Liberty Media Corporation
11/05/2025 | Press release | Distributed by Public on 11/05/2025 12:32
Quarterly Report for Quarter Ending September 30, 2025 (Form 10-Q)
Management's Discussion and Analysis of Financial Condition and Results of Operations
Cautionary Note Regarding Forward-Looking Statements
Certain statements in this Quarterly Report on Form 10-Q constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding the proposed Liberty Live Split-Off (as defined below); our projected sources and uses of cash; fluctuations in interest rates and stock prices; the anticipated non-material impact of certain contingent liabilities related to legal and tax proceedings; and other matters arising in the ordinary course of business. Where, in any forward-looking statement, we express an expectation or belief as to future results or events, such expectation or belief is expressed in good faith and believed to have a reasonable basis, but there can be no assurance that the expectation or belief will result or be achieved or accomplished. The following include some but not all of the factors (as they relate to our consolidated subsidiaries and equity affiliates) that could cause actual results or events to differ materially from those anticipated:
| ● | the historical financial information of the Liberty Formula One Group (the "Formula One Group") and the Liberty Live Group may not necessarily reflect their results had they been separate companies; |
| ● | our ability to obtain additional financing on acceptable terms and cash in amounts sufficient to service debt and other financial obligations; |
| ● | our and our subsidiaries' indebtedness could adversely affect operations and could limit the ability of our subsidiaries to react to changes in the economy or our industry; |
| ● | the success of businesses attributed to each of our tracking stock groups and their popularity with audiences; |
| ● | our ability to realize the benefits of acquisitions or other strategic investments; |
| ● | the impact of weak and uncertain economic conditions on consumer demand for products, services and events offered by our businesses attributed to our tracking stock groups; |
| ● | our overlapping directors and management with QVC Group, Inc., formerly known as Qurate Retail, Inc. ("QVC Group"), Liberty Broadband Corporation and GCI Liberty, Inc.; |
| ● | the outcome of pending or future litigation; |
| ● | the operational risks of our subsidiaries and business affiliates with operations outside of the United States ("U.S."); |
| ● | our ability to use net operating loss, disallowed business interest and tax credit carryforwards to reduce future tax payments; |
| ● | the degradation, failure or misuse of our information systems; |
| ● | the ability of our subsidiaries and business affiliates to comply with government regulations, including, without limitation, competition laws and adverse outcomes from regulatory proceedings; |
| ● | the regulatory and competitive environment of the industries in which we, and the entities in which we have interests, operate; |
| ● | changes in the nature of key strategic relationships with partners, vendors and joint venturers; |
| ● | the impact of a future pandemic and other public health related risks and events, such as COVID-19, on our customers, vendors and businesses generally; |
| ● | reliance on intellectual property and the ability to protect intellectual property; |
| ● | reliance on third parties; |
| ● | the ability to attract and retain qualified personnel; |
| ● | the impact of our equity method investment in Live Nation Entertainment, Inc. ("Live Nation") on our net earnings (loss) and the net earnings (loss) of the Liberty Live Group; |
| ● | termination of or changes in any of the agreements, commitments or policies Formula 1 and MotoGP (as defined below) rely on to operate and the limitations such agreements, commitments and policies impose on Formula 1 and MotoGP; |
| ● | challenges by tax authorities in the jurisdictions where Formula 1 and MotoGP operate; |
| ● | changes in tax laws that affect Formula 1, MotoGP and the Formula One Group; |
| ● | the ability of Formula 1 and MotoGP to expand into new markets; |
| ● | changes in laws and regulations and/or their interpretations related to advertising, media rights and the environment; |
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| ● | the establishment of rival motorsports events or other circumstances that impact the competitive position of Formula 1 and/or MotoGP; |
| ● | the impact of cancelations or postponements of events or accidents or terrorist attacks during events; |
| ● | changes in consumer viewing habits and the emergence of new content distribution platforms; |
| ● | fluctuations in currencies against the U.S. dollar; |
| ● | the risks associated with the Company as a whole and our use of tracking stock groups, even if a holder does not own shares of common stock of both of our groups; |
| ● | market confusion that results from misunderstandings about our capital structure; |
| ● | market price of our tracking stocks may be volatile; |
| ● | we may not pay dividends equally to our tracking stocks or at all; |
| ● | our directors' or officers' equity ownership may create the appearance of conflicts of interest; |
| ● | geopolitical incidents, accidents, terrorist acts, international conflicts, natural disasters, including the effects of climate change, or other events that cause one or more events to be cancelled or postponed, are not covered by insurance, or cause reputational damage to our subsidiaries and business affiliates; |
| ● | challenges related to assessing the future prospects of tracking stock groups based on past performance; |
| ● | our ability to recognize the anticipated benefits from the proposed Liberty Live Split-Off; |
| ● | the possibility that our business may suffer as a result of uncertainty surrounding the proposed Liberty Live Split-Off; and |
| ● | the possibility that the proposed Liberty Live Split-Off may have unexpected costs. |
For additional risk factors, please see Part II, Item 1A. Risk Factors of this Quarterly Report on Form 10-Q, Part II, Item 1A. Risk Factors of our Quarterly Report on Form 10-Q for the quarter ended June 30, 2025, Part II, Item 1A. Risk Factors of our Quarterly Report on Form 10-Q for the quarter ended March 31, 2025 and Part I, Item 1A. Risk Factors of our Annual Report on Form 10-K for the year ended December 31, 2024. Any forward-looking statements and such risks, uncertainties and other factors speak only as of the date of this Quarterly Report, and we expressly disclaim any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein, to reflect any change in our expectations with regard thereto, or any other change in events, conditions or circumstances on which any such statement is based.
The following discussion and analysis provides information concerning our results of operations and financial condition. This discussion should be read in conjunction with our accompanying condensed consolidated financial statements and the notes thereto and our Annual Report on Form 10-K for the year ended December 31, 2024.
The information contained herein relates to Liberty Media Corporation and its controlled subsidiaries ("Liberty," the "Company," "we," "us," or "our" unless the context otherwise requires).
