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Welcome to Liberty Media Corporation's 2026 Second Quarter Earnings Call. [Operator Instructions] As a reminder, this conference will be recorded August 6. I would now like to turn the call over to Hooper Stevens, Senior Vice President, Investor Relations. Please go ahead.

Thank you for joining us this morning. This call includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual events or results could differ materially due to a number of risks and uncertainties, including as mentioned in the most recent Forms 10-K and 10-Q filed by Liberty Media with the SEC. These forward-looking statements speak only as of the date of this call, and Liberty Media expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein to reflect any change in Liberty Media's expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.

On today's call, we will discuss certain non-GAAP financial measures for Liberty Media, including adjusted OIBDA, [indiscernible] constant currency for MotoGP, the required definitions and reconciliations for Liberty Media Schedule 1 and MotoGP Schedule 2 can be found at the end of the earnings press release issued today, which is available on Liberty Media's website.

Speaking on today's call, we have Liberty's President and CEO, Derek Chang; Liberty's Chief Accounting and Principal Financial Officer, Brian Wendling; Formula One's President and CEO, Stefano Domenicali; MotoGP's CEO, Carmelo Ezpeleta and other members of management will be available for Q&A.

With that, I'll turn it over to Derek.

Great. Thank you, Hooper, and good morning, everyone. We are thrilled with the second quarter performance at both F1 and MotoGP, amidst the global uncertainty and credit to our operating teams in this challenging environment. Our businesses are motoring along at a speedy pace.

Our priorities for 2026 remain unchanged, which are to build upon Formula One's durable business matter, established the foundation for MotoGP's next phase of development, and allocate capital with discipline. Since May, we have made tangible progress against each priority while keeping the distinct identity of each sport at the center of our approach.

Formula One continues to demonstrate the breadth and durability of its platform. New technical era is producing compelling competition on track. There is immense demand from fans, promoters, commercial partners and media platforms. Meanwhile, our business continues to perform incredibly well with notable momentum across Paddock Club, licensing and sponsorship.

In the U.S., Formula One momentum on Apple continues to build with viewership up year-over-year, season to date and total hours watched up 13%. We could not be more pleased with this result. The digital product is great and sponsors across the F1 ecosystem are very happy with our distribution on Apple. This season, F1 has attracted a much younger and more female audience in the U.S. on Apple TV.

Our experience with Apple continues to reinforce the strategy of pairing a premium live coverage with product innovation and broader ecosystem breadth without compromising reach. Through Apple's ecosystem, F1 is being amplified, discovered and embraced by a new generation of fans, and we couldn't be more excited to see what this partnership will bring to our stores in the coming years.

We are also creating more direct and frequent relationships with fans. Provisional content, licensing and experiential activations are extending engagement beyond race weekend. For example, Passenger Princess which in its first season generated close to 300 million views returned for second season last half. Our Las Vegas Grand Prix 10-year extension through 2037 is a milestone that underscores F1's growing U.S. presence. At MotoGP, we are beginning to capitalize on the significant opportunities ahead, and we are very happy with our progress so far.

Raising the season has been exceptional with incredibly tight competition among the top 5 riders. More importantly, for the long term, MotoGP completed agreements with our manufacturers and teams through 2031, together with new technical regulations beginning next year. This establishes a stable framework for investment, promotion and commercial growth.

We continue strengthening the organization including progressing on key hires and building commercial capabilities while pursuing growth in ways that are authentic to MotoGP. There is positive momentum in the business with new media agreements signed in Spain and Portugal and the extensions of the Malaysian and Silverstone Grands Prix. Fan activations like the 20,000-person immersive watch party in London in June, broadened access and visibility and underscore our priority of bringing the MotoGP experience closer to city centers.

Our capital priorities at the Liberty level remain to support attractive organic growth, maintain a prudent balance sheet and evaluate opportunities that complement our existing assets. Brian will cover the financial results in more detail, and Stefano and Carmelo will discuss the operating businesses. Our confidence remains high in the durability of Formula One's growth and they're increasingly direct and always on fan relationships. Likewise, we continue to feel very excited by MotoGP's long-term potential as its organizational and commercial foundation take shape.

Now I'll turn it over to Brian.

Thank you, Derek, and good morning, everyone. We'll start with the Formula One business. The race cap this quarter is especially challenging due to not holding the Saudi and Bahrain GP's in April, and other differences in the calendar, resulting in a 44% decline in the rate count for the quarter and a 27% decline year-to-date.

With that in mind, I'll focus on year-to-date comparisons and as always, it remains best to focus on our business on a full year basis. Absent the calendar variability of the business is performing incredibly well.

Results reported year-to-date reflect the 22-race calendar, the number known at June 30. Subsequent to the end of the second quarter, we have rescheduled the Bahrain GP, which will be held in Malaysia in October, bringing our expected rate count to 23 races for the year. We expect to start accruing season-based revenue costs and associated true-ups with respect to a 23-race calendar starting in the third quarter of this year.

No additional '26 calendar changes may be necessary. We expect to return to a full 24-race calendar next season.

The second quarter of 2026 helped dive races compared to 9 races in the second quarter of last year. Year-to-date through the second quarter, F1 also had 3 fewer races with 8 races held in the current year-to-date period compared to 11 races held in the prior year.

Year-to-date, revenue declined 15% and adjusted OIBDA declined 30%, driven by the change in race count. The decline in primary revenue was driven by the calendar variance and its effect on recognition of season-based revenue. With 8 out of 22 assumed races stage year-to-date with approximately 36% of season-based revenue recognized compared to the prior year period when 11 out of 24 races have been staged at approximately 46% of season-based revenue had been recognized.

During the second quarter, media rights revenue was also impacted by the onetime revenue associated with the release of the F1 movie last year.

Offsetting the decline was underlying contractual fee increases at our the primary revenue streams and revenue generated from new and renewed sponsorship partners. Other revenue declined due to lower hospitality and freight revenue from 3 fewer events held year-to-date and lower F3 revenue due to the sale of cars at the beginning of the new F3 cycle last year, partially offsetting with strong demand for the pataclub at recurring events, continued growth in our licensing business and growth in the Grand Prix Plaza activities in Las Vegas.

Adjusted OIBDA decreased year-to-date because of the lower event count. Revenue decline discussed above outpaced the decline in expenses. Decreased operating expenses included lower team payments and expenses related to the delivery of hospitality offerings, travel freight and other costs due to the calendar variance.

SG&A expenses increased driven by higher personnel and information technology costs, partially offset by lower marketing costs as we lap the 75th season launch last year.

The payments as a percent of pre-team share adjusted OIBDA were 61.7% year-to-date, and we're also accrued based on a 22-race calendar assumption. For the full year, we still expect to see roughly 200 basis points improvement in leverage on this metric, in line with the average that we've seen over the past 4 years. After 2026, for the remainder of the term of the new Concorde agreement through 2030, we expect the payout percentage to remain relatively stable.

Key payments are best analyzed on a full year basis due to quarterly fluctuations in team payments as a percent of adjusted OIBDA.

Now turning to MotoGP. Reminder that we closed the acquisition on July 3, 2025. So our financial results prior to the date of the acquisition are presented on a pro forma basis, so the transaction occurred on January 1, '24. The majority of MotoGP's revenue and costs are euro-denominated and as such, are subject to translational impacts from foreign exchange fluctuations.

I will focus on constant currency results here. Similar to F1, I'll also focus on year-to-date comparisons.

Year-over-year comparisons are impacted by the mix of races, not just the number. And a reminder, MotoGP flyaway races as generally carry higher costs, including freight, travel and fees. MotoGP race count itself was identical year-over-year for both the quarter and the year-to-date periods.

Revenue increased at MotoGP year-to-date, driven by growth in rates promotion from event mix and sponsorship revenue due to new sponsors and underlying contractual growth. A reduction in contractual media rights and a decline in title sponsorship revenue related to a bed mix partially offset that revenue growth.

Adjusted OIBDA also grew year-to-date driven by both revenue growth and a decline in expenses. Class to MotoGP Motorsport revenue decreased due to the impact of lower freight expenses from the race mix as well as lower hospitality costs related to MotoGP's new hospitality agreement with Quint, where MotoGP now recognized as revenue and costs related to hospitality on a net basis.

Looking briefly at Corporate and Other results year-to-date, revenue was $12 million, which relates to the rental income generated by Grand Prix Plaza in Las Vegas. Corporate and Other adjusted OIBDA was a loss of $16 million includes Grand Prix Plaza rental income and our corporate expenses.

At quarter end, Liberty Media had cash and liquid investments of approximately $1.5 billion, which included $1 billion of cash at F1 and $142 million of cash at MotoGP. Our debt was approximately $5 billion at quarter end, which included $3.3 billion of debt at F1, and $1 billion of debt at MotoGP with $497 million at the corporate level.

F1's $500 million revolver and MotoGP's EUR 100 million revolver, both remain undrawn. We did reprice MotoGP's debt in June, and we priced a EUR 720 million term loan B, a USD 200 million term loan A and a new $100 million multicurrency revolving credit facility at attractive terms with future reductions in margin expected as the business delevers.

Additionally, we repaid a portion of MotoGP's debt funded with cash from MotoGP's balance sheet.

Quarter-end, Liberty Media's net leverage was 3.4x. That is a slight uptick from the end of the first quarter, but it's largely driven by the F1 calendar events. F1 and MotoGP are both in compliance with their debt covenants at quarter end.

And with that, I'll turn it over to Stefano to discuss Formula One.

Thanks, Brian. The 2026 season so far has delivered some incredible racing and amazing moments for all of our fans. There have been great battles for poles among Kimi, George, Louis, Lando and Charles, that have fueled excitement on track. The Champs battle remains highly competitive, and I expect the teams to converge more and more as the season progresses.

The news I knew would become reality is that attendance is up, audience are up, digital numbers are growing and the fans are enjoying what they are seeing. The fans are at the heart of everything we do, and they are loving the season.

As you know, the CTS security of everyone in the sport remains our first and foremost priority. We have closing monetary developers in the Middle East region, originally hoping to bring back One Race to the region. But unfortunately, we were unable to do so as originally planned. Instead, we recently announced the great news that we will recover the Baring Grand Prix, but it will be hosted by the Malaysian, creating an exciting triple header alongside Barco and Singapore.

I want to thank his Majesty the King of Bahrain, his Royal Principal man of Bahrain and his Majesty, the King of is Malaysia, as well as their respective governments, and of course, the press of the FIA, and the promoters for all their collaboration and the flexibility making this race possible.

It once again shows that we can adapt fine solution and deliver incredible results for the sport. Looking ahead, we continue to expect that Qatar and Abu Dhabi Grand to currently proceed on schedule for a 23-race calendar this season and expect to return to a full 24-race calendar next season. Engagement trends continue to underscore the strength of our sport.

We all go 3.3 million attendees to date with all 10 races selling out through Belgium. Five racers set new attendance records including silverware coming 564,000 fans, making it the most attended race in the sports history. Our Sprint format continues to drive higher Friday attendances as stronger daily attendees through our race recap, the success of the spring format continues to drive growing interest from promoters in other screen race, and we expect to expand the number of screens for next year and to provide further details sold.

Our hospitality offerings continue to benefit from huge demand for premium experiences. The Paddock Club remains sold out for the rest of the season and House 44, which is also sold out this season has been a standout success. We plan to expand House 44 from 9 locations this year to 30 locations next year. At the Belgian Grand Prix, we launched our new premium experience, the outlab, in partnership with LVMH. Early feedback from our partners and fans have been overwhelmingly positive, and we expect to operate this experience across Europe next season.

Retail sales remain robust and highlight the underlying consumer demand on F1 branded merchandise. At Silverstone, we introduced a new flagship retail concept that offers fans a broader and more diverse product assortment. We plan to expand this flagship format to Monza, Madrid and Norton later this year. Building on the success of the specialty F1 business store in Asia, we launched another distributed hub at the motor rate this quarter. Additionally, we also opened 2 new F1 Hub location in Montreal and further extending our retail footprint and following the success of the original concept in Las Vegas. That returns in November. We continue working with our promoter partners to elevate our premium hospitality experience, including adding new capacity, increases the season that Silverstone Monza Monaco, Austin and Hungary. And we planned expansion next year in Austria. In Monoco this season, we added the third floor to the Paddock Club in addition to diversifying our premium product mix with 5 different experienced packages.

At Silverstone, we opened our term on Alex in our Paddock Club, taking our premium capacity to an all-time high this season.

Global TV audience, led by several key strategic markets, including Brazil, Italy and China. In Brazil, the British Grand Prix reached a record of 18 million viewers across TV Global Sport TV generating the highest audience for the event in 8 years and the largest sources for any F1 race globally since 2020.

In Italy, TV audiences are up plus 27% through Silverstone versus last year, helping drive broader growth in fund engagement across our ecosystem.

In China, the moment generated by the Chinese Grand Prix, where we can do this more than double year-to-year has continued throughout the season supported by increased coverage and growing audiences.

Our social and digital platforms continue to play an important role in bringing our younger digital first audience closer to our sport. We grew our social media follower 19% year-over-year with particularly strong engagement on TikTok. Our total YouTube views surpassed [ 1 3 ] billion, up plus 30% year-over-year, while our YouTube highlights views have reached almost 200 million views with over 15 million hours watched.

While we continue to benchmark our sport engagement using traditional measure of viewership, we also recognize that our fan base continues to evolve. So to do the way our fans engage with us across a diverse range of platform channels and experience. For example, the Rego drives Pardieston generated more than 70 million video views across multiple platforms, creating another cultural relevant moment that captured the attention far beyond the libraries itself.

To reflect this evolution, we are continuing to enhance how we measure and value fan engagement, building a more comprehensive view of how fans connect with Formula One across the entire ecosystem. Our partnership with Apple underscores this ability to interact with fans across multiple touch points, enabling a more holistic view of engaging with our sports.

Since launching on Apple TV, F1 has attracted a younger audience while also expanding its reach among female fans. Our sport continues to build momentum on Apple TV, delivering strong viewership and engagement with fun this season. The strength of Apple ecosystem has already helped us reach and engage with new fans across the U.S. F1 isn't just being watched. It is being discovered followed and embraced by a new generation of fans across every Apple platform and device.

Our growing fan engagement continues to translate into sustained interest from our commercial partners. With respect to our media rights, we remain active in our negotiation and renewals recently renewing with the Service TV in Austria in a multiyear agreement. Globally, our F1 TV product continues to perform well with F1 TV revenue, not including in the U.S. where the arrangement has changed, increasing 18% year-to-date.

Our risk promotion business has never been stronger. While our calendar is fully allocated through 2028, interest from new destination to host a race remain robust with many potential host city seeking to develop long-term proposal that will drive tourism, investment and broader economic activity around our potential race we can.

Our active pipeline, despite our calendar being full, underscore the strength of the sport commercial proposition in an era of expanding media reach, deepening partner engagement and growing consumer demand globally.

