidiaries entered into a $110,000 senior secured five-year term loan facility. The Company’s long-term debt is classified within Level II of the fair value hierarchy as it is valued using quoted indices of similar securities for which the inputs are readily observable.
Contingent Consideration Liabilities
In connection with the TAO Group acquisition (see Note 3 to the consolidated and combined financial statements included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2017 for further details), the Company recorded certain contingent consideration liabilities at fair value as part of the preliminary purchase price allocation. The fair value was estimated using a Monte-Carlo simulation model which included significant unobservable Level III inputs such as projected financial performance over the earn-out period (five years) along with estimates for market volatility and the discount rate applicable to potential cash payouts. As of December 31, 2017 and June 30, 2017, the fair value of contingent consideration liabilities in connection with the TAO Group acquisition was $7,900.
In connection with the CLG acquisition, the Company may be required to make future payments for deferred and contingent consideration up to a total of $9,150 based upon the achievement of certain specified objectives during the three years following the transaction as defined under the membership interest purchase agreement. The Company recorded $6,586 as the initial fair value of deferred and contingent consideration liabilities as part of the preliminary purchase price allocation. The fair values of these deferred and contingent consideration liabilities were estimated using weighted probabilities of achievement for the possible objective and earn-out events and adjusted for a discount rate applicable to the deferred and potential cash payouts. During the six months ended December 31, 2017, the Company made a payment of $4,000 as one of the objectives for contingent consideration was achieved. As of December 31, 2017, the fair value of deferred and contingent consideration liabilities was $2,586.
Note 11. Credit Facilities

Knicks Revolving Credit Facility
On September 30, 2016, New York Knicks, LLC (“Knicks LLC”), a wholly owned subsidiary of the Company, entered into a credit agreement (the “Knicks“2016 Knicks Credit Agreement”) with a syndicate of lenders providing for a senior secured revolving credit facility of up to $200,000 with a term of five years to fund working capital needs and for general corporate purposes.
On November 6, 2020, the Company amended and restated the 2016 Knicks Credit Agreement in its entirety (the “2020 Knicks Credit Agreement”). On December 14, 2021, Knicks LLC entered into Amendment No. 2 to the 2020 Knicks Credit Agreement, which amended and restated the 2020 Knicks Credit Agreement (as amended and restated, the “Knicks Credit Agreement”).
The Knicks Credit Agreement provides for a senior secured revolving credit facility of up to $275,000 (the “Knicks Revolving Credit Facility”) to fund working capital needs and for general corporate purposes. The maturity date of the Knicks Credit Agreement is December 14, 2026. Amounts borrowed may be distributed to the Company except during an event of default.
The Knicks Revolving Credit Facility requires Knicks LLC to comply with a debt service ratio of 1.5:1.0 over a trailing four quarter period. As of December 31, 2017, Knicks LLC was in compliance with this financial covenant.
All borrowings under the Knicks Revolving Credit Facility are subject to the satisfaction of certain customary conditions. Borrowings under the Knicks Credit Agreement bear interest at a floating rate, which at the option of Knicks LLC may be either (i) a base rate plus a margin ranging from 0.00%0.250% to 0.125%0.500% per annum or (ii) LIBORterm Secured Overnight Financing Rate (“SOFR”) plus a credit spread adjustment of 0.100% per annum plus a margin ranging from 1.00%1.250% to 1.125%1.500% per annum.annum depending on the credit rating applicable to the NBA’s league-wide credit facility. Knicks LLC is required to pay a commitment fee ranging from 0.20%0.250% to 0.25%0.300% per annum in respect of the average daily unused commitments under the Knicks Revolving Credit Facility. During the six months ended December 31, 2023, the Company borrowed an additional $40,000 under the Knicks Revolving Credit Facility. The outstanding balance under the Knicks Revolving Credit Facility was undrawn $275,000 as of December 31, 2017.2023, which was recorded as Long-term debt in the accompanying consolidated balance sheet. The interest rate on the Knicks Revolving Credit Facility as of December 31, 2023 was 6.71%. During the six months ended December 31, 2023 the Company made interest payments of $9,073 in respect of the Knicks Revolving Credit Facility.
All obligations under the Knicks Revolving Credit Facility are secured by a first lien security interest in certain of Knicks LLC’s assets, including, but not limited to, (i) the Knicks LLC’s membership rights in the NBA, and (ii) revenues to be paid to the Knicks LLC by the NBA pursuant to certain U.S. national broadcast agreements.agreements, and (iii) revenues to be paid to Knicks LLC pursuant to local media contracts.
Subject to customary notice and minimum amount conditions, Knicks LLC may voluntarily prepay outstanding loans under the Knicks Revolving Credit Facility at any time, in whole or in part, without premium or penalty (except for customary breakage costs with respect to EurocurrencySOFR-based loans). Knicks LLC is required to make mandatory prepayments in certain circumstances, including without limitation if the maximum available amount under the Knicks Revolving Credit Facility is greater than 350% of qualified revenues.


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THE MADISON SQUARE GARDEN COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)


In addition to the financial covenant described above, the Knicks Credit Agreement and the related security agreement contain certain customary representations and warranties, affirmative covenants and events of default. The Knicks Revolving Credit AgreementFacility contains certain restrictions on the ability of Knicks LLC to take certain actions as provided in (and subject to various exceptions and baskets set forth in) the Knicks Revolving Credit Agreement,Facility, including the following: (i) incurring additional indebtedness and contingent liabilities; (ii) creating liens on certain assets; (iii) making restricted payments during the continuance of an event of default under the Knicks Revolving Credit Agreement;Facility; (iv) engaging in sale and leaseback transactions; (v) merging or consolidating; and (vi) taking certain actions that would invalidate the secured lenders’ liens on any Knicks LLC’s collateral.
The Knicks UnsecuredRevolving Credit Facility
On September 30, 2016, requires Knicks LLC entered into an unsecured revolving credit facilityto comply with a lender for an initial maximum credit amountdebt service ratio of $15,000 andat least 1.5:1.0 over a 364-day term (the “Knicks Unsecured Credit Facility”). Knicks LLC renewed this facility with the lender on the same terms effective as of September 29, 2017. This facility was undrawn astrailing four quarter period. As of December 31, 2017.2023, Knicks LLC was in compliance with this financial covenant.
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MADISON SQUARE GARDEN SPORTS CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)

Rangers Revolving Credit Facility
On January 25, 2017, New York Rangers, LLC (“Rangers LLC”), a wholly owned subsidiary of the Company, entered into a credit agreement (the “Rangers“2017 Rangers Credit Agreement”) with a syndicate of lenders providing for a senior secured revolving credit facility of up to $150,000 with a term of five years to fund working capital needs and for general corporate purposes.
On November 6, 2020, the Company amended and restated the 2017 Rangers Credit Agreement in its entirety (the “2020 Rangers Credit Agreement”). On December 14, 2021, Rangers LLC entered into Amendment No. 3 to the 2020 Rangers Credit Agreement, which amended and restated the 2020 Rangers Credit Agreement (as amended and restated, the “Rangers Credit Agreement”).
The Rangers Credit Agreement provides for a senior secured revolving credit facility of up to $250,000 (the “Rangers Revolving Credit Facility”) to fund working capital needs and for general corporate purposes. The maturity date of the Rangers Credit Agreement is December 14, 2026. Amounts borrowed may be distributed to the Company except during an event of default.
The Rangers Revolving Credit Facility requires Rangers LLC to comply with a debt service ratio of 1.5:1.0 over a trailing four quarter period. As of December 31, 2017, Rangers LLC was in compliance with this financial covenant. All borrowings under the Rangers Revolving Credit Facility are subject to the satisfaction of certain customary conditions.
Borrowings under the Rangers Revolving Credit Facility bear interest at a floating rate, which at the option of Rangers LLC may be either (i) a base rate plus a margin ranging from 0.125%0.500% to 0.50%1.000% per annum or (ii) LIBORterm SOFR plus a credit spread adjustment of 0.100% per annum plus a margin ranging from 1.125%1.500% to 1.50%2.000% per annum.annum depending on the credit rating applicable to the NHL’s league-wide credit facility. Rangers LLC is required to pay a commitment fee ranging from 0.375% to 0.625% per annum in respect of the average daily unused commitments under the Rangers Revolving Credit Facility. During the six months ended December 31, 2023, the Company borrowed an additional $35,000 and made principal repayments of $40,000 under the Rangers Revolving Credit Facility. The outstanding balance under the Rangers Revolving Credit Facility was undrawnwas $55,000 as of December 31, 2017.2023, which was recorded as Long-term debt in the accompanying consolidated balance sheet. The interest rate on the Rangers Revolving Credit Facility as of December 31, 2023 was 7.21%. During the six months ended December 31, 2023 the Company made interest payments of $2,815 in respect of the Rangers Revolving Credit Facility.
All obligations under the Rangers Revolving Credit Facility are, subject to the Rangers NHL Advance Agreement (as defined below), secured by a first lien security interest in certain of Rangers LLC’s assets, including, but not limited to, (i) Rangers LLC’s membership rights in the NHL, (ii) revenues to be paid to Rangers LLC by the NHL pursuant to certain U.S. and Canadian national broadcast agreements, and (iii) revenues to be paid to Rangers LLC pursuant to local media contracts.
Subject to customary notice and minimum amount conditions, Rangers LLC may voluntarily prepay outstanding loans under the Rangers Revolving Credit Facility at any time, in whole or in part, without premium or penalty (except for customary breakage costs with respect to EurocurrencySOFR-based loans). Rangers LLC is required to make mandatory prepayments in certain circumstances, including without limitation if qualified revenues are less than 17% of the maximum available amount under the Rangers Revolving Credit Facility is less than 17% of qualified revenues.Facility.
In addition to the financial covenant described above, the Rangers Credit Agreement and the related security agreement contain certain customary representations and warranties, affirmative covenants and events of default. The Rangers Revolving Credit AgreementFacility contains certain restrictions on the ability of Rangers LLC to take certain actions as provided in (and subject to various exceptions and baskets set forth in) the Rangers Revolving Credit Agreement,Facility, including the following: (i) incurring additional indebtedness and contingent liabilities; (ii) creating liens on certain assets; (iii) making restricted payments during the continuance of an event of default under the Rangers Revolving Credit Agreement;Facility; (iv) engaging in sale and leaseback transactions; (v) merging or consolidating; and (vi) taking certain actions that would invalidate the secured lenders’ liens on any of Rangers LLC’s assets securing the obligations under the Rangers Revolving Credit Facility.
The Rangers Revolving Credit Facility requires Rangers LLC to comply with a debt service ratio of at least 1.5:1.0 over a trailing four quarter period. As of December 31, 2023, Rangers LLC was in compliance with this financial covenant.
Rangers NHL Advance Agreement
On March 19, 2021, Rangers LLC, Rangers Holdings, LLC and MSG NYR Holdings LLC entered into an advance agreement with the NHL (the “Rangers NHL Advance Agreement”) pursuant to which the NHL advanced $30,000 to Rangers LLC. The advance is required to be utilized solely and exclusively to pay for Rangers LLC operating expenses.
All obligations under the Rangers NHL Advance Agreement are senior to and shall have priority over all secured and other indebtedness of Rangers LLC, Rangers Holdings, LLC and MSG NYR Holdings LLC. All borrowings under the Rangers NHL Advance Agreement were made on a non-revolving basis and bear interest at 3.00% per annum, ending on the date any such advances are fully repaid. Advances received under the Rangers NHL Advance Agreement are payable upon demand by the

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THE MADISON SQUARE GARDEN COMPANYSPORTS CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)



TAO Credit Facilities
On January 31, 2017, TAOIH, TAOG, and certain of its subsidiaries entered into a credit and guaranty agreement with a syndicate of lenders providing for a senior secured term loan facility of $110,000 with a term of five years (the “TAO Term Loan Facility”) to fund, in part,NHL. It is expected that the acquisition of TAO Group and a senior secured revolving credit facility of up to $12,000 with a term of five years (the “TAO Revolving Credit Facility,” and together with the TAO Term Loan Facility, the “TAO Credit Facilities”) for working capital and general corporate purposes of TAOG. The TAO Credit Facilities were obtained without recourse to MSGadvanced amount will be set off against funds that would otherwise be paid, distributed or any of its affiliates (other than TAOIH and its subsidiaries).
The TAO Credit Facilities require TAOIH (i) to maintain, for the relevant TAO entities, a minimum consolidated liquidity of $5,000 at all times, (ii) to comply with a maximum total net leverage ratio of 4.00:1.00 initially and stepping down over time to 2.50:1.00transferred by the first quarter of calendar year 2021 and through the remainder of the term of the TAO Credit Facilities, and (iii)NHL to comply with a minimum fixed charge coverage ratio of 1.50:1.00 initially and stepping down over time to 1.15:1.00 by the second quarter of calendar year 2021 and through the remainder of the term of the TAO Credit Facilities. TAOIH was in compliance with the financial covenants of the TAO Credit Facilities as of September 24, 2017 (the most recent date at which compliance was assessedRangers LLC. The outstanding balance under the TAO Credit Facilities). The TAO Revolving Credit FacilityRangers NHL Advance Agreement was undrawn$30,000 as of December 31, 2017.
The TAO entities under2023 and was recorded as Debt in the TAO Credit Facilities are also subject to certain limitations with respect to making capital expenditures based uponaccompanying consolidated balance sheet. During the total net leverage ratio and other factors. The restrictions on capital expenditures are subject to certain “carry-forward” provisions and other customary carve-outs.
All borrowings under the TAO Credit Facilities are subject to the satisfaction of certain customary conditions, including compliance with a maximum leverage multiple, accuracy of representations and warranties and absence of a default or event of default. Borrowings bear interest at a floating rate, which at the option of TAOG may be either (i) a base rate plus a margin ranging from 6.50% to 7.00% per annum or (ii) LIBOR plus a margin ranging from 7.50% to 8.00% per annum. TAOG is required to pay a commitment fee of 0.50% per annum in respect of the average daily unused commitments under the TAO Revolving Credit Facility. The interest rate on the TAO Credit Facilities as of September 24, 2017 was 9.25%. TAO Group made interest payments under the TAO Term Loan Facility of $2,580 and $5,098 for the three and six months ended September 24, 2017 (the period for which TAO Group’s operating results are recordedDecember 31, 2023 the Company made interest payments of $675.
Deferred Financing Costs
The following table summarizes deferred financing costs, net of amortization, related to the Company’s credit facilities as reported in the Company’saccompanying consolidated balance sheets:
December 31,
2023		June 30,
2023
Other current assets$1,145 $1,145 
Other assets2,237 2,810 
Note 13. Benefit Plans
Defined Benefit Pension Plans
The Company sponsors the MSG Sports, LLC Excess Cash Balance Plan (the “Excess Cash Balance Plan”), an unfunded non-contributory, non-qualified excess cash balance plan and the MSG Sports, LLC Excess Retirement Plan, an unfunded non-contributory, non-qualified defined benefit pension plan for the benefit of certain employees (collectively referred to as the “Pension Plans”). All benefits in the Pension Plans are frozen and participants are not able to earn benefits for future service under these plans, and no employee of the Company who was not already a participant as of the date the respective plan was frozen may become a participant in the Pension Plans. Existing account balances under the Excess Cash Balance Plan are credited with monthly interest in accordance with the terms of the plan.
The following table presents components of net periodic benefit cost for the Pension Plans included in the accompanying consolidated statements of operations for the three and six months ended December 31, 2017).2023 and 2022. Components of net periodic benefit cost are reported in Miscellaneous income (expense), net.
All obligations under
Three Months EndedSix Months Ended
December 31,December 31,
2023202220232022
Interest cost$68 $60 $136 $120 
Recognized actuarial loss9 4 18 8 
Net periodic benefit cost$77 $64 $154 $128 
Defined Contribution Plans
MSG Sports employees participate in The Madison Square Garden 401(k) Savings Plan (the “401(k) Plan”), which is a multiple employer plan sponsored by MSG Entertainment Holdings, LLC, a wholly owned subsidiary of MSG Entertainment. In addition, the TAO Credit Facilities are secured by a first lien security interest in substantially allCompany sponsors the MSG Sports LLC, Excess Savings Plan (the “Excess Savings Plan”), which provides non-qualified retirement benefits to eligible MSG Sports employees.
Expense related to the 401(k) Plan and Excess Savings Plan for the three and six months ended December 31, 2023 was $1,314 and $2,608, respectively, and $1,072 and $2,137 for the three and six months ended December 31, 2022, respectively.
22
Table of the applicable TAO entities’ assets, including, but not limited to, a pledge of all of the capital stock of substantially all of TAOIH’s wholly-owned domestic subsidiaries and 65% of the voting capital stock, and 100% of the non-voting capital stock, of each of its first-tier foreign subsidiaries.Contents
Subject to customary notice and minimum amount conditions, TAOG may voluntarily prepay outstanding loans under the TAO Credit Facilities at any time, in whole or in part (subject to customary breakage costs with respect to LIBOR loans) with premiums due in respect of prepayments of the TAO Term Loan Facility or permanent reduction under the TAO Revolving Credit Facility, in each case, starting at 5.0% initially and stepping down to 0% after three years. Beginning March 31, 2018, TAOG is required to make scheduled amortization payments under the TAO Term Loan Facility in consecutive quarterly installments equal to $688 per quarter initially, stepping up over time to $4,125 per quarter by March 31, 2021 and through the final maturity date of the TAO Term Loan Facility with the final balance payable on such maturity date. TAOG is also required to make mandatory prepayments under the TAO Credit Facilities in certain circumstances, including, without limitation, 75% of excess cash flow, with a step-down to 50% when the total net leverage ratio is less than 2.00:1.00.MADISON SQUARE GARDEN SPORTS CORP.
The TAO Credit Facilities contain certain restrictions on the ability of TAOG to take certain actions as provided in (and subject to various exceptions and baskets set forth in) the TAO Credit Facilities, including, without limitation, the following: (i) incurring additional indebtedness; (ii) creating liens on assets; (iii) making distributions, dividends and other restricted payments; (iv) engaging in sale and leaseback transactions; (v) merging or consolidating; (vi) making investments; and (vii) prepaying certain indebtedness.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)

Executive Deferred Compensation Plan
See Note 1014 to the consolidated and combined financial statements included in the Company’s Annual Report on Form 10-K for the year ended June 30, 20172023 for more information regarding the Company’s debt maturitiesExecutive Deferred Compensation Plan (the “Deferred Compensation Plan”). The Company recorded compensation expense of $839 and $735 for the TAO Term Loan Facility.three and six months ended December 31, 2023, respectively, and $449 and $346 for the three and six months ended December 31, 2022, respectively, within Selling, general and administrative expenses to reflect the remeasurement of the Deferred Compensation Plan liability. In addition, the Company recorded gains of $839 and $735 for the three and six months ended December 31, 2023, respectively, and $449 and $346 for the three and six months ended December 31, 2022, respectively, within Miscellaneous income (expense), net to reflect the remeasurement of the fair value of assets under the Deferred Compensation Plan.


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THE MADISON SQUARE GARDEN COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)


Deferred Financing Costs
The following table summarizes the presentation of the TAO Term Loan Facility, and the related deferred financing costs in the accompanying consolidated balance sheets as of December 31, 2017 and June 30, 2017.
  December 31, 2017
  TAO Term Loan Facility Deferred Financing Costs Total
Current portion of long-term debt, net of deferred financing costs $1,375
 $(939) $436
Long-term debt, net of deferred financing costs 108,625
 (3,161) 105,464
Total $110,000
 $(4,100) $105,900
       
  June 30, 2017
  TAO Term Loan Facility Deferred Financing Costs Total
Current portion of long-term debt, net of deferred financing costs $—
 $—
 $—
Long-term debt, net of deferred financing costs 110,000
 (4,567) 105,433
Total $110,000
 $(4,567) $105,433

The following table summarizes deferred financing costs, net of amortization,amounts recognized related to the Knicks Revolving Credit Facility, Knicks Unsecured Credit Facility, Rangers Revolving Credit Facility, and TAO Revolving Credit Facility as reported onDeferred Compensation Plan in the accompanying consolidated balance sheets as of December 31, 2017 and June 30, 2017.sheets:
December 31,
2023		June 30,
2023
Non-current assets (included in investments)$16,842 $14,406 
Current liabilities (included in accrued employee related costs)(476)(1,358)
Non-current liabilities (included in other employee related costs)(16,366)(13,048)
  December 31,
2017		 June 30,
2017
Other current assets $778
 $806
Other assets 2,296
 2,784
Note 12. Pension Plans and Other Postretirement Benefit Plan14. Share-based Compensation
See Note 1115 to the consolidated and combined financial statements included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2017 for more information regarding the Company’s defined benefit pension plans (“Pension Plans”), postretirement benefit plan (“Postretirement Plan”), Madison Square Garden 401(k) Savings Plan and the MSG Sports & Entertainment, LLC Excess Savings Plan (collectively, the “Savings Plans”), and Madison Square Garden 401(k) Union Plan (the “Union Savings Plan”).