Overview
We own controlling and non-controlling interests in companies that are engaged in the motorsport and live entertainment industries. Formula 1, our most significant operating subsidiary, is a wholly-owned consolidated subsidiary and is also a reportable segment. Formula 1 is a global motorsports business that holds exclusive commercial rights with respect to the Fédération Internationale de l'Automobile ("FIA") Formula One World Championship (the "F1 Championship"), an annual, approximately nine-month long, motor race-based competition in which teams compete for the Constructors' Championship and drivers compete for the Drivers' Championship. The F1 Championship takes place on various circuits with a varying number of events ("Formula 1 Events") taking place in different countries around the world each season. Formula 1 is responsible for the commercial exploitation and development of the F1 Championship as well as various aspects of its management and administration.
The Company acquired approximately 84% of the equity interests in Dorna Sports, S.L. ("MotoGP") on July 3, 2025. Beginning on this date, MotoGP is a consolidated subsidiary and also a reportable segment. MotoGP is a global motorsports business that holds the exclusive commercial rights with respect to the Fédération Internationale de Motocyclisme Grand Prix World Championship (the "MotoGP Championship") and other motorcycle racing championships. The MotoGP
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Championship is comprised of a varying number of events ("MotoGP Events") taking place in different countries around the world each season.
We hold an ownership interest in Live Nation, which is accounted for as an equity method investment as of September 30, 2025. Live Nation is considered the world's leading live entertainment company. As of December 31, 2024, Live Nation met the Company's reportable segment threshold for equity method affiliates.
Our "Corporate and Other" category includes our consolidated subsidiary QuintEvents, LLC ("QuintEvents"), corporate expenses and investments and related financial instruments in public and private companies.
A tracking stock is a type of common stock that the issuing company intends to reflect or "track" the economic performance of a particular business or "group," rather than the economic performance of the company as a whole.
On August 3, 2023, the Company reclassified its then-outstanding shares of common stock into three new tracking stocks - Liberty SiriusXM common stock, Liberty Formula One common stock and Liberty Live common stock, and, in connection therewith, provided for the attribution of the businesses, assets and liabilities of the Company's remaining tracking stock groups among its newly created Liberty SiriusXM Group, Formula One Group and Liberty Live Group (the "Reclassification"). As a result of the Reclassification, each then-outstanding share of Liberty SiriusXM common stock was reclassified into one share of the corresponding series of new Liberty SiriusXM common stock and 0.2500 of a share of the corresponding series of Liberty Live common stock and each outstanding share of Liberty Formula One common stock was reclassified into one share of the corresponding series of new Liberty Formula One common stock and 0.0428 of a share of the corresponding series of Liberty Live common stock.
On September 9, 2024, Liberty completed the split-off (the "Liberty Sirius XM Holdings Split-Off") of its wholly owned subsidiary, Liberty Sirius XM Holdings Inc. ("Liberty Sirius XM Holdings"). The Liberty Sirius XM Holdings Split-Off was accomplished through the redemption by the Company of each outstanding share of Liberty SiriusXM common stock in exchange for 0.8375 of a share of Liberty Sirius XM Holdings common stock, with cash paid in lieu of fractional shares. Liberty Sirius XM Holdings was comprised of the businesses, assets and liabilities attributed to the Liberty SiriusXM Group immediately prior to the Liberty Sirius XM Holdings Split-Off. The Liberty Sirius XM Holdings Split-Off was intended to be tax-free to holders of Liberty SiriusXM common stock (except with respect to cash received in lieu of fractional shares).
Following the Liberty Sirius XM Holdings Split-Off, on September 9, 2024, a wholly owned subsidiary of Liberty Sirius XM Holdings merged with and into Sirius XM Holdings Inc. ("Sirius XM Holdings"), with Sirius XM Holdings surviving the merger as a wholly owned subsidiary of Liberty Sirius XM Holdings (the "Merger" and, together with the Liberty Sirius XM Holdings Split-Off, the "Transactions"). As a result of the Transactions, Liberty Sirius XM Holdings is an independent public company separate from Liberty.
While the Formula One Group and the Liberty Live Group have separate collections of businesses, assets and liabilities attributed to them, neither group is a separate legal entity and therefore cannot own assets, issue securities or enter into legally binding agreements. Holders of tracking stock have no direct claim to the group's stock or assets and therefore, do not own, by virtue of their ownership of shares of Liberty tracking stock, any equity or voting interest in a public company, such as Live Nation, in which Liberty holds an interest that is attributed to a Liberty tracking stock group, in this case the Liberty Live Group. Holders of tracking stock are also not represented by separate boards of directors. Instead, holders of tracking stock are stockholders of the parent corporation, with a single board of directors and subject to all of the risks and liabilities of the parent corporation.
As of September 30, 2025, the Formula One Group is primarily comprised of Liberty's interests in Formula 1, MotoGP and QuintEvents, cash and Liberty's 2.25% Convertible Senior Notes due 2027. The Formula One Group had cash and cash equivalents of approximately $1,291 million as of September 30, 2025, which included $825 million of subsidiary cash.
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As of September 30, 2025, the Liberty Live Group is primarily comprised of Liberty's interest in Live Nation, cash, other minority investments, Liberty's 2.375% Exchangeable Senior Debentures due 2053 and an undrawn margin loan. As of September 30, 2025, the Liberty Live Group had cash and cash equivalents of approximately $297 million.
Prior to the Liberty Sirius XM Holdings Split-Off, the Liberty SiriusXM common stock was intended to track and reflect the separate economic performance of the businesses, assets and liabilities attributed to the Liberty SiriusXM Group. At the time of the Liberty Sirius XM Holdings Split-Off, the Liberty SiriusXM Group was comprised of Liberty's interest in Sirius XM Holdings, corporate cash, Liberty's 3.75% Convertible Senior Notes due 2028, Liberty's 2.75% Exchangeable Senior Debentures due 2049 and a margin loan obligation incurred by a wholly-owned special purpose subsidiary of Liberty. Liberty Sirius XM Holdings is presented as a discontinued operation in the accompanying condensed consolidated financial statements.