We are equally thrilled with the phenomenal progress we have made this year with the Las Vegas Grand Prix. We have added our very first F1 after-party concept featuring the iconic Backstreet Boys at the sphere following the raise on Saturday night. Our ticket sales are trending well ahead of the last year with respect to both volume and revenues. In fact, we are already at month end September '25 levels as of the end of July. And on a like-for-like basis, excluding tickets for the Backstreet Boys.

We have also recently announced our 10 years extension with the LVCVA, keeping the LVGP on the calendar through 2037. This succession reinforce the strategic importance of these risks to our local community partners, and we now have greater certainty to invest in long-term infrastructure and operational improvements, reducing future build-out costs.

Grand Prix Plaza in Las Vegas also continues performing well with private events, attraction and was performing really well with the tenders on track to surpass 2025 levels. Sponsorship activity remained strong during this quarter. We extended our agreement with as our official type supply through 2028 and welcome Flexjet as our official private aviation supplier in a multiyear partnership.

Additionally, we also announced Fever as our new centralized tiny platform for f1.com, starting New season, bringing the strength of their marketing platform to our sport and ensuring we continue showing up in the most cultural level in location. By partnering with fiber, we will deliver a smoother fun journey with more sophisticated technology to improve this curability and ticket purchase.

Momentum around our licensing business continued to build. We recently announced a new multiyear global publishing partnership with the DK books, bringing our storytelling to a new level for fans of all ages crispiness F1. We have also renewed our part with the automobiles, which continues to print F1 posters and calendars for us. And we also recently partnered with a harsh broad to launch a special F1 thin edition of monopoly. In addition, we have sent mutinew agreement through our distance partnership, including Gentle Monster and Uniqlo and have many additional product launches plans with and without Disney globally.

For the remainder of the year as we further the reach of our sport with iconic global brands. While we remain momentum across all parts of our business, we believe Formula One as an exciting growth journey ahead, and we are excited by the opportunity. We are confident that the foundation we are building today will drive enduring value for all our partners and stakeholders. Avanti Tupa, full speed ahead.

And now I will turn the call to Carmelo to discuss MotoGP.

Good morning, and thank you, Stefano. It has been an understanding first year growing our sport with Liberty Media, and we look forward to building on this momentum with Liberty's continued support. Our season this year has been incredible. The competition has never been tighter across the region. With only 24 points splitting the top 5 drivers season to date with notable strength from Aprilia.

To date, 12 drivers across 7 teams and 3 manufacturers of Maipodium. Congrats to Ayogura, winning his first GP assassin. Our first Japanese winner since 2004 and the first graduate of the Asian talent cap to Winner.

Consistent with our history, we have successfully signed the manufacturers and agreement for the next 5 years. This renewal provides the necessary foundation to grow our sport collectively. The most important outcome from this agreement is a strong alignment across all parties on a shared vision, which is to evolve our sport while maintaining each unique heritage. Under the new agreement, we are collaborating on ways to optimize cost while preserving the competitive integrity of the sport.

Allowing teams and writers to reinvest in back into their commercial efforts as we work collectively to rise our reach. We will increase our investment into the sport. We share responsibility across manufacturers and teams to help drive the long-term commercial success of MotoGP, creating a strong plan to continue innovation and performance and reinforcing MotoGP as a premium global export.

We continue to grow MotoGP engagement, both on and off track across the first 11 races attendant is plus 4% with record attendance in Thailand and Germany. We also continue to see growth in our TV audiences, with viewerships up 3% through Mugello. We will notable the strength in our U.S., Spanish and markets.

We also recently hosted a watch party for the Dutch Grand Prix at the Autonet in London, growing over 20,000 visitors and look forward to running the same activation for As we broaden our reach, we see attractive opportunities to engage funds in creative immersive experience in key markets around the world.

We remain focused on extending MotoGP global footprint and are encouraged by the momentum across our digital and social footprint. We ended the quarter with 63 million social media followers, a plus 3% increase year-over-year, with particularly strong performance on TikTok, where engagement increases over 80%.

Our Chinese social media platforms also delivered strong growth with followers increasing plus 26% as we continue to deepen our presence in the key growth markets. Video with excluding video parts, increases over 30%. We have a productive quarter with several news and renewal partnerships across our business.

In the media rates, we continue to strengthen our global footprint. We have recently renewed with Sky Dutch covering Austria, Germany and with a ton in Spain and Portugal and with RTBF in Belgium, in a multiyear agreement. We also continue building momentum in race promotion, extending agreements with several promoters partners, including Malaysia to 2031 and Silverstone through 2028.

Looking ahead to next year, we are excited to raise again in Argentina at Buenos Aires. And for the review of GP, we look forward to unveiling the far visual renderings of the new Adeline circuit over the next few weeks.

In our sponsorship business, we signed a CAA as our global sponsorship agency. Fuze straining our commercial platform and capitalizing on our brand refresh and growth. In hospitality, we are encouraged by the early momentum with our expanded partnership with -- where we are working together to enhance the premium hospitality experience on our events. We are exactly by the path ahead and remaining encouraged by our early momentum. We look forward to continue to update the investor community in our progress.

Now I will turn the call back over to Derek.

Great. Thank you, everyone. We appreciate your continued interest in Liberty Media. That we'll open the call up for Q&A. Operator? .

[Operator Instructions] Our first question is from Kutgun Maral with Evercore ISI.

Two, if I could. First, I wanted to dig into the underlying trends across media rights. I think the Apple deal in the U.S. continues to get a lot of attention. But you think the number of other broadcast agreements since then, and we don't get as much visibility into the economics of those. I know every deal is different and the linear and digital media landscapes keep shifting. But could you give us a sense of how those conversations are generally evolving? And in broad strokes, is there a helpful way to think about the trajectory of media rights revenue as these deals get renewed or extended?

And then second of all, I wanted to ask about the Las Vegas Grand Prix. It's very encouraging to hear ticket sales are trending well. I know you don't break out the financials separately and discretely for the race. But can you share any color on how profitability is trending year-over-year? Because if current ticket sales and revenue trends hold, and you continue to evolve the vendor contracts, it seems like profitability should be positioned to improve as well, but I'd appreciate your thoughts on how we should be thinking about the financial impacts of the 10-year extension going forward as well?

Sure. This is Derek. I'll just start, I think, on the media right. As you know, media rights across the globe are sort of -- they sort of ebb and flow depending on sort of who the players are, what rights are that are coming up and other factors as it relates to the dynamics of the different sort of subscription businesses, our broadcast businesses in those markets. And so we are constantly sort of in discussion with folks. Not only will or in negotiation, but frankly, outside of that because they are our partners in intra trying to build and sort of generate as good a product as we can with them. But through those discussions, you're constantly sort of hearing about what's going on in these markets, whether or not digital players are coming in globally in other markets, what their expansion aspirations are. And I think more broadly than I would just say that it's we feel good that we have great products. We have products, we have content that people want. We obviously, to some degree, are subject to sort of some of those things that are outside of our control. And the things that we can control are continuing to make the sports that we own sort of as compelling as possible and as interesting for our partners as possible. And that's what we do sort of to put ourselves in the best position as we go to market every time.

Now we are -- as I mentioned earlier, constantly, having discussions with these guys. And so what you've seen from time to time is us also taking advantage of opportunities where we've renewed deals early because it makes sense. And we will continue to look for ways to do that because what we are interested in is sort of the long-term stability of our products and making sure where we have the right partners. And just like with the race promoters, if we can find the right partners who will invest for the long term, we think that builds our brand, that builds value in our sports.

And so as we come back to the specifics of the question, I think that we are very encouraged by sort of where the Apple deal has gone. I think we're encouraged certainly with Etalon with the recent renewals with Sky. And then on the MotoGP side, also very encouraged by what we've just done recently, particularly with which Spain and Borge are important markets for us. Stefano and Carmelo, I don't know if you guys want to add anything to that?

Yes. I mean, Derek, I think that a couple of points on top of what Derek just said, first of all, the beauty of what we are doing is that we control the content and we produce it. And this is an incredible asset and opportunity to redefine what is now in media world, the redefinition of the reach. We don't have to forget that the reach is taken not only with the evolution of what we have had in terms of great deals with the great media We have other to produce content to other different ways to connect people. We don't have to forget the fact that now there is so many platforms to reach people that are creating value or the media broadcaster to connect with us either through a products or other products that would be digital or other platforms.

And that's why the beauty of what we are having today in a global world is that the partners that are -- or together with us, want to renew earlier than what is the expiration date because they see the value of what they're doing. And on our side, making sure we take the right evaluation market-by-market, we're going to see if we can -- new trends coming in can be monetized or helping us to get to a different dimension reach. And otherwise, it will be different. So I think we are a great spot today.

We are an incredible for that because of what we are producing gives the leverage to make sure that looking ahead. We are very point we can be a sport that can be produced in all the different platforms around the world, making sure that we can monetize as much as we can every single contract what we are doing on every single market. That's the point on media in my opinion, to add on what already Derek said, absolutely, but very clearly.

And Derek, of course, if we can answer to the second question, I will follow you otherwise, I can go ahead with that point as you prefer. But I think that -- I think that what we don't have to forget is I start once again for one factor. Vegas is becoming one of the most important events that has already shown since the beginning, the potential of it. I don't want to forget that if we compare the economical impact that F1 did versus Super Bowl with respect, we were bigger. That means the potential to growing control even more the cost, having now the opportunity of having agreed the 10 years extension with LVCVA makes that can really build out even stronger the possibility for this ramp even more profitable, that is already the case because this is something that we knew that was a product that was being -- could have been fantastic.

And this growth in terms of profitability and also not only ticketing wise, but in a number of positioning as an phone product that can have a great push to other promotes is becoming a relevant thing that is indicating to the world of sports business the way to produce events around the world. And this is very, very good. We are very happy, Emily Fraser, the CEO of the Vegas Grand Prix did a tremendous job with the team there, focusing and making sure that altogether, that one can produce even stronger product for the future. This year event will be phenomenal. I don't want to anticipate there will be some new comfort that we're going to do on the racing because we don't forget. The central product, Vegas, Miami, Madrid or whatever you are in the world is what we're doing on the track. And then being able to extend the experience that is the key factor being so successful so far around the world.

Our next question is from Stephen Laszczyk with Goldman Sachs.

Brian, you called out that absent of the calendar variability at F1 this year, the business is performing exceedingly well. I was just curious if you could maybe speak a little bit more to the underlying performance you've seen year-to-date and if there's any particular parts in the business that are performing better than expectations heading into the year?

Yes. Thank you for the question, and I can certainly start, and I'll let Stefano add on. But obviously, the calendar variability makes it very challenging because you have lower proportionate revenue recognition. But if you kind of look through that, we're seeing really good growth on sponsorship, as we did last year. We're seeing really strong performances in licensing. The demand for the Paddock Club is very strong. Obviously, you have fewer races. You don't necessarily see that come through the numbers. But those are three areas that I would very specifically call out. Stefano, anything you want to add to the underlying performance of the...

I think, Brian, you reached the most important point. For sure, licensing is starting to be on the trajectory that we heard since a couple of years. There is a tremendous effort to characterize this revenue stream even stronger in the future. I want to say stay tuned because something happened because it's important that we keep growing that revenue stream as we always said. And then I go back to the point that we're saying -- that Brian was saying before is related to Paddock Club. Paddock Club is related to experience. And this is something that will create even more the possibility of growing our revenues in the future because experiential opportunity is where we are focusing our future. We did an experiment, for example, in Spar, offering a very exclusive customer, a possibility to have one of the best chefs in the world, a tour having a unique way of having a food experience at the end of the -- at the end of the Saturday night, this is another way to create things that you can money cannot buy. So that's our approach to create even stronger that kind of possibility that will have an impact on our revenues. That's definitely very, very important.

And if I may, I do want to give for granted the fact that we were able to react in a very difficult situation. Because, of course, our way to embrace our -- our way to work is to over try to find the solution even if there are problems. The fact that with the Grand Prix, we wanted to bring home a race there and find that place to be Malaysia, not in Bahrain shows our fatality. We are reasons inside. We want to make sure that our friends and our partners will rely on us to find solutions. That's what will have future with regard to revenue streams that I see a great potential even in the next 5 years ahead of us.

Great. And then maybe just on the expense side for Stefano and Brian SG&A. At F1 looks like it continues to pace up a good bit year-over-year. Just would be curious if you could talk more about the investments you're making in the business and then how we should be thinking about the pacing of SG&A as we look into the back half of the year and then maybe even into 2027?

The biggest two factors are you have a marketing benefit because we had the 75th anniversary last year. We also have an FX impact where FX has negatively impacted SG&A through the first half of this year. Normally, we don't see something that large, but as our cost base in the U.K. changes, if you have changes in the British pound, obviously, that could be an impact.

Outside of those two items, there's investment in personnel. So personnel costs are higher than they were in the prior year. SG&A is slightly higher at LB GP. The bulk of that is due to the fact that, as you recall, we took over the sales function from Quint last year, but that wasn't fully baked at the beginning of 2025. So it was being built up through 2025 and you have a full year of it now. So that's not a -- that shouldn't be an impact going forward. And then we do have higher IT costs as we invest in the business. Those are the primary items.

Our next question is from Matt Condon with Citizens Bank.

Stefano, you mentioned the commercial opportunity, and I know you've talked about in the past as being a big future opportunity. Can you just talk about the key levers to make this a bigger part of the business over time?

Sorry, Matt, can you repeat the question because the line was a little bit distorted on my side, sorry.

Sorry. No, I was just asking about the commercial licensing opportunity. And you talked about this being a big future opportunity. Just wanted to know the key levers to getting this to be a bigger part of the business over time.

Okay. Sorry, now I understand. No, I think that the beauty of what we are doing is that every time we meet, there is always what's next. But next is finding opportunities that our market is presenting to ourselves. We have, for sure, done already an incredible step with regard to what -- in all the categories we can offer to our customer, the investment on digitalization that Brian was mentioned before, will allow us to grow this opportunity even further. Different mark, different visibility, different opportunity. And therefore, this will allow us to maximize that ever connected to that.

In terms of other commercial opportunity, I think definitely one thing that we are very focused in trying to not try and working on very hard to renew the -- let's say, the actual big partners to be extended now without waiting the expiration of the content. And one area that we want to protect because it's an area where everyone wants to be totally involved of AI. We will never give to anyone or a single part that area because it's too big. Therefore, our ability to divide that area of business is creating us a lot of opportunities.

And the other thing is that it's related to the key license partners that is growing year-by-year. We see that through different proposition that we are doing, we are creating capsule. We are creating content that have enabled us to have a bigger issue with our fans. Now we are really I would say, in a good position to monetize as much as we can, the possibility with our customers through our partners to also, but that will give us a great visibility of a great trajectory of future revenue that will continue in the next future...

Great. That's very helpful. And then I just wanted to ask about the new agreements with the manufacturers and teams for MotoGP. Can you maybe just give us an overview and what are the key points that we should really know as you think about this going forward?

