Las Vegas's Sphere: Big Shows, Bigger Losses

Las Vegas's Sphere is making waves with its high-profile shows and movie screenings. The venue has seen a big jump in revenue, thanks to hits like "The Wizard of Oz" and the Backstreet Boys. But even with these successes, the company is still in the red. The numbers tell an interesting story. Revenue for the third quarter was up by 15%, reaching $262. 5 million. That's a solid increase, but it's not enough to cover the nearly $130 million operating loss. Adjusted operating income did see a big turnaround, going from a loss of $10. 2 million to a gain of $36. 4 million. Sphere has become a hotspot for artist residencies. Since opening in 2023, it has hosted big names like U2, Phish, and the Eagles. The Backstreet Boys recently extended their residency, and upcoming acts include Illenium and No Doubt. When there aren't concerts, the venue shows movies, like the immersive "The Wizard of Oz" adaptation. This film has sold over 1 million tickets and brought in more than $130 million since its premiere. The Sphere Experience, which includes movie screenings, has seen a 37% revenue boost. This is partly due to more showings of films like "Postcard from Earth" and the U2 concert film. However, the increase in shows also means higher expenses. Operating expenses for the Sphere segment rose by about $10 million, contributing to an overall 26% increase. Despite the losses, there are signs of growth. The Sphere segment's operating loss improved by $40. 6 million compared to last year. The company's CEO, James Dolan, sees potential in the venue's ability to adapt and grow. But the question remains: Can Sphere turn these big shows into sustainable profits?