Strong playoff performances by the New York Knicks and New York Rangers near the end of the 2024 fiscal year have helped boost both teams’ parent companies’ revenues to record highs and swelled the coffers of Madison Square Garden Sports.
MSGS reported revenues of $227 million for the fourth quarter of fiscal 2024, ending June 30, up $100 million from the same period last year. This was driven by the Knicks’ advancement to the Eastern Conference Semifinals and the Rangers’ advancement to the Eastern Conference Finals. This season marked the first time since 2013 that both MSG teams advanced to the second round of the playoffs in the same year. Seven more playoff games and four more regular season games compared to last year’s fourth quarter helped MSGS finish the fiscal year strong with total revenues exceeding a record $1 billion, up 16% ($139 million) from fiscal 2023.
But the fourth quarter was the highlight as Jalen Brunson and the Knicks narrowly missed out on their first conference finals appearance since 2000. Meanwhile, the Rangers made it to their second conference finals appearance in three seasons.
That helped MSGS make a profit of $25 million in the fourth quarter ended June 30, compared with a net loss of $9.3 million in the same period a year ago. MSGS also said sponsorship, suite revenues and league-wide distributed revenues all increased year-over-year, helping it set a new annual record for adjusted operating income ($172.2 million).
The rare glimpse into the financial health of professional sports teams comes after MSG Chairman James Dolan recently criticized the NBA’s revenue-sharing policy and its new $74 billion media deal, which he said neglects the NBA’s regional sports networks. MSG COO Jamal Resan echoed that sentiment during an investor call on Tuesday, saying the changing landscape, which could result in fewer exclusive live broadcasts, will impact local media rights partner MSG Networks, which has a “significant” debt due in October.
“We are evaluating how these new rights agreements will impact other areas of our business, including local media rights revenue,” MSGS CFO Victoria Mink said on the conference call. Mink said the reduction in local media rights fees will partially offset the increased domestic revenue from the NBA’s new media deals.
MSGS Sports is looking to replicate that financial success by strengthening both teams in the offseason. The Knicks re-signed All-NBA guard Brunson and small forward OG Anunoby and acquired another former Villanova University star, Mikal Bridges, in a trade with the Brooklyn Nets. The Rangers also added new players, including 2023 Stanley Cup winner Riley Smith, acquired in a trade with the Pittsburgh Penguins.
Although Wall Street values MSGS at a significant discount to private valuations by Sportico and other media, the Knicks and Rangers remain the two most valuable teams in U.S. professional sports. When asked about the possibility of executives selling minority stakes in the future, Lesan did not rule out the possibility.
“These are extremely scarce assets and a strong business foundation that we don’t believe is properly reflected in the current stock price,” he added. “We wouldn’t rule out the possibility of selling a minority stake, but we have nothing to report at this time.”