Sure. This is Derek. I think the key points are that we've got another failure deal with the teams and the manufacturers. And I think we've got everyone sort of moving in the right direction, in terms of sort of the outlining what the technical aspects of the sport will be. I think the other key components are we're -- and some of this in the deal so did not, but just sort of how we're going to build this sport together. This process has been a little bit long. And as you might imagine, in any sort of discussion like this, I think there are some gives and takes. But I think that we're coming out of it and a lot are everyone on both sides in terms of the teams and sort of us trying to figure out and work together to build the sport both as a product but also from a commercial standpoint that will benefit all of us.

Carmelo, I don't know if you want to take -- go into that a little bit more.

Thank you, Derek, and thank you for the question. I think it's a very positive outcome for us. And evidently, after the deal with Liberty Media closed an acquisition closed, that was really the time that we could really start the conversation with the manufacturers and teams as there has been a real alignment in terms of how we want to build this together as Derek was saying. And really, what is the vision and the strategy behind building MotoGP and how the manufacturers and the teams have to be a part of that. I think that -- high ties raise boats and putting together the investment that is going in towards the teams for them to also be able to invest into their own resources to grow their brands, the sport is an amazing place from the racing point of view and 2027 and the new regulations will only improve that. So this is really -- it's been a great conversation with the team and the manufacturers to really get everybody aligned on the commercial side and the strategy behind building this sport.

Our next question is from David Joyce with Seaport Research Partners.

More on MotoGP, please. Can you help us understand how much of the cost base in the quarter was allocated to incremental growth initiatives as that sport seems to apply the Formula 1 playbook? And separately, on the sponsorship side there for MotoGP. How much of that is expiring in the next year that could result in either upgrading the sponsors or expanding relationships or getting step-ups based on the continued fan engagement growth there?

Why don't we start with Brian on the cost side?

Yes. David, it's -- I would say the investment phase is not that pronounced in the quarter. specifically -- I'll look at the year-to-date results. But year-to-date, we've got higher marketing expenses as we try to grow the brand. There are some incremental investments in personnel but those are really not that material. I mean, you can see in our reported results that SG&A is relatively flat for the quarter.

And then on cost of revenue, there certainly are investments there, but those are offset by changes in the schedule where you have higher payments to the teams due to the change in the schedule and increased flyways. -- actually, I'm sorry, a lower flyway. -- lower freight cost because of the change in So, so far, you're not seeing material increases in the cost base through the investment other than some personnel and marketing costs.

And on the sponsorship question, I think the way to think about it is less about sort of what's expiring -- as you might imagine, we have a regular flow of deals that sort of come up with are probably 3 to 5 years in nature. And so periodically, you have these coming up. But I think it's actually more about what sponsorships are going to be available with a focus on the business and bringing this to a much wider audience. And I think something that we've been pitting on from day 1 and we've historically had a fairly endemic sponsorship base.

And I think as we look much further field, it starts to open up much bigger opportunities for us well beyond sort of what low renewal rates renewal rate paradigm will give us. So I think that's how I'd frame it, how I think about it. It's what we do.

Our next question is from Brent Navon with Bank of America.

We've seen Formula One, I guess, increasingly add Sprint races to the calendar. I mean, how many more can realistically be added here? And I guess, can you explain how this filters through the business? Is this just extra race promotion revenues? I mean, is there media rights or sponsorship opportunities that come with it as well or even hospitality?

Sure. Stefano, why don't you just go ahead and take that one.

Yes, sure. I mean Sprint race is an opportunity that, first of all, started because we wanted to produce something that could create action the track, creating leverage for the promoter and ourselves to create action on the track starting for the weekend. We're going to have more races -- more sprint races -- Sprint, sorry, next year, yes. We will inform when we will announce the calendar and how many. The principle is very simple. This is also an opportunity to increment the revenue stream for sure, is an opportunity for us to have new deals as we have already seen. And moving in this direction will be our future.

We want to do it in the right way because, of course, this will allow us also to make sure that the scarcity is a value. So if commercially, we would go everywhere, of course, that's not anymore a value that we can really varies from the commercial point of view. But definitely, we're going to move further up in terms of what was the number in the future. That's a 1,000% what will happen already next year.

Great. That's helpful. And maybe just a follow-up to some the media discussion earlier. A few months ago, when you announced the Sky extension, Germany was noticeably optimate from that agreement. And there's been a few recent press reports suggesting you may look to be adding a race back to the calendar in Germany. And so I guess, should we interpret that as potentially Germany, you guys viewing that as an untapped growth market and maybe help kind of help us think through how bringing a race back potentially could help with the media right discussions there.

Look, I think I'll let Stefano talk about a race in Germany. But I think that, broadly speaking, this is sort of what I was alluding to earlier, like Germany is a market in flux with the RTL Sky merger, I think also you've got some of the digital players, the streaming platforms that are coming into Germany. So it's a market that probably a few years ago was not as robust, and it's looking now more robust. And that's -- those are just market-driven phenomenon. And then you layer on to that, what we continue to do from a product standpoint which I'll let Stefano talk about more and any sort of sense of rates in Germany and such. But that's fully dependent on having races, having the content, it is -- part of it is what the macro dynamics are happening in that particular marketplace.

If I may add -- yes, if I may add on what Derek said, definitely RTL was an important step in our need to have more reach in that market. I'm pretty sure that in the future, 1 would be the right negotiation. The market of Germany will be different, for example, from what we have now in Italy or in the U.K. there will be a digital platform or other streamers that will apply for the tender because that's a market that possibly we'll have that opportunity to put us in a situation that we need to make the right tie for the future. But with regard to the potential, I would say that we do have to forget that we have audit a stepping into the business. We have We have big partners that have their home base in Germany. And I think now Germany wants to think in the medium term, if they can come back into the calendar or even more important, being as it was 20 years ago, 1 of the most important markets for Formula One. I think that are the base for this discussion. .

I think that we know very well the dynamic in Germany are not really the fastest one. But definitely, the new situation in Germany start to move in the direction where I see Germany, potentially in the future being a very interesting market that will have a positive effect both on the media side, but also maybe on the promoter side. Will not, in that case, a short-term call, but definitely it will happen. And this is very, very important to remember.

Our next question is from Ian Moore with Bernstein Research.

Everything you shared on like premium hospitality, Paddock Club really encouraging today. What are you learning, I guess, about supply versus demand dynamics there? You've added a lot of capacity there over the past couple of seasons. What are the signals that are giving you confidence that demand for these experiences continues to outpace supply?

Stefano, you can take...

Yes. Thanks, Derek. I mean, today, I can tell you that today, we are talking about the fact that already next year, 2028, we have already allocated for the teams all the puzzle club hospitality that we have. So it's a sign that today, we need to see how we can extend not only in terms of profit, but in terms of pricing, the other offers that the promoters are doing as a joint activity. So the signals are all positive, all grade. We see our market in a full strength mode. Also because we don't have to forget that now also the team have solid partners, very important brands that want to invest in Formula One to what we are offering on the commercial side.

So today are all good. We have new products that are very, very innovative, that -- the growth is that I take personally, not personal as Stefano, but as a team and F1, as the good things because everyone is watching at us on what we are preparing for the future of sport entertainment. And our team is focused on create even more initiatives to try to be over the top edge because today, it's not only pricing, it's really how we can evolve our team and our people, sorry, to leverage what we are today. So the signals are super positive and we will not give up in making sure that this positive city will be extended for a longer period as much as we can.

Thank you, Stefano. Thank you, Ian, and everybody else for participating today. We look forward to speaking to you more offline and seeing you in the coming weeks. Take care.

Okay. Great. So we'll kick things off today. Here on my left, I have from Liberty Media, Derek Chang, President and CEO. Derek, thanks for being here.

Thanks for having me.

All right. Great. So Liberty Media is about 6 months into its current era, operating as an asset-backed stock with 2 main units in Formula One and MotoGP. So Derek, what does this new structure meant in terms of your focus or priorities?

The -- as you know, we spun off Liberty Live last year -- late last year, which holds the interest in Live Nation, which has left Formula One with Formula One and MotoGP, as you alluded to earlier. I don't know if it necessarily changes much in terms of our sort of unyielding focus on sort of the operations of the business and how we grow the businesses. And that's been our fundamental focus, I think, for a while now, which is how do you take these great assets that we have and continue to grow them and continue the momentum that you have, particularly at F1, where these guys have just -- Stefano and his team have been sort of on fire, as you know, based on the performance that you've seen. But I think how do you continue to drive that over the next few years and where are those opportunities for growth.

And then on the MotoGP side, we're really laying into that right now. We closed, I think, in July last year, undergoing some changes there with respect to upgrading the team in terms of the commercial applications and really taking a sport that is fundamentally probably one of the coolest things I've ever seen and really making it accessible to a much broader group of people. And I think with that, you'll start to see the commercialization start to ramp over the next several years.

So similar to the way I began with TKO yesterday, I always think it's important to start with product. So maybe we'll start with Formula One. Drama is always kind of normal course of business, but there has been a lot of noise lately around the kind of new regulations and cars. So I'm interested to get your thoughts on the rollout so far and maybe the read-through to your various stakeholders.

I think the rollout has been fantastic. Look, every time you introduce new rules, new engines and things like that, there's always some controversy. For the business that we're in, controversy is actually not a bad thing, and it gets people talking about it. And even then the mid-season corrections that you have, we took the break in April and people were able to tune their cars and do everything that they do during -- when they're off. And we keep having ongoing conversations with the teams because we're constantly trying to make sure the product, as you describe it, is as good as it can be.

And so I think it's been great. I think you'll have sort of the people who are praising it, some of detractors, whatever it is, is good for business, as you say, to have people talking about it. And I think the fans have gotten into it even more because of what it's enabled in terms of the competitiveness on the track, the overtaking, the passing, all that sort of stuff is, again, has made it very, very exciting. Kimi Antonelli was a very young driver, second season in F1 and has been sort of on fire recently. That brings a whole another element into the equation because you're constantly trying to promote the competitors of the sport. And I think you see that in Formula One right now.

Maybe staying on presentation. So in the U.S., you're in a new distribution framework with Apple TV and streaming. Maybe beyond any early metrics, can you talk about what Apple is doing differently with the product, the broadcast itself, the ecosystem around it, maybe that you haven't seen with other partners prior?

Yes. And let me just start by saying that Apple, I think the relationship with Apple has gotten off to a fantastic start. I think it's everything that we envisioned when we did the deal with them last year and more. And so the things that you worry about when you transition from one broadcaster to another is, okay, will the audience follow? Can they find it? And what we've seen thus far is that we had no hiccups going from ESPN, who was a great partner to Apple this year. And the people -- the fans have followed, the fans have been there. And I think now what you're seeing is less -- certainly from an investor standpoint, less sort of, hey, is this going to work to, oh, what does this unleash? And what is the potential of the deal with Apple? And I think this is what you're talking about.

All of a sudden, you're on a tech platform, which has many more sort of capabilities and flexibility with what they can do. And so things like the multi-view application, the amount of data that's coming for through the product is pretty amazing. And I think that the fans are gravitating towards it. Fans are noticing what they have and what Apple is actually bringing to them. And it's all been, in my mind, very, very positive.

I think the other element of Apple that we've seen is -- and I've spoken about this before because I have a long history for better for worse in the pay television industry. And in pay television, what happened over the years as the broadcasters and programmers sort of demanded more and more in the way of fees, the distributors sort of fought back through sort of restrictions that they put on what the programmers could do with the product. And so to think about ESPN or someone like that taking F1 and doing what Apple has done, it would have been unfathomable. And now Apple, what you're seeing is, okay, they did sort of the last Miami race. They broadcasted in IMAX theaters. They've done a deal with Netflix, where this weekend's GP in Montreal is going to be broadcast on Netflix in addition to Apple. And at the same time, Season 8 of Drive to Survive is on Apple is available on Apple also.

They've got other deals with, I think, Tubi and other ways of distributing the product that in the old world, you never would have thought of because you would have said, oh, that's a competitive, you're giving content to a competitor. And what we see now is really an innovation and a way to innovate where it's not really a competitive concept, but more of a promotional concept. And I think it's working. And I think that's, again, one of the elements that Apple brings to the table.

I think finally, we haven't done any other deals with Apple yet, but clearly, they've been invigorated by sort of the success that they've had with us in the U.S. thus far. It goes without saying that Eddy Cue is a huge F1 fan and whether or not we can maybe do business with Apple in other locations around the world. remains to be seen, and I think we'll have those discussions. And at a minimum, it helps tighten the market in other markets.

Got it. Maybe just talking about other markets. So you recently announced an extension with Sky in the U.K. and Italy. I think it should be noted that Sky is a somewhat unique partner for you in terms of their broadcast and content that gets licensed around the world. But can you speak to that wider relationship and then just the decision to kind of renew early here?

Sure. Sky is -- for those of you who have lived in the U.K. as I have, Sky is the best platform to be on in the U.K. by far, if you're a sports holder -- rights holder. And so what they've done with us from going exclusive on Sky in 2019, I think that audience has increased by 90%. The female quotient of the viewership is now at 50-50, I believe, or close to it, 44%, 45%. The growth in sort of the younger demographics, 16 to 35, I think, has increased considerably over that amount of time. And a lot of it's due to sort of what Sky does in terms of its reach. It is the major sports platform. So to be on it just sort of brings that credibility to what you do, what you have.

I also think that Sky, the amount of energy and investment that they put into the broadcast, not just on race day, but similar to Apple, what they do sort of on a 24/7, 365 days a year basis helps us promote the sport and keep it ever present in front of our fans. And so -- and this year, and I spoke about Kimi Antonelli earlier, I think viewership in Italy on Sky Italia is up by 25%. So they are constantly in their own way, despite the fact that people would think of them as a traditional distribution platform, but they've innovated over time in a way that incorporates a lot of the streaming aspects, the digital aspects that go along with sort of their traditional linear platform. And they've been -- probably one of our best partners globally for the last handful of years.

Got it. F1 TV continues to be a great story for you. I think you reported Q1 revenue ex the U.S., where it's tied to Apple now was up 30%. Can you frame some of the growth drivers there? And how do you balance sort of having this DTC product against, obviously, the needs of your local partners?

Sure. I think F1 TV is -- has sort of been the leading edge for us in terms of our direct-to-consumer applications. So it's not just the content, but as you think about things like merchandising and licensing and things like that, how we get closer to our fans. We have historically, the roots of F1 has been a B2B business, and we've been very successful at it, and we'll continue to be -- that will be a huge component of our business. But getting closer to the fans and understanding sort of what their behaviors are, who's attending, who's watching, all that sort of stuff is very important. F1 TV brings a lot of that to us even in the context of a deal like with Apple, where they've effectively become the sales component of F1 TV, but the data still comes to us. So we actually understand what's going on.

