TKO Group Holdings TKO · USD

19. SEGMENT INFORMATIONPrior to the Endeavor Asset Acquisition, the Company identified two reportable segments: UFC and WWE, to align with how the Company’s chief operating decision maker (the “CODM”), the Chief Executive Officer, managed the businesses, evaluated financial results, and made key operating decisions. Subsequent to the Endeavor Asset Acquisition and effective February 28, 2025, the Company identified three reportable segments—UFC, WWE and IMG—to align with how the Company’s CODM manages the businesses, evaluates financial results, and makes key operating decisions. The UFC segment consists entirely of the operations of the Company's UFC business and the WWE segment consists entirely of the operations of the Company's WWE business. The IMG segment consists of the operations of the IMG business and On Location. The Company also reports the results for the “Corporate and Other” group. The Corporate and Other group reflects operations not allocated to the UFC, WWE or IMG segments and primarily consists of general and administrative expenses as well as operations of PBR and boxing. Boxing includes the joint venture with Sela Company for the Zuffa Boxing brand as well as promotional services TKO provides for boxing events.Revenue from our Corporate and Other group principally consists of media rights fees associated with the distribution of PBR's programming content; ticket sales and site fees associated with live events; partnerships and marketing; and consumer products licensing agreements of PBR-branded products. Revenue also consists of management and promotional fees for services primarily related to boxing.General and administrative expenses relate largely to corporate activities, including information technology, facilities, legal, human resources, finance and accounting, treasury, investor relations, corporate communications, community relations and compensation to TKO’s management and board of directors, which support all reportable segments. Corporate and Other expenses also include service fees paid by the Company to EGH and its subsidiaries under the Services Agreement, inclusive of fees paid for revenue producing services related to the segments. On the closing date of the Endeavor Asset Acquisition, the Services Agreement between EGH and TKO OpCo was terminated and the Transition Services Agreement was entered into between the EGH Parties, TWI and the TKO Parties.

16. REVENUEThe Company derives its revenue principally from the following sources: (i) media rights and content fees associated with the distribution of content, (ii) ticket sales at live events and site fees, (iii) partnerships and marketing sales, and (iv) consumer products licensing.Disaggregated Revenue The following table presents the Company’s revenue disaggregated by primary revenue sources (in thousands): Year Ended December 31, 2025 UFC WWE IMG Corporate & Other Total Media rights, production and content $ 907,659 $ 1,000,565 $ 672,761 $ 24,131 $ 2,605,116 Live events and hospitality 232,937 412,822 611,273 82,424 $ 1,339,456 Partnerships and marketing 314,271 159,583 68,956 45,706 $ 588,516 Consumer products licensing and other 47,294 136,425 14,269 46,801 $ 244,789 Eliminations — — — — (42,726 ) Total $ 1,502,161 $ 1,709,395 $ 1,367,259 $ 199,062 $ 4,735,151 Year Ended December 31, 2024 UFC WWE IMG Corporate & Other Total Media rights, production and content $ 879,427 $ 865,460 $ 721,254 $ 32,264 $ 2,498,405 Live events and hospitality 220,400 338,555 1,156,774 75,350 1,791,079 Partnerships and marketing 251,407 82,991 73,328 37,159 444,885 Consumer products licensing and other 55,007 111,094 18,874 25,501 210,476 Eliminations — — — — (60,604 ) Total $ 1,406,241 $ 1,398,100 $ 1,970,230 $ 170,274 $ 4,884,241 Year Ended December 31, 2023 UFC WWE IMG Corporate & Other Total Media rights, production and content $ 870,551 $ 249,496 $ 692,224 $ 15,870 $ 1,828,141 Live events and hospitality 167,942 87,705 650,585 81,524 987,756 Partnerships and marketing 196,296 17,957 79,103 26,397 319,753 Consumer products licensing and other 57,412 27,609 15,198 8,196 108,415 Eliminations — — — — (19,269 ) Total $ 1,292,201 $ 382,767 $ 1,437,110 $ 131,987 $ 3,224,796 Remaining Performance ObligationsThe transaction price related to the Company’s future performance obligations does not include any variable consideration related to sales or usage-based royalties. The variability related to these sales or usage-based royalties will be resolved in the periods when the licensee generates sales related to the intellectual property license.