On November 13, 2024, the Company announced that it is pursuing a plan to splitoff the Liberty Live Group (the "Liberty Live Split-Off"). Immediately prior to the Liberty Live Split-Off, QuintEvents, interests in certain private assets and cash will be reattributed from the Formula One Group to the Liberty Live Group in exchange for interests in certain other private assets. Any cash consideration will be determined at a future date based on relative valuations of the assets that are being reattributed. The Liberty Live Split-Off will be effected through the redemption of Liberty Live common stock in exchange for common stock of a newly formed company, Liberty Live Holdings, Inc. ("Liberty Live"). The Company will redeem each outstanding share of its Series A, Series B and Series C Liberty Live common stock for one share of the corresponding series of common stock of Liberty Live. As a result of the Liberty Live Split-Off, the Company and Liberty Live will be separate publicly traded companies, and the Company's outstanding common stock, the Liberty Formula One common stock, will no longer be a tracking stock. The Liberty Live Split-Off is subject to various conditions including, among other things, shareholder approval and the receipt of an opinion of tax counsel. The Liberty Live Split-Off is currently expected to be completed on December 15, 2025 and is intended to be tax-free to stockholders of the Company.
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Results of Operations-Consolidated
General. Provided in the tables below is information regarding our consolidated operating results and other income and expense, as well as information regarding the contribution to those items from our reportable segments. The "Corporate and other" category consists of those assets or businesses which do not qualify as a separate reportable segment. For a more detailed discussion and analysis of the financial results of our principal reportable segments see "Results of Operations-Businesses" below.
Consolidated Operating Results
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September 30, |
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September 30, |
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2025 |
2024 |
2025 |
2024 |
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amounts in millions |
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Revenue |
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Formula One Group |
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Formula 1 |
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$ |
869 |
|
861 |
|
2,498 |
|
2,285 |
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MotoGP |
|
|
169 |
|
- |
|
169 |
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- |
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Corporate and other |
|
|
68 |
|
70 |
|
266 |
|
255 |
|
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Intragroup elimination |
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(21) |
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(20) |
|
(60) |
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(54) |
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Total Formula One Group |
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1,085 |
|
911 |
|
2,873 |
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2,486 |
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Consolidated Liberty |
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$ |
1,085 |
911 |
2,873 |
2,486 |
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Operating Income (Loss) |
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Formula One Group |
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Formula 1 |
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168 |
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146 |
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433 |
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366 |
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MotoGP |
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26 |
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- |
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26 |
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- |
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Corporate and other |
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(36) |
(36) |
(88) |
(102) |
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Total Formula One Group |
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158 |
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110 |
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371 |
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264 |
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Liberty Live Group |
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Corporate and other |
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(9) |
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(3) |
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(20) |
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(7) |
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Total Liberty Live Group |
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(9) |
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(3) |
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(20) |
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(7) |
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Consolidated Liberty |
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$ |
149 |
107 |
351 |
257 |
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Adjusted OIBDA |
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Formula One Group |
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Formula 1 |
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234 |
|
221 |
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680 |
|
589 |
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MotoGP |
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66 |
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- |
|
66 |
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- |
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Corporate and other |
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(3) |
(14) |
(7) |
(15) |
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Total Formula One Group |
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297 |
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207 |
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739 |
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574 |
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Liberty Live Group |
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Corporate and other |
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(8) |
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(2) |
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(17) |
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(4) |
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Total Liberty Live Group |
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(8) |
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(2) |
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(17) |
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(4) |
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Consolidated Liberty |
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$ |
289 |
205 |
722 |
570 |
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Revenue. Our consolidated revenue increased $174 million and $387 million for the three and nine months ended September 30, 2025, respectively, as compared to the corresponding periods in the prior year, driven by increases in Formula 1 revenue and revenue from MotoGP, which was acquired in July 2025. See "Results of Operations-Businesses" below for a more complete discussion of the results of operations of Formula 1 and MotoGP.
Operating income (loss). Our consolidated operating income increased $42 million and $94 million for the three and nine months ended September 30, 2025, respectively, as compared to the corresponding periods in the prior year, primarily driven by improvements in Formula 1's operating results and the acquisition of MotoGP in July 2025. The increase in
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operating results for the nine months ended September 30, 2025 was also driven by improvements in QuintEvents' operating results. The increases in operating results during the three and nine months ended September 30, 2025 were partially offset by the impact of costs associated with the proposed Liberty Live Split-Off. See "Results of Operations-Businesses" below for a more complete discussion of the results of operations of Formula 1 and MotoGP.
Stock-based compensation. Stock-based compensation includes compensation related to options, stock appreciation rights, restricted stock awards, restricted stock units, performance-based restricted stock units and other stock-based awards granted to officers, employees, nonemployee directors and employees of our subsidiaries. We recorded $18 million and $27 million of stock-based compensation expense for the nine months ended September 30, 2025 and 2024, respectively. As of September 30, 2025, the total unrecognized compensation cost related to unvested Liberty equity awards was approximately $36 million. Such amount will be recognized in our condensed consolidated statements of operations over a weighted average period of approximately 3.0 years.
Acquisition costs. The Company recorded $14 million and $3 million of costs related to corporate acquisitions during the three months ended September 30, 2025 and 2024, respectively, and $28 million and $23 million of costs related to corporate acquisitions during the nine months ended September 30, 2025 and 2024, respectively.