I think to answer your first question, though, we are very flexible with how we use F1 TV and our partners because we're here to support sort of the broader ecosystem and again, to drive -- ultimately to drive viewership across the board. And so whether it's the deal that we have structured with Apple or in some cases, where we continue to have a stand-alone product in markets, we sort of flex to what the partners need, and we'll do that on a case-by-case basis. I think ultimately, we want to maintain a direct relationship with the fans even if someone else is potentially selling it for us and then having the data that comes with it is sort of critical to what our mission is.

Got it. Maybe shifting to the race promotion side. So with your recent Turkey and Portugal deals, I think the calendar is set through 2027. It'd be great to hear how you're thinking about optimizing the schedule beyond this. But maybe as importantly, I know in some of the recent deals you've done, there's been a lot of focus on working with the promoters around hospitality and infrastructure. So maybe we can talk to that a bit.

Sure. I think on the demand side, and I spoke about this earlier today on an interview with Bloomberg, which is there's just this insatiable demand for live entertainment. And then how that applies to Formula One is we continue to see sellouts of the Paddock Club. I don't -- I think we're close to sold out for the rest of the year, for instance. And so how do you deal with that? I think you got to deal with it through creating more inventory. And so as we do sort of renewals or new deals with promoters, the concept is how do you expand capacity. And you've seen it more recently in Hungary, which just renovated last year. I think Monza, Austin are undergoing renovation right now to expand capacity. Australia is another one where capacity is going to expand. And so that really creates clearly additional inventory and therefore, additional revenue.

I think the first part of your question in terms of how you sort of plan out the race calendar and what do you look at. The great news for us right now is we're constantly having conversations. I think that what we've seen over the last handful of years is folks really view Formula One as an important component to a strategy to promote a particular geography or city or whatever it is they're trying to do. And so that partnership is huge. And you see this in the amount of interest from potential new locations as well as the renewals that were -- that are underway now, where I would say 5 years ago, people might have been a little bit lukewarm every time you did a renewal and they were like, oh, that's a big jump up in fee. And the reality is the market is commanding higher fees. And I think that people are starting to -- are understanding that where they haven't necessarily before.

And I think later this year, we're introducing our race in Madrid. As you noted, we have Turkey and Portugal coming back on the calendar next year. So we're keeping things fresh also. And as you look at what your race calendar is, it's not like you change it over every year. I think every year, there may be a spot. In some years, there are no spots. In some years, like next year, there's 2 spots that are opening up. And so you're constantly kind of tweaking it to say, hey, how do I create geographic diversification, making sure that I'm reaching as many fans as possible. We only have 24 races, and there are many more cities and many more fans than we can sort of supply. But that being said, we're going to do our best to do it and keep it fresh, keep the exposure as broad as possible.

So for this year, Formula One made the decision not to hold planned races in Saudi Arabia and Bahrain. MotoGP rescheduled a Grand Prix in Qatar to later this year. I think Stefano has publicly indicated a willingness to put a race back on the calendar. Maybe you can just elaborate on the circumstances you need to see for that.

Sure. It's a challenging time, not just for us. I mean there are others who obviously are much more impacted than we are. I don't mean sporting properties, but people. And so we're keeping a careful eye. We don't control what happens in the Middle East. To the extent that things settle down and it's safe to have races there, then ideally, we try to get another race -- one of the races back on the calendar, probably between Baku and Singapore would be the logical place. But at this point, we're sort of in the same boat as most other folks, which is everyone, I think, is hoping for hostilities to end, but none of us sort of are in a position to dictate any of that.

Got it. So with the Las Vegas Grand Prix, we thought last year's race weekend and underlying financial performance demonstrated traction across a range of revenue and cost items. With the event now in year 4, curious what are the ways in which you can further elevate the GP and leverage it across the wider F1 ecosystem?

Sure. Vegas has turned out to be what we thought it would be, which is sort of a landmark destination or one of the stops on the calendar. And I think like any race that starts or any event that you start the early years are always a little bit choppy. I think we've gotten through most of that choppiness. And from an operational standpoint, it's performing really well.

I think from a commercial standpoint, we're already ahead of where we were last year in terms of ticket sales, both volume as well as dollars. And so we're happy about that. We work very well with -- and it wasn't always the case with sort of the local partners, whether it's the Las Vegas authorities or the casinos who are obviously major stakeholders in this operation. I think those relationships are in a great place. And I think that we are looking forward to having a sustaining race in Vegas for a long time.

And I think what that allows people to do is make investments. So whether you are the sponsors that we have, there are definitely sponsors that came into F1 because of Vegas, who have then expanded their footprint across more races in F1. American Express is a great example of that. So I think those opportunities continue because Vegas is such a signature event.

For ourselves, beyond the Grand Prix, we have Grand Prix Plaza, which is the permanent branded attraction that we have in Vegas, which last year, we opened. Again, early on, you always have some challenges. I think a lot of that's been smoothed out. And now you see sort of the attraction and it being another destination for people to go to in Vegas. The go karting, I think, is probably one of the busiest, if not the busiest go kart track in the U.S. So for those of you who haven't been there, can't go during the race because we have to take the track down. But outside of that, it's a great experience.

Right. Outside of October to maybe...

I think early January.

Got it. Okay. That's a good segue to sponsorship. So F1 has been active on that front recently. You've added partnerships in the betting and insurance categories. You renewed some long-standing deals. How should investors view the growth opportunities from here in terms of new verticals, more inventory repricing deals?

Yes. As you guys know, I think our sponsorship revenue was up, I think, 30% last year in '25 over '24. And we see continued strength and continued growth. And I think you see it on two fronts. One is on renewals, where our existing sponsor base is -- and some of them coming back early and saying, hey, this has been great, and we'd like to renew and understand that the market is moving. I think with sort of new sponsors -- look, I think the question we consistently get is what happens to categories and inventory. And I think there are still categories you mentioned betting as one that continues to have -- we see some space.

I think even within existing categories, call it, more broadly speaking, financial services. As you mentioned, we just did a deal with Marsh and insurance. We did a deal with Standard Chartered and Wealth Management earlier this year. And so I think there are ways that you continue to broaden the sponsor set. I think that the other thing that you see is sort of the vertical dynamic where people will flip from being a regional sponsor to a global sponsor or vice versa to the extent that if they can't tolerate certain increases in sort of what the fees are, I think you can always find a place for those. So you keep everyone happy at the same time that you grow the broader pie.

So licensing is a nascent but growing business. It's been a lot more visible recently with partnerships like LEGO and Disney. Maybe just speak to the strategic value of these relationships and then just the opportunity for expansion in sort of the big 3 categories of consumer products, apparel, experiential.

Sure. I think licensing is beyond the financial impact, which as we grow licensing partners, we will continue to grow the financials along with them, and we see a lot of headroom there. But I think the synergistic sort of coupling with some of these major consumer brands like a LEGO, like a Disney and what it's done for our reach has been pretty substantial. And so you see it through the growth in the demographic of the younger set, right, whether it's kids, young adults, whatever.

And now look, I was on the phone with LEGO the other day. LEGO's demographic is much broader than just kids. But clearly, there is a specialty to it. And what you've seen is how -- with the right licensing partners that they can increase the funnel that we have and drive sort of fan engagement, different types of fan, different ages, different demographics, which the younger they are, hopefully, they stay as fans through their entire lifetime. So if you get them in, in whatever form you get them, my guess is they migrate over time and become different types of fans, but hopefully remain fans. So I think the ability to broaden our exposure, broaden our reach off the backs and in partnership with our licensing partners is a significant opportunity.

I want to ask on Formula One costs. So you've been clear on the impact of the new Concorde Agreement to pre-team share margins this year. I'm curious, as you look over the medium term, though, and this relates to your kind of overall EBITDA margins at F1, how do you think about the ongoing growth investment that shows up in SG&A and other costs?

Sure. I think back in November, when we had our investor conference, we kind of said, look, we're looking at stable margins and growing EBITDA, right? And I think that we're still in a stage right now where we are looking to invest to ultimately drive the top line. And so where that settles over time, we'll see, but we don't want to sort of restrict ourselves to not being able to grow the business because I think long-term growth is clearly where our focus growth short term and long term is always our focus, but we definitely want to be mindful of where we're going long term.

Got it. Maybe before pivoting to Moto, I do want to ask about China. Derek, you bring a unique perspective having run the NBA in the region. How do you gauge the place of F1 in China sports landscape today? What are the steps to grow that? Do you need more races there? Do you need buy-in from a Chinese OEM maybe?

Boy, that was -- that's a painful memory, my time in China. No, it was actually a great experience, but right at the end, we had an unfortunate tweet from the General Manager, the Rockets at the time, who incidentally, I saw was sort of just left the 6ers the other day. But China is a significant market, and we've had a race there for quite a while now. I would say that we -- if I'm being candid, we probably didn't take advantage of that race as well as we could have over these years. But that being said, over the last few years, the vibe in China has changed pretty considerably just like it has around the world. And I think people are taking to F1 now in China like they never have. I think viewership of the China Grand Prix -- Chinese Grand Prix was up 60% on CCTV this year over last year. The growing -- I think we're close to 50-50 on women fans. Again, the younger demographics, 16 to 35, I think we -- probably is 40%, 45% of our fan base at this point. So it is growing.

And I think for China, just like in many other places, it sort of hit that point where it's become part of sort of the cultural zeitgeist. And that's really where you want to be if you are going to be a preeminent global entertainment brand. So I see China as an area that we can have growth and definitely we'll be focused on it. I don't think you necessarily need, say, another race in China, another driver. We did have a Chinese driver for a couple of years. We probably didn't take advantage of that as much as we could have. And to the extent there is another Chinese driver, Zhou Guanyu comes back under the grid at some point, we should try to make hay off of that. But I don't think it's completely necessary in order to grow the business.

I think that having been in China with the NBA, it's for the most part, a digital product. Because you don't play games there other than we have preseason. We do have one race. So that's a huge advantage, and we just need to sort of continue to refine our strategy in China and make it a ubiquitous sort of 365-day a year concept there, just like we have in many other places. One great stat that we have is that 60% of our fans interact with F1 on a daily basis. So outside of race day, outside of qualifying just every day sort of checking in on different elements of what F1 is. I think to sort of reach that standard in a place like China is something that we are striving for. And I think it's certainly doable.

Got it. Let's shift to MotoGP, where you closed the deal last July. Maybe can you discuss where your focus has been in terms of facilitating best practices across the organizations, where you see the earliest opportunities?

Sure. I think the opportunity that we saw at MotoGP continues to ring true, which is it is a property that has a tremendous appeal to its core fan base, and it has a very, very passionate core fan base. The action on the track is unparalleled, and it is just invigorating. It's exciting. It is -- the riders are fearless. The stuff that they can do, the physical attributes of what the athleticism that they need to be able to ride a bike for 45 minutes in those conditions at those speeds is pretty amazing. And I think that what we want to do is to tell that story, bring that to life to a much broader group of people, just like we did with Formula One.

And I think you're going to see us do that through how we promote it, who we partner with, the content that we create around it, the content that we distribute around it, all that sort of stuff is part of bringing the sport to life, bringing the riders to life, making a much broader group of people understand sort of what the beauty of MotoGP is. And I think that is -- that's certainly where we're headed, and that's the mission that we're on.

From an org standpoint and a leaning in standpoint, I'm spending a lot of time with MotoGP right now as we ramp up and as we hire in folks on the commercial side. because we want to get this ball rolling. We are close to sort of filling out members of the senior management team. And once we have that, I think we'll be off to the races. And I think the big advantage that we have over Formula One is Formula One and our experience with Formula One. So you have a lot of credibility in the marketplace, whether you're speaking to media partners or potential sponsors or race promoters because they know what we did with Formula One. They know we are heavily invested in this. They know that we are committed. And I think that, that credibility that you bring can accelerate a lot of the efforts that we're trying to make happen in MotoGP.

Maybe on the reach point, right, Formula One did have great success, especially with Drive to Survive. And certainly, there's a lot of room to better know the MotoGP riders. Can you run that playbook, right, just recognizing there's been some saturation for sports documentaries. Are there other levers that you're thinking about?

I think when we talk about the playbook, the playbook is what I was trying to describe earlier, which is how do you tell the story to more people, right, and expose the sport, make it more accessible. And so there's a lot that goes into that, again, whether it's at the track, whether it's through the sponsors and the licensing partners you have and whether it's through the content that you produce and the content that you deliver around it. And so do you need to have Drive to Survive like a copy of drive? I'm not so sure that's the right answer. I think we are looking at different ways, again, to promote the sport and retain its authenticity, retain its core, not just sit there and say, hey, we're going to do the exact same thing you did at F1 and MotoGP. You got to realize it's 5 years later, too, right?

So things have changed. The environment has changed, sort of the technology has changed. So how do you take advantage of all of what is available to you in the current time and apply that against MotoGP. But expanding the fan base, expanding the demographic, all of that is very similar to Formula One. How we do it, my guess is will be different.

MotoGP and its teams are currently engaged in sort of their version of the Concorde Agreement negotiations. Just what's the latest on that process? What are the goals from the MotoGP side?

I think the goal for MotoGP from the teams themselves is always to drive as competitive a product as we can on the track. And so as we think about the agreement, what are ways to incent sort of the competitiveness to incent the investment into the sport, both on our part as well as on the team's part, all that is sort of part of the dialogue. We actually feel like we're pretty close at this point to getting something done. Coming to conclusion on these sorts of agreements is never necessarily easy. But at the end of the day, I think we all have a shared interest in what the success of the sport can be. And I think that some of it's education, right?

So MotoGP has not sort of had the same level of sophistication, both in terms of the sport, both and sort of the teams from a commercialization standpoint that you've seen at Formula One. But the great news is underlying it all and underpinning it all, we have this fantastic sport, and we have this fantastic property, and we're going to be able to sort of tell that story. And I think the teams now understand with Liberty coming in that our focus, it's not a sort of a confrontational focus. It really is sort of how do we build this thing together. And I think we're getting close to that, concluding that, at which point we'll have another 5 years of sort of this is the way the sport is going to be, bring the stability, allow people to invest, promote and do that together in a way that lifts the sport.

Maybe a couple of questions at the Liberty level. So deleveraging has been a priority. You're executing towards that. Assuming things continue at pace, leverage goes down further, kind of what's the framework you apply towards capital allocation?

Yes. So I think we did set out last year when I got on board, I mean, we kind of said, hey, we are going to deleverage, and we have been on that track. I think we announced that we're at 3x leverage at the end of the first quarter. That number probably goes up a little bit because of the disruption to the schedule in the second quarter, but the long-term trend continues. I do think that Liberty being Liberty, we are constantly looking for opportunities to invest. I think investing directly into the businesses to drive organic growth is clearly a preferred path.

I think in addition to that, where we see complementary sort of businesses in and around the assets that we already own. I think similar sorts of assets where you've got very strong IP or businesses with -- that are highly defensible and that can generate sort of predictable and durable cash flow are businesses that we remain interested in. At the same time, to the extent that you can execute on those types of investments that we can maintain that discipline against our thesis and our strategy, then ultimately, you think about how you return capital to shareholders. And you've got to be respectful always of sort of creating value, however that comes.