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THE MADISON SQUARE GARDEN COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)


Defined Benefit Pension Plans and Postretirement Benefit Plan
Components of net periodic benefit cost for the Pension Plans and Postretirement Plan recognized in direct operating expenses and selling, general and administrative expenses in the accompanying consolidated statements of operations for the three and six months ended December 31, 2017 and 2016 are as follows:

  Pension Plans Postretirement Plan
  Three Months Ended Three Months Ended
  December 31, December 31,
  2017 2016 2017 2016
Service cost $21
 $23
 $32
 $34
Interest cost 1,374
 1,240
 51
 40
Expected return on plan assets (721) (596) —
 —
Recognized actuarial loss 280
 344
 —
 —
Amortization of unrecognized prior service credit —
 —
 (6) (13)
Net periodic benefit cost $954
 $1,011
 $77
 $61
  Pension Plans Postretirement Plan
  Six Months Ended Six Months Ended
  December 31, December 31,
  2017 2016 2017 2016
Service cost $42
 $46
 $63
 $68
Interest cost 2,613
 2,480
 90
 81
Expected return on plan assets (1,317) (1,192) —
 —
Recognized actuarial loss 620
 688
 —
 —
Amortization of unrecognized prior service credit —
 —
 (18) (25)
Net periodic benefit cost $1,958
 $2,022
 $135
 $124

Defined Contribution Pension Plans
For the three and six months ended December 31, 2017 and 2016, expenses related to the Savings Plans and Union Savings Plan included in the accompanying consolidated statements of operations are as follow:
Savings Plans Union Savings Plan
Three Months Ended Six Months Ended Three Months Ended Six Months Ended
December 31, December 31, December 31, December 31,
2017 2016 2017 2016 2017 2016 2017 2016
$1,919
 $1,984
 $4,142
 $3,946
 $55
 $28
 $80
 $50
Note 13. Share-based Compensation
See Note 12 to the consolidated and combined financial statements included in the Company’s Annual Report on Form 10-K for the year ended June 30, 20172023 for more information regarding the Company’s 2015 Employee Stock Plan (the “Employee Stock Plan”) and its 2015 Stock Plan for Non-Employee Directors.


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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)


For the three months ended December 31, 2017 and 2016, share-basedShare-based compensation expense wasis recognized in the consolidated statements of operations as a component of direct operating expenses or selling,Selling, general and administrative expensesexpenses. Share-based compensation expense was $6,570 and was $13,912$10,719 for the three and $11,743, respectively. For the six months ended December 31, 20172023, respectively and 2016,$11,619 and $18,839 for the three and six months ended December 31, 2022, respectively. There were no costs related to share-based compensation expense was $26,816 and $20,098, respectively.
Upon the adoption of ASU No. 2016-09, the Company elected to account for forfeitures as they occur on a prospective basis effective July 1, 2017, rather than estimating expected forfeitures as was required under the prior guidance. See “Note 2. Accounting Policies — Recently Issued Accounting Pronouncements” for further discussion on the impact from the adoption of ASU 2016-09.
In addition,that were capitalized for the Company’s stock option awards, the Company applies the fair value recognition provisions of ASC Topic 718 “Compensation — Stock Compensation”. ASC Topic 718 requires companies to estimate the fair value of share-based payment awards on the date of grant using an option-pricing model. The Company determines the fair value as of the grant date. For awards with graded vesting conditions, the values of the awards are determined by valuing all vesting tranches in the aggregate as one award using an average expected term. For stock options, the Black-Scholes option pricing model considers, among other factors, the expected life of the awardthree and the expected volatility of the Company’s stock price.
The Company determines its assumptions for the Black-Scholes option-pricing model in accordance with ASC Topic 718six months ended December 31, 2023 and SEC Staff Accounting Bulletin (“SAB”) No. 107, “Share-Based Payment” based on the following:
The expected term of stock options is estimated using the simplified method.
The expected risk-free interest rate is based on the U.S. Treasury interest rate which term is consistent with the expected term of the stock options.
The expected volatility is based on the historical volatility of the Company’s stock price.
In December 2007, the SEC staff issued SAB No. 110, “Certain Assumptions Used In Valuation Methods — Expected Term”. SAB No. 110 allows companies to continue to use the simplified method, as defined in SAB No. 107, to estimate the expected term of stock options under certain circumstances. The simplified method for estimating expected term uses the mid-point between the vesting term and the contractual term of the stock option. The Company has analyzed the circumstances in which the use of the simplified method is allowed. The Company has opted to use the simplified method for stock options the Company granted in fiscal year 2018 because management believes that the Company does not have sufficient historical exercise data to provide a reasonable basis upon which to estimate the expected term.

2022, respectively.
Restricted Stock Units Award Activity
The following table summarizes activity related to holders (including the Company’s and MSG Networks’ employees) of the Company’s restricted stock units and performance restricted stock units, collectively referred to as “RSUs,” held by current and former employees of the Company and non-employee directors, for the six months ended December 31, 2017:2023:
 Number of
Weighted-Average
Fair Value 
Per Share at
Date of Grant (a)
 Nonperformance
Based Vesting
RSUs		Performance
Based Vesting
RSUs
Unvested award balance, June 30, 2023124 160 $167.08 
Granted63 48 $177.39 
Vested(57)(52)$162.69 
Forfeited / Cancelled(3)(3)$176.52 
Unvested award balance, December 31, 2023127 153 $172.64 
 Number of 
Weighted-Average
Fair Value 
Per Share At
Date of Grant
 
Nonperformance
Based
Vesting
RSUs
 
Performance
Based
Vesting
RSUs
 
Unvested award balance, June 30, 2017208
 464
 $172.78
  Granted103
 180
 $211.15
Vested(88) (249) $176.90
Forfeited(8) (127) $183.20
Unvested award balance, December 31, 2017215
 268
 $189.51
_____________________


Table(a)Weighted-average fair value per share at date of Contents
THE MADISON SQUARE GARDEN COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)


grant does not reflect any adjustments to awards granted prior to the Sphere Distribution.
The fair value of RSUs that vested during the six months ended December 31, 20172023 was $74,582.$19,195. Upon delivery, RSUs granted under the Employee Stock Plan were net share-settled to cover the required statutory tax withholding obligations. To fulfill the Company’s current and former employees’ required statutory minimum tax withholding obligations for the applicable income and other employment taxes, 5746 of these RSUs, with an aggregate value of $12,232$8,084, inclusive of $4 related to the Company’s former employees (who vested in the Company’s RSUs), were retained by the Company and the taxes paid are reflected as a financing activity in the accompanying consolidated statement of cash flows for the six months ended December 31, 2017.2023.
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(Continued)

The fair value of RSUs that vested during the six months ended December 31, 20162022 was $15,209.$34,233. The weighted-average fair value per share at grant date of RSUs granted during the six months ended December 31, 20162022 was $170.98.$161.41.
Stock Options Award Activity
The following table summarizes activity related to a holder of the Company’s stock options for the six months ended December 31, 2017:
2023:
 Number of Weighted-Average Exercise Price Per Share Weighted-Average Remaining Contractual Term (In Years) Aggregate Intrinsic Value
 Nonperformance Based Vesting Options Performance Based Vesting Options   
Balance as of June 30, 2017—
 —
 $—
   $—
Granted94
 —
 $210.13
    
Balance as of December 31, 201794
 —
 $210.13
 9.96
 $68
Exercisable as of December 31, 2017—
 —
 $—
 —
 $—
Number of
Time Vesting Options		Weighted-Average Exercise Price Per ShareWeighted-Average Remaining Contractual Term (In Years)Aggregate Intrinsic Value
Balance as of June 30, 202394 $138.78 
Granted— $— 
Cancelled— $— 
Balance as of December 31, 202394 $138.78 3.96$4,039 
Exercisable as of December 31, 202394 $138.78 3.96$4,039 
During the six months ended December 31, 2017, the Company granted 94 stock options that vest ratably over three years and are being expensed on a straight-line basis over the vesting period of the stock options. The maximum contractual term is 10 years. The Company calculated the fair value of these options on the date of grant using the Black-Scholes option pricing model, which resulted in a weighted-average grant-date fair value of $53.29.
The following are key assumptions used to calculate the weighted-average grant-date fair value of stock options:
Expected term6 years
Expected volatility20.38%
Risk-free interest rate2.22%
Note 14.15. Stock Repurchase Program
On September 11,Amounts in this footnote are in thousands, except for the number of shares repurchased and per share data.
Effective as of October 1, 2015, the Company’s board of directors authorized the repurchase of up to $525,000 of the Company’s Class A Common Stock once the shares of the Company’s (“Class A Common Stock began “regular way” trading on October 1, 2015.Stock”). Under the authorization, shares of Class A Common Stock may be purchased from time to time in open market or private transactions, block trades or such other manner as the Company may determine, in accordance with applicable insider trading and other securities laws and regulations. The timing and amount of purchases will depend on market conditions and other factors.
DuringOn October 6, 2022, the six months ended December 31, 2017,Company’s Board of Directors authorized a $75,000 accelerated share repurchase (“ASR”) program under the Company’s existing share repurchase authorization. On October 28, 2022, the Company repurchased 56entered into a $75,000 ASR agreement with JPMorgan Chase Bank, National Association (“JP Morgan”). Pursuant to the ASR agreement, the Company made a payment of $75,000 to JP Morgan and JP Morgan delivered 388,777 initial shares of Class A Common Stock to the Company on November 1, 2022, representing 80% of the total shares expected to be repurchased under the ASR (determined based on the closing price of the Company’s Class A Common Stock of $154.33 on October 28, 2022). The ASR was completed on January 31, 2023 with JP Morgan delivering 67,681 additional shares of Class A Common Stock to the Company upon final settlement. The average purchase price per share for shares of Class A Common Stock purchased by the Company pursuant to the ASR was $164.31.
The ASR was accounted for as a total costrepurchase of $11,685, including commissionsshares and fees. These acquired shares have beenas an equity forward contract indexed to the Company’s Class A Common Stock. The equity forward contract was classified as an equity instrument under ASC Subtopic 815-40. The Company has treated the initial and final shares of Class A Common Stock delivered as treasury stock in the accompanying consolidated balance sheetshares as of the date the shares were physically delivered in computing the weighted average shares of outstanding Class A Common Stock for both basic and diluted earnings per share.
During the six months endedDecember 31, 2017. 2023, the Company did not make any share repurchases under its share repurchase program. As of December 31, 2017,2023, the Company had $259,639$184,639 of availability remaining under its stock repurchase authorization.

authorization.

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THE MADISON SQUARE GARDEN COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)


Note 15. Accumulated Other Comprehensive Loss
The following table details the components of accumulated other comprehensive loss:
 
Pension Plans and
Postretirement
Plan (a)
 Cumulative Translation Adjustments 
Unrealized Gain on Available-for-sale
Securities
 
Accumulated
Other
Comprehensive
Loss
Balance as of June 30, 2017$(39,408) $—
 $5,293
 $(34,115)
Other comprehensive income (loss) before reclassifications, before income taxes—
 2,277
 (8,213) (5,936)
Amounts reclassified from accumulated other comprehensive loss, before income taxes602
 —
 —
 602
Other comprehensive income (loss)602
 2,277
 (8,213) (5,334)
Balance as of December 31, 2017$(38,806) $2,277
 $(2,920) $(39,449)
        
Balance as of June 30, 2016$(42,611) $—
 $—
 $(42,611)
Other comprehensive income before reclassifications, before income taxes—
 —
 10,175
 10,175
Amounts reclassified from accumulated other comprehensive loss, before income taxes663
 —
 —
 663
Other comprehensive income663
 —
 10,175
 10,838
Balance as of December 31, 2016$(41,948) $—
 $10,175
 $(31,773)
________________
(a)
Amounts reclassified from accumulated other comprehensive loss, before income taxes, represent amortization of net actuarial loss and net unrecognized prior service credit included in net periodic benefit cost, which is reflected in direct operating expenses and selling, general and administrative expenses in the accompanying consolidated statements of operations (see Note 12).
Note 16. Income Taxes
On December 22, 2017, new tax legislation, commonly referred to as the Tax Cuts and Jobs Act, was enacted, which significantly changed the existing U.S. tax laws, including a reduction in the corporate Federal income tax rate from 35% to 21% effective January 1, 2018. The Company is required to recognize the effect of tax law changes in the period of enactment even though certain key aspects of the new law became effective January 1, 2018. The Company’s income tax provision for interim periods is comprised of the tax on ordinary income (loss) provided at the most recent estimated annual effective tax rate, adjusted for the tax effect of discrete items. The Company used a blended statutory Federal income rate of 28% based upon the number of days that it will be taxed at the former rate of 35% and the number of days it will be taxed at the new rate of 21% to calculate its most recent estimated annual effective tax rate.
Income tax expense (benefit) for the three months ended December 31, 2017 and 2016 was $(116,832) and $3,248, respectively. For the six months ended December 31, 2017 and 2016, income tax expense (benefit) was $(116,070) and $314, respectively.
Income tax benefit for the three months ended December 31, 2017 of $116,832 differs from the income tax expense derived from applying the blended statutory Federal rate of 28% to pretax income primarily as a result of a deferred income tax benefit of $113,494 related to the revaluation of the Company’s deferred tax assets and liabilities under provisions contained in the new tax legislation, of which (i) $51,015 was due to the reduction of net deferred tax liabilities in connection with the lower Federal income tax rate of 21%, and (ii) $62,479 was due to a reduction in the valuation allowance attributable to the new rules, which provide that future Federal net operating losses have an unlimited carry-forward period. These rules on future Federal net operating losses allow the Company to recognize a portion of its unrecognized deferred tax assets for future deductible items. Other decreases to the statutory rate include the impact of an income tax benefit of $27,059 in Federal and state valuat


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THE MADISON SQUARE GARDEN COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)


ion allowance decreases recorded which offsets the income tax expense attributable to most of the operating income, and the impact of a change in state tax rate of $3,241. These decreases were partially offset by the impact of state and local income taxes (net of Federal benefit) of $6,494 and tax expense of $430 primarily related to non-deductible expenses.
Income tax benefit for the six months ended December 31, 2017 of $116,070 differs from the income tax expense derived from applying the blended statutory Federal rate of 28% to pretax income primarily as a result of a deferred income tax benefit of $113,494 related to the revaluation of the Company’s deferred tax assets and liabilities under provisions contained in the new tax legislation, of which (i) $51,015 was due to the reduction of net deferred tax liabilities in connection with the lower Federal income tax rate of 21%, and (ii) $62,479 was due to a reduction in the valuation allowance attributable to the new rules, which provide that future Federal net operating losses have an unlimited carry-forward period. These rules on future Federal net operating losses allow the Company to recognize a portion of its unrecognized deferred tax assets for future deductible items. Other decreases to the statutory rate include the impact of an income tax benefit of $24,399 in Federal and state valuation allowance decreases recorded which offsets the income tax expense attributable to most of the operating income, and the impact of a change in state tax rate of $3,110. These decreases were partially offset by the impact of state and local income taxes (net of Federal benefit) of $6,494 and tax expense of $1,237 primarily related to non-deductible expenses.
Income tax expense for the three months ended December 31, 2016 of $3,248 differs from income tax expense derived from applying the statutory Federal rate of 35% to pretax income primarily as a result of a reduction of $22,123 of recorded Federal and state valuation allowances which offsets tax expense that would otherwise have been recorded on operating income. The tax expense also includes $3,126 to reverse a tax benefit recorded on operating losses in the three months ended September 30, 2016, as well as tax expense of $1,012 primarily related to non-deductible expenses.
Income tax expense for the six months ended December 31, 2016 of $314 differs from income tax expense derived from applying the statutory Federal rate of 35% to pretax income primarily as a result of a reduction of $11,115 of recorded Federal and state valuation allowances which offsets tax expense that would have otherwise been recorded on operating income. The income tax expense also reflects tax expense of $1,342 primarily related to non-deductible expenses.
The Company has not recorded any unrecognized tax benefits for uncertain tax positions as of December 31, 2017 and June 30, 2017. The Company’s policy is to reflect interest and penalties associated with uncertain tax positions, if any, as a component of income tax expense.
Note 17. Related Party Transactions
As of December 31, 2017,2023, for purposes of Section 13(d) of the Securities Exchange Act of 1934, as amended, members of the Dolan family, including trusts for members of the Dolan family (collectively, the “Dolan Family Group”), for purposes of Section 13(d) of the Securities Exchange Act of 1934, collectively beneficially own all100% of the Company’s outstanding Class B Common Stock and own approximately 2.8%3.3% of the Company’s outstanding Class A Common Stock. Such shares of the Company’s Class A Common Stock and Class B Common Stock, collectively, represent approximately 71.3%71.0% of the aggregate voting power of the Company’s outstanding common stock. Members of the Dolan familyFamily Group are also the controlling stockholders of Sphere Entertainment, MSG NetworksEntertainment and AMC Networks Inc. (“AMC Networks”).
In connectionThe Company was party to the following agreements and/or arrangements with the Distribution, the CompanyMSG Entertainment as of December 31, 2023:
•Arena license agreements, entered into various agreements within April 2020 (the “Arena License Agreements”), pursuant to which MSG Networks, including media rights agreements coveringEntertainment (i) provides the right to use The Garden for games of the Knicks and the Rangers for a 35-year term in exchange for arena license fees, (ii) shares revenues collected for suite and club licenses, (iii) operates and manages
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MADISON SQUARE GARDEN SPORTS CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)

the sale of the sports teams’ merchandise at The Garden for a commission, (iv) operates and manages the sales of food and beverage concessions in exchange for 50% of net profits from sales and catering services during Knicks and Rangers home games, (v) shares revenues collected for the sale of venue indoor signage space and sponsorship rights at The Garden that are not specific to our teams, (vi) provides day of game services, and (vii) provides other general services within The Garden;
•Sponsorship sales and service representation agreements pursuant to which MSG Entertainment has the exclusive right and obligation to sell the Company’s sponsorships for an advertisinginitial stated term of 10 years for a commission. In addition, under this agreement, the Company is charged by MSG Entertainment for sales representationand service staff and overhead associated with the sales of sponsorship assets;
•Team sponsorship allocation agreement with MSG Entertainment, pursuant to which the teams receive an allocation of sponsorship and a transitionsignage revenues associated with sponsorship agreements that include the assets of both the Company and MSG Entertainment;
•Services agreement (the “Services Agreement”) pursuant to which the Company (i) receives certain services agreement (“TSA”). The TSA expired on September 30, 2017. The Company entered into a new services agreement effective July 1, 2017, which provides for each party to furnish substantially the same services,from MSG Entertainment, such as well as theinformation technology, accounts payable, payroll, human resources, and other corporate functions and executive support services, described below, in exchange for service fees.fees and (ii) provides certain services to MSG Entertainment, such as certain communications, legal and ticketing services, in exchange for service fees;
Beginning in June 2016,•Arrangements pursuant to which the Company provides certain sponsorship, premium hospitality and other business operations services;
•The Sublease Agreement, pursuant to which the Company leases office space from MSG Entertainment;
•Group ticket sales representation agreement, pursuant to which MSG Entertainment appointed the Company as its sales and service representative to sell group ticket packages related to MSG Entertainment events in exchange for a commission;
•Single night rental commission agreement, pursuant to which the Company may, from time to time, sell (or make referrals for sales of) licenses for the use of suites at The Garden for individual MSG Entertainment events in exchange for a commission and reimbursement for sales and service staff and overhead associated with the ticket sales on behalf of MSG Entertainment; and
•Other agreements with MSG Entertainment entered into in connection with the Sphere Distribution, including a trademark license agreement and certain other arrangements.
The Company is also party to the following agreements and/or arrangements with Sphere Entertainment (including through its subsidiary MSG Networks) as of December 31, 2023:
•Media rights agreements between the Company and MSG Networks, entered into in July 2015, with stated terms of 20 years providing MSG Networks with local telecast rights for Knicks and Rangers games in exchange for media rights fees;
•Arrangements with MSG Networks pursuant to which the Knicks and the Rangers have allocated revenues with MSG Networks related to virtual advertising inventory;
•Arrangements pursuant to which the Company provides Sphere Entertainment with certain sponsorship and other business operations services;
•Arrangements pursuant to which the Company provides sponsorship rights to Sphere Entertainment;
•Other agreements with Sphere Entertainment in connection with the Sphere Distribution, including a distribution agreement, a tax disaffiliation agreement and an employee matters agreement and certain other arrangements; and
•Other agreements with MSG Networks entered into in connection with the MSGS Distribution, including an employee matters agreement, agreements related to audio-only distribution rights for Knicks and Rangers games, and certain other arrangements.
The Company is also party to arrangements with MSG Entertainment and Sphere Entertainment pursuant to which the three companies have agreed to shareallocate expenses in connection with the use by each company of aircraft owned or leased by the Company and MSG Entertainment.
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MADISON SQUARE GARDEN SPORTS CORP.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)