Adjusted OIBDA. To provide investors with additional information regarding our financial results, we also disclose Adjusted OIBDA, which is a non-GAAP (as defined below) financial measure. We define Adjusted OIBDA as operating income (loss) plus depreciation and amortization, stock-based compensation, separately reported litigation settlements, Concorde incentive payments and restructuring, acquisition and impairment charges. Our chief operating decision maker and management team use this measure of performance in conjunction with other measures to evaluate our businesses and make decisions about allocating resources among our businesses. We believe this is an important indicator of the operational strength and performance of our businesses by identifying those items that are not directly a reflection of each business' performance or indicative of ongoing business trends. In addition, this measure allows us to view operating results, perform analytical comparisons and benchmarking between businesses and identify strategies to improve performance. Accordingly, Adjusted OIBDA should be considered in addition to, but not as a substitute for, operating income, net income, cash flow provided by operating activities and other measures of financial performance prepared in accordance with U.S. generally accepted accounting principles ("GAAP"). The following table provides a reconciliation of Operating income (loss) to Adjusted OIBDA:
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September 30, |
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2025 |
2024 |
2025 |
2024 |
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amounts in millions |
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Operating income (loss) |
|
$ |
149 |
|
107 |
|
351 |
|
257 |
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Depreciation and amortization |
|
118 |
88 |
275 |
263 |
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Stock-based compensation |
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8 |
7 |
18 |
27 |
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Acquisition costs |
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14 |
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3 |
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28 |
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23 |
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Concorde incentive payments |
|
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- |
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- |
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50 |
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- |
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Adjusted OIBDA |
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$ |
289 |
205 |
722 |
570 |
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Consolidated Adjusted OIBDA increased $84 million and $152 million for the three and nine months ended September 30, 2025, respectively, as compared to the corresponding periods in the prior year, primarily due to increases in Formula 1's Adjusted OIBDA and the acquisition of MotoGP in July 2025. See "Results of Operations-Businesses" below for a more complete discussion of the results of operations of Formula 1 and MotoGP.
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Other Income and Expense
Components of Other Income (Expense) are presented in the table below.
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September 30, |
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2025 |
2024 |
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amounts in millions |
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Interest expense |
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Formula One Group |
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$ |
(79) |
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(54) |
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(176) |
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(162) |
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Liberty Live Group |
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(7) |
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(8) |
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(22) |
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(22) |
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Consolidated Liberty |
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$ |
(86) |
(62) |
(198) |
(184) |
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Share of earnings (losses) of affiliates, net |
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Formula One Group |
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$ |
(3) |
|
(1) |
|
(8) |
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(6) |
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Liberty Live Group |
|
|
124 |
|
117 |
|
201 |
|
181 |
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Consolidated Liberty |
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$ |
121 |
116 |
193 |
175 |
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Realized and unrealized gains (losses) on financial instruments, net |
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Formula One Group |
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$ |
17 |
|
39 |
|
259 |
|
86 |
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Liberty Live Group |
|
|
(177) |
|
(94) |
|
(483) |
|
(75) |
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Consolidated Liberty |
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$ |
(160) |
(55) |
(224) |
11 |
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Other, net |
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Formula One Group |
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$ |
(4) |
|
21 |
|
96 |
|
56 |
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Liberty Live Group |
|
|
3 |
|
8 |
|
9 |
|
20 |
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Consolidated Liberty |
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$ |
(1) |
29 |
105 |
76 |
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$ |
(126) |
28 |
(124) |
78 |
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Interest expense. Consolidated interest expense increased $24 million and $14 million for the three and nine months ended September 30, 2025, respectively, as compared to the corresponding periods in the prior year, primarily due to an increase in the average amount of debt outstanding, partially offset by a decrease in the interest rate on Formula 1's Senior Loan Facilities (as defined in note 9 to the accompanying condensed consolidated financial statements).
Share of earnings (losses) of affiliates, net. The following table presents our share of earnings (losses) of affiliates:
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September 30, |
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September 30, |
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2025 |
2024 |
2025 |
2024 |
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amounts in millions |
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Formula One Group |
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Other |
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$ |
(3) |
(1) |
(8) |
(6) |
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Total Formula One Group |
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(3) |
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(1) |
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(8) |
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(6) |
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Liberty Live Group |
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|
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Live Nation |
|
|
125 |
|
117 |
|
198 |
|
180 |
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Other |
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(1) |
|
- |
|
3 |
|
1 |
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Total Liberty Live Group |
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|
124 |
|
117 |
|
201 |
|
181 |
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Consolidated Liberty |
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$ |
121 |
116 |
193 |
175 |
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Realized and unrealized gains (losses) on financial instruments, net. Realized and unrealized gains (losses) on financial instruments, net are comprised of changes in the fair value of the following:
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Three months ended |
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September 30, |
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September 30, |
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2025 |
2024 |
2025 |
2024 |
||||||
|
|
|
amounts in millions |
|
|||||||
|
Debt measured at fair value |
|
$ |
(110) |
(106) |
(363) |
(109) |
|
|||
|
Foreign currency forward contracts |
|
|
- |
85 |
335 |
93 |
|
|||
|
Live Nation Forward Contracts |
|
|
(60) |
- |
(150) |
- |
|
|||
|
Interest rate swaps |
|
|
4 |
(41) |
(49) |
13 |
|
|||
|
Other |
|
6 |
7 |
3 |
14 |
|
||||
|
|
|
$ |
(160) |
(55) |
(224) |
11 |
|
|||
Changes in unrealized gains (losses) on debt measured at fair value are due to market factors primarily driven by changes in the fair value of the underlying shares into which the debt is exchangeable. Changes in unrealized gains (losses) on foreign currency forward contracts are driven by changes in foreign currency exchange rates. Realized and unrealized gains (losses) on the Live Nation Forward Contracts (as defined in note 9 to the accompanying condensed consolidated financial statements) are primarily driven by changes in the market price of Live Nation common stock. Changes in realized and unrealized gains (losses) on interest rate swaps are driven by changes in the fair value of Formula 1's interest rate swaps and the realized gains (losses) on Formula 1's interest rate swaps.
Other, net. Other, net income decreased $30 million for the three months ended September 30, 2025 as compared to the corresponding period in the prior year primarily due to foreign currency exchange losses in the current period compared to foreign currency gains in the prior period, a decrease in interest income and debt modification costs in the current period, partially offset by losses on early extinguishment of debt in the prior period. Other income, net increased $29 million for the nine months ended September 30, 2025 as compared to the corresponding period in the prior year primarily due to gains on the disposition of assets, losses on the early extinguishment of debt in the prior period and an increase in interest income, partially offset by debt modification costs in the current period and decreases in foreign currency gains.