All right. We're about out of time. Derek, thanks so much for being here.

Thanks for having me. Thanks, everyone.

Welcome to Liberty Media Corporation's 2026 Q1 Earnings Call. [Operator Instructions] As a reminder, this conference will be recorded today, May 7, I would now like to turn the call over to Hooper Stevens, SVP, Investor Relations. Please go ahead.

Thank you very much for joining us this morning for Liberty Media's First Quarter 2026 Earnings Call. As we get started, I'd like to remind you that this call includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual events or results could differ materially due to a number of risks and uncertainties, including those mentioned in the most recent forms 10-K and 10-Q filed by Liberty Media with the SEC. These forward-looking statements speak only as of the date of this call, and Liberty Media expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any change in Liberty Media's expectations with regard thereto or any change in events, conditions or circumstances on which any statement is based.

On today's call, we will discuss certain non-GAAP financial measures for Liberty Media, including adjusted OIBDA, constant currency for MotoGP, the required definitions and reconciliations for Liberty Media are on Schedule 1 and MotoGP Schedule 2 can be found at the end of the earnings press release issued today, which is available on our IR website.

Speaking on today's call, we have Liberty's President and CEO, Derek Chang; Liberty's Chief Accounting and Principal Financial Officer, Brian Wendling; Formula One's President and CEO of Stefano Domenicali; and MotoGP's CEO, Carmelo Ezpeleta. Other members of the management will also be available for Q&A. With that, I'll turn it over to Derek.

Thank you, Hooper, and good morning, everyone. When we spoke with you in February, we framed 2026 around 3 priorities: sustaining Formula 1 momentum, positioning MotoGP for long-term growth and remaining disciplined and opportunistic with our capital. Our framework remains intact, and we are seeing good progress across the portfolio.

We delivered strong financial results this quarter at both F1 and MotoGP. Starting with Formula One, the store continues to demonstrate the strength and resilience of its global platform. We made the difficult, but appropriate decision together with the FIA and local promoters, not to proceed with Bahrain and Saudi Arabian Grand Prix in April, given the situation in the Middle East. The well-being of everyone in F1 comes first, and we will always manage the calendar with that principle in mind. While that creates a near-term financial impact, it does not change our confidence in the long-term trajectory of this sport. We will be thoughtful in our approach, and we will continuously evaluate the calendar this year. And as Stefano mentioned in the Bloomberg news last week, it might be possible to reschedule one race toward the end of the season.

Formula One remains supported by strong fan demand, deep commercial partner interest, attractive media rights dynamics and a stable long-term foundation with the new Concorde agreement. The early season has also reinforced the value of the investments being made around the fan experience and distribution. In the U.S., Apple's first season as our exclusive media rights partner is underway, and the initial results have been promising. Our partnership with Apple and its tech-forward platform is already delivering early innovative enhancements to our F1 product with multiview, data feeds and onboard features, creating a more engaging viewing experience for our fans. Viewership increased through the first 3 races of the year. Fan engagement is up. We're attracting a younger and more female audience, and we're seeing expanded reach across the vast Apple ecosystem.

Alongside Apple, we rolled out a series of dedicated marketing activations that significantly amplified the Miami race across both the city and the country, including nationwide Apple Store retail pit-stops, Apple Maps integration, and the launch of new original F1 programming of a race weekend. We're extremely pleased with the high energy from our U.S. fan base and the broader race week has become a meaningful cultural and commercial moment for the sport in the U.S.

At MotoGP, the first full season under Liberty ownership is giving us even greater conviction in the opportunity. The sport is delivering compelling racing, with the calendar evolving to expand its global footprint, including the return to Brazil this year. We are also beginning to broaden the ecosystem around MotoGP through initiatives like the Harley-Davidson Bagger World Cup, which brings a distinctive new format and lifestyle brand into the MotoGP weekend experience. The broadcast of the U.S. Grand Prix on Fox reached an average audience of 500,000, which is an increase over last year on cable and an increase from the last time it was on broadcast in 2023. We have also seen our social media followers in the U.S. increase 16% since January 2025, which is an encouraging indicator of growing engagement in the U.S. market.

The strength of MotoGP is its compelling identity, fierce racing, extraordinary athletes, passionate fans and a unique culture. Liberty's role is to help provide the commercial focus, operational support and long-term investment discipline that can allow that identity to reach a broader global audience. That means building capabilities carefully, strengthening the event experience, improving fan engagement, expanding commercial partnerships and sharing learnings across the portfolio where they are relevant.

Following the Liberty live split-off, our portfolio is centered around 2 world-class Boards with strong brands, valuable global rights and multiple long-term growth levers. We will remain thoughtful in our capital allocation approach as we support our operating companies as they invest in growth, and we will evaluate additional opportunities to deploy our capital. Brian will cover the financial results in more detail, Stefano and Carmelo will provide deeper dive on Formula One and MotoGP.

We remain confident in the strategy we laid out earlier this year. Formula One has a proven global platform with significant momentum. MotoGP has meaningful long-term upside, and Liberty is well positioned as we build the next chapter of growth. Now I'll turn it over to Brian.

Thanks, Derek, and good morning, everyone. As a reminder, each quarter in 2026 for the Formula One business will reflect an incomparable race count and mix with the exception of the fourth quarter. Additionally, due to our decision to not hold the Saudi Arabian and Bahrain Grand Prix in April results in the first quarter reflect a 22-race calendar this year. The second quarter will be the most impacted with only 5 races expected to be held this year versus 9 races held during the second quarter of 2025. The change in the race calendar did affect the pro rata revenue -- pro rata recognition of revenue and team payments in the first quarter. We expect the largest impact from not holding the 2 races in April to be from the loss of race promotion revenue certainly followed by hospitality and some minimal impacts to race specific sponsorship revenue.

We do expect relatively limited impact to sponsorship revenue as we anticipate the ability to offset some of that exposure with other races later in the season.

On the expense side, we will not recognize most of the expenses related to the disrupted races and the net impact to F1 will flow through the team prize fund calculation. Similar to revenue recognition, projected team payments in each quarter will be recognized pro rata over 22 races instead of 24.

Now looking at the results for the first quarter. Most of the strong growth in Q1 year-over-year results is due to one more race being held in the first quarter compared to the prior year period, the change in the pro rata season-based revenue recognition and underlying growth in the business. The first quarter of 2026 held 3 races compared to 2 in the first quarter of last year with Japan included in the current year period, but not in the prior year.

For the first quarter, revenue grew 53%. Adjusted OIBDA grew 102% driven by the extra race held and growth across all revenue streams from underlying contractual fee increases. Media rights and sponsorship revenue growth was driven by the calendar variance related to recognition of season-based revenue with 3 out of 22 races recognized in the quarter or approximately 14% of season-based revenue compared to 2 out of 24 races or approximately 8% of season-based revenue recognized during the prior year period.

Sponsorship revenue also increased due to revenue growth from new sponsors, including Standard Chartered.

Other revenue grew due to higher hospitality, freight and travel revenue from 1 additional event held. Hospitality revenue growth was also driven by strong underlying Paddock Club performance and other premium product growth, licensing revenue and revenue generated after the reopening of Grand Prix Plaza in Vegas at the end of January.

Adjusted OIBDA increased during the first quarter, driven by strong revenue growth discussed above, outpacing expense growth. Increased operating expenses included higher team payments and expenses associated with hospitality, freight and travel costs from the additional races held as well as an increase in new premium product offerings and higher freight, travel and commission and other partner servicing costs.

The increase in SG&A expense was primarily due to unfavorable currency exchange rates and higher personnel and technology costs, offset by lower marketing expenses.

Team payments as a percent of pre-team share adjusted OIBDA were 51.7% for the first quarter of 2026. For the full year, we continue to expect to see an average of roughly 200 basis point improvement in leverage, in line with the average we've seen over the past 4 years.

After 2026, for the remainder of the term of the new Concorde agreement, we expect the payout percentage to remain relatively stable.

A reminder that team payments are best analyzed on a full year basis due to the quarterly fluctuations in team payments as a percent of adjusted OIBDA.

Now looking at MotoGP. Just a quick reminder that we closed the acquisition on July 3 of last year. So our financial results prior to the date of acquisition are presented on a pro forma basis as though the transaction occurred on January 1, 2024. And the trending schedule will be posted to our website after the 10-Q is filed, including results in U.S. GAAP for historical periods.

The majority of MotoGP's revenue and costs are euro denominated and as such, are subject to translational impacts from foreign exchange fluctuations. And the following discussion of results, I'll focus on constant currency results.

Year-over-year comparisons are impacted by the mix of races and MotoGP flyaway races generally carry higher costs, including freight, travel and promoter fees. MotoGP held 3 races in the first quarter of both this year and the prior year. Revenue increased at MotoGP during the first quarter due to the race mix and increased sponsorship revenue, slightly offset by a small reduction in media rights revenue.

Adjusted OIBDA also grew during the first quarter as revenue growth outpaced expense growth.

Cost of MotoGP Motorsport revenue increased due to the impact of higher freight expenses from race mix and increased fuel costs.

Looking briefly at Corporate and Other results for the quarter. Revenue was $6 million, which relates to rental income generated by the Grand Prix Plaza in Las Vegas. Corporate and other adjusted OIBDA was a loss of $7 million and includes Grand Prix Plaza rental income and corporate expenses.

At quarter end, Liberty Media had cash and liquid investments of $1.3 billion, which includes $862 million of cash at F1 and $186 million of cash at MotoGP. Total principal amount of debt was approximately $5 billion at quarter end, which includes $3.3 billion of debt at F1, and $1.2 billion of debt at MotoGP, with just under $500 million at the corporate level. F1's $500 million revolver in MotoGP's EUR 100 million revolver, both remain undrawn.

At quarter end, Liberty Media's net leverage was 3x. As a result of not holding 2 races in the Middle East in April, at F1, we expect there could be a modest increase in trailing 12-month leverage during the second quarter of this year. F1 and MotoGP are in compliance with their debt covenants at quarter end. And with that, I will turn it over to Stefano to discuss Formula 1.

Thanks, Brian. The 2026 season is off to a captivating start as we kick off this next chapter in F1's history with new regulations, new teams and new winners on the podium. Congratulations to Kimi Antonelli, who became the youngest driver in F1 history to lead the world championship and taking 3 consecutive race wins after winning the Chinese, Japanese and Miami Grand Prix. As you know, we made the decision to not go ahead with the Bahrain Grand Prix and the Saudi Arabian Grand Prix as planned in April to ensure the safety and security of everyone in the sport during a very fluid and uncertain time. Saudi Arabia and Bahrain have been fantastic long-term partners, and we look forward to being back with our friends there as soon as we can.

We were extremely excited to be back racing in Miami last weekend, and 2026 has represented the start of an incredible new era for our sport. The first 4 races of the season have all sold out, social media engagement is up year-on-year and early TV data shows growing audience worldwide. Our research also indicates a very positive response to the on-track spectacle, with particular appreciation for the level of action, racing battles and overtakes. In Miami, we saw sellout crowds along with exciting new activation with Apple, our new U.S. media rights partner.

Engagement remains robust this season. We welcome 1.3 million attendees to date with all 4 races selling out and the Australian Grand Prix setting a new attendance record. The Paddock Club is already sold out for the nearly all of our remaining races this season with over 65,000 tickets sold to date. This figure is already in line with our 2025 total Paddock Club attendance. To accommodate demand, we are increasing the Paddock Club capacity this season at Silverstone, Austin and Monza and our promoters are working to increase capacity at other circuit.

Our successful collaboration with Soho House and Louis Hamilton's House 44 is also expanding and will feature at 9 races locations this year, up from 5 after it launched last year. House 44 is already sold out at 8 races so far. In addition, our collaboration with Gordon Ramsay continues to grow with a new Paddock based premium offering operating in Shanghai, and we are looking into opportunities to roll out the experience at other locations, potentially starting with the United States Grand Prix in Austin.

Live audiences across our top 14 markets are up year-over-year relative to 2025 across the first 3 races, driven by strength in key markets, including Brazil, Italy and China. This season, we return to global TV free-to-air in Brazil. In China, we kicked off our new media rights deal with the CCTV and have seen more the extensive coverage. The live broadcast of Chinese Grand Prix attracted 1.9 million viewers in China, a plus 60% increase year-over-year in one of our key growth markets. Our YouTube content generated almost 600 million views through the Japanese Grand Prix, up 46% relative to last year.

We grew our following nearly 20% year-over-year with over 120 million social media followers as of the end of April.

Commercially, we continue our momentum across renewal and new partnerships. We are delighted to welcome Apple TV as our new U.S. media rights partner this season. Through its extensive ecosystem, Apple TV has allowed Formula 1 to reach a large U.S. audience. The first 3 races delivered higher average viewership across track session relative to the last season, and we are pleased with that strong momentum carried into Miami.

Our fans are collectively also tuning in for longer with total viewing hours increasing relative to linear last year. The average viewer of F1 content on Apple is both younger and more female. The sport is featured extensively within the Apple ecosystem and externally through innovative partnership with Netflix and Tubi, just to name a couple.

Our broadcast of the Miami Grand Prix at the IMAX Theater was extremely well received and continues to highlight the new ways we and Apple are bringing the sport to fans. We continue to see major brand alignment between our 2 iconic global brands as we set out to take a more forward-looking approach to how fans discover and consume Formula 1. Globally, our F1 TV product continues to perform well with F1 TV revenue increased 28% year-over-year.

We were delighted to announce yesterday our 5 years renewal with Sky in the U.K. through 2034, and Italy through 2032 inclusive that will take us into the next decade with our incredible and long-term partner. The depth and quality of the programming and content Sky delivers has been impressive and help to engage and grow our fan base in both the U.K. and Italy. In the U.K., total viewing on the Sky has increased by 90%, with female viewership more than doubling and under 35s viewership growing 12% since becoming the exclusive home of F1 in 2019. In Italy, we have seen a 25% increase in viewership this season, in part driven by the strong performance of Ferrari and Kimi Antonelli. Sky has been a trusted partner of F1 with world-class coverage, and we are delighted to extend our partnership into the future.

Internally, we remain active in our negotiation and renewals, recently renewing with beIN Pan Asia and with Foxtel in Australia. We are also thrilled to announce we will be returning to race at Turkey at Istanbul Park next year for the first time since 2021, under a new 5-year agreement. The return to the Turkish Grand Prix will be exciting for the F1 fan, drivers and teams. Formula 1 continues to grow strongly in Turkey, where the sport now reaches more than 19 million fans and almost half of the fan base is under 35. We are also seeing strong momentum on digital and social platform within Instagram followers growing by 30% year-on-year.