In addition, the Company shares certain executive support costs, including office space, executive assistants, security and transportation costs forfor: (i) the Company’s Executive Chairman with Sphere Entertainment and, following the MSGE Distribution, with MSG Networks andEntertainment as well; (ii) the Company’s Vice Chairman with AMC Networks, Sphere Entertainment and following the MSGE Distribution, with MSG NetworksEntertainment as well, and (iii) the Company’s Executive Vice President with Sphere Entertainment and AMC Networks.
On June 16, 2016, Additionally, the Company, entered into an arrangement with the Dolan Family Office, LLC (“DFO”),Sphere Entertainment, AMC Networks, and, following the MSGE Distribution, MSG Networks providing for the sharing of certain expenses associated with executive office space which will be available to James L. Dolan (the Executive Chairman, Chief Executive Officer and a director of the Company, the Executive Chairman and a director of MSG Networks, and a director of AMC Networks), Charles F. Dolan (the Executive Chairman and a director of AMC Networks and a director of the Company and MSG Networks), and the DFO which is controlled by Charles F. Dolan.
On January 11, 2017, the Company, through a wholly-owned subsidiary, and Quart 2C, LLC (“Q2C”), a company controlled by


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THE MADISON SQUARE GARDEN COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)


James L. Dolan, the Company’s Executive Chairman, Chief Executive Officer and director, and Kristin A. Dolan, his wife and a director of the Company, entered into reciprocal aircraft lease agreements pursuant to which the Company and Q2C have agreed from time to time to make available for lease each party’s aircraft to the other party on a non-exclusive basis for rent at an hourly rate and specified expenses of each flight. On February 8, 2017, the Company, through a wholly-owned subsidiary, and AMC Networks entered into aircraft time sharing agreements, pursuant to which the Company has agreed from time to time to make the aircraft owned or leased by it available to AMC Networks for lease on a “time sharing” basis.
On May 22, 2017, the Company, through a wholly-owned subsidiary, and Charles F. Dolan, a director of the Company, entered into an aircraft dry lease agreement pursuant to which the Company has agreed to make available for lease its G550 aircraft on a non-exclusive basis for rent at an hourly rate and specified expenses of each flight. Additionally, on May 22, 2017, the Company, through a wholly-owned subsidiary, and Sterling Aviation, LLC, a company controlled by Charles F. Dolan, also entered into a reciprocal aircraft dry lease agreement pursuant to which Sterling Aviation, LLC has agreed to make available for lease its GV aircraft on a non-exclusive basis for rent at an hourly rate and specified expenses of each flight.
The Company, through a wholly-owned subsidiary, and MSG Networks are party to an aircraft time sharing agreement, pursuant to which the Company has agreed from time to time to make its aircraft available to MSG Networks for lease on a “time sharing” basis. Additionally, the Company and MSG Networks have agreed on an allocation ofEntertainment, allocate the costs of certain personal aircraft and helicopter useusage by itstheir shared executives.
The Company also has certain arrangements with its nonconsolidated affiliates. See Note 6 for information on outstanding loans provided by the Company to its nonconsolidated affiliates.
Revenues and Operating Expenses
The following table summarizes the composition and amounts of the transactions with the Company’s affiliates, primarily MSG Networks.affiliates. These amounts are reflected in revenues and operating expenses in the accompanying consolidated statements of operations for the three and six months ended December 31, 20172023 and 2016:2022:
Three Months Ended December 31,Six Months Ended December 31,
2023202220232022
Revenues (a)
$77,658 $74,950 $86,475 $83,124 
Operating expenses:
Expense pursuant to the Services Agreement$9,539 $9,817 $19,426 $19,330 
Rent expense pursuant to Sublease agreement with MSG Entertainment752 723 1,502 1,421 
Costs associated with the Sponsorship sales and service representation agreements5,550 5,726 8,151 8,659 
Operating lease expense associated with the Arena License Agreements24,362 31,617 25,673 32,928 
Other costs associated with the Arena License Agreements12,817 15,097 13,621 16,067 
Other operating (credits) expenses, net(707)(62)(1,319)5 
___________________
  Three Months Ended December 31, Six Months Ended December 31,
  2017 2016 2017 2016
Revenues $41,131
 $39,040
 $77,041
 $72,881
Operating expenses (credits):        
Corporate general and administrative, net - MSG Networks $(2,494) $(2,406) $(4,950) $(4,895)
Consulting fees 1,014
 942
 2,029
 1,919
Advertising expenses 594
 475
 630
 595
Other, net 125
 (152) 238
 (134)
Revenues
Revenues from related parties primarily(a) Primarily consist of local media rights recognized by the Company’s Sports segment from the licensing of team-related programming to MSG Networks under the media rights agreements covering the Knicks and Rangers, which provide MSG Networks with exclusive media rights to team games in their local markets, as well as commissions earned in connection with the advertising sales representation agreement pursuant to whichRangers.
Note 17. Income Taxes
In general, the Company hasis required to use an estimated annual effective tax rate to measure the exclusive righttax benefit or tax expense recognized in an interim period. The estimated annual effective tax rate exceeds the statutory federal tax rate of 21% primarily due to state taxes, nondeductible officers’ compensation, and obligation to sell MSG Networks’ advertising availabilities. In addition,players’ disability insurance premiums expense. The estimated annual effective tax rate is revised on a quarterly basis.
Income tax expense for the Company and Tribeca Enterprises have a service agreement pursuant to whichthree months ended December 31, 2023 of$10,784 reflects an effective tax rate of 43%. Income tax benefit for the Company provides marketing inventory and consulting services to Tribeca Enterprisessix months ended December 31, 2023 of $4,360 reflects an effective tax rate of 49%.
Income tax expense for a fee. The Company is also a party to certain commercial arrangements with AMC Networks and its subsidiaries.
Corporate General and Administrative Expense, net - MSG Networks
The Company’s corporate overhead expenses are primarily related to centralized functions, including executive compensation, finance, treasury, tax, internal audit, legal, information technology, human resources and risk management functions. For the three and six months ended December 31, 2017, corporate general2022 of $24,555 and administrative expense, net - MSG Networks amount$4,062, respectively, reflects an effective tax rate of 53% and 55%, respectively.

The Company was notified in April 2020 that the City of New York was commencing an audit of the local income tax returns for the fiscal years ended June 30, 2016 and 2017. The audit was finalized in January 2024 and resulted in no material changes.

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THE MADISON SQUARE GARDEN COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)


reflects charges fromDuring the Company to MSG Networks of $2,274 and $4,477, respectively, net of general and administrative costs charged to the Company by MSG Networks, under a new services agreement, which became effective July 1, 2017.
For the three and six months ended December 31, 2016, corporate general and administrative expense, net - MSG Networks amount reflects charges from2023, the Company to MSG Networks of $2,118 and $4,166, respectively,made income tax payments, net of general and administrative costs charged to the Company by MSG Networks, under the TSA, which expired on September 30, 2017.
Consulting Fees
The Company pays AMSGE and its nonconsolidated affiliates for advisory and consulting services that AMSGE and its nonconsolidated affiliates provide to the Company, and for the reimbursementrefunds, of certain expenses in connection with such services. In the fourth quarter of fiscal year 2016, the Company paid $5,000 to AMSGE for work performed towards securing the right to lease property to be developed in Las Vegas. That amount is included in other assets in the accompanying consolidated balance sheets as of December 31, 2017 and June 30, 2017 and will be amortized over the term of the lease.
Advertising Expenses
The Company incurs advertising expenses for services rendered by its related parties, primarily MSG Networks, most of which related to the utilization of advertising and promotional benefits by the Company.
Other Operating Expenses, net
The Company and its related parties enter into transactions with each other in the ordinary course of business. Amounts charged to the Company for other transactions with its related parties are net of amounts charged by the Company to the Knickerbocker Group, LLC, an entity owned by James L. Dolan, the Executive Chairman, Chief Executive Officer and a director of the Company, for office space equal to the allocated cost of such space and the cost of certain technology services. In addition, other operating expenses include net charges relating to (i) reciprocal aircraft arrangements between the Company and each of Q2C and DFO/Sterling Aviation, LLC and (ii) time sharing agreements with MSG Networks and AMC Networks.
Note 18. Segment Information
The Company is comprised of two reportable segments: MSG Entertainment and MSG Sports. In determining its reportable segments, the Company assessed the guidance of FASB ASC 280-10-50-1, which provides the definition of a reportable segment. In accordance with the FASB guidance, the Company takes into account whether two or more operating segments can be aggregated together as one reportable segment as well as the type of discrete financial information that is available and regularly reviewed by its chief operating decision maker. The Company has evaluated this guidance and determined that there are two reportable segments. The Company allocates certain corporate costs and its performance venue operating expenses to each of its reportable segments. Allocated venue operating expenses include the non-event related costs of operating the Company’s venues, and include such costs as rent for the Company’s leased venues, real estate taxes, insurance, utilities, repairs and maintenance, and labor related to the overall management of the venues. Depreciation and amortization expense related to The Garden, The Theater at Madison Square Garden, the Forum, and certain corporate property, equipment and leasehold improvements not allocated to the reportable segments is reported in “Corporate and Other.” Additionally, the Company does not allocate any purchase accounting adjustments to the reporting segments.
The Company evaluates segment performance based on several factors, of which the key financial measure is their operating income (loss) before (i) depreciation, amortization and impairments of property and equipment and intangible assets, (ii) share-based compensation expense or benefit, (iii) restructuring charges or credits, and (iv) gains or losses on sales or dispositions of businesses, which is referred to as adjusted operating income (loss), a non-GAAP measure. In addition to excluding the impact of the items discussed above, the impact of purchase accounting adjustments related to business acquisitions is also excluded in evaluating the Company’s consolidated adjusted operating income (loss). The Company believes adjusted operating income (loss) is an appropriate measure for evaluating the operating performance of its business segments and the Company on a consolidated basis. Adjusted operating income (loss) and similar measures with similar titles are common performance measures used by investors and analysts to analyze the Company’s performance. The Company uses revenues and adjusted operating income (loss) measures as the most important indicators of its business performance, and evaluates management’s effectiveness with specific reference to these indicators.$14,259.

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THE MADISON SQUARE GARDEN COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)


Adjusted operating income (loss) should be viewed as a supplement to and not a substitute for operating income (loss), net income (loss), cash flows from operating activities, and other measures of performance and/or liquidity presented in accordance with GAAP. The Company has presented the components that reconcile operating income (loss), the most directly comparable GAAP financial measure, to adjusted operating income (loss).
Information as to the operations of the Company’s reportable segments is set forth below.
 
   Three Months Ended December 31, 2017
   
MSG
Entertainment
 
MSG
Sports
 Corporate and Other Purchase
accounting adjustments		 Total
Revenues  $271,216
 $265,086
 $—
 $—
 $536,302
Direct operating expenses  147,045
 163,683
 20
 1,133
 311,881
Selling, general and administrative expenses
(a) 
 45,278
 50,230
 25,932
 —
 121,440
Depreciation and amortization
(b) 
 4,362
 1,849
 19,589
 4,744

30,544
Operating income (loss)  $74,531
 $49,324
 $(45,541) $(5,877) $72,437
Loss in equity method investments          (2,608)
Interest income          5,378
Interest expense          (3,798)
Miscellaneous expense
(e) 
         (250)
Income from operations before income taxes          $71,159
            
Reconciliation of operating income (loss) to adjusted operating income (loss):           
Operating income (loss)  $74,531
 $49,324
 $(45,541) $(5,877) $72,437
Add back:           
Share-based compensation  3,051
 3,905
 6,956
 —
 13,912
Depreciation and amortization  4,362
 1,849
 19,589
 4,744
 30,544
Other purchase accounting adjustments  —
 —
 —
 1,133
 1,133
Adjusted operating income (loss)  $81,944
 $55,078
 $(18,996) $—
 $118,026
            
Other information:           
Capital expenditures
(c) 
 $3,407
 $588
 $104,150
 $—
 $108,145


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THE MADISON SQUARE GARDEN COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)


 
   Three Months Ended December 31, 2016
   
MSG
Entertainment
 
MSG
Sports
 Corporate and Other Purchase
accounting adjustments		 Total
Revenues  $192,485
 $252,665
 $—
 $—
 $445,150
Direct operating expenses  106,464
 160,209
 —
 —
 266,673
Selling, general and administrative expenses
(a) 
 26,442
 49,346
 18,472
 —
 94,260
Depreciation and amortization
(b) (d) 
 2,603
 2,905
 20,228
 230
 25,966
Operating income (loss)  $56,976
 $40,205
 $(38,700) $(230) $58,251
Loss in equity method investments          (1,188)
Interest income          2,692
Interest expense          (491)
Miscellaneous income
(e) 
         1,405
Income from operations before income taxes          $60,669
            
Reconciliation of operating income (loss) to adjusted operating income (loss):           
Operating income (loss)  $56,976
 $40,205
 $(38,700) $(230) $58,251
Add back:           
Share-based compensation  4,076
 4,100
 3,567
 —
 11,743
Depreciation and amortization  2,603
 2,905
 20,228
 230
 25,966
Adjusted operating income (loss)  $63,655
 $47,210
 $(14,905) $—
 $95,960
            
Other information:           
Capital expenditures  $5,434
 $693
 $7,297
 $—
 $13,424


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THE MADISON SQUARE GARDEN COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)


 
   Six Months Ended December 31, 2017
   
MSG
Entertainment
 
MSG
Sports
 Corporate and Other Purchase
accounting adjustments		 Total
Revenues  $435,497
 $346,020
 $—
 $—
 $781,517
Direct operating expenses  252,691
 180,585
 41
 2,300
 435,617
Selling, general and administrative expenses
(a) 
 89,905
 92,664
 45,285
 24
 227,878
Depreciation and amortization
(b) 
 8,523
 3,755
 39,889
 8,923

61,090
Operating income (loss)  $84,378
 $69,016
 $(85,215) $(11,247) $56,932
Earnings in equity method investments          2,117
Interest income          9,764
Interest expense          (7,509)
Miscellaneous expense
(e) 
         (250)
Income from operations before income taxes          $61,054
            
Reconciliation of operating income (loss) to adjusted operating income (loss):           
Operating income (loss)  $84,378
 $69,016
 $(85,215) $(11,247) $56,932
Add back:           
Share-based compensation  6,952
 8,141
 11,723
 —
 26,816
Depreciation and amortization  8,523
 3,755
 39,889
 8,923
 61,090
Other purchase accounting adjustments  —
 —
 —
 2,324
 2,324
Adjusted operating income (loss)  $99,853
 $80,912
 $(33,603) $—
 $147,162
            
Other information:           
Capital expenditures
(c) 
 $11,113
 $1,559
 $115,012
 $—
 $127,684


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THE MADISON SQUARE GARDEN COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Continued)


 
   Six Months Ended December 31, 2016
   
MSG
Entertainment
 
MSG
Sports
 Corporate and Other Purchase
accounting adjustments		 Total
Revenues  $303,183
 $323,662
 $—
 $—
 $626,845
Direct operating expenses  198,322
 179,758
 —
 —
 378,080
Selling, general and administrative expenses
(a) 
 49,882
 88,859
 32,540
 —
 171,281
Depreciation and amortization
(b) (d) 
 5,059
 5,523
 41,034
 460

52,076
Operating income (loss)  $49,920
 $49,522
 $(73,574) $(460) $25,408
Loss in equity method investments          (2,182)
Interest income          5,091
Interest expense          (901)
Miscellaneous income
(e) 
         1,405
Income from operations before income taxes          $28,821
            
Reconciliation of operating income (loss) to adjusted operating income (loss):           
Operating income (loss)  $49,920
 $49,522
 $(73,574) $(460) $25,408
Add back:           
Share-based compensation  7,615
 7,584
 4,899
 —
 20,098
Depreciation and amortization  5,059
 5,523
 41,034
 460
 52,076
Adjusted operating income (loss)  $62,594
 $62,629
 $(27,641) $—
 $97,582
            
Other information:           
Capital expenditures  $6,794
 $2,357
 $12,615
 $—
 $21,766
_________________
(a)
Corporate and Other’s selling, general and administrative expenses primarily consist of unallocated corporate general and administrative costs.
(b)
Corporate and Other principally includes depreciation and amortization on The Garden, The Theater at Madison Square Garden, the Forum, and certain corporate property, equipment and leasehold improvement assets not allocated to the Company’s reportable segments.
(c)
Corporate and Other’s capital expenditures for the three and six months ended December 31, 2017 are primarily associated with the purchase of land in London. See Note 7 for more information regarding this purchase. MSG Entertainment’s capital expenditures for the six months ended December 31, 2017 are primarily associated with certain investments with respect to Radio City Music Hall.
(d)
MSG Entertainment’s depreciation and amortization for the three and six months ended December 31, 2016 was reclassified to exclude the impact of purchase accounting adjustments related to the BCE acquisition.
(e)
Miscellaneous expense for the three and six months ended December 31, 2017 reflects a pre-tax non-cash impairment charge to write off the carrying value of one of the Company’s cost method investments. Miscellaneous income for the three and six months ended December 31, 2016 consists principally of the recovery of certain claims in connection with a third-party bankruptcy proceeding.
Substantially all revenues and assets of the Company’s reportable segments are attributed to or located in the United States and are primarily concentrated in the New York metropolitan area.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
This Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) contains forward-looking statements.statements within the meaning of the Private Securities Litigation Reform Act of 1995. In this MD&A, there are statements concerning the future operating and future financial performance of The Madison Square Garden CompanySports Corp. and its direct and indirect subsidiaries (collectively, “we,” “us,” “our,” “Madison Square Garden,“MSG Sports,” or the “Company”), including lower ticket-related revenue for the regular season. on our future operations. Words such as “expects,” “anticipates,” “believes,” “estimates,” “may,” “will,” “should,” “could,” “potential,” “continue,” “intends,” “plans,” and similar words and terms used in the discussion of future operating and future financial performance identify forward-looking statements. Investors are cautioned that such forward-looking statements are not guarantees of future performance, results or events and involve risks and uncertainties and that actual results or developments may differ materially from the forward-looking statements as a result of various factors. Factors that may cause such differences to occur include, but are not limited to:
•the level of our revenues, which depends in part on the popularity and competitiveness of our sports teams and the level of popularity of the Christmas Spectacular, New York Spectacular and other entertainment events which are presented in our venues;
teams;
•costs associated with player injuries, waivers or contract terminations of players and other team personnel;
•changes in professional sports teams’ compensation, including the impact of signing free agents and executing trades, subject to league salary caps and the impact of luxury tax;
the level of our capital expenditures and other investments;
•general economic conditions, especially in the New York City Los Angeles and Las Vegas metropolitan areas where we conduct the majority of our operations;
area;
•the demand for sponsorship arrangements and for advertising;
•competition, for example, from other teams, other venues and other sports and entertainment options, including the construction of new competing venues;options;
our ability to successfully design, construct, finance and operate new venues in Las Vegas, London and other markets, and the investments and costs associated with those efforts, including the impact of unexpected construction delays and cost overruns;
•changes in laws, NBANational Basketball Association (“NBA”) or NHLNational Hockey League (“NHL”) rules, regulations, guidelines, bulletins, directives, policies and agreements, (includingincluding the leagues’ respective collective bargaining agreements (each, a “CBA”) with their players’ associations, salary caps, escrow requirements, revenue sharing, NBA luxury tax thresholds and media rights)rights, or other regulations under which we operate;
•the performance by our affiliates of their obligations under various agreements with the Company, including the potential for financial difficulties that may impact MSG Networks Inc.’s (“MSG Networks”) ability to perform its obligations;
•a resurgence of the COVID-19 pandemic or another pandemic or public health emergency, and our ability to effectively manage the impacts, including labor market disruptions;
•any NBA, NHL or NHLother work stoppage;
•any economic, political or other actions, such as boycotts, protests, work stoppages or campaigns by labor organizations;
•seasonal fluctuations and other variationsvariation in our operating results and cash flow from period to period;
•the level of our expenses, including our corporate expenses;
•business, reputational and litigation risk if there is a security incident resulting in loss, disclosure or misappropriation of stored personal information or other breaches of our information security;
•activities or other developments that discourage or may discourage congregation at prominent places of public assembly, including Madison Square Garden Arena (“The Garden”) where the successful developmenthome games of new live productions or enhancements or changes to existing productionsthe New York Knickerbockers (the “Knicks”) and the investments associated with such development or enhancements or changes;New York Rangers (the “Rangers”) are played;
the continued popularity and success of the TAO Group restaurants and nightlife and hospitality venues, as well as its existing brands, and the ability to successfully open and operate new restaurants and nightlife and hospitality venues;•a default by our subsidiaries under their respective credit facilities;
the ability of BCE to attract attendees and performers to its festival;
the evolution of the esports industry and its potential impact on CLG;
•the acquisition or disposition of assets or businesses and/or the impact of, and our ability to successfully pursue, acquisitions or other strategic transactions;
•our ability to successfully integrate acquisitions new venues or new businesses into our operations;
•the operating and financial performance of our strategic acquisitions and investments, including those we domay not control;