Income taxes. Earnings (losses) from continuing operations before income taxes and income tax (expense) benefit are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
Nine months ended |
|
|||||
|
|
|
September 30, |
|
September 30, |
|
|||||
|
|
|
2025 |
2024 |
2025 |
2024 |
|
||||
|
|
|
amounts in millions |
|
|||||||
|
Earnings (loss) from continuing operations before income taxes |
|
$ |
23 |
135 |
227 |
335 |
|
|||
|
Income tax (expense) benefit |
|
$ |
(10) |
(3) |
(5) |
(41) |
|
|||
|
Effective income tax rate |
|
|
43% |
2% |
2% |
12% |
|
|||
For the three months ended September 30, 2025, the Company recognized tax expense greater than the expected federal tax rate of 21% primarily due to an increase in our valuation allowance and non-deductible expenses. For the nine months ended September 30, 2025, the Company recognized tax expense less than the expected federal tax rate of 21% primarily due to certain unrealized gains that are not taxable. For the three months ended September30, 2024, the Company recognized tax expense less than the expected federal tax rate of 21% primarily due to certain gains that are not taxable and earnings in foreign jurisdictions taxed at rates lower than the 21% U.S. federal tax rate. For the nine months ended September30, 2024, the Company recognized tax expense less than the expected federal tax rate of 21% primarily due to tax benefits related to deductible stock-based compensation, certain gains that are not taxable and earnings in foreign jurisdictions taxed at rates lower than the 21% U.S. federal tax rate.
I-42
Net earnings (loss) from continuing operations. We had net earnings from continuing operations of $13 million and $222 million for the three and nine months ended September 30, 2025, respectively, and net earnings from continuing operations of $132 million and $294 million for the three and nine months ended September 30, 2024, respectively. The changes were the result of the above-described fluctuations in our revenue, expenses and other gains and losses.
Material Changes in Financial Condition
As of September 30, 2025, substantially all of our cash and cash equivalents were invested in U.S. Treasury securities, other government securities or government guaranteed funds, AAA rated money market funds and other highly rated financial and corporate debt instruments.
The following are potential sources of liquidity: available cash balances, cash generated by the operating activities of our subsidiaries (to the extent such cash exceeds the working capital needs of the subsidiaries and is not otherwise restricted), proceeds from net asset sales, monetization of our public investment portfolio (including derivatives), debt borrowings and equity issuances, available borrowing capacity under a margin loan and dividend and interest receipts.
Liberty does not have a debt rating.
As of September 30, 2025, Liberty's cash and cash equivalents were as follows:
|
|
|
|
|
|
|
|
|
|||
|
|
|
Cash and Cash |
|
|
|
|
|
Equivalents |
|
|
|
|
|
amounts in millions |
|
|
|
Formula One Group |
|
|
|
|
|
Formula 1 |
|
$ |
571 |
|
|
MotoGP |
|
|
176 |
|
|
Corporate and other |
|
|
544 |
|
|
Total Formula One Group |
|
$ |
1,291 |
|
|
Liberty Live Group |
|
|
|
|
|
Corporate and other |
|
$ |
297 |
|
|
Total Liberty Live Group |
|
$ |
297 |
|
Cash held by Formula 1 is accessible by Liberty, except when a restricted payment ("RP") test imposed by the first lien term loan and the revolving credit facility at Formula 1 is not met. Pursuant to the RP test, Liberty does not have unlimited access to Formula 1's cash when the leverage ratio (defined as net debt divided by covenant earnings before interest, tax, depreciation and amortization for the trailing twelve months) exceeds a certain threshold. During the nine months ended September 30, 2025, Formula 1 distributed $2.5 billion to Liberty and the RP test was met, pro forma for such distribution. If distributions are made in the future, the RP test, pro forma for such distributions, would have to be met. Cash held by MotoGP is accessible by Liberty, except when a RP test imposed by MotoGP's Credit Facilities (as defined in note 9 to the accompanying condensed consolidated financial statements) is not met. Pursuant to the RP test, Liberty does not have unlimited access to MotoGP's cash when MotoGP's leverage ratio exceeds a certain threshold. As of September 30, 2025, MotoGP has not made any distributions to Liberty. If distributions are made in the future, the RP test, pro forma for such distributions, would have to be met. As of September 30, 2025, Liberty had $400 million available under Liberty's margin loan secured by shares of Live Nation. Liberty believes that it currently has appropriate legal structures in place to repatriate foreign cash as tax efficiently as possible and meet the business needs of the Company.
I-43
The Company, Formula 1 and MotoGP are in compliance with their debt covenants as of September 30, 2025.
|
|
|
|
|
|
|
|
|
|
|
Nine months ended |
|
|||
|
|
|
September 30, |
|
|||
|
|
2025 |
2024 |
||||
|
Cash Flow Information |
amounts in millions |
|
||||
|
Formula One Group cash provided (used) by operating activities |
|
$ |
813 |
|
587 |
|
|
Liberty Live Group cash provided (used) by operating activities |
|
|
(28) |
|
(11) |
|
|
Net cash provided (used) by operating activities |
$ |
785 |
576 |
|
||
|
Formula One Group cash provided (used) by investing activities |
|
$ |
(3,137) |
|
(277) |
|
|
Liberty Live Group cash provided (used) by investing activities |
|
|
(1) |
|
105 |
|
|
Net cash provided (used) by investing activities |
$ |
(3,138) |
(172) |
|
||
|
Formula One Group cash provided (used) by financing activities |
|
$ |
989 |
|
954 |
|
|
Liberty Live Group cash provided (used) by financing activities |
|
|
1 |
|
(11) |
|
|
Net cash provided (used) by financing activities |
$ |
990 |
943 |
|
||
Liberty's primary use of cash during the nine months ended September 30, 2025 (excluding cash used by Formula 1 and MotoGP) was $3,267 million for the acquisition of MotoGP, net of cash acquired, funded with cash on hand and borrowings under Formula 1's Senior Loan Facilities, which were distributed to Liberty, as described above.
During the nine months ended September 30, 2025, Formula 1's primary use of cash was $57 million of capital expenditures, funded by cash from operations.