We also officially began the 2026 public sales cycle for our fourth edition of the last Vegas Grand Prix today. Following last year's sellout and ahead of our public on sale, demand indicators were very strong with deposits for this year's race at record levels. We have maintained our sponsorship momentum with an active quarter of renewal and new partnership. We entered into a new multiyear agreement with FanDuel and Betway to reinforce our desire to enter the betting space regionally. We have also signed Marsh as our official risk partner and official insurance broking partners.

We have also extended our Salesforce and [ Owen ] partnership, all effective this season. Our momentum continue to accelerate across our other revenue streams, including licensing and hospitality. We have announced our multiyear extension with Fanatec, our sim racing hardware company, and we launched our eSport Championship hosted 2 live events to date and one in our new on-site facility Biggin Hill. We are fully leaning into our first full year of partnership with Disney, including the successful launch of Disney and F1 Fuel The Magic campaign in the Asian Pacific region.

At the Chinese and Japanese Grand Prix, we launched specialty F1 Disney stores in the fan zone, driving overall retail sales during the quarter, up 125%, with China retail sales growing nearly 80% year-over-year. We reopened our Grand Prix Plaza site in Las Vegas at the end of January, and early performance has been encouraging. Average weekly attendance this year is nearly peak levels from 2025, with private events occurring weekly. Demand for F1 Drive has also been particularly strong with the multiple sold-out weekends.

We remain focused this season on cultivating and fueling the fandom with our always on strategy through bringing the creativity, thrill and excellence of our ever-evolving sport and entertainment platform to the fans. While we have grown so much in such a short amount of time, we believe we are just at the beginning of what is possible for Formula 1. The momentum we see across all our business continues, at a remarkable pace, and the foundation we are building today will create enduring value for our partners, shareholders and our fans for the years to come.

Avanti tutta, full speed ahead as always. And now I will turn the call to Carmelo to discuss MotoGP.

Good morning, and thank you, Stefano. We have a strong start to the beginning of our season with compelling storylines on track and continued momentum across the business. With Liberty Media's continued support, we are confident in achieving the long-term strategic vision of our sport and are encouraged by the early progress we have seen today. As you have seen, we have made the decision to postpone our Qatar Grand Prix to November, given the ongoing situation in the Middle East. We look forward to returning to the region soon. On track, the racing remains as competitive as ever, while Marco Bezzecchi continued to lead the riders championship. We have already seen 7 drivers across 5 different teams on the podium this season, highlighting the unpredictability and excitement that define our sport.

We welcome more than 720,000 fans across our first 4 races, including a record of 228,000 fans in Buriram. We also returned to Brazil this season after 20 years hiatus in the country with the city-to-city track integration and delivered an exciting race weekend. Brazil is one of our most engaged markets with over 80% of fans consuming MotoGP content weekly. Across the spring and Grand Prix in Brazil, our broadcast audience surpasses over 1.6 million viewers. We look forward to returning next year alongside of our returns to Buenos Aires and Australia, both of the new circuits in or near city center, bringing the thrill of MotoGP racing closer to our fans.

We continue to track brand awareness and engagement through our fans insights platform, which will support our commercial evolution and localized content initiative in growth markets, including the U.K. and U.S.A. We ended the quarter with nearly 62 million social media followers across our own platform. Video views across our digital platforms, excluding VideoPass increased almost 40% in the same periods on 2025.

We also continue to make progress with our commercial partners. We have extended our partnership with ServusTV in Austria to broadcast our rights through 2030.

Starting with the Austrian Grand Prix this season, we also expanded our partnership with Quint through an exclusive multiyear agreement. With Quint's invaluable experience, we are focused on scaling our hospitality offering, enhancing the premium hospitality experience, with the VIP village and driving further mix shift improvements towards high-end customers and partners. We are encouraged by the strong start to the year and the quality of demand we are seeing across our portfolio with double-digit growth in ticketing volume and sustaining momentum across all regions as we roll our new innovation across our hospitality product suite. We look forward to continuing to update the investor community on our progress.

Now I will turn the call back over to Derek.

Thank you, everyone. We appreciate your continued interest in Liberty Media. And with that, we'll open the call up for Q&A. Operator?

[Operator Instructions] Our first questions come from the line of Sean Diffley with Morgan Stanley.

Two, if I may. First, on sponsorships and second on capital allocation. Congrats on the success that you've seen on the sponsorship side. I think over the last few years, it's been adding new sponsors really driving a lot of this, and you continue to do that with Standard Chartered and Marsh, but it also seems like you're gaining traction on the renewal side with upgrades like Salesforce and [ Owen ]. I was hoping you could talk about the balance of kind of new and existing partners going bigger in any categories or verticals that you think are still underpenetrated in?

And then second question, Derek, you had mentioned evaluating avenues for capital deployment to deliver long-term value to shareholders. I was hoping you could elaborate a bit on that. What's your framework for determining what those could be, and how we should think about your approach to investing in the core businesses you have, potential M&A or capital return?

Sure. Thanks, Sean. Let me take the second one first, and then I'll hand it over to Stefano for a bit on the sponsorship. I think on capital allocation, we've been pretty clear in recent history here that our primary focus has been to delever, which we clearly are in the process of doing as well as looking at strategic investments and ultimately also the thought of capital return to shareholders. I don't think we're in a position right now to say, hey, we're pursuing one over the other. All options are on the table and it's something that we are looking at on a regular and frankly, a daily basis, That's the job of the folks here. So -- and then just we are very focused on the performance of our operating companies and leaning into those and continuing the strong performance that we've seen there, which frankly puts us in this position to be able to have the question that you've asked.

And also finally, I think just in the very near term, we clearly are very bullish on our businesses and where we see them going. We can't control every macro factor out there. We don't have a crystal ball. So to some extent, we're being a little bit conservative right, now and we make sure that we understand the implications of some of the other events that are happening out there.

On the sponsorship side, I will let Stefano talk a bit about sort of his mix of the renewals and the new sponsors and where he sees some of that going.

Thanks, Derek, and thanks, Sean, for the question. If I go back a couple of years ago, we always said that our duty is to make sure that what we are offering is solid and genuine. And only solidity and genuinity has allowed us to be stronger in this momentum. And if I just think back and no one would have thought that, for example, in the category of brokering, there will be someone who really wanted to invest in our platform to develop their business. So it is true that now, as we said last time, we see potential to keep growing because we have done a lot of new steps in terms of creative activation that has allowed us to offer something new in the market to different partners.

It is true that on the other side, what we have done is basically moved also from normally what has been considered a B2B partner also to B2C. We have seen that in the last couple of extension renewal or a new entry. And it is clear that the category of high tech is the category where we can find some other opportunity in the future, even if the big partner we have now are basically are very, very interested to lock down in the future in order to prevent others to come in. So it's a great situation we have.

And I go back to the fact that for us now, it's really a matter of keep growing, keeping offering something new to the partners, keeping -- given the momentum of what we can offer in a very genuine way and that is really -- it has been so far a successful strategy that will continue in the future. Because as you said, Sean, now we are also in the process of having active renewal much more in advance before the expiry date. That means that everyone believed in us, and this is something that we feel we take back home as a great responsibility.

Our next questions come from the line of David Karnovsky with JPMorgan.

Maybe just starting on the Sky agreement announced yesterday. You did have some time on this one in both Italy and the U.K. So interested in why now is a good moment to execute on a deal with what I think is your largest media partner rather than the alternative, which would be waiting and kind of testing the open market in a few years. And does this agreement have any current economic impact? Or is this just about locking up future terms?

Sure. David, thank you for the question. I think I'll start and let Stefano take it, but there are no current implications as a result of the deal. I think one thing to think about is whether it's sponsors, media partners, local promoters, what we're really asking a lot of these guys to do as they partner with us is to invest in the product. And in order to do that, you want them sort of confident with the relationship and where things are going to be on a longer-term basis. So sometimes we are entering into these discussions early to facilitate that, exactly that. You see that at a lot of the local promoter deals that Stefano has done in recent history, which are really to that facilitate increased investment in sort of the infrastructure, hospitality, things like that. And it's a similar sort of concept here as these guys continue to work with us to build sort of the nextgen of what the viewing experience is like, it's important to both of us to sort of lock up in a manner like this.

I'll let Stefano elaborate on that.

Thanks, Derek. I would add on top of what you said to answer the question of David, is, first of all, let me thank Dana Strong, and all the team at Sky for the tremendous job they've done since the first day that they are with us. And now this is an extension of an incredible deal that will cover a very important area of where our fans are very solid, that is U.K., Ireland and Italy. And it, of course, will have an impact that will be on long term because, as Derek was saying, the financial implication up to the end of the 2008 (sic) [ 2028 ] expiry has not been touched, we're just looking ahead with a more and stronger financial and technical contribution.

It is true on the other side, they are already very, very focused on delivering new extra content, not only using the so-called broadcasting operation, they have a big voice in influencing a great demand that is growing in these markets. And that's something that we want to recognize to them.

And on the other hand, we do believe that the privilege of being a worldwide sport, we can really understand where we do believe that the shifting between traditional broadcasting versus streaming is moving. We do believe that in the market that we have signed the deal as an extended agreement with Sky, the situation we're having it will be the best even mid and long term. That's why we are very, very convinced that this relationship will continue to create an incredible demand of interest and the right product that will serve in this market to grow. And of course, in other markets, the situation could be seen different because that's really where we are. Understanding what will be eventually other opportunity that we can take, for example, in new markets that could be potentially very interesting in the future to bundle with other sport. Why not? So we need to be creative. That's what has been always our approach to try to find the best solution with our partners that have contributed so much for the growth of our sport.

Okay. And then I have one for Brian. Brian, your team payments figure this year always gets a lot of scrutiny. So I wanted to see if you could maybe shed any light on your budgeting approach, how you approach variable items like Vegas or potential sponsor deals? And then would there be any contingencies in that number for the Middle East races you have on the calendar later this year, just given the ongoing conflict there.

Yes. Thanks for the question, David. No, the budgeting approach is similar to past years. And the biggest variable that we've had over the last few years since we've launched the Vegas race is the Vegas race. So there is certainly some conservatism in there around Vegas, just to give ourselves room, as it relates to the team payments, but the 200 basis point decrease that we kind of gave you guys at the end of the year, that still holds true. Right now, we're focused on a 22-race calendar. And as Derek said, we're still hopeful that we can move one of those races to the back part of the year. So that would be upside, but that's what's in the forecast at this point is the 22 races.

Our next question has come from the line of Stephen Laszczyk with Goldman Sachs.

Derek, there's been some discussion in the press around Miami potentially adding some more Paddock Club capacity as well as maybe a MotoGP race at some point in the future. I was hoping you could maybe talk a little bit more about the opportunity in Miami to expand and as well, maybe more broadly about how you're thinking about the opportunity to expand Paddock Club capacity across the calendar as well as how many opportunities you think might be out there to add a MotoGP race alongside F1 at some of these tracks?

Let me take the second part of that first, and then I'll go back to the Paddock Club and then turn it over to Stefano so he can talk about that. But on MotoGP, I think the context for Moto really is we've said it and we're going to continue to say in the U.S. is an important market for MotoGP. And so we are looking at all avenues to grow our business here. It's going to take time, just like it did with Formula 1, but we do see that there's an appetite and that there's going to be a market here. And how we go about that clearly will be -- we do have interest in adding races in the U.S. Miami would seem to be a logical thought because there's already a track there.

There's a lot of things that have to get worked out, whether it's Miami or any other track in terms of whether or not it works for MotoGP and sort of the safety concerns and stuff like that, where you've got different requirements than Formula 1 as well as what markets, frankly, makes sense from a commercial standpoint. But those are conversations that we will have with Miami, with other folks also trying to scope out what the right locations would be for U.S. expansion.

As it relates to Miami itself, they did announce over the weekend that they are expanding Paddock capacity. I think that Stefano has spoken about this on many occasions in terms of the way we're structuring a lot of our promoter deals going forward is really a lot of it is the expansion of high-end hospitality. We saw that in Budapest. I think we announced Austin recently. They've got a whole new building going up down there around the first turn. But I'll turn it to Stefano for a little bit more detail on his thoughts.

Thanks, Derek. Let me take the opportunity to -- after the end of that incredible Grand Prix in Miami to thank Tom Garfinkel and Kathy for their incredible organization. It has been really a phenomenal event with a lot of people, a lot of action on the track. And it's true as we just mentioned, that they're going to invest even more to make sure that the quality and the capacity of that event will be even bigger in the future. But that goes back to what we said, I think, the other time. There are certain places or certain events that we believe are fundamental for the growth of our sport and by giving the possibility for them to have a long-term deal, will push them also to invest in the right way. And on top of what Derek has just mentioned, we want to remember that also Monza will do that. Hungary will do that. Almost everyone will have a plan to increase capacity with the right quality of the offer. That is something related to the request. The demand is very, very high.

The profile of the customers that are coming now also with the new partners require a different possibility of expanding that. In Monte Carlo, in Monaco, for example, we have extra capacity. We have also with the partner MSC and a boat where our guests can exploit a different kind experience. So all is connected to the fact that the ecosystem is solid, staying together, working with the vision to keep growing the business. Otherwise, no businessmen will invest in something that we believe will be beneficial also for their interest, which is normal. Therefore, as I said this is another signal, I do believe, Stephen, of the quality and the performance of our sporting platform today.

Great. And then maybe just one for Brian. On SG&A continues to trend higher on the F1 side. I was just curious if you could help unpack what we're seeing there in the first quarter? And then maybe help us think about how that line should trend as we think out here over the balance of the year?

Yes. I mean this quarter, the 3 biggest drivers are you have -- you do have an FX impact in the SG&A number that's negatively impacting the growth. So we'll see how that fluctuates as the year goes along. There are also some higher personnel costs and some SG&A costs around LVGP, which are also kind of more personnel related, and I think those are a bit more front-end loaded. That's offset by reduced marketing costs because remember, last year, we had the 75th anniversary event. So those are really the big drivers. There are some increased IT spend in there as the company is working on different types of projects.

Our next question has come from the line of David Joyce with Seaport Research Partners.

Thinking about the Formula 1 calendar this year, if there is the possibility of adding Saudi Arabia back into December and shifting Abu Dhabi out a week, how does that reallocation based accounting work for the various revenue lines? Would you restate the first quarter? Or would you reallocate going forward with a true-up? How should we think about that? And then secondly, kind of housekeeping. Why was D&A up a lot sequentially?

Yes. On the first part of the question, any impact from adding an additional race would come through in that would come through in that quarter in which you make that change in the calendar. On the second part of your question, David, D&A, it's up $1 million. The company has been investing in their operations facility out in Biggin Hill so you see increased depreciation associated with that building, which was -- that project was largely completed early last year. So that's probably what's driving the bulk of that difference.

You also have GPP CapEx that was in our results early in 2025 so you'd see increased depreciation associated with that.

Our next questions come from the line of Matt Condon with Citizens Bank.