21. COMMITMENTS AND CONTINGENCIESThe Company enters into long-term commercial partnership arrangements and other executory contracts in the ordinary course of business. Accordingly, as of December 31, 2025, the Company has no material unconditional purchase obligations required to be disclosed in accordance with ASC 440, Commitments. The Company’s future commitments related to its debt obligations and its operating and finance leases are separately disclosed in Note 8, Debt, and Note 20, Leases, respectively.Legal ProceedingsThe Company is involved in legal proceedings, claims and governmental investigations arising in the normal course of business. The types of allegations that arise in connection with such legal proceedings vary in nature, but can include, among others, contract, employment, tax and intellectual property matters. The Company evaluates all cases and records liabilities for losses from legal proceedings when the Company determines that it is probable that the outcome will be unfavorable and the amount, or potential range, of loss can be reasonably estimated. While any outcome related to litigation or such governmental proceedings cannot be predicted with certainty, management believes that the outcome of these matters, except as otherwise may be discussed below, individually or in the aggregate, will not have a material adverse effect on the Company’s financial position, results of operations or cash flows.UFC Legal Proceedings Five related class-action lawsuits were filed against Zuffa between December 2014 and March 2015 by a total of eleven former UFC fighters. The lawsuits, which were substantially identical, were transferred to the United States District Court for the District of Nevada and consolidated into a single action in June 2015, captioned Le et al. v. Zuffa, LLC, No. 2:15-cv-1045-RFB-BNW (D. Nev.) (the “Le” case). The lawsuit alleged that Zuffa violated Section 2 of the Sherman Act by monopsonizing an alleged market for the services of elite professional MMA athletes. The fighter plaintiffs claimed that Zuffa’s alleged conduct injured them by artificially depressing the compensation they received for their services. The plaintiffs sought treble damages under the antitrust laws, as well as attorneys’ fees and costs, and, in some instances, injunctive relief. On August 9, 2023, the district court certified the lawsuit as a damages class action, encompassing the period from December 16, 2010 to June 30, 2017.

8. DEBTThe following is a summary of the Company’s outstanding debt (in thousands): As of December 31, December 31, 2025 2024 First Lien Term Loan (due November 2031) $ 3,717,569 $ 2,750,000 Other Secured Loans 63,067 30,267 Notes Payable 2,552 4,800 Total principal 3,783,188 2,785,067 Unamortized discount (9,761 ) (10,154 ) Unamortized debt issuance cost (11,303 ) (12,631 ) Total debt 3,762,124 2,762,282 Less: Current portion of long-term debt (38,061 ) (26,977 ) Total long-term debt $ 3,724,063 $ 2,735,305 First Lien Term Loan (due November 2031)As of December 31, 2025 and 2024, the Company had $3.7 billion and $2.8 billion, respectively, outstanding under a credit agreement dated August 18, 2016 (as amended and/or restated, the “First Lien Credit Agreement,” by and among Zuffa Guarantor, LLC (n/k/a “TKO Guarantor, LLC” or "TKO Guarantor"), UFC Holdings, LLC (n//k/a “TKO Worldwide Holdings, LLC” or “TKO Worldwide Holdings”), as borrower, the lenders party thereto and Goldman Sachs Bank USA, as administrative agent, which was entered into in connection with the acquisition of Zuffa by EGH in 2016. TKO OpCo and TKO are holding companies with limited business operations, cash flows, assets and liabilities other than the equity interests in the borrower entities Zuffa Guarantor and UFC Holdings. On September 15, 2025 (the “Credit Agreement Closing Date”), TKO Worldwide Holdings entered into the Sixth Refinancing Amendment (the “Credit Agreement Amendment”). The Credit Agreement Amendment, among other things: (i) refinanced and replaced the outstanding first lien term loans (the "Existing Term Loans") with a new class of first lien secured term loans, (ii) provided for an additional $1.0 billion incremental first lien secured term loan as a fungible increase to the Existing Term Loans of $2.8 billion (the “New Term Loans”), (iii) extended the maturity of the existing $205.0 million revolving credit facility from November 21, 2029 to September 15, 2030 (the "Revolving Credit Facility" and together with the New Term Loans, the "Credit Facilities"), and (iv) made certain other changes to the First Lien Credit Agreement. The Credit Facilities are secured by liens on substantially all of the assets of TKO Guarantor and TKO Worldwide Holdings and certain subsidiaries thereof. The New Term Loans accrue interest, at the option of the borrower, at either (a) Term SOFR plus 2.00% (with a SOFR floor of 0.00%) or (b) the Alternate Base Rate (“ABR”) plus 1.