The projected uses of Liberty's cash (excluding Formula 1 and MotoGP's uses of cash) are the investment in existing or new businesses, debt service and the potential buyback of common stock under the approved share buyback program. Liberty expects to fund its projected uses of cash with cash on hand, borrowing capacity under margin loans and outstanding or new debt instruments, or distributions from operating subsidiaries. Liberty may be required to make net payments of income tax liabilities to settle items under discussion with tax authorities.
Formula 1's uses of cash are expected to be capital expenditures and debt service payments. Liberty expects Formula 1 to fund its projected uses of cash with cash on hand and cash provided by operations.
MotoGP's uses of cash are expected to be debt service payments. Liberty expects MotoGP to fund its projected uses of cash with cash on hand and cash provided by operations.
We believe that the available sources of liquidity are sufficient to cover our projected future uses of cash.
Results of Operations-Businesses
Formula 1. Formula 1 is a global motorsports business that holds exclusive commercial rights with respect to the F1 Championship, an annual, approximately nine-month long, motor race-based competition in which teams compete for the Constructors' Championship and drivers compete for the Drivers' Championship. The F1 Championship takes place on various circuits throughout the world. Formula 1 derives its primary revenue from the commercial exploitation and development of the F1 Championship through a combination of race promotion, media rights and sponsorship arrangements. A significant majority of the race promotion, media rights and sponsorship contracts specify payments in advance and annual increases in the fees payable over the course of the contracts. The 2025 F1 Championship calendar is scheduled to consist of the same 24 Formula 1 Events that were held in 2024, except in a different order. During both the three and nine months ended September 30, 2025, there was one less Formula 1 Event held than in the corresponding periods in the prior year.
Following the acquisition of QuintEvents, Formula 1's results include intragroup revenue that is eliminated in consolidation.
I-44
Formula 1's operating results were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
Nine months ended |
|
|||||
|
|
|
September 30, |
|
September 30, |
|
|||||
|
|
2025 |
2024 |
2025 |
2024 |
||||||
|
|
|
amounts in millions |
|
|||||||
|
Primary revenue |
|
$ |
738 |
758 |
2,089 |
1,960 |
|
|||
|
Other revenue |
|
|
131 |
103 |
409 |
325 |
|
|||
|
Total motorsport revenue |
|
|
869 |
861 |
2,498 |
2,285 |
|
|||
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
Cost of motorsport revenue, excluding Concorde incentive payments |
|
|
(552) |
(561) |
(1,581) |
|
(1,492) |
|
||
|
Selling, general and administrative expenses |
|
|
(83) |
(79) |
(237) |
(204) |
|
|||
|
Adjusted OIBDA |
|
|
234 |
221 |
680 |
589 |
|
|||
|
Concorde incentive payments |
|
|
- |
- |
|
(50) |
|
- |
|
|
|
Stock-based compensation |
|
|
(1) |
(1) |
|
(1) |
|
(2) |
|
|
|
Depreciation and amortization |
|
|
(65) |
(74) |
(196) |
(221) |
|
|||
|
Operating income (loss) |
$ |
168 |
146 |
433 |
366 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of Formula 1 Events |
|
|
6 |
|
7 |
|
17 |
|
18 |
|
Primary revenue is derived from the commercial exploitation and development of the F1 Championship through a combination of the following:
| ● | Race promotion fees - earned from granting the rights to host, stage and promote each Formula 1 Event on the F1 Championship calendar, fees from certain race promoters to license additional commercial rights from Formula 1 to secure Formula 2, Formula 3 and F1 Academy races at Formula 1 Events, technical service fees from promoters to support the origination of program footage and ticketing revenue from Formula 1's direct promotion of the Las Vegas Grand Prix |
| ● | Media rights fees - earned from licensing the right to broadcast Formula 1 Events and Formula 2 and Formula 3 races on television and other platforms, F1 TV subscriptions and other related services, the origination of program footage, footage from Formula 1's archives and the licensing of radio broadcast and other ancillary media rights |
| ● | Sponsorship fees - earned from the sale of F1 Championship and Formula 1 Event-related advertising and sponsorship rights and the servicing of such rights, rights to advertise on Formula 1's digital platforms and at non-Championship related events |
Primary revenue decreased $20 million during the three months ended September 30, 2025, as compared to the corresponding period in the prior year, due to the impact of recognizing Formula 1 Event-specific revenue and season-based revenue from one less Formula 1 Event, which impacted race promotion and media rights revenue, partially offset by contractual increases in fees across all primary revenue streams, increases in sponsorship revenue from new sponsors and increases in media rights revenue due to continued growth in F1 TV subscription revenue. Primary revenue increased $129 million during the nine months ended September 30, 2025, as compared to the corresponding period in the prior year, due to contractual increases in fees across all primary revenue streams, increases in sponsorship revenue from new sponsors, increases in media rights revenue due to continued growth in F1 TV subscription revenue and the recognition of one-time revenue associated with the release of the F1 movie, partially offset by the impact of recognizing Formula 1 Event-specific revenue and season-based revenue from one less Formula 1 Event on race promotion and media rights revenue.
Other revenue is generated from miscellaneous and ancillary sources primarily related to the sale of tickets to the Formula 1 Paddock Club hospitality program (the "Paddock Club") at most Formula 1 Events, facilitating the shipment of cars and equipment to and from Formula 1 Events outside of Europe, the sale of hospitality and experiences at the Las Vegas Grand Prix, the operation of the Formula 2, Formula 3 and F1 Academy series, other licensing opportunities, various
I-45
television production activities and the operations at the Grand Prix Plaza site in Las Vegas, including karting, other activations and hosting corporate events.
Other revenue increased $28 million and $84 million during the three and nine months ended September 30, 2025, respectively, as compared to the corresponding periods in the prior year, due to higher hospitality revenue, driven by increased attendance at, and revenue from, the Paddock Club and other premium hospitality offerings, growth in licensing income and growth from activities at Grand Prix Plaza in Las Vegas. The increase in other revenue during the nine months ended September 30, 2025, as compared to the corresponding period in the prior year, was also driven by higher freight income due to the different routes flown and the pass through of increased freight costs.