My first one is just after the first couple of races with Apple in the U.S., just any key learnings coming off of that, whether it be from the broadcast itself, but also just the distribution to the broader Apple ecosystem? And then my second question is just on the calendar opportunity in MotoGP and just, I know you've talked previously about optimizing race locations. Just how are those conversations coming? Do you try to move some of those into city centers and such?

On the Apple question, I will let Stefano take most of that. I think that what we've seen, though, is dealing across all segments of sort of the race weekend has been very strong. I think that Apple has done a great job of bringing people to the ecosystem. I think that on the risk mitigation side, I think people probably -- anytime you change broadcast partners, you always run the risk of having a lot of fan outlash that they can't find it or things like that or it's not as good. And we haven't had any of that, in fact, it's been to the positive in terms of how consumers have been interacting with product, with the viewing and sort of the commentary out there has been it's been a good experience for them. But I'll let Stefano continue on that, and then we'll come back to the calendar question on TV.

Thanks, Derek. Matt, I would say, to add on what Derek has just said, not to forget 2 things. Our fan base is younger and there are a lot of females also around 40% in the U.S. And that's why we do believe that Apple will guarantee to them a much more suitable way to live that experience. We don't have to forget that the other positive effect of what is a journey that has just happened. We just did only 4 races, and of course, it will be a long deal. So every weekend, there is something that we learn and will improve. There is the possibility as it has happened for Apple to use different platforms, IMAX, Tubi, stores and other activation that's been done, will generate more interest and more following -- more followers.

And I would say it's a more dynamic way to live that forward, and that is in line with what we're going to see. I mean there is a tremendous effort on Apple also to deliver some new technical content, and these are, as I said, long-term journey that so far has been very, very successful because we're just at the beginning of a new journey where I would say, on top of the 4 races, the first 3 we have not been, let's say, time friendly for the U.S. market. And as a global owners for what we can see, it has been a very, very positive start of the season.

So that's why we do believe that this is just the beginning of something that will create even more attention for the future and on which I can confirm because Eddy Cue was present in Miami, Apple is full on board, full on board confirmed by Eddy Cue, but also the future CEO of Apple that is a racing fan. That is not bad. And for the second question, I would say, I go back to Derek, if it's okay.

Thank you, Stefano. So on the MotoGP calendar, I'll start, and I'll turn it over to Carmelo for some additional commentary. But I do think that our stated objective is to get some of these races closer to cities where we can leverage off of the infrastructure, whether it's the airport long distance travel or -- for both ourselves as well as for the fans who are coming in internationally in the hotels and the restaurants and sort of ease of access, I think, is important. And you're seeing this with sort of the races we announced for next year, both in Buenos Aires and Adelaide. So we're already starting to make progress on that.

That being said, you also don't want to just wholesale change out all the races. We have a long heritage here of races in many, many compelling locations where it makes a lot of sense to keep them there. And they've been fixtures on the race calendar and they bring a lot to the sport and a lot to the identity of the sport. I have been, this year already to Austin, I have been to [indiscernible] heading to Mugello and Austin later this year. I really want to get a good sense of what it feels like in the different locations because what we want to do is create a fan experience that is engaging, exciting, entertaining, accessible wherever we do it. So there's a lot to be learned on even on locations where we may not move, but how to improve those. But so it's a mix of all of that as we think about our calendar moving forward.

But Carlos, you may have some -- a couple of words to add to that.

So I think Carlos might be switched off so we can come back to that later. Operator, we will take the next question.

Our next question has come from the line of Steven Cahall with Wells Fargo.

First, I just wanted to ask about fuel prices. I think the structure allows for a pass-through from F1 to the teams on fuel prices. But I imagine in Motorsport, when fuel prices go up, that cost flow through somewhere to someone. So can you just help us understand how rising prices for gasoline will affect both F1 and MotoGP kind of short, medium term, and where we might see some of that reflected longer term in the P&L? And then, Stefano, I just wanted to ask you about competition. So we've seen Cadillac and Audi come in this year. Ford is making a big push with Red Bull. The racing has definitely improved with the new technical changes. We haven't though yet seen kind of any new teams get from the midfield to the top tier. What do you think needs to happen for that to change? Is it a technical issue? Is it a financial issue since I think competition is always good for the value of the sport?

I'll let Brian start with the fuel question, then I'll turn it over to Stefano for the racing question.

Yes, Stephen, thanks for the question. On fuel, it's a little bit different for the 2 businesses. As you rightly point out at F1, if we have increasing fuel costs and freight costs, those are generally passed through to the teams. So there should be -- you'll see a bit of a gross up on the income statement throughout the year, but pretty minimal impact to net margins. On MotoGP, it's a little bit different. There's more of a kind of a fixed structure there. So to the extent we experience rising fuel costs, you might see some pressure to our overall cost of revenue without that offset on the top line.

Stefano, do you want to take the racing question?

Thanks, Derek. Stephen, I mean, I think that what we see is definitely from the -- an experience point of view, something that you were expecting. F1 is a big beast. When you come in, we are, of course, very, very pleased with what has been the new entry. But the process is not related to money, it's related to experience and time. This is something that has been always elements that happened since the beginning of this sport. It's a big technological challenge, is a work of team players that need to understand what is the dimension of the challenge. It's something that, of course, is related to the fact they are new, and they will have the chance with the budget cap to have less burden in respect of the past.

So it's just a matter of being a little bit patient even if -- when in a racing world, after only 4 races, you believe that it's 400 races because every day, every minute, the pressure is getting higher. They are advised that, I would say, they know very well is not to fall in that kind of anxiety because that anxiety will not help them to be even more performant.

The beauty of what we are seeing in a totally different scenario of a totally new regulation is something related to the fact that there is a lot of margin for the improvement that, of course, the more you are behind, the more could be bigger if you are able to take the right stream of development. And if you're working how with your drivers and teams to improve the performance.

And in this specific year, there are so many new elements that could allow them to be even faster if they understand where to focus the need for them to recover the gap they have now.

Our next question has come from the line of Joe Stauff with Susquehanna.

Just trying to maybe better understand the rescheduling scenarios. I know it's complicated, but it seems to me a second race in Las Vegas might be, of all your scenarios, a relatively easier one, given the city's flexibility and your vertical ownership of the Las Vegas Grand Prix. Is that a fair assumption?

And then two, with respect to whether or not you reschedule or not reschedule, how much, say, premarketing, how much of a lead time do you need in terms of being able to properly market that and so forth? Is it 2, 3 months, just wondering?

Sure. Look, I think we are evaluating all the various alternatives and trying to make decisions in a timely fashion that will give us as much lead time to the extent we make changes and make adjustments. But I'll let Stefano talk through some of those specifics as he and his team are working over time, trying to keep up.

Yes. Thanks, Derek. Thanks, Joe. I mean, to be very direct, I mean, to avoid any speculation, the only thing I can say that we have plans, hopefully, not to be applied because we really hope that the situation for the world, not only for the racing, will go back to a normal situation. We have plans, of course, the lead time or the cutoff really is difference between the fact that we can eventually recover what has been not run in April, that is what could eventually happen or not happen in end of November, beginning of December.

We are, of course, aligning with the teams, with the promoters because that's something that has a big chain of reaction. But we are -- in the due time, we will keep everyone informed. But I hope you understand, Joe, if we just say something there will be speculation that we want to avoid because, as I said, the first hope is to make sure that we go back in the place we should be.

Our final questions will come from the line of Ian Moore with Bernstein.

I know the announcements are all relatively new and fresh, but given the broadcast agreement extensions like with Sky, the return of the Turkish Grand Prix next year and the updates to the Miami regs, are you noticing any, I guess, positive halo effects or incremental opportunities with respect to F1 sponsorship interests or just broader demand that might have implications for the rest of the year and beyond that?

I'll let Stefano take that. My guess though is that from just purely what landed this year is probably limited at this point, just given the -- given how these deals are done, but Stefano will probably give you more color on the broader halo effects.

I mean the halo effects -- and thanks, Ian, is what we said at the beginning, is the fact that the activation is getting bigger, better in terms of quality. Of course, we want to be as creative as possible without taking away the quality of what we're offering to our customers and guests. But of course, the fact that we have bigger venues is pushing the ecosystem to try to find solutions. And this is good because everyone is on the same page and the F1, let's say, sponsorship package is really very, very solid.

If you believe -- if the question is related to what will be the effect on this year, definitely the effect in this year is to not relate to have more numbers because it's already almost sold out everywhere. So this is also even better because it will allow us to grow in the future on numbers that have not yet indicated in the account that we have today. So it's just something that goes back to the long-term strategy, and all the partners and sponsors will be part of this incredible growth that we really do believe will happen even in the next couple of years in front of us.

Great. Thanks, Stefano. And I think with that, we will conclude the call. Before we end, I did want to say a special thank you to Carmelo and Stefano and their teams just because managing through sort of some of the disruptions that we've had. I realize this -- the events in the Middle East have hit most companies, but obviously very directly to ours in terms of a lot of the rescheduling and logistics and thinking through contingencies and all that. So we're on it, and I wanted to thank those guys and their teams because they've been working over time.

And I want to thank everyone on call for taking the time. We always appreciate your interest in Liberty Media and look forward to speaking with you guys again soon.

Ladies and gentlemen, thank you so much. This does conclude today's teleconference. We appreciate your participation. You may disconnect your lines at this time. Enjoy the rest of your day.

Okay. We're going to get started. Good afternoon, everybody. I'm Ben Swinburne, Morgan Stanley's media and telecom analyst. For important disclosures, please see the Morgan Stanley research disclosure website. at morganstanley.com/researchdisclosures. And I'm excited to welcome to the conference. I think speaking for the first time with us, certainly as Liberty's CEO, Derek Chang, Derek has been the CEO of Liberty Media since last February. But is a veteran executive across the global media sports and entertainment industry.

Derek, thanks for coming. Good to see you.

Thanks for having Ben, and congratulations on your new gig.

Thank you so much.

Disney is a big partner of F1, I'm very excited to be working with you in that capacity.

Absolutely. That sounds great. All right. Why don't we get started. There's a lot to talk about and a lot going on in the world. I think maybe we should start with sort of what's happening geopolitically in the Middle East. I think you guys -- I know look at the calendar, there's races in April in that region? What's sort of the message today to investors on how you guys are thinking about navigating this?

Yes. I mean clearly, it's very timely. And obviously, unfortunate for much broader. But I think as it relates to us, well, right now, we have people in transit to Melbourne for the season opening race and that all is, at this point, still going as planned, which we are excited about because it should be. And we'll get more into this later a very, very exciting season. I think, in particular, as we look at the calendar, we have 2 races in the Middle East in April in Bahrain and Jeddah. MotoGP has a race also in Qatar and in April.

So those are situations that we are, as you might imagine, clearly monitoring what's going on and how that might impact us. And I think that we probably have more definitive news on that in the very near future. I don't have anything more than that right now. We have contingency planning that we do on this sort of stuff. And we're evaluating that and any potential impacts that might have on our business. But again, no details right now. And again, hopefully, as with all conflicts it end soon. But how it impacts our business. We'll have more news on later.

Okay. All right. So nothing to add right now. Why don't we talk a little bit about sort of where the Liberty Media is in its -- was it 4.0, I think we're at for John. But you completed the Liberty Live split off in December. Where does that sort of leave the company now kind of structurally and strategically if we start high level? .

Sure. I think the Liberty Live spin-off has made us split off, have made us clearly a much more simplified structure. So now we're operating Liberty Media with 2 primary assets, which is Formula 1 and MotoGP. Two premier sports brands, sports IP. And I think as we think about Liberty Media, focusing on those as operating assets and the growth what we need to do to support that growth is clearly job 1.

I think as you look beyond that, where we can continue to grow and seeing Liberty Media as a continuing growth vehicle, where can we invest into those businesses alongside those businesses and then ultimately into similar types of businesses all that for us is what we're evaluating now. I think that we're excited about what we have, and we're really excited about current geopolitical situation notwithstanding, really excited about these businesses. Looking forward to seeing them grow.

Great. Maybe before we dive into the business, the fact that it's a simplified company focused on sports, kind of narrow your M&A lens? Or is your M&A lens -- was it already narrow maybe before the Liberty Live spin-off in terms of where you would deploy inorganically?

Well, I think if you look at the history of Liberty Media, we've been pretty opportunistic. And I think that will always be a hallmark of Liberty Media. I do think though that the company is set up in a certain way right now, we have to maintain sort of discipline across what we're investing in and how we're doing that and all that sort of stuff. But I would say that comparable sorts of businesses are the ones we would be most interested in. I think where we can add value in a Liberty Media sort of way, whether that's through relationships, spotting opportunities, financial structuring, all that sort of stuff would play into what we're going to pursue.

Got it. Maybe just one more. Are there any practical implications that investors should be thinking about of John Malone transitioning to sort of Chairman Emeritus. And how is that impacting sort of the day-to-day running of in your role as CEO of the company? .

I would say there's probably a negligible impact on a day-to-day basis. John has obviously put in what he believes is a skilled management team, a supportive Board, the knowledge of the Board. And I think that it's up to us to plot the strategy as we move forward. That being said, John is -- has a significant holding our control of the company in the company. So we would -- it would make sense for us to have continuing dialogue with John and understanding so to where his priorities are. And I think, over time, that's kind of been how we fund things and I don't see that necessarily changing.

It is great, though, to have John in the position that he has been in and the position even now because, as we all know, John is a long-term holder. And that has very positive effects for us as we run these businesses.

Okay. All right. Why don't we talk about Formula One, the business? So you wrapped up 2025 reporting earnings recently, revenues were up 14%, adjusted OIBDA up 20%. Of course, the market always wants to know what's next. And you could talk a little bit about the sort of growth drivers for the business and how sustainable you think those are into the future? .

Sure. I think if you look at our revenues, we've sort of got 3 main sources of revenue, the rights, sponsorship, race promotion. And I think we see different levels of growth across those probably, but I think they're all healthy, which is great. On the media right side, last year, we announced sort of new deals or renewals in the U.S., which I'm sure will talk about later. Brazil, Japan. Just this morning, we announced that we are renewing with Foxtel in Australia. ESPN down in Latin America, beIN in Southeast Asia. So a lot of activity over the course of the last year with what I believe are the right partners who will help us both from a traditional broadcast standpoint, but as we think about new ways to engage fans, the right partners in a lot of these markets do that.

From a race promotion standpoint, you see most recently last year, we announced, I believe, renewals in Austria, in Austin, we recently announced a new deal with Barcelona, Barcelona and Spa will rotate races alternate. So we are continuing to see sort of good growth in that sector. We are also continuing to see good demand and interest, both from our existing partners, but as well other cities and locations out there, which I think will help support what we're trying to do -- continue to do from a global standpoint.

But the other thing about sort of race promotion that people miss sometimes is you've got traditionally a fee that gets paid to you to host a race. But then we have a lot of hospitality in inventory at predominantly the Paddock Club. And I think as we renew deals or strike new deals, creating more of that inventory for both us and the local partner is a good thing and produces a lot of value because clearly, that type of hospitality and inventory is in high demand. And if it's in high demand and you can supply it, hopefully, that generates more revenue overall. So I think there's twofold benefits on the race promotion side.