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the costs associated with, and the outcome of, litigation and other proceedings to the extent uninsured, including litigation or other claims against companies we invest in or acquire;
•the impact of governmental regulations or laws, including changes in how those regulations and laws are interpreted and the continued benefit of certain tax exemptions (including for The Garden) and the ability for us and Madison Square Garden Entertainment Corp. (“MSG Entertainment”) to maintain necessary permits or licenses;
•the impact of any government plans to redesign New York City’s Pennsylvania Station, including the possible dispositionStation;
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Table of The Theater at Madison Square Garden;Contents
•business, economic, reputational and other risks associated with, and the outcome of, litigation risk if there is a loss, disclosure or misappropriation of stored personal information orand other breaches of our information security;proceedings;
a default by our subsidiaries under their respective credit facilities;
•financial community and rating agency perceptions of our business, operations, financial condition and the industry in which we operate;
the ability•certain restrictions on transfer and ownership of our investees and otherscommon stock related to repay loans and advances we have extended to them;
our ownership of professional sports franchises in the NBA and NHL and certain transfer restrictions on our common stock;NHL;
•the tax freetax-free treatment of the Distribution;
the impactdistribution of all of the Tax Cutsoutstanding common stock of Sphere Entertainment Co. (formerly Madison Square Garden Entertainment Corp. and Jobs Actreferred herein as “Sphere Entertainment”) to its stockholders, which was completed on our income tax expenseApril 17, 2020 (the “Sphere Distribution”); and deferred tax liabilities; and
•the factors described under “Risk Factors” in the Company’sour Annual Report on Form 10-K for the fiscal year ended June 30, 2017.
2023.
We disclaim any obligation to update or revise the forward-looking statements contained herein, except as otherwise required by applicable Federalfederal securities laws.
All dollar amounts included in the following MD&A are presented in thousands, except as otherwise noted.
Introduction
This MD&A is provided as a supplement to, and should be read in conjunction with, the Company’s unaudited financial statements and accompanying notes thereto included in this Quarterly Report on Form 10-Q, as well as the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2017,2023, to help provide an understanding of our financial condition, changes in financial condition and results of operations. Unless the context otherwise requires, all references to “we,” “us,” “our,” “Madison Square Garden”“MSG Sports,” or the “Company” refer collectively to The Madison Square Garden Company,Sports Corp., a holding company, and its direct and indirect subsidiaries through which substantially all of our operations are actually conducted. The Company is comprised of two reportable segments: MSG Entertainment and MSG Sports.
MSG Entertainment includes live entertainment events such as concerts, family shows, performing arts and special events, which are presented or hosted in the Company’s diverse collection of venues along with live offerings through TAO Group and BCE. TAO Group is a hospitality group with globally-recognized entertainment dining and nightlife brands: TAO, Marquee, Lavo, Avenue, The Stanton Social, Beauty & Essex and Vandal. BCE produces New England’s premier Boston Calling Music Festival. MSG Entertainment also includes the Company’s original productions — the Christmas Spectacular and the New York Spectacular. In November 2017, the Company acquired a 100% controlling interest in Obscura, a creative studio, which is now part of our MSG Entertainment segment. See Note 3 to the consolidated financial statements included in “Part I — Item 1. Financial Statements” of this Quarterly Report on Form 10-Q for discussion on certain costs incurred by Obscura.
MSG Sports includes the Company’s professional sports franchises: the Knicks of the NBA, the Rangers of the NHL, the Liberty of the WNBA, the Hartford Wolf Pack of the AHL, and the Westchester Knicks of the NBAGL. The MSG Sports segment is also home to a broad array of other live sporting events, including professional boxing, college basketball, college hockey, professional bull riding, mixed martial arts, esports, tennis and college wrestling, all of which the Company promotes, produces and/or presents. In July 2017, the Company acquired a controlling interest in CLG, a premier North American esports organization, which is now part of our MSG Sports segment.

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The Company conducts a significant portion of its operations at venues that it either owns or operates under long-term leases. The Company owns The Garden and The Theater at Madison Square Gardenreports financial information in New York City, the Forum in Inglewood, CA and The Chicago Theatre in Chicago. In addition, the Company leases Radio City Music Hall and the Beacon Theatre in New York City, and has a booking agreement with respect to the Wang Theatre in Boston. Additionally, TAO Group operates various restaurants, nightlife and hospitality venues under long-term leases and management contracts in New York, Las Vegas, Los Angeles, Australia and Singapore.
Factors Affecting Results of Operations
TAO Group’s Operating Results
The Company completed the TAO Group acquisition on January 31, 2017. TAO Group financial statements are not available within the time constraints the Company requires to ensure the financial accuracy of the operating results. Therefore, the Company records TAO Group’s operating results in its consolidated statements of operations on a three-month lag basis. As a result, TAO Group’s related operating results for the three months ended December 31, 2017 are for the period from June 26, 2017 to September 24, 2017. TAO Group’s related operating results for the six months ended December 31, 2017 are for the period from March 27, 2017 to September 24, 2017. In addition, the results of operations of the Company and the MSG Entertainment segment for the three and six months ended December 31, 2016 do not include any of TAO Group’s operating results.
CLG’s Operating Results
The results of operations of the Company and the MSG Sports segment for the three and six months ended December 31, 2017 include CLG’s results of operations from the date of acquisition, which was July 28, 2017. The Company’s results for the three and six months ended December 31, 2016 do not include any of CLG’s operating results.
Obscura’s Operating Results
The results of operations of the Company and the MSG Entertainment segment for the three and six months ended December 31, 2017 include Obscura’s results of operations from the date of acquisition, which was November 20, 2017. The Company’s results for the three and six months ended December 31, 2016 do not include any of Obscura’s operating results. In addition, the Obscura financial results of operations will be reflected in the MSG Entertainmentone segment. Any costs incurred by Obscura that are associated with the Company’s venue development initiatives will be reported in “Corporate and Other.”
This MD&A is organized as follows:
Results of Operations. This section provides an analysis of our unaudited results of operations for the three and six months ended December 31, 20172023 compared to the three and six months ended December 31, 2016 on a consolidated and segment basis.2022.
Liquidity and Capital Resources. This section provides a discussionfocuses primarily on (i) the liquidity and capital resources of our financial condition and liquidity,the Company, (ii) an analysis of ourthe Company’s cash flows for the six months ended December 31, 20172023 compared to the six months ended December 31, 2016, as well as2022, and (iii) certain contractual obligations and off balance sheet arrangements.obligations.
Seasonality of Our Business. This section discusses the seasonal performance of our segmentsbusiness.
Recently Issued Accounting Pronouncements and Critical Accounting Policies. This section discusses accounting pronouncements that have been adopted by the Company, recently issued accounting pronouncements not yet adopted by the Company,if any, as well as the results of the Company’s annual impairment testing of goodwill and identifiable indefinite-lived intangible assets performed during the first quarter of fiscal year 2018.2024. This section should be read together with our critical accounting policies, which are discussed in our Annual Report on Form 10-K for the fiscal year ended June 30, 20172023 under “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations — Recently Issued Accounting Pronouncements and Critical Accounting Policies — Critical Accounting Policies” and in the notes to the consolidated and combined financial statements of the Company included therein.

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Results of Operations
Comparison of the Three Months Ended three and six months ended December 31, 20172023 versus the Three Months Ended three and six months ended December 31, 20162022
Consolidated Results of Operations
The table below sets forth, for the periods presented, certain historical financial information.
Three Months EndedSix Months Ended
December 31,ChangeDecember 31,Change
20232022$%20232022$%
Revenues$326,898 $353,694 $(26,796)(8)%$369,944 $377,783 $(7,839)(2)%
Direct operating expenses232,225 225,702 6,523 3 %235,745 229,383 6,362 3 %
Selling, general and administrative expenses65,066 75,636 (10,570)(14)%118,622 130,917 (12,295)(9)%
Depreciation and amortization790 838 (48)(6)%1,584 1,863 (279)(15)%
Operating income28,817 51,518 (22,701)(44)%13,993 15,620 (1,627)(10)%
Other income (expense):
Interest expense, net(6,800)(5,512)(1,288)(23)%(13,276)(8,468)(4,808)(57)%
Miscellaneous income (expense), net2,991 385 2,606 NM(9,674)219 (9,893)NM
Income (loss) before income taxes25,008 46,391 (21,383)(46)%(8,957)7,371 (16,328)NM
Income tax (expense) benefit(10,784)(24,555)13,771 56 %4,360 (4,062)8,422 NM
Net income (loss)14,224 21,836 (7,612)(35)%(4,597)3,309 (7,906)NM
Less: Net loss attributable to nonredeemable noncontrolling interests— (655)655 100 %— (1,362)1,362 100 %
Net income (loss) attributable to Madison Square Garden Sports Corp.’s stockholders$14,224 $22,491 $(8,267)(37)%$(4,597)$4,671 $(9,268)NM
  Three Months Ended    
  December 31, Change
  2017 2016 Amount Percentage
Revenues $536,302
 $445,150
 $91,152
 20 %
         
Direct operating expenses 311,881
 266,673
 45,208
 17 %
Selling, general and administrative expenses 121,440
 94,260
 27,180
 29 %
Depreciation and amortization 30,544
 25,966
 4,578
 18 %
Operating income 72,437
 58,251
 14,186
 24 %
Other income (expense):        
Loss in equity method investments (2,608) (1,188) (1,420) (120)%
Interest income, net 1,580
 2,201
 (621) (28)%
Miscellaneous income (expense) (250) 1,405
 (1,655) (118)%
Income from operations before income taxes 71,159
 60,669
 10,490
 17 %
Income tax benefit (expense) 116,832
 (3,248) 120,080
 NM
Net income 187,991
 57,421
 130,570
 NM
Less: Net loss attributable to redeemable noncontrolling interests (767) —
 (767) NM
Less: Net loss attributable to nonredeemable noncontrolling interests (855) (305) (550) (180)%
Net income attributable to The Madison Square Garden Company’s stockholders $189,613
 $57,726
 $131,887
 NM
Revenues
_________________
NM — Percentage is not meaningful
The following is a summary of changes in our segments’ operating resultsRevenues decreased $26,796, or 8%, to $326,898 for the three months ended December 31, 20172023 as compared to the prior year period.
Our results Revenues decreased $7,839, or 2%, for the threesix months ended December 31, 2017 include the operating results of TAO Group, CLG, and Obscura and, as a result, our operating results for the current year period are not directly comparable to our results for the prior year period.
Changes attributable to Revenues Direct
operating
expenses		 Selling,
general and
administrative
expenses		 Depreciation and amortization Operating income (loss)
MSG Entertainment segment (a)
 $78,731
 $40,581
 $18,836
 $1,759
 $17,555
MSG Sports segment (a)
 12,421
 3,474
 884
 (1,056) 9,119
Corporate and Other —
 20
 7,460
 (639) (6,841)
Purchase accounting adjustments —
 1,133
 —
 4,514
 (5,647)
  $91,152
 $45,208
 $27,180
 $4,578
 $14,186
_________________
(a)
See “Business Segment Results” for a more detailed discussion relating to the operating results of our segments.

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Selling, general and administrative expenses - Corporate and Other
Selling, general and administrative expenses in Corporate and Other for the three months ended December 31, 2017 increased $7,460, or 40%, to $25,932. The increase was primarily due to higher employee compensation and related benefits, as well as the inclusion of certain Obscura selling, general and administrative costs, which primarily reflects retention bonuses paid in connection with the change of control. The increase was partially offset by a management fee earned for providing management and strategic services to TAO Group, which is eliminated in the Company’s consolidated results of operations presented above.
Operating loss - Corporate and Other
Operating loss in Corporate and Other for the three months ended December 31, 2017 increased $6,841, or 18%, to $45,541. The increase was primarily due to higher selling, general and administrative expenses as discussed above, partially offset by lower depreciation and amortization as a result of certain assets being fully depreciated and amortized. See Note 18 to the consolidated financial statements included in “Part I — Item 1. Financial Statements” of this Quarterly Report on Form 10-Q for discussion of depreciation and amortization under Corporate and Other.
Loss in equity method investments
Loss in equity method investments for the three months ended December 31, 2017 increased $1,420 to $2,608. The year-over-year increase in loss reflects a distribution from an equity method investment during the prior year period that was previously written off and an increase in the net loss attributable to the Company’s investees, partially offset by the absence of the Company’s share of the results of Fuse Media as the investment was written off in the third quarter of fiscal year 2017.
Interest income, net
Net interest income for the three months ended December 31, 2017 decreased $621, or 28%, to $1,580 as compared to the prior year period primarily due to interest expense incurred under the TAO Term Loan Facility. The decrease was partially offset by higher interest income earned by the Company as a result of higher interest rates and a change in investment mix. In addition, during the three months ended December 31, 2017, the Company recognized interest income of $937, which was received in connection with the repayment of a loan receivable from one of the Company’s nonconsolidated affiliates that was on a nonaccrual status.
Miscellaneous income (expense)
Miscellaneous expense in the current year period reflects a pre-tax non-cash impairment charge to write off the carrying value of one of the Company’s cost method investments. Miscellaneous income in the prior year period consists principally of the recovery of certain claims in connection with a third-party bankruptcy proceeding.
Income taxes
On December 22, 2017, new tax legislation, commonly referred to as the Tax Cuts and Jobs Act, was enacted, which significantly changed the existing U.S. tax laws, including a reduction in the corporate Federal income tax rate from 35% to 21% effective January 1, 2018. The Company is required to recognize the effect of tax law changes in the period of enactment even though certain key aspects of the new law became effective January 1, 2018. The Company’s income tax provision for interim periods is comprised of the tax on ordinary income (loss) provided at the most recent estimated annual effective tax rate, adjusted for the tax effect of discrete items. The Company used a blended statutory Federal income rate of 28% based upon the number of days that it will be taxed at the former rate of 35% and the number of days it will be taxed at the new rate of 21% to calculate its most recent estimated annual effective tax rate.
Income tax benefit for the three months ended December 31, 2017 was $116,832 and income tax expense for the three months ended December 31, 2016 was $3,248.
Income tax benefit for the three months ended December 31, 2017 of $116,832 differs from the income tax expense derived from applying the blended statutory Federal rate of 28% to pretax income primarily as a result of a deferred income tax benefit of $113,494 related to the revaluation of the Company’s deferred tax assets and liabilities under provisions contained in the new tax legislation, of which (i) $51,015 was due to the reduction of net deferred tax liabilities in connection with the lower Federal income tax rate of 21%, and (ii) $62,479 was due to a reduction in the valuation allowance attributable to the new rules, which provide that future Federal net operating losses have an unlimited carry-forward period. These rules on future Federal net operating losses allow the Company to recognize a portion of its unrecognized deferred tax assets for future deductible items. Other decreases to the statutory rate include the impact of an income tax benefit of $27,059 in Federal and state valuation allowance decreases recorded which offsets the income tax expense attributable to most of the operating income, and the impact of a change in state tax rate of $3,241. These decreases were partially offset by the impact of state and local income taxes (net of Federal benefit) of $6,494 and tax expense of $430 primarily related to non-deductible expenses.

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Income tax expense for the three months ended December 31, 2016 of $3,248 differs from income tax expense derived from applying the statutory Federal rate of 35% to pretax income primarily as a result of a reduction of $22,123 of recorded Federal and state valuation allowances which offsets tax expense that would otherwise have been recorded on operating income. The tax expense also includes $3,126 to reverse a tax benefit recorded on operating losses in the three months ended September 30, 2016, as well as tax expense of $1,012 primarily related to non-deductible expenses.
Adjusted operating income
The following is a reconciliation of operating income to adjusted operating income:
  Three Months Ended    
  December 31, Change
  2017 2016 Amount Percentage
Operating income $72,437
 $58,251
 $14,186
 24%
Share-based compensation 13,912
 11,743
 

  
Depreciation and amortization (a)
 30,544
 25,966
 

  
Other purchase accounting adjustments 1,133
 —
    
Adjusted operating income $118,026
 $95,960
 $22,066
 23%
_________________
(a)
Depreciation and amortization includes purchase accounting adjustments of $4,744 and $230 for three months ended December 31, 2017 and 2016, respectively.
Adjusted operating income for the three months ended December 31, 2017 increased by $22,066, or 23%, to adjusted operating income of $118,026 as compared to the prior year period. The increase is attributable to the following:
Increase in adjusted operating income of the MSG Entertainment segment$18,289
Increase in adjusted operating income of the MSG Sports segment7,868
Other net decreases(4,091)
 $22,066
Other net decreases were primarily due to higher employee compensation and related benefits, excluding share-based compensation expense, as well as the inclusion of certain Obscura selling, general and administrative costs, which primarily reflects retention bonuses paid in connection with the change of control. This increase was partially offset by a management fee earned for providing management and strategic services to TAO Group, which is eliminated in the Company’s consolidated results of operations presented above.
Net loss attributable to redeemable and nonredeemable noncontrolling interests

For the three months ended December 31, 2017, the Company recorded a net loss attributable to redeemable noncontrolling interests of $767 and a net loss attributable to nonredeemable noncontrolling interests of $855 as compared to $305 of net loss attributable to nonredeemable noncontrolling interests for the three months ended December 31, 2016. These amounts represent the share of net loss from the Company’s investments in TAO Group, BCE and CLG that are not attributable to the Company. In addition, the net loss attributable to redeemable and nonredeemable noncontrolling interests includes a proportional share of expenses related to purchase accounting adjustments.