Cost of motorsport revenue
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
Nine months ended |
|
|||||
|
|
|
September 30, |
|
September 30, |
|
|||||
|
|
|
2025 |
2024 |
2025 |
2024 |
|
||||
|
|
|
amounts in millions |
|
|||||||
|
Team payments, excluding Concorde incentive payments |
|
$ |
(341) |
|
(371) |
|
(968) |
|
(969) |
|
|
Other costs of motorsport revenue |
|
|
(211) |
|
(190) |
|
(613) |
|
(523) |
|
|
Cost of motorsport revenue, excluding Concorde incentive payments |
|
$ |
(552) |
|
(561) |
|
(1,581) |
|
(1,492) |
|
Cost of motorsport revenue decreased $9 million and increased $89 million during the three and nine months ended September 30, 2025, respectively, as compared to the corresponding periods in the prior year.
Team payments are recognized on a pro-rata basis across the Formula 1 Events of the F1 Championship calendar. Team payments decreased during the three months ended September 30, 2025 due to the pro rata recognition of team payments, with one less Formula 1 Event held than in the corresponding period in the prior year. Team payments were relatively flat during the nine months ended September 30, 2025 as compared to the corresponding period in the prior year as the effect on the pro rata recognition of one less Formula 1 Event was offset by the expectation of higher full year team payments.
Other costs of motorsport revenue are largely variable in nature and relate to both primary and other revenue. On an annual basis, the largest components of other costs of motorsport revenue are costs related to promoting, organizing and delivering the Las Vegas Grand Prix, hospitality costs, which are principally related to catering and other aspects of the production and delivery of hospitality offerings at the Las Vegas Grand Prix and the Paddock Club at other Formula 1 Events, and costs incurred in the provision and sale of freight, travel and logistical services. Other costs of motorsport revenue also include sponsorship and digital product sales' commissions, circuit rights' fees payable under various agreements with race promoters to acquire certain commercial rights at Formula 1 Events, including the right to sell advertising, hospitality and support race opportunities, annual FIA regulatory fees, Formula 2 and Formula 3 cars, parts and maintenance services, costs related to the F1 Academy series, television production and post-production services, advertising production services, digital and social media activities and the operation of various activities at Grand Prix Plaza.
Other costs increased $21 million and $90 million during the three and nine months ended September 30, 2025, respectively, as compared to the corresponding periods in the prior year, primarily due to higher Paddock Club costs driven by increased attendance and increased costs from various activities at Grand Prix Plaza. The increase during the nine months ended September 30, 2025 was also driven by higher freight costs associated with the freight movements required as a result of the different order of Formula 1 Events and cost inflation, higher commissions and partner servicing costs linked to underlying revenue growth, higher race promotion costs to service new sponsors and higher hosting and other costs of delivering F1 TV to a growing subscriber base.
I-46
Selling, general and administrative expenses include personnel costs, legal, professional and other advisory fees, bad debt expense, rental expense, information technology costs, insurance premiums, maintenance and utility costs and other general office administration costs.
Selling, general and administrative expenses increased $4 million and $33 million during the three and nine months ended September 30, 2025, respectively, as compared to the corresponding periods in the prior year, due to higher marketing costs including, in the nine month period, the costs associated with the 75th season launch event. The increase for the nine months ended September 30, 2025 was also driven by an increase in personnel costs.
Concorde incentive payments represent one-time fees paid to the teams upon signing the 2026 Concorde Commercial Agreement. Such payments are excluded from Adjusted OIBDA for the nine months ended September 30, 2025.
Depreciation and amortization includes depreciation of property and equipment and amortization of intangible assets. Depreciation and amortization decreased $9 million and $25 million during the three and nine months ended September 30, 2025, respectively, as compared to the corresponding periods in the prior year, primarily due to a decrease in amortization expense related to certain intangible assets acquired in the acquisition of Formula 1 by Liberty.
MotoGP. MotoGP is a global motorsports business that holdsexclusive commercial rights to the MotoGP Championship and other motorcycle racing championships. The MotoGP Championship is comprised of a varying number of MotoGP Events, which are inclusive of MotoGP, Moto2 and Moto3, taking place in different countries around the world each season. MotoGP derives its primary revenue from the commercial exploitation and development of the MotoGP Championship through a combination of media rights, race promotion and sponsorship arrangements. A significant majority of the media rights, race promotion and sponsorship contracts specify payments in advance and annual increases in the fees payable over the course of the contracts. The 2025 MotoGP Championship calendar is scheduled to consist of 22 MotoGP Events. The 2024 MotoGP Championship was comprised of 20 MotoGP Events.
Liberty acquired approximately 84% of the equity interests of MotoGP on July 3, 2025 and applied acquisition accounting and consolidated the results of MotoGP from that date. Although MotoGP's results are only included in Liberty's results for the period from July 3, 2025 through September 30, 2025, we believe a discussion of MotoGP's results for all periods presented promotes a better understanding of the overall results of its business. For comparison and discussion purposes, we are presenting the pro forma results of MotoGP for the full three and nine months ended September 30, 2025 and 2024, inclusive of acquisition accounting adjustments, which primarily impact amortization expense. The pro forma financial information was prepared based on the historical financial information of MotoGP and assuming the acquisition of MotoGP took place on January 1, 2024. The acquisition price allocation related to the MotoGP acquisition is preliminary. Accordingly, the pro forma adjustments are based on this preliminary allocation and have been made solely for the purpose of providing comparative pro forma financial information. The financial information below is presented for illustrative purposes only and does not purport to represent the actual results of operations of MotoGP had the acquisition occurred on January 1, 2024, or to project the results of operations of Liberty for any future periods. The pro forma adjustments are based on available information and certain assumptions that Liberty management believes are reasonable. The pro forma adjustments are directly attributable to the acquisition and are expected to have a continuing impact on the results of operations of Liberty.
MotoGP's pro forma operating results include intragroup revenue from QuintEvents that is eliminated in consolidation.