15. INCOME TAXESTKO Group Holdings, Inc. was incorporated as a Delaware corporation in March 2023. As the sole managing member of TKO OpCo, TKO Group Holdings, Inc. ultimately controls the business affairs of TKO OpCo. TKO Group Holdings, Inc. is subject to corporate income taxes on its share of taxable income of TKO OpCo. TKO OpCo is treated as a partnership for U.S. federal income tax purposes and is therefore generally not subject to U.S. corporate income tax. TKO OpCo’s foreign subsidiaries are subject to entity-level taxes. TKO OpCo’s U.S. subsidiaries are subject to withholding taxes on sales in certain foreign jurisdictions which are included as a component of foreign current taxes. TKO OpCo is subject to entity-level income taxes in certain U.S. state and local jurisdictions.As discussed in Note 4, Acquisition of WWE, the TKO Transactions are accounted for as a reverse acquisition of WWE using the acquisition method of accounting in accordance with ASC 805. As a result, TKO recorded a fair value step-up on the acquired WWE net assets in the amount of $3.3 billion and deferred tax liabilities in the amount of $379.6 million, all of which was recorded through goodwill as of the Closing Date.For the years ended December 31, 2025, 2024 and 2023, the effective tax rate was 12.2%, (17.7)%, and 19.9%, respectively. Income (loss) before income taxes includes the following components (in thousands): Year Ended December 31, 2025 2024 2023 United States $ 574,626 $ (265,532 ) $ 124,736 Foreign 31,998 55,327 42,247 Total income (loss) before income taxes $ 606,624 $ (210,205 ) $ 166,983 As further described in Note 3, Recent Accounting Pronouncements, the Company has elected to prospectively adopt the guidance in ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Taxes Disclosures. Accordingly, the income tax disclosures in the applicable tables presented below for the current year are presented in accordance with the guidance in ASU 2023-09, while prior year disclosures are disclosed in accordance with guidance prior to the adoption of ASU 2023-09. The income tax provision for year ended December 31, 2025 consists of the following in accordance with the guidance in ASU 2023-09 (in thousands): Year Ended December 31, 2025 Current: U.S. federal $ 32,463 State and local 10,977 Foreign 40,475 Total Current 83,915 Deferred: U.S.

20. LEASESAs of December 31, 2025, the Company’s lease portfolio consisted of operating and finance leases, in which the Company is the lessee, primarily for real estate property for offices around the world. In addition, the Company has various live event production service arrangements that contain operating and finance equipment leases. The Company’s real estate leases have remaining lease terms of approximately one year to 26 years, some of which include one or more options to renew. These renewal terms can extend the lease term and are included in the lease term when it is reasonably certain that the Company will exercise the option. The Company’s equipment leases, which are included as part of various operating service arrangements, generally have remaining lease terms of approximately one year to six years. Generally, no covenants are imposed by the Company’s lease agreements. Quantitative Disclosures Related to LeasesThe following table provides quantitative disclosure about the Company’s operating and finance leases for the periods presented (dollars in thousands): Year Ended December 31, 2025 2024 2023 Lease costs Finance lease costs: Amortization of right-of-use assets $ 26,062 $ 22,924 $ 7,227 Interest on lease liabilities 19,787 20,246 6,997 Operating lease costs 19,339 21,956 16,725 Other short-term and variable lease costs 3,017 1,086 1,480 Total lease costs $ 68,205 $ 66,212 $ 32,429 Other information Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from finance leases $ 19,787 $ 22,531 $ 8,072 Operating cash flows from operating leases $ 17,692 $ 20,643 $ 15,867 Finance cash flows from finance leases $ 18,667 $ 12,111 $ 938 Right-of-use assets obtained in exchange for new finance lease liabilities (1) $ 9,266 $ 22,937 $ 257,359 Right-of-use assets obtained in exchange for new operating lease liabilities (1) $ 5,381 $ 7,249 $ 24,356 As of December 31, 2025 2024 Weighted-average remaining lease term (in years) - finance leases 22.0 23.3 Weighted-average remaining lease term (in years) - operating leases 5.0 5.1 Weighted-average discount rate - finance leases 8.2 % 8.2 % Weighted-average discount rate - operating leases 6.6 % 6.7 % (1)The amounts for the year ended December 31, 2023 are primarily related to the assets acquired from WWE as discussed in Note 4, Acquisition of WWE.