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Business Segment Results
MSG Entertainment
The table below sets forth, for the periods presented, certain historical financial information and a reconciliation of operating income to adjusted operating income for the Company’s MSG Entertainment segment.
  Three Months Ended    
  December 31, Change
  2017 2016 Amount Percentage
Revenues $271,216
 $192,485
 $78,731
 41%
Direct operating expenses 147,045
 106,464
 40,581
 38%
Selling, general and administrative expenses 45,278
 26,442
 18,836
 71%
Depreciation and amortization 4,362
 2,603
 1,759
 68%
Operating income $74,531
 $56,976
 $17,555
 31%
Reconciliation to adjusted operating income:        
Share-based compensation 3,051
 4,076
   

Depreciation and amortization 4,362
 2,603
    
Adjusted operating income $81,944
 $63,655
 $18,289
 29%
Revenues
Revenues for the three months ended December 31, 2017 increased $78,731, or 41%, to $271,2162023 as compared to the prior year period. The net increase isdecreases were attributable to the following:
ThreeSix
MonthsMonths
Decrease in pre/regular season ticket-related revenues$(19,045)$(18,709)
Decrease in suite revenues(5,895)(5,679)
Decrease in sponsorship and signage revenues(5,811)(5,527)
Increase in revenues from local media rights fees1,952 2,184 
Increase in revenues from league distributions1,651 18,643 
Other net increases352 1,249 
$(26,796)$(7,839)
Inclusion of revenues associated with entertainment dining and nightlife offerings$54,436
Increase in event-related revenues at The Theater at Madison Square Garden7,202
Increase in revenues from the presentation of the Christmas Spectacular
6,618
Increase in event-related revenues at the Forum5,204
Increase in event-related revenues at The Garden3,707
Increase in event-related revenues at The Chicago Theatre1,329
Net decrease in venue-related sponsorship and signage and suite rental fee revenues(1,067)
Other net increases, inclusive of revenues from Obscura1,302
 $78,731
The inclusion ofdecreases in pre/regular season ticket-related revenues associated with entertainment dining and nightlife offerings is the result of the acquisition of a 62.5% interest in TAO Group on January 31, 2017, and primarily reflects revenues generated from food and beverage sales. TAO Group’s operating results are recorded in the Company’s consolidated statements of operations on a three-month lag basis. As a result, TAO Group’s related revenues are for the period from June 26, 2017 to September 24, 2017.
The increase in event-related revenues at The Theater at Madison Square Garden wasthree and six months ended December 31, 2023 were primarily due to a change in the mix of events, as well as additional events heldKnicks and the Rangers playing fewer home games at the venueThe Garden during the current year periodperiods as compared to the prior year period.periods, partially offset by higher average per-game revenue. The Knicks played 15 games at The Garden during the three and six months ended December 31, 2023 as compared to 21 games during the prior year periods. The Rangers played 17 games at The Garden during the three months ended December 31, 2023 and 19 games at The Garden during the six months ended December 31, 2023 as compared to 20 and 22 games, respectively, during the prior year periods.
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The decreases in suite revenues for the three and six months ended December 31, 2023 were primarily due to the Knicks and the Rangers playing fewer games at The Garden during the current year periods as compared to the prior year periods, partially offset by higher net sales of suites products, including revenue related to new premium hospitality offerings which were made available at the start of the 2023-24 seasons.
The decreases in sponsorship and signage revenues for the three and six months ended December 31, 2023 were primarily due to the Knicks and the Rangers playing fewer games at The Garden during the current year periods as compared to the prior year periods.
The increases in revenues from local media rights fees for the three and six months ended December 31, 2023 were primarily due to contractual rate increases.
The increase in revenues from league distributions for the presentation of the Christmas Spectacularthree months ended December 31, 2023 was primarily due to higher ticket-related revenue, mainly as a result of higher average ticket prices and the impact of additional scheduled performances, partially offset by a decrease in average per-show paid attendanceincreased national media rights fees in the current year period, partially offset by lower other league distributions in the current year period. The increase in revenues from league distributions for the six months ended December 31, 2023 was primarily due to an increase in and the timing of recognition of certain league distributions unrelated to national media rights fees and, to a lesser extent, increased national media rights fees in the current year period.
Direct operating expenses
Direct operating expenses increased $6,523, or 3%, to $232,225 for the three months ended December 31, 2023 as compared to the prior year period. The Company had 200 scheduled performances of the production this holiday season, 197 of which took place in the second quarter of fiscal year 2018, as compared to 197 scheduled performances in fiscal year 2017, of which 191 took place in the second quarter of fiscal year 2017. For the 2017 holiday season, more than one million tickets were sold, representing a low single digit percentage decrease as compared to the 2016 holiday season.
The increase in event-related revenues at the Forum was due to a change in the mix of events, as well as additional events held at the venue during the current year period as compared to the prior year period.
The increase in event-related revenues at The Garden was primarily due to a change in the mix of events held at the venue during the current year period as compared to the prior year period.

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The increase in event-related revenues at The Chicago Theatre was primarily due to a change in the mix of events and additional events held at the venue during the current year period as compared to the prior year period.
The net decrease in venue-related sponsorship and signage and suite rental fee revenues was primarily due to lower sponsorship and signage revenues, as a result of the timing of delivering certain contractually obligated sponsorship assets, as well as the impact of a marketing partner, upon renewal of its agreement, shifting its marketing spend from a combination of entertainment and sports, entirely to sports. The decrease in sponsorship and signage was partially offset by an increase in suite rental revenue.
Direct operating expenses
Direct operating expenses increased $6,362, or 3%, to $235,745 for the threesix months ended December 31, 2017 increased $40,581, or 38%, to $147,0452023 as compared to the prior year period. The net increase isincreases were attributable to the following:
Inclusion of direct operating expenses associated with entertainment dining and nightlife offerings$32,034
Increase in event-related direct operating expenses at the Forum4,016
Increase in event-related direct operating expenses at The Theater at Madison Square Garden3,298
Increase in direct operating expenses associated with the presentation of the Christmas Spectacular
1,102
Increase in event-related direct operating expenses at The Chicago Theatre858
Decrease in venue operating costs(1,278)
Other net increases, inclusive of direct operating expenses from Obscura551
 $40,581
ThreeSix
MonthsMonths
Increase in team personnel compensation$12,192 $10,863 
Increase in net provisions for league revenue sharing expense (net of escrow and excluding playoffs) and NBA luxury tax2,626 3,634 
Decrease in operating lease costs associated with the Knicks and the Rangers playing home games at The Garden(7,255)(7,255)
Other net decreases(1,040)(880)
$6,523 $6,362 
The inclusion of direct operating expenses associated with entertainment dining and nightlife offerings is the result of the acquisition of a 62.5% interestincreases in TAO Group on January 31, 2017, and primarily reflects costs associated with food and beverage sales, inclusive of labor costs, as well as venue related operating expenses. TAO Group’s operating results are recorded in the Company’s consolidated statements of operations on a three-month lag basis. As a result, TAO Group’s related direct operating expenses are for the period from June 26, 2017 to September 24, 2017.
The increase in event-related direct operating expenses at the Forum was primarily due to a change in the mix of events, as well as additional events held at the venue during the current year period as compared to the prior year period.
The increase in event-related direct operating expenses at The Theater at Madison Square Garden was primarily due to a change in the mix of events held at the venue during the current year period as compared to the prior year period.
The increase in direct operating expenses associated with the presentation of the Christmas Spectacular was primarily due to higher labor costs, additional scheduled performances, as well as an increase in deferred production cost amortization, partially offset by lower marketing expenses during the current year period as compared to the prior year period. The Company had 200 scheduled performances of the production this holiday season, 197 of which took place in the second quarter of fiscal year 2018, as compared to 197 scheduled performances in fiscal year 2017, of which 191 took place in the second quarter of fiscal year 2017.
The increase in event-related direct operating expenses at The Chicago Theatre was primarily due to a change in the mix of events and additional events held at the venue during the current year period as compared to the prior year period.
The decrease in venue operating costs reflects lower labor costs, partially offset by higher real estate taxes at Radio City Music Hall during the current year period as compared to the prior year period.
Selling, general and administrative expenses
Selling, general and administrative expensesteam personnel compensation for the three and six months ended December 31, 2017 increased $18,836, or 71%, to $45,278 as compared to the prior year period mainly due to (i) inclusion of TAO Group’s selling, general and administrative costs, including a management fee incurred by TAO Group payable to the Company for providing management and strategic services and, to a lesser extent, (ii) an increase in corporate general and administrative costs and (iii) higher professional fees.
Depreciation and amortization
Depreciation and amortization for the three months ended December 31, 2017 increased $1,759, or 68%, to $4,362 as compared to the prior year period2023 were primarily due to the inclusion of depreciation and amortization for TAO Group’s property and equipment.

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Operating income
Operating incomeroster changes for the three months ended December 31, 2017 increased $17,555, or 31%, to $74,531 as compared toKnicks and the prior year period primarily due to an increase in revenuesRangers, partially offset by higher direct operatingthe absence of expenses higher selling, general and administrative expenses and,related to a lesser extent, higher depreciation and amortization, as discussed above.
Adjusted operating income
Adjusted operating income increased for the three months ended December 31, 2017 by $18,289, or 29%, to $81,944 as compared to the prior year period primarily due to an increaseCounter Logic Gaming (“CLG”) in revenues partially offset by higher direct operating expenses and selling, general and administrative expenses as discussed above, excluding share-based compensation expense.
MSG Sports
The table below sets forth, for the periods presented, certain historical financial information and a reconciliation of operating income to adjusted operating income for the Company’s MSG Sports segment.
  Three Months Ended    
  December 31, Change
  2017 2016 Amount Percentage
Revenues $265,086
 $252,665
 $12,421
 5 %
Direct operating expenses 163,683
 160,209
 3,474
 2 %
Selling, general and administrative expenses 50,230
 49,346
 884
 2 %
Depreciation and amortization 1,849
 2,905
 (1,056) (36)%
Operating income $49,324
 $40,205
 $9,119
 23 %
Reconciliation to adjusted operating income:        
Share-based compensation 3,905
 4,100
    
Depreciation and amortization 1,849
 2,905
    
Adjusted operating income $55,078
 $47,210
 $7,868
 17 %

Revenues
Revenues for the three months ended December 31, 2017 increased $12,421, or 5%, to $265,086 as compared to the prior year period. The net increase is attributable to the following:
Increase in professional sports teams’ sponsorship and signage revenues and ad sales commission$5,102
Increase in professional sports teams’ pre/regular season ticket-related revenue3,900
Increase in professional sports teams’ pre/regular season food, beverage and merchandise sales3,640
Increase in local media rights fees from MSG Networks2,140
Increase in suite rental fee revenue1,862
Increase in revenues from league distributions1,436
Decrease in event-related revenues from other live sporting events(6,149)
Other net increases, inclusive of other revenues from CLG not discussed elsewhere in this table490
 $12,421
The increase in professional sports teams’ sponsorship and signage revenues and ad sales commission was primarily due to increased sales of existing sponsorship and signage inventory, new sponsorship and signage inventory, and the impact of a marketing partner, upon renewal of its agreement, shifting its marketing spend from a combination of entertainment and sports, entirely to sports.
The increase in professional sports teams’ pre/regular season ticket-related revenue was due to the Knicks and Rangers playing additional games at The Garden during the current year period as compared toperiods, following the prior year period and higher average Rangers per-game revenue, partially offset by lower average Knicks per-game revenue. The Knicks played five more regular season games and the Rangers played four more regular season games and one fewer pre-season game at The Garden during the current year period as compared to the prior year period.Company’s sale of its controlling interest in CLG in April 2023.
The increase in professional sports teams’ pre/regular season food, beverage and merchandise sales was due to the Knicks and Rangers playing additional games at The Garden during the current year period as compared to the prior year period partially offset by lower average per-game revenue during the current year period as compared to the prior year period.
The increase in local media rights fees from MSG Networks was due to contractual rate increases.
The increase in suite rental fee revenue was due to contractual rate increases, as well as higher sales of suite products.
The decrease in event-related revenues from other live sporting events was primarily due to a change in the mix of events, one event that generated lower revenue and fewer events held during the current year period as compared to the prior year period.
Direct operating expenses
Direct operating expenses for the three months ended December 31, 2017 increased $3,474, or 2%, to $163,683 as compared to the prior year period. The net increase is attributable to the following:
Increase in other team operating expenses not discussed elsewhere in this table$2,137
Increase in net provisions for NBA and NHL revenue sharing expense (excluding playoffs) and NBA luxury tax1,902
Increase in net provisions for certain team personnel transactions1,778
Increase in professional sports teams’ pre/regular season expense associated with food, beverage and merchandise sales1,709
Decrease in event-related expenses associated with other live sporting events(2,896)
Decrease in venue operating costs(1,383)
Other net increases227
 $3,474
The increase in other team operating expenses was primarily due to higher day-of-event costs, primarily driven by the Knicks and Rangers playing additional games at The Garden during the current year period as compared to the prior year period.
Net provisions for NBA and NHLleague revenue sharing expense (excluding(net of escrow and excluding playoffs) and NBA luxury tax and for certain team personnel transactions were as follows:
  Three Months Ended Increase
  December 31, 
  2017 2016 
Net provisions for NBA and NHL revenue sharing expense (excluding playoffs) and NBA luxury tax $20,973
 $19,071
 $1,902
Net provisions for certain team personnel transactions 2,758
 980
 1,778
Three Months EndedSix Months Ended
December 31,December 31,
20232022Increase20232022Increase
Net provisions for league revenue sharing expense (net of escrow and excluding playoffs) and NBA luxury tax$23,584 $20,958 $2,626 $22,418 $18,784 $3,634 
The increases in net provisions for league revenue sharing expense (net of escrow and excluding playoffs) and NBA luxury tax for the three and six months ended December 31, 2023 were primarily related to higher provisions for league revenue sharing expense (net of escrow and excluding playoffs) of $2,276 and $2,276, respectively. In addition, the increase in net provisions for NBA and NHLleague revenue sharing expense (excluding(net of escrow and excluding playoffs) and NBA luxury tax reflects higher provisions for both NBA and NHL revenue sharing expense of $1,855 and lower NBA luxury tax credit of $47. Higher NBA and NHL revenue sharing expense primarily reflects higher estimated NBA and NHL revenue sharing expense for the 2017-18 season andsix months ended December 31, 2023 was partially due to the net impact of adjustments to prior seasons’ revenue sharing expense partially offset by higher estimated net player escrow recoveries. (net of escrow).
The Knicks were not a luxury tax payer for the 2016-172022-23 season and, therefore, received an equal share of the portion of luxury tax receipts that were distributed to non-tax paying teams. The Knicks’ roster as of December 31, 20172023 would not result in the team being a luxury tax payer for the 2017-18 season and the estimated luxury tax receipt is expected to approximate the luxury tax receipt for the 2016-172023-24 season.
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The actual amounts for the 2017-18 season2023-24 seasons may vary significantly from the recorded provisions based on actual operating results for each league and all teams within each league for the season and other factors.
Team personnel transactionsThe decreases in operating lease costs associated with the Knicks and the Rangers playing home games at The Garden for the three and six months ended December 31, 2017 and 2016 reflect provisions recorded for player waivers/contract terminations.
The increase in professional sports teams’ pre/regular season expense associated with food, beverage and merchandise sales was due to2023 were a result of the Knicks and the Rangers playing additionalfewer games at The Garden during the current year periodperiods as compared to the prior year period partially offset by lower average per-game expense during the current year period as compared to the prior year period.

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The decrease in event-related expenses associated with other live sporting events was primarily due to a change in the mix of events, one event that generated lower expense and fewer events held during the current year period as compared to the prior year period.
The decrease in venue operating costs was primarily due to the absence of a non-recurring labor-related cost at The Garden.periods.
Selling, general and administrative expenses
Selling, general and administrative expenses primarily consist of (i) administrative costs, including compensation, costs under the Company’s Services Agreement, and professional fees, (ii) fees related to the Company’s sponsorship sales and service representation agreements, and (iii) sales and marketing costs. Selling, general and administrative expenses generally do not fluctuate in line with changes in the Company’s revenues and direct operating expenses.
Selling, general and administrative expenses for the three months ended December 31, 2017 increased $884,2023 decreased $10,570, or 2%14%, to $50,230$65,066 as compared to the prior year period.period driven by lower employee compensation and related benefits of $7,821, primarily due to executive management transition costs recognized in the prior year period, and lower other general and administrative expenses.
Selling, general and administrative expenses for the six months ended December 31, 2023 decreased $12,295, or 9%, to $118,622 as compared to the prior year period driven by lower employee compensation and related benefits of $10,527, primarily due to executive management transition costs recognized in the prior year period, and lower other general and administrative expenses.
Depreciation and amortization
Depreciation and amortization for the three months ended December 31, 20172023 decreased $1,056,$48, or 36%6%, to $1,849$790 as compared to the prior year period includingperiod. Depreciation and amortization for the impact of an intangible asset becoming fully amortized.six months ended December 31, 2023 decreased $279, or 15%, to $1,584 as compared to the prior year period.
Operating income
Operating income for the three months ended December 31, 20172023 decreased $22,701, or 44%, to $28,817 as compared to the prior year period primarily due to lower revenues and, to a lesser extent, higher direct operating expenses, partially offset by lower selling, general and administrative expenses.
Operating income for the six months ended December 31, 2023 decreased $1,627, or 10%, to $13,993 as compared to the prior year period primarily due to lower revenues and higher direct operating expenses, partially offset by lower selling, general and administrative expenses.
Interest expense, net
Net interest expense for the three months ended December 31, 2023 increased $9,119,$1,288, or 23%, to $49,324$6,800 as compared to the prior year period primarily due to anincreased interest expense caused by higher average interest rates in the current year period and higher average borrowings under the Knicks Revolving Credit Facility in the current year period. The increase in revenueswas partially offset by higher direct operating expenses, as discussed above.lower average borrowings under the Rangers Revolving Credit Facility in the current year period.
Adjusted operating income
Adjusted operating incomeNet interest expense for the threesix months ended December 31, 20172023 increased $7,868,$4,808, or 17%57%, to $55,078$13,276 as compared to the prior year period primarily due to an increase in revenues partially offsetincreased interest expense caused by higher direct operating expensesaverage interest rates in the current year period and selling, generalhigher average borrowings under the Rangers Revolving Credit Facility and administrative expenses, as discussed above, excluding share-based compensation expense.the Knicks Revolving Credit Facility in the current year period.
The Company may experience lower regular season ticket-related revenue
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Miscellaneous income (expense), net
Miscellaneous income, net for the second half of fiscal year 2018three months ended December 31, 2023 increased $2,606 to $2,991 as compared to the prior year period primarily due to the recognition of unrealized gains in the current year period related to the Company’s investments in Xtract One common stock and warrants which were made in the third and fourth quarters of fiscal year including the impact of the Knicks and Rangers playing fewer home games.

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Comparison of the Six Months EndedDecember 31, 2017 versus the Six Months EndedDecember 31, 2016
Consolidated Results of Operations
The table below sets forth, for the periods presented, certain historical financial information.
  Six Months Ended    
  December 31, Change
  2017 2016 Amount Percentage
Revenues $781,517
 $626,845
 $154,672
 25 %
         
Direct operating expenses 435,617
 378,080
 57,537
 15 %
Selling, general and administrative expenses 227,878
 171,281
 56,597
 33 %
Depreciation and amortization 61,090
 52,076
 9,014
 17 %
Operating income 56,932
 25,408
 31,524
 124 %
Other income (expense):        
Earnings (loss) in equity method investments 2,117
 (2,182) 4,299
 197 %
Interest income, net 2,255
 4,190
 (1,935) (46)%
Miscellaneous income (expense) (250) 1,405
 (1,655) (118)%
Income from operations before income taxes 61,054
 28,821
 32,233
 112 %
Income tax benefit (expense) 116,070
 (314) 116,384
 NM
Net income 177,124
 28,507
 148,617
 NM
Less: Net income attributable to redeemable noncontrolling interests 133
 —
 133
 NM
Less: Net loss attributable to nonredeemable noncontrolling interests (1,515) (593) (922) (155)%
Net income attributable to The Madison Square Garden Company’s stockholders $178,506
 $29,100
 $149,406
 NM
_________________
NM — Percentage is not meaningful
The following is a summary of changes in our segments’ operating results2023. Miscellaneous income (expense), net for the six months ended December 31, 20172023 decreased $9,893 to a net expense of $9,674 as compared to the prior year period.
Our results for the fiscal year 2018 include the operating results of TAO Group, CLG and Obscura and, as a result, our operating results for the fiscal year 2018 are not directly comparable to our results for the fiscal year 2017 period.
Changes attributable to Revenues Direct
operating
expenses		 Selling,
general and
administrative
expenses		 Depreciation and amortization Operating income (loss)
MSG Entertainment segment (a)
 $132,314
 $54,369
 $40,023
 $3,464
 $34,458
MSG Sports segment (a)
 22,358
 827
 3,805
 (1,768) 19,494
Corporate and Other —
 41
 12,745
 (1,145) (11,641)
Purchase accounting adjustments —
 2,300
 24
 8,463
 (10,787)
  $154,672
 $57,537
 $56,597
 $9,014
 $31,524
_________________
(a)
See “Business Segment Results” for a more detailed discussion relating to the operating results of our segments.


