Liberty Media (FWONK) Q2 FY26 earnings call: guidance and Q&A

Formula One's financial results for Q2 FY26 and year-to-date were significantly impacted by calendar variability, with 3 fewer races held year-to-date compared to the prior year. This led to a 15% decline in revenue and a 30% decline in adjusted OIBDA year-to-date. Management emphasized that the business is performing 'incredibly well' when accounting for these calendar shifts, with strong underlying growth in sponsorship, licensing, and Paddock Club demand. The Bahrain GP was rescheduled to Malaysia in October, bringing the expected FY26 race count to 23, with a return to a full 24-race calendar expected in FY27.

MotoGP, acquired on July 3, 2025, is in its early stages of integration and development under Liberty Media. The company has secured agreements with manufacturers and teams through 2031, establishing a stable framework for investment and growth. Revenue increased year-to-date driven by race promotion and sponsorship, while adjusted OIBDA also grew due to revenue growth and expense declines, including lower freight costs and net accounting for hospitality. The focus is on strengthening the organization, building commercial capabilities, and expanding its global footprint.

Both F1 and MotoGP are prioritizing fan engagement across diverse platforms. F1's partnership with Apple TV has attracted a younger and more female audience in the U.S., with viewership up 13% in total hours watched. Social media followers for F1 grew 19% year-over-year, and YouTube views surpassed 1.3 billion, up 30%. MotoGP also saw strong digital growth, with social media followers increasing 3% to 63 million and TikTok engagement up over 80%. The strategy involves provisional content, experiential activations, and enhancing measurement of fan engagement across the ecosystem.

Demand for premium experiences in F1 remains exceptionally strong. The Paddock Club is sold out for the rest of the season, and House 44, also sold out, plans to expand from 9 to 30 locations next year. A new premium experience, 'the outlab,' launched at the Belgian Grand Prix in partnership with LVMH, received overwhelmingly positive feedback. F1 is also adding new capacity at various Grand Prix locations and diversifying its premium product mix, indicating continued confidence in the high-end market.

The Las Vegas Grand Prix continues to perform well, with ticket sales trending significantly ahead of last year. A 10-year extension through 2037 with the LVCVA was announced, reinforcing the strategic importance of the race and providing certainty for long-term infrastructure investments and operational improvements. The Grand Prix Plaza in Las Vegas is also performing well, with attendance on track to surpass 2025 levels. Management highlighted the event's potential to be even more profitable and serve as a model for producing global sports events.

F1's licensing business is on a strong growth trajectory, with new global publishing partnerships (DK books) and renewals (automobiles), as well as collaborations for special editions (Monopoly with Hasbro). New agreements with partners like Gentle Monster and Uniqlo are also in place. Management sees significant opportunities to further characterize and grow this revenue stream through digitalization and by creating unique content and capsules that resonate with fans. The focus is on maximizing monetization through various propositions and expanding reach with iconic global brands.

Media rights discussions are ongoing and dynamic, influenced by regional market conditions, the entry of digital players, and the strength of F1 and MotoGP content. Management emphasizes controlling content and producing compelling sports to put them in the best negotiating position. Early renewals are pursued when they make strategic sense for long-term stability and partner investment. The German market was highlighted as being in flux but with potential for future growth, driven by digital platforms and the sport's strong brand presence.