I-47
MotoGP's pro forma operating results were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
Nine months ended |
|
|||||
|
|
|
September 30, |
|
September 30, |
|
|||||
|
|
2025 |
2024 |
2025 |
2024 |
||||||
|
|
|
amounts in millions |
|
|||||||
|
Primary revenue |
|
$ |
147 |
146 |
365 |
324 |
|
|||
|
Other revenue |
|
|
22 |
23 |
52 |
47 |
|
|||
|
Total motorsport revenue |
|
|
169 |
169 |
417 |
371 |
|
|||
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
|
Cost of motorsport revenue |
|
|
(84) |
(79) |
(214) |
|
(177) |
|
||
|
Selling, general and administrative expenses |
|
|
(19) |
(17) |
(53) |
(40) |
|
|||
|
Adjusted OIBDA |
|
|
66 |
73 |
150 |
154 |
|
|||
|
Depreciation and amortization |
|
|
(38) |
(37) |
(109) |
(110) |
|
|||
|
Operating income (loss) |
$ |
28 |
36 |
41 |
44 |
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of MotoGP Events |
|
|
7 |
|
7 |
|
17 |
|
15 |
|
Primary revenue is derived through a combination of media rights fees (earned from licensing the right to broadcast MotoGP Events, VideoPass subscriptions and other related services, the origination of program footage, footage from MotoGP's archives and the licensing of other ancillary media rights), race promotion fees (earned from granting the rights to host, stage and promote MotoGP Events) and sponsorship fees (earned from the sale of MotoGP Championship and Event-related advertising and sponsorship rights and the servicing of such rights and rights to advertise on MotoGP's digital platforms).
Primary revenue increased $1 million during the three months ended September 30, 2025, as compared to the corresponding period in the prior year, primarily due to increased race promotion fees related to a different mix of MotoGP Events and a favorable change in currency exchange rates, partially offset by the impact of recognizing season-long media rights and sponsorship revenue in a smaller proportion to the previous season (7 out of 22 MotoGP Events for 2025 versus 7 out of 20 MotoGP Events for 2024). Primary revenue increased $41 million during the nine months ended September 30, 2025, as compared to the corresponding period in the prior year, primarily due to the impact of recognizing MotoGP Event-specific and season-based revenue from two additional MotoGP Events and a favorable change in currency exchange rates.
Other revenue is generated from other motorcycle racing championships, including the FIM World Superbike Championship ("WorldSBK"), hospitality (inclusive of the sale of tickets to the MotoGP VIP Village and MotoGP Premier hospitality programs at most events) and other licensing opportunities.
Other revenue decreased $1 million during the three months ended September 30, 2025, as compared to the corresponding period in the prior year, primarily due to a decrease in races held for WorldSBK (4 races in 2025 versus 6 races in 2024), partially offset by an increase in hospitality revenue and a favorable change in currency exchange rates. Other revenue increased $5 million during the nine months ended September 30, 2025, as compared to the corresponding period in the prior year, primarily driven by an increase in hospitality revenue due to two additional MotoGP Events and a favorable change in currency exchange rates.
In describing MotoGP's operating results, the term "currency exchange rates" refers to the foreign currency exchange rates MotoGP uses to convert the operating results for countries where the functional currency is not the U.S. dollar. MotoGP calculates the effect of changes in currency exchange rates as the difference between current period activity translated using the prior period's currency exchange rates. MotoGP refers to the results of this calculation as the impact of currency exchange rate fluctuations. Constant currency operating results, a non-GAAP measure, refers to operating results without the impact of currency exchange rate fluctuations. The disclosure of results in constant currency permits investors to better understand MotoGP's underlying performance without the effects of currency exchange rate fluctuations.
I-48
The percentage change in MotoGP's revenue in U.S. dollars and in constant currency was as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended September 30, 2025 |
|
Nine months ended September 30, 2025 |
|
||||||||||||||
|
|
U.S. Dollars |
|
Foreign currency exchange impact |
|
Constant currency |
|
U.S. Dollars |
|
Foreign currency exchange impact |
|
Constant currency |
|
|||||||
|
Motorsport revenue |
- |
% |
|
4.7 |
% |
|
(4.7) |
% |
|
12.4 |
% |
|
3.5 |
% |
|
8.9 |
% |
|
|
For the three months ended September 30, 2025, motorsport revenue decreased 4.7% on a constant currency basis and was flat in U.S. dollars, the difference of which is attributable to the weakening of the U.S. dollar to the Euro. For the nine months ended September 30, 2025, motorsport revenue had a constant currency growth rate of 8.9% versus a U.S. dollar growth rate of 12.4%, the difference of which is attributable to the weakening of the U.S. dollar to the Euro.
Cost of motorsport revenue includes both variable and fixed costs components and relates to both primary and other motorsport revenue. On an annual basis, the largest components of costs of motorsport revenue are costs related to International Road-Racing Teams Association payments, which are generally fixed on a per race basis with slight variations based on the mix and number of MotoGP Events and escalate on an annual basis, costs related to television productions, advertising and sponsorship materials, the delivery of hospitality offerings, freight travel and annual FIM regulatory fees.
Cost of motorsport revenue increased $5 million during the three months ended September 30, 2025, as compared to the corresponding period in the prior year, primarily due to an increase in costs of servicing sponsorship partners and an unfavorable change in currency exchange rates. Cost of motorsport revenue increased $37 million during the nine months ended September 30, 2025, as compared to the corresponding period in the prior year, primarily due to two additional MotoGP Events, which drove increased freight and travel costs, and an unfavorable change in currency exchange rates.
Selling, general and administrative expenses include personnel costs, legal, professional and other advisory fees, bad debt expense, rental expense, information technology costs, insurance premiums, maintenance and utility costs and other general office administration costs. Selling, general and administrative expenses increased $2 million and $13 million during the three and nine months ended September 30, 2025, respectively, as compared to the corresponding periods in the prior year, primarily due to higher personnel costs and an unfavorable change in currency exchange rates.
Depreciation and amortization includes depreciation of property and equipment and amortization of intangible assets. Depreciation and amortization was relatively flat during each of the three and nine months ended September 30, 2025, as compared to the corresponding periods in the prior year.
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