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Selling, general and administrative expenses -Corporate and Other
Selling, general and administrative expenses in Corporate and Other for the six months ended December 31, 2017 increased $12,745, or 39%, to $45,285. The increase wasperiod primarily due to higher employee compensation and related benefits, as well as the inclusionrecognition of certain Obscura selling, general and administrative costs, which primarily reflects retention bonuses paid in connection with the change of control. The increase was partially offset by a management fee earned for providing management and strategic services to TAO Group. The TAO Group’s management fee is eliminatedunrealized losses in the current year period related to the Company’s consolidated results of operations presented above.investments in Xtract One common stock and warrants.
Operating loss - Corporate and OtherIncome taxes
Operating loss in Corporate and Other for the six months ended December 31, 2017 increased $11,641, or 16%, to $85,215. The increase was primarily due to higher selling, general and administrative expenses as discussed above, partially offset by lower depreciation and amortization as a result of certain assets being fully depreciated and amortized. See Note 1817 to the consolidated financial statements included in “Part I — Item 1. Financial Statements” of this Quarterly Report on Form 10-Q for a discussion of depreciation and amortization under Corporate and Other.the Company’s income taxes.
EarningsAdjusted operating income
During the fourth quarter of fiscal year 2023, the Company amended the definition of adjusted operating income (loss) in equity method investments
Earnings in equity method investments forso that the six months ended December 31, 2017 improved $4,299 to $2,117. The year-over-year change primarily reflects an improvement inimpact of the net earnings attributablenon-cash portion of operating lease costs related to the Company’s investees.Arena License Agreements with MSG Entertainment is no longer excluded in the calculation of adjusted operating income (loss) in all periods presented.
InterestThe Company evaluates performance based on several factors, of which the key financial measure is operating income net
Net interest income for(loss) excluding (i) depreciation, amortization and impairments of property and equipment, goodwill and other intangible assets, (ii) share-based compensation expense or benefit, (iii) restructuring charges or credits, (iv) gains or losses on sales or dispositions of businesses, (v) the six months ended December 31, 2017 decreased $1,935, or 46%impact of purchase accounting adjustments related to $2,255 as comparedbusiness acquisitions, and (vi) gains and losses related to the prior year period primarily due to interest expense incurredremeasurement of liabilities under the TAO Term Loan Facility. The decrease was partially offset by higher interestCompany’s Executive Deferred Compensation Plan, which is referred to as adjusted operating income earned by(loss), a non-GAAP measure.
Management believes that the Company as a resultexclusion of higher interest rates and a change in investment mix. In addition, duringshare-based compensation expense or benefit allows investors to better track the six months ended December 31, 2017, the Company recognized interest income of $937, which was received in connection with the repayment of a loan receivable from oneperformance of the Company’s nonconsolidated affiliatesbusiness without regard to the settlement of an obligation that was onis not expected to be made in cash. In addition, management believes that the exclusion of gains and losses related to the remeasurement of liabilities under the Company’s Executive Deferred Compensation Plan provides investors with a nonaccrual status.
Miscellaneous income (expense)
Miscellaneous expense in the current year period reflects a pre-tax non-cash impairment charge to write off the carrying value of oneclearer picture of the Company’s cost method investments. Miscellaneous incomeoperating performance given that, in the prior year period consists principally of the recovery of certain claims in connectionaccordance with a third-party bankruptcy proceeding.
Income taxes
Income tax benefit for the six months ended December 31, 2017 was $116,070GAAP, gains and income tax expense for the six months ended December 31, 2016 was $314.
Income tax benefit for the six months ended December 31, 2017 of $116,070 differs from the income tax expense derived from applying the blended statutory Federal rate of 28% to pretax income primarily as a result of a deferred income tax benefit of $113,494losses related to the revaluationremeasurement of liabilities under the Company’s Executive Deferred Compensation Plan are recognized in Operating income (loss) whereas gains and losses related to the remeasurement of the assets under the Company’s deferred tax assetsExecutive Deferred Compensation Plan, which are equal to and liabilities under provisions contained intherefore fully offset the new tax legislation, of which (i) $51,015 was duegains and losses related to the reductionremeasurement of liabilities, are recognized in Miscellaneous income (expense), net, deferred tax liabilitieswhich is not reflected in connectionOperating income (loss).
The Company believes adjusted operating income (loss) is an appropriate measure for evaluating the operating performance of the Company. Adjusted operating income (loss) and similar measures with similar titles are common performance measures used by investors and analysts to analyze the lower FederalCompany’s performance. The Company uses revenues and adjusted operating income tax rate of 21%, and (ii) $62,479 was due to a reduction in(loss) measures as the valuation allowance attributable to the new rules, which provide that future Federal net operating losses have an unlimited carry-forward period. These rules on future Federal net operating losses allow the Company to recognize a portionmost important indicators of its unrecognized deferred tax assets for future deductible items. Other decreasesbusiness performance and evaluates management’s effectiveness with specific reference to the statutory rate include the impact of an income tax benefit of $24,399 in Federal and state valuation allowance decreases recorded which offsets the income tax expense attributable to most of thethese indicators.
Adjusted operating income and the impact of a change in state tax rate of $3,110. These decreases were partially offset by the impact of state and local income taxes (net of Federal benefit) of $6,494 and tax expense of $1,237 primarily related to non-deductible expenses.
Income tax expense for the six months ended December 31, 2016 of $314 differs from income tax expense derived from applying the statutory Federal rate of 35% to pretax income primarily(loss) should be viewed as a resultsupplement to and not a substitute for operating income (loss), net income (loss), cash flows from operating activities, and other measures of performance and/or liquidity presented in accordance with GAAP. Since adjusted operating income (loss) is not a reductionmeasure of $11,115 of recorded Federal and state valuation allowances which offsets tax expenseperformance calculated in accordance with GAAP, this measure may not be comparable to similar measures with similar titles used by other companies. The Company has presented the components that would have otherwise been recorded onreconcile operating income. The income tax expense also reflects tax expense of $1,342 primarily related(loss), the most directly comparable GAAP financial measure, to non-deductible expenses.adjusted operating income (loss).


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Adjusted operating income
The following is a reconciliation of operating income to adjusted operating income:
  Six Months Ended    
  December 31, Change
  2017 2016 Amount Percentage
Operating income $56,932
 $25,408
 $31,524
 124%
Share-based compensation 26,816
 20,098
 

  
Depreciation and amortization (a)
 61,090
 52,076
 

  
Other purchase accounting adjustments 2,324
 —
    
Adjusted operating income $147,162
 $97,582
 $49,580
 51%
_________________
(a)
Depreciation and amortization includes purchase accounting adjustments of $8,923 and $460 for six months ended December 31, 2017 and 2016, respectively.
Adjusted operating income forare the six months ended December 31, 2017 increased $49,580, or 51% to $147,162 as compared to the prior year period. The net increase is attributable to the following:
Increase in adjusted operating income of the MSG Entertainment segment$37,259
Increase in adjusted operating income of the MSG Sports segment18,283
Other net decreases(5,962)
 $49,580
Other net decreases were primarily due to higher employee compensation and related benefits, excluding share-based compensation expense, as well as the inclusion of certain Obscura selling, general and administrative costs, which primarily reflects retention bonuses paid in connection with the change of control.

Net income (loss) attributable to redeemable and nonredeemable noncontrolling interests

For the six months ended December 31, 2017, the Company recorded a net income attributable to redeemable noncontrolling interests of $133 and a net loss attributable to nonredeemable noncontrolling interests of $1,515 as compared to $593 of net loss attributable to nonredeemable noncontrolling interests for the six months ended December 31, 2016. These amounts represent the share of net income (loss) from the Company’s investments in TAO Group, BCE, and CLG that are not attributable to the Company. In addition, the net income (loss) attributable to redeemable and nonredeemable noncontrolling interests includes a proportional share of expenses related to purchase accounting adjustments.


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Business Segment Results
MSG Entertainment
The table below sets forth, for the periods presented, certain historical financial information and a reconciliationreconciliations of operating income to adjusted operating income for the three and six months ended December 31, 2023 and 2022:
Three Months EndedSix Months Ended
December 31,ChangeDecember 31,Change
20232022$%20232022$%
Operating income$28,817 $51,518 $(22,701)(44)%$13,993 $15,620 $(1,627)(10)%
Depreciation and amortization790 838 1,584 1,863 
Share-based compensation6,570 11,619 10,719 18,839 
Remeasurement of deferred compensation plan liabilities839 449 735 346 
Adjusted operating income (a)
$37,016 $64,424 $(27,408)(43)%$27,031 $36,668 $(9,637)(26)%
_________________
(a)During the fourth quarter of fiscal year 2023, the Company amended the definition of adjusted operating income (loss) so that the impact of the non-cash portion of operating lease costs related to the Company’s Arena License Agreements with MSG Entertainment segment.
  Six Months Ended    
  December 31, Change
  2017 2016 Amount Percentage
Revenues $435,497
 $303,183
 $132,314
 44%
Direct operating expenses 252,691
 198,322
 54,369
 27%
Selling, general and administrative expenses 89,905
 49,882
 40,023
 80%
Depreciation and amortization 8,523
 5,059
 3,464
 68%
Operating income $84,378
 $49,920
 $34,458
 69%
Reconciliation to adjusted operating income:        
Share-based compensation 6,952
 7,615
    
Depreciation and amortization 8,523
 5,059
    
Adjusted operating income $99,853
 $62,594
 $37,259
 60%
Revenues
Revenuesis no longer excluded. Pursuant to GAAP, recognition of operating lease costs is recorded on a straight-line basis over the term of the agreement based upon the value of total future payments under the arrangement. As a result, operating lease costs is comprised of a contractual cash component plus or minus a non-cash component for each period presented. Adjusted operating income includes operating lease costs of (i) $15,409 and $16,238 of expense paid in cash for the three and six months endedDecember 31, 2017 increased $132,314,2023, respectively, and $19,416 and $20,221 of expense paid in cash for the three and six months ended December 31, 2022, respectively, and (ii) a non-cash expense of $8,953 and $9,435, for the three and six months ended December 31, 2023, respectively, and $12,202 and $12,708 for the three and six months ended December 31, 2022, respectively.
For the three months ended December 31, 2023, adjusted operating income decreased $27,408, or 44%43%, to $435,497$37,016 as compared to the prior year period. The net increase is attributable to the following:
Inclusion of revenues associated with entertainment dining and nightlife offerings$115,121
Increase in event-related revenues at The Theater at Madison Square Garden6,540
Increase in revenues from the presentation of the Christmas Spectacular
6,534
Increase in event-related revenues at the Forum4,434
Increase in event-related revenues at The Garden4,115
Increase in event-related revenues at Radio City Music Hall, excluding the Christmas Spectacular and the New York Spectacular
3,900
Increase in event-related revenues at The Chicago Theatre3,779
Decrease in revenues from the presentation of the New York Spectacular as a result of no scheduled performances in the current year period
(11,238)
Decrease in venue-related sponsorship and signage and suite rental fee revenues(1,890)
Other net increases, inclusive of other revenues from Obscura1,019
 $132,314
The inclusion of revenues associated with entertainment dining and nightlife offerings is the result of the acquisition of a 62.5% interest in TAO Group on January 31, 2017, and primarily reflects revenues generated from food and beverage sales. TAO Group’s operating results are recorded in the Company’s consolidated statements of operations on a three-month lag basis. As a result, TAO Group’s related revenues are for the period from March 27, 2017 to September 24, 2017.
The increase in event-related revenues at The Theater at Madison Square Garden was primarily due to a change in the mix of events held at the venue during the current year period as compared to the prior year period.
The increase in revenues associated with the presentation of the Christmas Spectacular was primarily due to higher ticket-related revenue, mainly as a result of higher average ticket prices and the impact of additional scheduled performances, partially offset by a decrease in average per-show paid attendance in the current year period as compared to the prior year period. The Company had 200 scheduled performances of the production this holiday season, 197 of which took place in the second quarter of fiscal year 2018, as compared to 197 scheduled performances in fiscal year 2017, of which 191 took place in the second quarter of fiscal year 2017. For the 2017 holiday season, more than one million tickets were sold, representing a low single digit percentage decrease as compared to the 2016 holiday season.

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The increase in event-related revenues at the Forum was due to a change in the mix of events partially offset by fewer events held at the venue during the current year period as compared to the prior year period.
The increase in event-related revenues at The Garden was due to a change in the mix of events and additional events held at the venue during the current year period as compared to the prior year period.
The increase in event-related revenues at Radio City Music Hall, excluding the Christmas Spectacular and the New York Spectacular, was due to additional events and a change in the mix of events held at the venue during the current year period as compared to the prior year period.
The increase in event-related revenues at The Chicago Theatre was due to additional events and a change in the mix of events held at the venue during the current year period as compared to the prior year period.
The decrease in revenues from the presentation of the New York Spectacular was driven by no scheduled performances in the current year period as compared to 56 scheduled performances presented in the prior year period. This was a result of the Company’s decision to suspend the planned 2017 presentation announced in February 2017.
The net decrease in venue-related sponsorship and signage and suite rental fee revenuesadjusted operating income was primarily due to lower sponsorship and signage revenues as a result of the timing of delivering certain contractually obligated sponsorship assets, as well as the impact of a marketing partner, upon renewal of its agreement, shifting its marketing spend from a combination of entertainment and sports, entirely to sports. The decrease in sponsorship and signage was partially offset by an increase in suite rental revenue.
Direct operating expenses
Direct operating expenses for the six months ended December 31, 2017 increased $54,369, or 27%, to $252,691 as compared to the prior year period. The net increase is attributable to the following:
Inclusion of direct operating expenses associated with entertainment dining and nightlife offerings$65,055
Increase in event-related direct operating expenses at the Forum4,239
Increase in event-related direct operating expenses at The Theater at Madison Square Garden2,774
Increase in event-related direct operating expenses at The Chicago Theatre2,759
Increase in event-related direct operating expenses associated with the presentation of the Christmas Spectacular
1,413
Increase in event-related direct operating expenses at Radio City Music Hall, excluding the Christmas Spectacular and the New York Spectacular
621
Decrease in direct operating expenses associated with the presentation of the New York Spectacular as a result of no scheduled performances in the current year period
(21,583)
Decrease in event-related direct operating expenses at The Garden(724)
Other net decreases(185)
 $54,369
The inclusion of direct operating expenses associated with entertainment dining and nightlife offerings is the result of the acquisition of a 62.5% interest in TAO Group on January 31, 2017, and primarily reflects costs associated with food and beverage sales, inclusive of labor costs, as well as venue related operating expenses. TAO Group’s operating results are recorded in the Company’s consolidated statements of operations on a three-month lag basis. As a result, TAO Group’s related direct operating expenses are for the period from March 27, 2017 to September 24, 2017.
The increase in event-related direct operating expenses at the Forum was due to a change in the mix of events partially offset by fewer events held at the venue during the current year period as compared to the prior year period.
The increase in event-related direct operating expenses at The Theater at Madison Square Garden was primarily due to a change in the mix of events held at the venue during the current year period as compared to the prior year period.
The increase in event-related direct operating expenses at The Chicago Theatre was due to additional events and a change in the mix of events held at the venue during the current year period as compared to the prior year period.
The increase in direct operating expenses associated with the presentation of the Christmas Spectacular was primarily due to higher labor costs, additional scheduled performances, as well as an increase in deferred production cost amortization, partially offset by lower marketing expenses during the current year period as compared to the prior year period. The Company had 200

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scheduled performances of the production this holiday season, 197 of which took place in the second quarter of fiscal year 2018, as compared to 197 scheduled performances in fiscal year 2017, of which 191 took place in the second quarter of fiscal year 2017.
The increase in event-related direct operating expenses at Radio City Music Hall, excluding the Christmas Spectacular and the New York Spectacular, was due to additional events largely offset by a change in the mix of events held at the venue during the current year period as compared to the prior year period.
The decrease in direct operating expenses associated with the presentation of the New York Spectacular was driven by no scheduled performances in the current year period as compared to 56 scheduled performances presented in the prior year period. This was a result of the Company’s decision to suspend the planned 2017 presentation announced in February 2017.
The decrease in event-related direct operating expenses at The Garden was due to a change in the mix of events partially offset by additional events held at the venue during the current year period as compared to the prior year period.
Selling, general and administrative expenses
Selling, general and administrative expenses for the six months ended December 31, 2017 increased $40,023, or 80%, to $89,905 as compared to the prior year period mainly due to (i) inclusion of TAO Group’s selling, general and administrative costs, including a management fee incurred by TAO Group payable to the Company for providing management and strategic services and, to a lesser extent, (ii) an increase in corporate general and administrative costs and (iii) higher professional fees.
Depreciation and amortization
Depreciation and amortization for the six months ended December 31, 2017 increased $3,464, or 68%, to $8,523 as compared to the prior year period primarily due to the inclusion of depreciation and amortization for TAO Group’s property and equipment.
Operating income
Operating income for the six months ended December 31, 2017 increased $34,458, or 69%, to $84,378 as compared to the prior year period primarily due to an increase in revenues, partially offset by higher direct operating expenses, selling, general and administrative expenses and depreciation and amortization, as discussed above.
Adjusted operating income
Adjusted operating income for the six months ended December 31, 2017 increased $37,259, or 60% to $99,853 as compared to the prior year period primarily due to an increase in revenues, partially offset by higher direct operating expenses, selling, general and administrative expenses as discussed above, excluding share-based compensation expense.
MSG Sports
The table below sets forth, for the periods presented, certain historical financial information and a reconciliation of operating income to adjusted operating income for the Company’s MSG Sports segment.
  Six Months Ended    
  December 31, Change
  2017 2016 Amount Percentage
Revenues $346,020
 $323,662
 $22,358
 7 %
Direct operating expenses 180,585
 179,758
 827
 NM
Selling, general and administrative expenses 92,664
 88,859
 3,805
 4 %
Depreciation and amortization 3,755
 5,523
 (1,768) (32)%
Operating income $69,016
 $49,522
 $19,494
 39 %
Reconciliation to adjusted operating income:        
Share-based compensation 8,141
 7,584
    
Depreciation and amortization 3,755
 5,523
    
Adjusted operating income $80,912
 $62,629
 $18,283
 29 %
_________________
NM — Percentage is not meaningful

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Revenues
Revenues for the six months endedDecember 31, 2017 increased $22,358, or 7%, to $346,020 as compared to the prior year period. The net increase is attributable to the following:
Increase in professional sports teams’ pre/regular season ticket-related revenue$6,530
Increase in revenues from league distributions6,357
Increase in professional sports teams’ sponsorship and signage revenues and ad sales commission4,454
Increase in local media rights fees from MSG Networks4,235
Increase in professional sports teams’ pre/regular season food, beverage and merchandise sales4,144
Increase in suite rental fee revenue2,149
Decrease in event-related revenues from other live sporting events(6,310)
Other net increases, inclusive of other revenues from CLG not discussed elsewhere in this table799
 $22,358
The increase in professional sports teams’ pre/regular season ticket-related revenue was due to the Knicks and Rangers playing additional games at The Garden during the current year period as compared to the prior year period and higher average Rangers per-game revenue, partially offset by lower average Knicks per-game revenue. The Knicks played five more regular season games and the Rangers played four more regular season games at The Garden during the current year period as compared to the prior year period.
The increase in professional sports teams’ sponsorship and signage revenues and ad sales commission was primarily due to new sponsorship and signage inventory, increased sales of existing sponsorship and signage inventory and the impact of a marketing partner, upon renewal of its agreement, shifting its marketing spend from a combination of entertainment and sports, entirely to sports.
The increase in local media rights fees from MSG Networks was primarily due to contractual rate increases.
The increase in professional sports teams’ pre/regular season food, beverage and merchandise sales was due to the Knicks and Rangers playing additional games at The Garden during the current year period as compared to the prior year period partially offset by lower average per-game revenue during the current year period as compared to the prior year period.
The increase in suite rental fee revenue was due to contractual rate increases and higher sales of suite products.
The decrease in event-related revenues from other live sporting events was primarily due to a change in the mix of events, one event that generated lower revenue and fewer events held during the current year period as compared to the prior year period.
Direct operating expenses
Direct operating expenses for the six months ended December 31, 2017 increased $827 to $180,585 as compared to the prior year period. The net increase is attributable to the following:
Increase in other team operating expenses not discussed elsewhere in this table$2,950
Increase in net provisions for NBA and NHL revenue sharing expense (excluding playoffs) and NBA luxury tax2,510
Increase in professional sports teams’ pre/regular season expense associated with food, beverage and merchandise sales2,215
Increase in team personnel compensation1,238
Decrease in event-related expenses associated with other live sporting events(3,158)
Decrease in net provisions for certain team personnel transactions(3,132)
Decrease in venue operating costs(1,416)
Other net decreases(380)
 $827
The increase in other team operating expenses was primarily due to higher day-of-event costs, primarily driven by the Knicks and Rangers playing additional games at The Garden during the current year period as compared to the prior year period.