4. ACQUISITION OF WWETKO Transactions OverviewOn September 12, 2023 (the “Closing Date”), the TKO Transactions combining the UFC and WWE businesses was completed, resulting in the newly formed public company, TKO. Under the terms of the Transaction Agreement, EGH/and or its subsidiaries received a 51.0% controlling non-economic voting interest in TKO and a 51.0% economic interest in the operating subsidiary, TKO OpCo. Former WWE stockholders received a 49% voting interest in TKO and a 100% economic interest in TKO, which in turn holds a 49.0% economic interest in TKO OpCo. The TKO Transactions have been accounted for as a reverse acquisition of WWE using the acquisition method of accounting in accordance with the guidance of ASC 805, Business Combinations (“ASC 805”), with TKO OpCo, the legal acquiree, treated as the accounting acquirer. The weighted average life of finite-lived intangible assets acquired was 20.3 years, which consisted of trademarks and trade names with a weighted average life of 25.0 years, customer relationships with a weighted average life of 11.3 years and other intangible assets with a weighted average life of 3.6 years. See Note 6, Goodwill and Intangible Assets, for the estimated annual amortization of intangible assets acquired in the TKO Transactions for the next five years and thereafter. In connection with the TKO Transactions, the Company incurred transaction costs of $2.7 million, $1.9 million and $83.8 million for the years ended December 31, 2025, 2024 and 2023, respectively, which were expensed as incurred and included in selling, general and administrative expenses in the consolidated statements of operations. Consideration TransferredThe fair value of the consideration transferred was $8,432.1 million, which consisted of 83,161,123 shares of TKO Class A common stock valued at $8,061.8 million, WWE Replacement Awards valued at $49.3 million (attributable to pre-combination vesting) and $321.0 million of deferred consideration which was paid on September 29, 2023 to former WWE shareholders in the form of a special dividend. Pursuant to the TKO Transactions, awards of WWE RSUs and PSUs outstanding immediately prior to the completion of the TKO Transactions were converted into awards of TKO RSUs or PSUs, as applicable, on the same terms and conditions as were applicable immediately prior to the Closing Date.

Item 1C. CybersecurityCybersecurity Risk Management and StrategyWe have developed and implemented a cybersecurity risk management program intended to protect the confidentiality, integrity, and availability of our critical systems and information. Our security approach is aligned with various applicable security and/or technical requirements and best practices, including those established by the National Institute of Standards and Cybersecurity Framework (“NIST CSF”). This does not imply that we meet any particular technical standards, specifications, or requirements, only that our information security team uses the NIST CSF as a framework for helping us to identify, assess, and manage cybersecurity risks relevant to our business. Our cybersecurity risk management program is integrated into our overall risk management program and is designed to share common methodologies, reporting channels and governance processes that apply across the risk management program to other legal, compliance, strategic, operational, and financial risk areas. We have a cross-functional team composed of TKO's senior IT, cybersecurity and compliance leadership that typically meets on a monthly basis to discuss efforts to identify new or prospective risks, mitigate previously identified risks, and discuss recent cybersecurity events. This cross-functional team reports into an executive steering committee comprised of senior enterprise leadership which meets, at a minimum, quarterly. We use a defense-in-depth strategy across our business applications and systems, including database encryption, encryption for laptops/desktops, endpoint-security solutions including network filtering, anti-virus, endpoint firewalls, endpoint detection/response, patch and security configuration management and monitoring through our use of a Security Information and Event Management (“SIEM”) system. The SIEM is monitored by our Security Operations Center (“SOC”). Our network and applications require multi-factor authentication, and logins are monitored for unusual activity by our SOC systems and personnel. The enterprise network is protected by stateful firewalls, which are also monitored via our SOC. Our dedicated cybersecurity team engages third parties to conduct periodic infrastructure, application, compliance, and security operations testing, and threats/findings are managed through our risk-register and governance processes.