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Net provisions for NBA and NHL revenue sharing expense (excluding playoffs) and NBA luxury tax and for certain team personnel transactions were as follows:
  Six Months Ended Increase (Decrease)
  December 31, 
  2017 2016 
Net provisions for NBA and NHL revenue sharing expense (excluding playoffs) and NBA luxury tax $21,880
 $19,370
 $2,510
Net provisions for certain team personnel transactions 2,858
 5,990
 (3,132)
The increase in net provisions for NBA and NHL revenue sharing expense (excluding playoffs) and NBA luxury tax reflects higher provisions for both NBA and NHL revenue sharing expense of $2,463 and lower NBA luxury tax credit of $47. Higher NBA and NHL revenue sharing expense primarily reflects higher estimated NBA and NHL revenue sharing expense for the 2017-18 season and adjustments to prior seasons’ revenue sharing expense partially offset by higher estimated net player escrow recoveries. The Knicks were not a luxury tax payer for the 2016-17 season and, therefore, received an equal share of the portion of luxury tax receipts that were distributed to non-tax paying teams. The Knicks’ roster as of December 31, 2017 would not result in luxury tax for the 2017-18 season and the estimated luxury tax receipt is expected to approximate the luxury tax receipt for the 2016-17 season. The actual amounts for the 2017-18 season may vary significantly from the recorded provisions based on actual operating results for each league and all teams within each league for the season and other factors.
Team personnel transaction for the six months ended December 31, 2017 reflect provisions recorded for player waivers/contract terminations. Team personnel transactions for the six months ended December 31, 2016 reflect provisions for a player trade and player waivers/contract terminations of $5,000 and $990, respectively.
The increase in professional sports teams’ pre/regular season expense associated with food, beverage and merchandise sales was due to the Knicks and Rangers playing additional games at The Garden during the current year period as compared to the prior year period partially offset by lower average per-game expense during the current year period as compared to the prior year period.
The increase in team personnel compensation was attributable to the inclusion of CLG’s results, which was acquired on July 28, 2017.
The decrease in event-related expenses associated with other live sporting events was primarily due to a change in the mix of events, one event that generated lower expense and fewer events held during the current year period as compared to the prior year period.
The decrease in venue operating costs was primarily due to the absence of a non-recurring labor-related cost at The Garden.
Selling, general and administrative expenses
Selling, general and administrative expenses for the six months ended December 31, 2017 increased $3,805, or 4%, to $92,664 as compared to the prior year period primarily due to higher corporate general and administrative costs and other net cost increases.
Depreciation and amortization
Depreciation and amortization for the six months ended ended December 31, 2017 decreased $1,768, or 32%, to $3,755 as compared to the prior year period including the impact of an intangible asset becoming fully amortized.
Operating income
Operating income for the six months ended December 31, 2017 increased $19,494, or 39%, to $69,016 as compared to the prior year period primarily due to higher revenues partially offset by an increase in selling, general and administrative expenses, as discussed above.

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Adjusted operating income
Adjusted operating income for the six months ended December 31, 2017 increased $18,283, or 29%, to $80,912, as compared to the prior year period primarily due to higher revenues partially offset by an increase in selling, general and administrative expenses and, to a lesser extent, higher direct operating expenses, as discussed above, excluding share-based compensation expense.partially offset by lower selling, general and administrative expenses.
The Company may experience lower regular season ticket-related revenue forFor the second half of fiscal year 2018six months ended December 31, 2023, adjusted operating income decreased $9,637, or 26%, to $27,031 as compared to the prior fiscal year including the impactperiod. The decrease in adjusted operating income was primarily due to lower revenues and higher direct operating expenses, partially offset by lower selling, general and administrative expenses.

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Table of the Knicks and Rangers playing fewer home games.Contents
Liquidity and Capital Resources
Overview
Our primary sources of liquidity are cash and cash equivalents, cash flowsflow from the operations of our businesses and available borrowing capacity under our $377,000 revolving credit facilities (see “Financing Agreements —facilities. See Note 12 to the consolidated financial statements included in “Part I - Item 1. Financial Statements” of this Quarterly Report on Form 10-Q for a discussion of the Knicks Revolving Credit Facility,” “Financing Agreements — Knicks UnsecuredAgreement, the Rangers Credit Facility,” “Financing Agreements —Agreement, and the Rangers Revolving Credit Facility” and “Financing Agreements — TAO Credit Facilities” below)NHL Advance Agreement (each as defined therein).
Our principal uses of cash include the operation of our businesses, working capital-related items, capital spending (including our planned constructionthe repayment of large-scale venues in Las Vegas and London), investments and related loans that we may fund from time to time,outstanding debt, repurchases of shares of the Company’s Class A Common Stock, repaymentdividends, if declared, and investments.
As of debt,December 31, 2023, we had $37,880 in Cash and cash equivalents. In addition, as of December 31, 2023, the paymentCompany’s deferred revenue obligations were $218,450, net of earn-outbilled, but not yet collected deferred revenue. This balance is primarily comprised of obligations in connection with tickets, suites and local media rights. In addition, the Company’s deferred revenue obligations included $11,033 from prior acquisitions.the NBA, which the league provided to each team.
We regularly monitor and assess our ability to meet our net funding and investing requirements. The decisions of the Company as to the use of its available liquidity will be based upon the ongoing review of the funding needs of the business, the optimalmanagement’s view of a favorable allocation of cash resources, and the timing of cash flow generation.
The Company plans to continue to grow its live sports and entertainment business, both organically and through acquisition and development, including by expanding its portfolio of venues, and is exploring investing in, acquiring or developing opportunities that range from new content to adjacencies that strengthen the Company’s position in delivering premium live experiences. The Company previously announced plans to build a new venue in Las Vegas which is anticipated to be approximately 600,000 square feet and have more than 18,000 seats. This state-of-the-art facility is expected to be constructed over a two and a half year period with the goal of commencing construction in the second half of calendar year 2018. In addition, the Company has purchased for approximately $79,518 (£60,000) a nearly five-acre parcel of land in London adjacent to Westfield Stratford City Shopping Center as the site of its first international large-scale venue. As is the case for any large scale real estate development, as the Company moves forward with the planning and construction for these and other major new venues, the Company will need to obtain all necessary and appropriate permits and other regulatory approvals and may face unexpected project delays and costs. In connection with these efforts, the Company will need to pursue additional capital beyond that which is available from cash on hand, cash flows from operations and borrowing under our revolving credit facilities. There is no assurance that we would be able to obtain such capital. The Company will continue to explore additional domestic and international markets where next generation venues can be successful. See also “— MSG Sphere” at the end of Management’s Discussion and Analysis of Financial Condition and Result of Operations.
We regularly monitor and assess our ability to meet our net funding and investing requirements. Over the next 12 months, we believe we have sufficient liquidity, including $1,125,647 in unrestricted cash and cash equivalents as of December 31, 2017, along with available borrowing capacity under our revolving credit facilities combined with operating cash flows to fund our operations, to pursue the development of the new arenas discussed above and other new business opportunities and to repurchase shares of the Company’s Class A Common Stock.
To the extent the Company desires to access alternative sources of funding through the capital and credit markets, weakrestrictions imposed by the NBA and NHL and potentially challenging U.S. and global economic and market conditions could adversely impact ourits ability to do so at that time.
TAO Group’s principal uses of cash include working capital related items, investments in new venues and repayment of debt. TAO Group plans to continue to grow its business through the opening of new venues. TAO Group regularly monitors and assesses its ability to meet its funding and investment requirements. Over the next 12 months, the Company believes that TAO Group hasWe believe we have sufficient liquidity, fromincluding approximately $37,880 in Cash and cash on hand, cash generated from operations and its revolving credit facility to fund its operations, service debt obligations and pursue new business opportunities.
On September 11, 2015, the Company’s board of directors authorized the repurchase of up to $525,000 of the Company’s Class A Common Stock once the shares of the Company’s Class A Common Stock began “regular way” trading on October 1, 2015. Under the authorization, shares of the Company’s Class A Common Stock may be purchased from time to time in accordance with applicable insider trading and other securities laws and regulations. The timing and amount of purchases will

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depend on market conditions and other factors. As of December 31, 2017, the Company had $259,639 of availability remaining under its stock repurchase authorization.
Financing Agreements
Knicks Revolving Credit Facility
On September 30, 2016, Knicks LLC, a wholly owned subsidiary of the Company, entered into a credit agreement with a syndicate of lenders providing for a senior secured revolving credit facility of up to $200,000 with a term of five years to fund working capital needs and for general corporate purposes. Amounts borrowed may be distributed to the Company except during an event of default.
The Knicks Revolving Credit Facility requires Knicks LLC to comply with a debt service ratio of 1.5:1.0 over a trailing four quarter period. As of December 31, 2017, Knicks LLC was in compliance with this financial covenant.
All borrowings under the Knicks Revolving Credit Facility are subject to the satisfaction of certain customary conditions. Borrowings bear interest at a floating rate, which at the option of Knicks LLC may be either (i) a base rate plus a margin ranging from 0.00% to 0.125% per annum or (ii) LIBOR plus a margin ranging from 1.00% to 1.125% per annum. Knicks LLC is required to pay a commitment fee ranging from 0.20% to 0.25% per annum in respect of the average daily unused commitments under the Knicks Revolving Credit Facility. The Knicks Revolving Credit Facility was undrawnequivalents as of December 31, 2017. 
All obligations2023, along with $195,000 of additional available borrowing capacity under the Knicks Revolving Credit Facility are secured by a first lien security interest in certain of Knicks LLC’s assets, including, but not limited to, (i) the Knicks LLC’s membership rights in the NBA and (ii) revenues to be paid to the Knicks LLC by the NBA pursuant to certain U.S. national broadcast agreements.
Subject to customary notice and minimum amount conditions, Knicks LLC may voluntarily prepay outstanding loans under the Knicks Revolving Credit Facility at any time, in whole or in part, without premium or penalty (except for customary breakage costs with respect to Eurocurrency loans). Knicks LLC is required to make mandatory prepayments in certain circumstances, including without limitation if the maximum available amount under the Knicks Revolving Credit Facility is greater than 350% of qualified revenues.
The Knicks Credit Agreement contains certain restrictions on the ability of Knicks LLC to take certain actions as provided in (and subject to various exceptions and baskets set forth in) the Knicks Credit Agreement, including the following: (i) incurring additional indebtedness and contingent liabilities; (ii) creating liens on certain assets; (iii) making restricted payments during the continuance of an event of default under the Knicks Credit Agreement; (iv) engaging in sale and leaseback transactions; (v) merging or consolidating; and (vi) taking certain actions that would invalidate the secured lenders’ liens on any Knicks LLC’s collateral.
Knicks Unsecured Credit Facility
On September 30, 2016, Knicks LLC entered into an unsecured revolvingexisting credit facility with a lender for an initial maximum credit amount of $15,000 and a 364-day term. Knicks LLC renewed this facility with the lender on the same terms effective as of September 29, 2017. This facility was undrawn as of December 31, 2017.
Rangers Revolving Credit Facility
On January 25, 2017, Rangers LLC, a wholly owned subsidiary of the Company, entered into a credit agreement with a syndicate of lenders providing for a senior secured revolving credit facility of up to $150,000 with a term of five yearsfacilities, to fund working capital needsour operations and for general corporate purposes. Amounts borrowed may be distributed to the Company except during an event of default.
The Rangers Revolving Credit Facility requires Rangers LLC to comply with a debt service ratio of 1.5:1.0 over a trailing four quarter period. As of December 31, 2017, Rangers LLC was in compliance with this financial covenant. All borrowings under the Rangers Revolving Credit Facility are subject to the satisfaction of certain customary conditions.
Borrowings bear interest at a floating rate, which at the option of Rangers LLC may be either (i) a base rate plus a margin ranging from 0.125% to 0.50% per annum or (ii) LIBOR plus a margin ranging from 1.125% to 1.50% per annum. Rangers LLC is required to pay a commitment fee ranging from 0.375% to 0.625% per annum in respect of the average daily unused commitments under the Rangers Revolving Credit Facility. The Rangers Revolving Credit Facility was undrawn as of December 31, 2017.

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Allsatisfy any obligations under the Rangers Revolving Credit Facility are secured by a first lien security interest in certain of Rangers LLC’s assets, including, but not limited to, (i) Rangers LLC’s membership rights in the NHL, (ii) revenues to be paid to Rangers LLC by the NHL pursuant to certain U.S. and Canadian national broadcast agreements, and (iii) revenues to be paid to Rangers LLC pursuant to local media contracts.
Subject to customary notice and minimum amount conditions, Rangers LLC may voluntarily prepay outstanding loans under the Rangers Revolving Credit Facility at any time, in whole or in part, without premium or penalty (except for customary breakage costs with respect to Eurocurrency loans). Rangers LLC is required to make mandatory prepayments in certain circumstances, including without limitation if the maximum available amount under the Rangers Revolving Credit Facility is less than 17% of qualified revenues.
The Rangers Credit Agreement contains certain restrictions on the ability of Rangers LLC to take certain actions as provided in (and subject to various exceptions and baskets set forth in) the Rangers Credit Agreement, including the following: (i) incurring additional indebtedness and contingent liabilities; (ii) creating liens on certain assets; (iii) making restricted payments during the continuance of an event of default under the Rangers Credit Agreement; (iv) engaging in sale and leaseback transactions; (v) merging or consolidating; and (vi) taking certain actions that would invalidate the secured lenders’ liens on any of Rangers LLC’s assets securing the obligations under the Rangers Revolving Credit Facility.
TAO Credit Facilities
On January 31, 2017, TAOIH, TAOG, and certain of its subsidiaries entered into a credit and guaranty agreement with a syndicate of lenders providing for a senior secured term loan facility of $110,000 with a term of five years to fund, in part, the acquisition of TAO Group and a senior secured revolving credit facility of up to $12,000 with a term of five years for working capital and general corporate purposes of TAOG. The TAO Credit Facilities were obtained without recourse to MSG or any of its affiliates (other than TAOIH and its subsidiaries).
The TAO Credit Facilities require TAOIH (i) to maintain, for the relevant TAO entities, a minimum consolidated liquidity of $5,000 at all times, (ii) to comply with a maximum total net leverage ratio of 4.00:1.00 initiallyforeseeable future.
Financing Agreements and stepping down over time to 2.50:1.00 by the first quarter of calendar year 2021 and through the remainder of the term of the TAO Credit Facilities, and (iii) to comply with a minimum fixed charge coverage ratio of 1.50:1.00 initially and stepping down over time to 1.15:1.00 by the second quarter of calendar year 2021 and through the remainder of the term of the TAO Credit Facilities. TAOIH was in compliance with the financial covenants of the TAO Credit Facilities as of September 24, 2017 (the most recent date at which compliance was assessed under the TAO Credit Facilities). The TAO Revolving Credit Facility was undrawn as of December 31, 2017.
The TAO entities under the TAO Credit Facilities are also subject to certain limitations with respect to making capital expenditures based upon the total net leverage ratio and other factors. The restrictions on capital expenditures are subject to certain “carry-forward” provisions and other customary carve-outs.
All borrowings under the TAO Credit Facilities are subject to the satisfaction of certain customary conditions, including compliance with a maximum leverage multiple, accuracy of representations and warranties and absence of a default or event of default. Borrowings bear interest at a floating rate, which at the option of TAOG may be either (i) a base rate plus a margin ranging from 6.50% to 7.00% per annum or (ii) LIBOR plus a margin ranging from 7.50% to 8.00% per annum. The interest rate on the TAO Credit Facilities as of September 24, 2017 was 9.25%. TAOG is required to pay a commitment fee of 0.50% per annum in respect of the average daily unused commitments under the TAO Revolving Credit Facility.
All obligations under the TAO Credit Facilities are secured by a first lien security interest in substantially all of the applicable TAO entities’ assets, including, but not limited to, a pledge of all of the capital stock of substantially all of TAOIH’s wholly-owned domestic subsidiaries and 65% of the voting capital stock, and 100% of the non-voting capital stock, of each of its first-tier foreign subsidiaries.
Subject to customary notice and minimum amount conditions, TAOG may voluntarily prepay outstanding loans under the TAO Credit Facilities at any time, in whole or in part (subject to customary breakage costs with respect to LIBOR loans) with premiums due in respect of prepayments of the TAO Term Loan Facility or permanent reduction under the TAO Revolving Credit Facility, in each case, starting at 5.0% initially and stepping down to 0% after three years. Beginning March 31, 2018, TAOG is required to make scheduled amortization payments under the TAO Term Loan Facility in consecutive quarterly installments equal to $688 per quarter initially, stepping up over time to $4,125 per quarter by March 31, 2021 and through the final maturity date of the TAO Term Loan Facility with the final balance payable on such maturity date. TAOG is also required to make mandatory prepayments under the TAO Credit Facilities in certain circumstances, including, without limitation, 75% of excess cash flow, with a step-down to 50% when the total net leverage ratio is less than 2.00:1.00.

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The TAO Credit Facilities contain certain restrictions on the ability of TAOG to take certain actions as provided in (and subject to various exceptions and baskets set forth in) the TAO Credit Facilities, including, without limitation, the following: (i) incurring additional indebtedness; (ii) creating liens on assets; (iii) making distributions, dividends and other restricted payments; (iv) engaging in sale and leaseback transactions; (v) merging or consolidating; (vi) making investments; and (vii) prepaying certain indebtedness.Stock Repurchases
See Note 1012 and Note 15 to the consolidated and combined financial statements included in the Company’s Annual“Part I — Item 1. Financial Statements” of this Quarterly Report on Form 10-K10-Q for the year ended June 30, 2017 for more information regardingdiscussions of the Company’s debt maturities for the TAO Term Loan Facility.
Revolving Credit Facilities Provided to Nonconsolidated Affiliates
In connection withobligations and various financing agreements, and the Company’s investment in AMSGE, the Company provides a $100,000 revolving credit facility to this entity, of which $97,500 had been drawn as of December 31, 2017.stock repurchases, respectively.
In connection with the Company’s investment in Tribeca Enterprises, the Company provides a $17,500 revolving credit facility to this entity, of which $16,500 was outstanding, excluding PIK interest of $1,392, as of December 31, 2017. In January 2018, Tribeca Enterprises borrowed the remaining $1,000 availability on the revolving credit facility.
Pursuant to their terms, the AMSGE and Tribeca Enterprises revolving credit facilities will terminate on September 20, 2020 and June 30, 2021, respectively.
Bilateral Letters of Credit Lines
The Company has established bilateral credit lines with a bank to issue letters of credit in support of the Company’s business operations. The Company either pays direct fees for the letters of credit or such fees are credited against interest income the Company receives in return from its investments in notes receivable with the same bank. As of December 31, 2017, the Company had $2,610 of letters of credit outstanding pursuant to which fees were credited against a note investment. In addition, TAO Group had three letters of credit outstanding for $1,500 as of September 24, 2017.
Contractual Obligations
The Company did not have any material changes in its contractual obligations since the end of fiscal year 20172023 other than activities in the ordinary course of business.
Cash Flow Discussion

As of December 31, 2017, cash and cash equivalents totaled $1,125,647, as compared to $1,238,114 as of June 30, 2017. The following table summarizes the Company’s cash flow activities for the six months ended December 31, 20172023 and 2016:
2022:
  Six Months Ended December 31,
  2017 2016
Net cash provided by operating activities $63,267
 $109,932
Net cash used in investing activities (143,872) (62,691)
Net cash used in financing activities (31,874) (81,213)
Effect of exchange rates on cash and cash equivalents 12
 —
Net decrease in cash and cash equivalents $(112,467) $(33,972)
Six Months Ended December 31,
20232022
Net (loss) income$(4,597)$3,309 
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:18,325 24,937 
Changes in working capital assets and liabilities(33,985)3,331 
Net cash (used in) provided by operating activities(20,257)31,577 
Net cash used in investing activities(5,238)(1,314)
Net cash provided by (used in) financing activities26,268 (76,123)
Net increase (decrease) in cash, cash equivalents and restricted cash$773 $(45,860)
Operating Activities
Net cash provided byused in operating activities for the six months ended December 31, 2017 decreased by $46,665 to $63,2672023 was $20,257 as compared to net cash provided by operating activities in the prior year period due to a decrease in other non-cash items and changes in assets and liabilities partially offset by an increase in net income. The decrease in operating cash flows from other non-cash itemsof $31,577. This was primarily due to (i) a reductionthe decrease in net deferred tax(loss) income adjusted for non-cash items in addition to changes in working capital assets and liabilities. The changes in working capital assets and liabilities as a resultwere primarily driven by (i) lower accrued and other liabilities of the recently enacted Federal tax reform legislation effective January 1, 2018, (ii)$60,478 primarily due to higher depreciationpayments related to employee compensation, league revenue sharing, and amortizationincome taxes in the current year period, as compared(ii) higher prepaid expenses and other assets of $10,236 primarily due to the prior year period, and (iii) an increase in share-based compensation expensehigher payments for income taxes in the current year period as comparedand lower receipts related to the prior year period. The increase in net cash used in operating activities resulting from changes in assetsescrow and liabilities was primarily due to (i) a decrease in deferred revenue primarily due to timing, (ii) higher employee and teamplayer compensation and related benefits paymentsrecoveries in the current year period, including severance-related(iii) $7,586 related to operating lease right-of-use assets and lease liabilities due to the timing of recognition of operating lease costs attributable to a separation agreement with a team executive, and (iii) an increase in receivables during the current year period in connection with the value-added tax, which the Company expects to recover, associated with the purchase of land in London. These decreases in operating cash flows were slightly offset by ahigher lease payments, (iv) higher net related party

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payment received inreceivables of $6,114 due to the current year periodtiming of collections related to a league non-recurring distribution which was accrued for asthe Company’s sponsorship sales and service representation agreements and Arena License Agreements, (v) higher accounts receivable, net of June 30, 2017.$4,793 due to the timing of collections related to sponsorship and ticket sales. These changes are partially offset by (i) higher deferred revenue of $33,592 primarily due to the higher collections of ticket sales in advance of recognition of pre/regular season ticket-related revenues, (ii) lower net related party payables of $11,592 primarily due to the timing of payments related to the Services Agreement, and (iii) lower investments of $7,344 primarily related to the Company’s Executive Deferred Compensation Plan.
Investing Activities
Net cash used in investing activities for the six months ended December 31, 20172023 increased by $81,181$3,924 to $143,872$5,238 as compared to the prior year period primarily due to (i) higher capital expenditures primarily associated with the purchasepurchases of land in London during the second quarter of fiscal year 2018 and venues and related technologiesinvestments in the current year period as compared to the prior year period and (ii) the acquisitions of controlling interests in Obscura and CLG during the current year period. These increases were offset by the acquisition of available-for-sale securities and a controlling interest in BCE in the prior year period.
Financing Activities
Net cash provided by financing activities for the six months ended December 31, 2023 was $26,268 as compared to net cash used in financing activities for the six months ended December 31, 2017 decreased by $49,3392022 of $76,123. This was primarily due to $31,874 as compared tothe impact of dividends paid and the accelerated share repurchase in the prior year period largely dueand, to a lesser extent, lower repurchases of shares of the Company’s Class A Common Stock in the current year period as compared to the prior year period. This decrease was partially offset by higher taxes paid in lieu of shares issued for equity-based compensation in the current year period as compared toperiod. These impacts were partially offset by additional borrowings under the Knicks Revolving Credit Facility and the Rangers Revolving Credit Facility in the prior year period and a contingent consideration payment related tohigher principal repayments under the acquisition of CLGCompany’s credit facilities in the current year period.
Seasonality of Our Business
The Company’s dependence of the MSG Sports segment on revenues from its NBA and NHL sports teams generally means that it earns a disproportionate share of its revenues in the second and third quarters of the Company’s fiscal year. The dependenceyear, which is when the majority of the MSG Entertainment segment on revenues from the Christmas Spectacular generally means it earns a disproportionate share of its revenues and operating income in the second quarter of the Company’s fiscal year. In addition, while it does not have a material impact on seasonality of our business, the first and third calendar quarterssports teams’ games are seasonally lighter quarters for TAO Group as compared to its second and fourth calendar quarters. As the Company consolidates TAO Group results of operations on a three-month lag basis, the seasonally lighter quarters for TAO Group will be reflected in the second and fourth quarters of the Company’s fiscal year.played.
Recently Issued Accounting Pronouncements and Critical Accounting Policies
Recently Issued Accounting Pronouncements
See Note 2 to the consolidated financial statements included in “Part I — Item 1. Financial Statements” of this Quarterly Report on Form 10-Q for discussion of recently issued accounting pronouncements.
Critical Accounting Policies
The following discussion has been included to provide the results of our annual impairment testing of goodwill and identifiable indefinite-lived intangible assets performed during the first quarter of fiscal year 2018.2024. There have been no material changes to the Company’s critical accounting policies from those set forth in our Annual Report on Form 10-K for the fiscal year ended June 30, 2017.2023.
Goodwill
The carrying amount of goodwill as of December 31, 2023 was $226,523. Goodwill is tested annually for impairment as of August 31st and at any time upon the occurrence of certain events or substantive changes in circumstances. The Company performs its goodwill impairment test at the reporting unit level, which is the same as or one level below the operating segment level. The Company has twoone operating and reportable segments, MSG Sportssegment, and MSG Entertainment, consistent withone reporting unit for goodwill impairment testing purposes.
The Company has the way management makes decisions and allocates resourcesoption to the business. For purposes of evaluating goodwill forperform a qualitative assessment to determine if an impairment is more likely than not to have occurred. If the Company has threecan support the conclusion that it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, the Company would not need to perform a quantitative impairment test for that reporting unit. If the Company cannot support such a conclusion or the Company does not elect to perform the qualitative assessment, the first step of the goodwill impairment test is used to identify potential impairment by comparing the fair value of a reporting unit with its carrying amount, including goodwill. The estimates of the fair value of the Company’s reporting units acrossare primarily determined using discounted cash flows and comparable market transactions. These valuations are based on estimates and assumptions including projected future cash flows, discount rates, determination of appropriate market comparables and the determination of whether a premium or discount should be applied to comparables. Significant judgments inherent in a discounted cash flow analysis include the selection of the appropriate discount rate, the estimate of the amount and timing of projected future cash flows and identification of appropriate continuing growth rate assumptions. The discount rates used in the analysis are intended to reflect the risk inherent in the projected future cash flows. The amount of an impairment loss is measured as the amount by which a reporting unit’s carrying value exceeds its two operating segments, which are MSG Sports, MSG Entertainment and TAO. Duringfair value determined in step one, not to exceed the first quartercarrying amount of fiscal year 2018, the Company performed its annual impairment test of goodwill and determined that there were no impairments of goodwill identified for any of its reporting units. The goodwill balance as of December 31, 2017 by reporting unit was as follows:goodwill.

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MSG Entertainment$76,840
TAO88,826
MSG Sports226,955
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The Company elected to perform the qualitative assessment of impairment for all of the Company’s reporting unitsunit for the fiscal year 20182024 impairment test. These assessments considered factors such as:
•macroeconomic conditions;
•industry and market considerations;
•market capitalization;
•cost factors;
•overall financial performance of the reporting units;unit;
•other relevant company-specific factors such as changes in management, strategy or customers; and
•relevant reporting unit specific events such as changes in the carrying amount of net assets.
The Company performed its most recent annual impairment test of goodwill during the first quarter of fiscal year 2024, and there was no impairment of goodwill. Based on thesethis impairment tests,test, the Company’s reporting units had sufficient safety margins, representing the excess of the estimated fair value of each reporting unit, derived from the most recently quantitative assessments, less its respective carrying value (including goodwill allocated to each respective reporting unit). The Company believesconcluded it was not more likely than not that if the fair value of the reporting unit exceedswas less than its carrying value by greater than 10%, a sufficient safety margin has been realized.amount.
Identifiable Indefinite-Lived Intangible Assets
Identifiable indefinite-lived intangible assets are tested annually for impairment as of August 31st and at any time upon the occurrence of certain events or substantive changes in circumstances. The following table sets forth the amount of identifiable indefinite-lived intangible assets reported in the Company’s consolidated balance sheet as of December 31, 2017 by reportable segment:2023:
Sports franchises$102,564 
Photographic related rights1,080 
$103,644 
Sports franchises (MSG Sports segment)$109,429
Trademarks (MSG Entertainment segment)62,421
Photographic related rights (MSG Sports segment)3,000
 $174,850
The Company has the option to perform a qualitative assessment to determine if an impairment is more likely than not to have occurred. In the qualitative assessment, the Company must evaluate the totality of qualitative factors, including any recent fair value measurements, that impact whether an indefinite-lived intangible asset other than goodwill has a carrying amount that more likely than not exceeds its fair value. The Company must proceed to conducting a quantitative analysis, if the Company (i) determines that such an impairment is more likely than not to exist, or (ii) forgoes the qualitative assessment entirely. Under the quantitative assessment, the impairment test for identifiable indefinite-lived intangible assets consists of a comparison of the estimated fair value of the intangible asset with its carrying value. If the carrying value of the intangible asset exceeds its fair value, an impairment loss is recognized in an amount equal to that excess. For all periods presented, the Company elected to perform a qualitative assessment of impairment for the indefinite-lived intangible assets. These assessments considered the events and circumstances that could affect the significant inputs used to determine the fair value of the intangible asset. Examples of such events and circumstances include:
During the first quarter of fiscal year 2018, the•cost factors;
•financial performance;
•legal, regulatory, contractual, business or other factors;
•other relevant company-specific factors such as changes in management, strategy or customers;
•industry and market considerations; and
•macroeconomic conditions.
The Company performed its most recent annual impairment test of identifiable indefinite-lived intangible assets during the first quarter of fiscal year 2024, and determined that there were no impairments identified. Based on results ofthis impairment test, the impairment tests performed, the Company’s indefinite-lived intangible assets had sufficient safety margins, representing the excess of each identifiable indefinite-lived intangible asset’s estimated fair value over its respective carrying value. The Company believesconcluded it was not more likely than not that if the fair value of an indefinite-lived intangible asset exceeds its carrying value by greater than 10%, a sufficient safety margin has been realized.
Contingent Consideration
See Note 10 to the consolidated financial statements included in “Part I — Item 1. Financial Statements” of this Quarterly Report on Form 10-Q for more information regarding the fair value of the Company’s contingent consideration liabilities related to the acquisitions of TAO Group and CLG.indefinite-lived intangible assets was less than their carrying amount.
MSG Sphere
The Company is moving forward with its venue strategy to create the “venue of the future.” These iconic structures will use cutting-edge technologies to establish an entirely new platform for creating the next-generation of immersive experiences. The Company will begin in Las Vegas with the construction of the first of these new venues — known as “MSG Sphere” for its iconic, spherical shape. The more than 18,000 seat venue is expected to be constructed over a two and a half year period with the goal of commencing construction in the second half of calendar year 2018. Key design features of the venue are expected to include (i) a 100% programmable exterior and an interior bowl that features the world’s largest and highest resolution media display known today, (ii) a first-of-its kind video system capable of capturing, curating and distributing both today’s and tomorrow’s content, (iii) an unprecedented, multi-layered audio system that will deliver a spectacular acoustical experience, and (iv) an advanced architecture for connectivity that will enable a broader range of content, greater interaction among guests and more immersive entertainment experiences. The Company intends to employ this state-of-the-art technological platform for a future venue to be built on land recently acquired in London and will continue to explore additional domestic and international markets where next-generation venues can be successful. See also “— Liquidity and Capital Resources — Overview.”

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Item 3. Quantitative and Qualitative Disclosures About Market Risk
There were no material changes to the disclosures regarding market risks in connection with our pension and postretirement plans, interest rate risk exposure and commodity risk exposure. See Item 7A, “Quantitative and Qualitative Disclosures About Market Risk,” of our Annual Report on Form 10-K for the fiscal year ended June 30, 2017.2023.
Potential interest rate risk exposure:
We are exposedhave potential interest rate risk exposure related to market risk resulting from foreign currency fluctuations, primarilyoutstanding borrowings incurred under our credit facilities. Changes in interest rates may increase interest expense payments with respect to any borrowings incurred under the British pound sterling throughcredit facilities.
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Borrowings under our net investment position initiated withcredit facilities incur interest, depending on our acquisition of landelection, at a floating rate based upon SOFR plus a credit spread adjustment, the U.S. Federal Funds Rate or the U.S. Prime Rate, plus, in London. Weeach case, a fixed spread. If appropriate, we may evaluate and decide, to the extent reasonable and practical,seek to reduce such exposure through the translation riskuse of foreign currency fluctuations on this underlying nonfunctional currency exposure by entering into foreign currency forward exchange contracts with financial institutions. If we were to enter into such hedging transactions, the market risk resulting from foreign currency fluctuations is unlikely to be entirely eliminated. We do not plan to enter into derivative financial instrument transactions for foreign currency speculative purposes.
interest rate swaps or similar instruments. As of December 31, 2017,2023, we had a uniformtotal of $330 million of borrowings outstanding under our credit facilities. The effect of a hypothetical 5% fluctuation100 basis point increase in the GBP/USD exchange ratefloating interest rates prevailing as of December 31, 2023 and continuing for a full year would have resulted in a change ofincrease interest expense by approximately $5.2 million in net asset value. For additional information, see Note 7 to the consolidated financial statements included in “Part I — Item 1. Financial Statements” of this Quarterly Report on Form 10-Q for discussion of our recent acquisition of land in London.$3.3 million. 
Item 4. Controls and Procedures
An evaluation was carried out under the supervision and with the participation of the Company’s management, including our Chief Executive OfficerChairman (our principal executive officer) and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934). Based on that evaluation, the principal executive officerCompany’s Executive Chairman and principal financial officerChief Financial Officer concluded that as of December 31, 2023 the Company’s disclosure controls and procedures were effective as of December 31, 2017.effective.
There were no changes in the Company’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Securities Exchange Act of 1934) during the quarter ended December 31, 20172023 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.
For the fiscal year ended June 30, 2017, management excluded the operations of TAO Group, which was acquired by the Company on January 31, 2017, in its assessment of the Company’s internal control over financial reporting. During the quarter ended December 31, 2017, the Company implemented certain new or enhanced controls over the TAO Group's operations which will be included in conducting the Company’s assessment of the effectiveness of its internal control over financial reporting for the fiscal year ended June 30, 2018.
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PART II—OTHER INFORMATION
Item 1. Legal Proceedings
The Company owns 50% of Azoff MSG Entertainment LLC, which in turn owns a majority interest in Global Music Rights, LLC (“GMR”). GMR is primarily a performance rights organization, whose business includes obtaining the right to license the public performance rights of songs composed by leading songwriters. GMR engaged in negotiations with the Radio Music Licensing Committee (“RMLC”), which represents over ten thousand commercial radio stations. On November 18, 2016, RMLC filed a complaint against GMR in the United States District Court for the Eastern District of Pennsylvania alleging that GMR is violating Section 2 of the Sherman Antitrust Act and seeking an injunction, requiring, among other things, that GMR issue radio stations licenses for GMR’s repertory, upon request, at a rate set through a judicial rate-making procedure, that GMR offer “economically viable alternatives to blanket licenses,” and that GMR offer only licenses for songs which are fully controlled by GMR. GMR and RLMC agreed to an interim license arrangement through September 30, 2017, which has been extended through March 31, 2018. GMR has advised the Company that it believes that the RMLC Complaint is without merit and is vigorously defending itself. On January 20, 2017, GMR filed a motion to dismiss or to transfer venue, asserting that the Eastern District of Pennsylvania is not a proper venue for the matter, lacks personal jurisdiction of GMR and that in any event the complaint fails to state a claim. On December 6, 2016, GMR filed a complaint against RMLC in the United States District Court for the Central District of California, alleging that RMLC operates as an illegal cartel that unreasonably restrains trade in violation of Section 1 of the Sherman Antitrust Act and California state law, and seeking an injunction restraining RMLC and its co-conspirators from enforcing or establishing agreements that unreasonably restrict competition for public performance licenses. The judge in the Central District of California denied RMLC’s motion to dismiss GMR’s claim for lack of ripeness and, on the basis that the two cases involve similar facts, stayed the California action in order to assess the status of the Pennsylvania case. On July 21, 2017, RMLC filed a preliminary injunction motion in the United States District Court for the Eastern District of Pennsylvania to extend the duration of the interim licenses which GMR had granted to certain radio stations. The district court determined that the jurisdictional matter should be decided prior to addressing the motion for preliminary injunction and referred the jurisdictional questions to the Magistrate Judge in the United States District Court Eastern District of Pennsylvania. On November 29, 2017, the Magistrate Judge issued a report and recommendation that personal jurisdiction was not appropriate over GMR in the Eastern District of Pennsylvania and recommending the dismissal ofthe RMLC’s action without prejudice. The RMLC has filed objectionsto the Magistrate Judge’s report and recommendation.
The Company is a defendant in various other lawsuits. Although the outcome of these other lawsuits cannot be predicted with certainty (including the extent of available insurance, if any), management does not believe that resolution of these other lawsuits will have a material adverse effect on the Company.

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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
The following table presents information about
As of December 31, 2023, the Company had approximately $185 million remaining under the $525 million Class A Common Stock share repurchase program authorized by the Company’s Board of Directors on September 11, 2015. Under the authorization, shares of Class A Common Stock may be purchased from time to time in open market or private transactions, block trades or such other manner as the Company may determine, in accordance with applicable insider trading and other securities laws and regulations, with the timing and amount of purchases depending on market conditions and other factors. The Company has been funding and expects to continue to fund stock repurchases, if any, through a combination of stock that were made duringcash on hand, cash generated by operations and available borrowing capacity under its existing credit facilities. During the three months ended December 31, 2017 (amounts are presented in thousands except per2023, the Company did not make any share data):repurchases under its share repurchase program.





38
         
Period Total Number of Shares Purchased 
Average Price Paid per Share (a)
 
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (b)
 Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs
October 1, 2017 - October 31, 2017 27
 $209.85
 26
 $262,053
November 1, 2017 - November 30, 2017 —
 $—
 —
 $262,053
December 1, 2017 - December 31, 2017 12
 $209.97
 12
 $259,639
Total 39
 $209.89
 38
  

_________________
(a)
The amounts do not give effect to any fees, commissions or other costs associated with repurchases of shares.
(b)
As of December 31, 2017, the total amount of Class A Common Stock authorized for repurchase by the Company’s board of directors was $525,000, and the Company had remaining authorization of $259,639 for future repurchases. Under the authorization, shares of Class A Common Stock may be purchased from time to time in accordance with applicable insider trading and other securities laws and regulations, with the timing and amount of purchases depending on market conditions and other factors. The Company has been funding and expects to continue to fund stock repurchases through a combination of cash on hand and cash generated by operations. The Company may also choose to fund our stock repurchase program through other funding sources including under our revolving credit facilities. The Company first announced its stock repurchase program on September 11, 2015.

Table of Contents

Item 6. Exhibits


(a)Index to Exhibits
(a)Index to Exhibits
EXHIBIT
NO.		DESCRIPTION
EXHIBIT
NO.31.1
DESCRIPTION
Time Sharing Agreement dated December 15, 2017 between MSG Sports & Entertainment LLC and Andrew Lustgarten (for the G450).

10.2
Time Sharing Agreement dated December 15, 2017 between MSG Sports & Entertainment LLC and Andrew Lustgarten (for the G550).

10.3
Time Sharing Agreement dated December 15, 2017 between MSG Sports & Entertainment LLC and Andrew Lustgarten (for the GV).

10.4
Form of Option Agreement.

10.5
First Amendment to the Credit and Guaranty Agreement dated as of January 31, 2017, among TAO Group Operating LLC, TAO Group Intermediate Holdings LLC, certain subsidiaries of TAO Group Operating, the various lenders thereto, and Goldman Sachs Specialty Lending Group, L.P. entered into as of May 19, 2017.

10.6
Second Amendment to the Credit and Guaranty Agreement dated as of January 31, 2017, among TAO Group Operating LLC, TAO Group Intermediate Holdings LLC, certain subsidiaries of TAO Group Operating, the various lenders thereto, and Goldman Sachs Specialty Lending Group, L.P. entered into as of January 22, 2018.

31.1
Certification by the Chief Executive OfficerChairman Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2

32.132.1*

32.232.2*

101.INS101
XBRL Instance Document.

The following materials from Madison Square Garden Sports Corp. Quarterly Report on Form 10-Q for the quarter ended December 31, 2023 formatted in Inline Extensible Business Reporting Language (iXBRL): (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations, (iii) Consolidated Statements of Comprehensive Income (Loss), (iv) Consolidated Statements of Cash Flows, (v) Consolidated Statements of Equity, and (vi) Notes to Consolidated Financial Statements.
101.SCH
XBRL Taxonomy Extension Schema.

101.CAL
XBRL Taxonomy Extension Calculation Linkbase.

101.DEF
XBRL Taxonomy Extension Definition Linkbase.

101.LAB
XBRL Taxonomy Extension Label Linkbase.

101.PRE
104
The cover page from the Company’s Quarterly Report on Form 10-Q for the quarter ended December 31, 2023 formatted in Inline XBRL Taxonomy Extension Presentation Linkbase.

and contained in Exhibit 101.

*    Furnished herewith. These exhibits shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, or otherwise subject to the liability of that Section. Such exhibits shall not be deemed incorporated into any filing under the Securities Act of 1933 or the Securities Exchange Act of 1934.

39

Table of Contents



SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized on the 8th6th day of February 2018.
2024.
The Madison Square Garden CompanySports Corp.
By:
/S/    DONNA COLEMANVICTORIA M. MINK
Name:Name:Donna ColemanVictoria M. Mink
Title:Title:Executive Vice President, and Chief Financial Officer and Treasurer





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