And then I think probably what people are talking about most recently is probably on the sponsorship side. And clearly, that team at F1, Stefano, Emily Prazer, those guys have really been honed in on sponsorship and what that means. And I think in addition to just sort of the fees that get paid for that sort of business, I think almost more important is the types of companies that we are associating with.

When you think about this last year and people coming online and new deals that we've done in terms of LVMH, LEGO, Pepsi, Disney, we just announced earlier this year, a deal with Standard Charter in terms of wealth management. And so that sort of has the ability for us to expand our own brand because those guys are sort of associating us what they're doing and all the marketing right that a lot of those brands put behind their own brands accrues to us also.

I think the other thing that you're seeing from a sponsorship standpoint that -- it's good to note is, clearly, we've added a lot of new sponsors. We do believe that there are categories that are certainly still available. But then the other interesting dynamic in terms of demand is there's so much demand it's causing the sort of you have different tiers of sponsors, global sponsors on down. You get movement, sometimes people trading up because they want that profile and therefore, paying more people sometimes trading down because maybe at that level, it's no longer affordable for them, but when they move down, they're probably coming in at a higher rate than what that level traditionally has been.

And the other dynamic that you're seeing is people coming to us, existing partners coming to us and asking to renew early. We just did a sales force deal. I think we announced that today. And part of that is men looking out there long term, saying, "Hey, this is a brand we want to continue to affiliate with. We like it. we want to renew now because we worry that the price goes up as the days go on."

Right. That's great. We'll dive into those revenues streams in more detail in a minute, but I did want to at least ask you about upcoming season from an F1 sport and fan point of view. You've got new cars, you've got a new team coming on. There's a lot of change going on. There's been -- I mean, I don't know, some controversy, I guess you would agree or not during testing. How would you sort of describe the changes coming to F1 this year and what they might mean for the business as we look out over the course of 2016?

Yes. No, you're right. The new cars, new engines, new features, which all people will have to learn and understand we're trying to make them more user friendly. But I think it really brings a lot of excitement to what's going on. And the fact that you're talking about testing you probably didn't know that they tested last year, right? Again, that's bringing sort of more awareness of this sort of thing to all of our fans. And so I think anything that brings that sort of engagement is always good.

Now yes, the new rules, the new technology, different teams may get impacted differently. But they're all big boys, and that's part of their job, which is to figure out how to sort of maximize their performance under whatever the current rules are. So you're seeing a lot of that going on right now. And by nature, some people will complain. Some people will be happy, and we'll see how that goes. It will always bring intrigue, which again, is good because as you know, we're not just a sport. We are an entertainment brand. And I think anything that supports that and get people interested is good. I think when you think about the new team, Audi and Cadillac, Audi bought Sauber and Cadillac is a new team to the grid. And I think for this market, for the U.S. market, having Cadillac comment is hugely significant. They spend, I don't know, you probably know what a Super Bowl at cost this year, like $7 million, something like that. So Cadillac brought a Super Bowl ad, right, to showcase and introduce their delivery. And then really, this is -- that was they're coming out.

And so when you have Cadillac putting the might of the Cadillac organization behind the F1 entry, you can think about what that then means in terms of them promoting the sport, their team, whether it's in their dealership, whether dealerships, whether it's through -- whatever it is, they're bringing that much more awareness to it. In a market that hasn't necessarily seen that from a manufacturer, right? So again, how we engage, how we attract new fans, all that is sort of happening in multiple ways.

Only F1 could the Super Bowl ad be still a drama.

As always.

All right. The other big thing that's happening in the U.S. this year is your Apple deal, which is commencing here with Australia coming up, I guess, in a weekend, weekend or two. There's been a lot of discussion about the monetization, the reach elements to it, what Apple brings to the sport. Talk about why you're excited about this partnership and maybe one of the things you think investors might be missing about the benefits long term of being in business with Apple.

Yes. So first of all, I do want to say thank you to ESPN for having a long 6-year history with us and helping us to promote sport, get it to where it is. You can report that back to your new bosses. .

I'll get back to that. .

But Apple, look, I think we're -- we all know sort of the distribution landscape in media and sports media has been changing literally every single day over the past 15 years. And so what we saw was an opportunity with Apple to really go big in this space. And to your point, people will question it and people have questioned it, we feel very confident in sort of this relationship. And Apple in our minds brings a lot to the table in this construct. So it's not just sort of Apple TV. It is sort of Apple Music, Apple News, the Apple Stores, just like we talked about Cadillac earlier, they have similar sort of touch points that go well beyond what you think about from a traditional television standpoint, a traditional video standpoint.

So we don't focus on reach in sort of an archaic definition of sort of how many people are watching on TV. But really, how do you touch your fans? How do you engage with your fans. And I think as we will see over the next sort of 5 years, the product should develop, maybe not so much the first year, but as they put their engineers to task and they think about what they can do with F1, we will see, I think, a lot of cool stuff come out.

But look, at the Apple movie, right, this past summer, the last summer of the Apple movie, which grossed over $600 million, right? The biggest sports movie of all time, Brad Pitt's biggest movie of all time. So what that did for F1, I think Apple will continue to look for ways to do that sort of -- just yesterday, they had on right by your offices in, what is it, 1575 Broadway?

1585.

1585 Broadway, right? The F1 on that screen, the cars going right past you. So they are committing tons of support effort, promotional value into this relationship.

And I think you also saw recently, Apple did a deal with IMAX theaters to distribute the races into -- certain races into those theaters. And then just last week, did a deal with Netflix, where Apple will stream season 8 of Drive to Survive, and Netflix will broadcast the Canadian Grand Prix this year alongside Apple. So 2 huge platforms coming together to promote F1 today, which is phenomenal for us, right?

And I think when you think about the start of your question, one of the things we saw in doing a deal with Apple is that they're operating in a different space than traditional broadcasters. So again, not to go back to ESPN, but if you think about it and having sat at this chair a long time ago at DIRECTV, where I had to negotiate with all the broadcasters and the limitations I would put on them as part of the negotiation in terms of where they could broadcast, when they could broadcast, all that sort of stuff would have put someone like ESPN in a much more restrictive position in terms of what they could do with F1 and our product where Apple could go do that deal with Netflix. I don't think you'd see that happening, for instance, with an ESPN, right? So it opens up many new opportunities for Apple to promote F1.

Yes. So what is the impact, if at all, on your direct-to-consumer strategy in the U.S.? Because F1 TV has been a really nice growth story globally, but particularly here -- and I think -- and I know that's changing at least the way consumers access it within the Apple ecosystem. So how do we think about what that product does for the business and whether there's any change as a result of the Apple relationship?

I don't think, with respect to that business, it changes that much other than the which sold, as you said, access, right? It's going to -- you're going to get it through the Apple TV platform. And for people last year, depending on what level of service you had, it's probably a $2 increase or even a $4 decrease from having the stand-alone F1 product. So we don't feel that there's a huge economic difference on that.

But most importantly, F1 TV continues to exist. It's just how it's sold, which also means we continue to get data from that product. And that feeds into, as you were saying earlier, are sort of our understanding of our consumer of our fans. So in addition to sort of what they view on F1 TV, what [indiscernible] they're buying, what tickets they're buying, all that sort of stuff feeds into, hey, this is what we know about our fans, which we can, a, understand better, monetize ourselves, serve them better with product and whatever it is, but also for our partners, whether they're sponsors media partners, whatever it is, give them that information in a way that is helpful to them, which then brings more value to us because of what they pay us or whatever it is.

You mentioned Drive to Survive before. Obviously, that's been a huge part of F1's rise in popularity around the world. You have the F1 movie. And now we're seeing this sort of innovation and evolution of content for the company with Netflix et cetera. How do you think about content and storytelling just as a continued growth driver for sports, F1 and maybe even for Moto over time? .

Yes. So I think once that that's important is 60% of their fans access F1 on a daily basis, right? So whatever that is, reading articles, social media, watching Instagram of someone's dog or whatever it is, one of the drivers is dog, right? So whatever it is, they're accessing it, which means those people are not just waiting for the race to be broadcast on Sunday. And what that says is, hey, content is important. Storytelling is important. All of that is important because it's what feeds the machine. At the end of the day, it's not just what happens on Sundays.

Sunday is exciting, but it's all this other stuff. And that also gets us into sort of segmentation of sort of fan base, right? You've got hardcore fans. You also have casual fans. You have fans who are interested in the testing. Like, Ben, you're an expert now, right? So you're watching the testing. But you may have fans that don't even watch much of the race but they're engaging in so many different ways because they're watching the movie or they're just watching short-form content on social media of Lando eating dinner, whatever it is, and so content, storytelling, all of that is critical to the brand.

Got it. I did want to ask you, you mentioned earlier, you've had a number of media rights renewals outside the U.S. That's a market investors generally have a little less visibility into. Can you talk a little bit, at least even qualitatively about sort of the growth you're seeing in your international renewals since every market is kind of unique?

Yes. So what you've seen is in certain markets, we were -- we just renewed with Foxtel. So that's an existing partner that we're continuing to do business with. In other markets where we might have gone in a different direction, you're actually seeing the traditional heavyweight broadcasters in some of these markets come back to us or start new with us because they've seen what the growth of F1 is. So Globo in Brazil, right? Everyone knows that. Televisa in Mexico, right? Fuji in Japan, right? These are the heavy weights. And so them seeing that value and then wanting our product, our races, our content is really a big demonstration to me of what we've done on this front.

Okay. And then you mentioned earlier sponsorship, new categories, different tiers. I think the probably the popular view out there is that's still your highest growth opportunity is on a percentage basis of your major revenue streams do you see continued long runway in sponsorship for the business?

Yes. I mean, when I talk to Stefano, he's as pumped as ever. So, I think he, his team. There's a very, very creative group of people. And what they've been able to do -- I get called all the time from other leagues because as you might imagine, given my career, pretty traveled at this point. but I say, hey, how did you do that? How do you do that on hospitality? How do you do that on sponsorship? How did you come up with that creative idea? So that also tells me, "Hey, we're doing the right stuff." And I think that creative engine continuing and will continue to lead to successful sort of growth for us.

Okay. You guys had your third Las Vegas Grand Prix back in November. It sounds like it was a success financially. Can you talk a little bit about kind of where that race is, what the long-term vision that businesses is? And if you think it continues to be a driver of sort of value for the company over the next couple of years? .

Yes. So if you go back to before we started Vegas, I think we were taking on a lot, and I think we all recognize it was probably going to be a bumpy road, but the reward at the end of all it was going to be there. And even though we're not at anywhere near the end, even 3 years later, we've seen that pan out, right? So first few years just operationally getting that right and probably spending in places just because you had to get the race going that evening.

Our relations with the community probably not great off the start, right? You think about it, a new race in your city, shutting down the streets for 3 night or whatever it is, not a great look. But now three years later, you've seen our community relations, our local relations probably in a good spot as ever. And people in Vegas take pride in the fact that the race is there now. And that, I think, has allowed us to work much more collaboratively with the local government, with our local partners, right, the casinos to actually start thinking about really what this can become in the future and not, hey, complaining about the fact that we did this wrong or they did that wrong or that sort of stuff, which, over the first 2 years, you probably had that.

So hopefully, through the growing pains, and now thinking about what the future can hold. So we are working very closely with all of them figure out how do we make the race better? How do we present it better? How do we help sell? How do they help us drive fans and all that sort of stuff, which is a pretty cool place to be. I think that 1 of your points is what does this mean for F1. It means a ton, right?

And I think most visibly, sort of the impact in the U.S. and what Vegas has meant. It's been the third race, but I think people look at it and they're like, "Oh, my god, 3 races now Vegas, Miami, Austin, this is a critical piece of that strategy. The other thing that you've seen and one of the reasons that we made this investment as opposed to licensing it to someone else was sort of speed to market and getting it done in our own way. And we were able to do that. And I think that turned on, we talked about sponsorship earlier, a few different sponsors that sort of engage with us because we had Vegas and now have gone and stay global with us. Amex is a great example of that. And so what that -- what Vegas has done to sort of burnish the brand around the world globally is sort of a huge impact that doesn't always show up in the direct Vegas P&L. .

Yes. I mean, given those benefits, would it make sense to self-promote so to speak, in other markets? Or is this really a unique situation given the U.S. and Vegas?

Yes. I think it's pretty unique just because we're operating in a jurisdiction where we actually have familiarity. I think there was a reason why Vegas itself was critical to our strategy, and I just elaborated as to why. I wouldn't say we wouldn't do it somewhere else, but stars would have to align a way that made sense for us to do it versus sort of several other people who are now clamoring to get in with races in different locations.

Okay. Last F1 question, then we'll turn to Moto. You've got the Concorde Agreement now done that runs through 2030. So you have line of sight on all the pieces of your relationship with the teams. What should investors understand about the, in particular, the team payment structure and sort of the operating leverage that the business can see over the course of the 5 years? .

Yes. I think what we said recently is we see about 200 basis points in '26 and then stable sort of after that. I think the best part about the Concorde Agreement is a continuation of an arrangement with all the people in the ecosystem that matter for another 5 years. And so we have the operating parameters of how we work together over the next 5 years. And if you go back 10 years to when Liberty bought F1 and the state of the relationships with F1 and the promoters, F1 and the teams, not good. Not good at all.

And I think a large part of the success most recently has been the fact that the level of trust that exists now between us and the teams is significantly different than what it was 10 years ago. So now we've come together and think about collaborating on stuff, not what are you trying to take for me versus him and why does he get that? And I think you've seen it play out, Drive to Survive, the first season, Ferrari and Mercedes were not there.

We heard about that.

And now you do these different projects, whether it's Disney or LEGO and things like that where you need everyone to participate and you see them all sort of coming to the table. Yes, we're still squable on stuff, but it's all small relative to the fact that everyone has gotten religion around the fact that if we can work together, the whole pie grows and everyone benefit.

Yes. Well, the team values have definitely grown.

Yes.

All right. Let's talk about MotoGP. You closed that deal last summer. How would you say the business is performing versus your kind of initial underwriting plan? Any surprises, good or bad, that we should be aware of at this point?

Yes. So we're still getting into it, but I think coming away with our initial impressions as very, very excited to have this business. There aren't many businesses like this. You go to a couple of these races and you understand sort of the passion that is there. You also understand just the sport itself and sort of the emotion that evokes because it is so sort of raw and dangerous. And that is what that brand, I think, will be.

I think from a business commercialization standpoint, it's going to be a bit of a build. And we've talked about that, which is, hey, we got to build the pieces to this. I don't think there's fundamentally anything to the sport per se and huge investment that way, is building out the team and people with the requisite skills in terms of building brands, commercializing the enterprise. And so that's all sort of doable in our minds. It will take some time. It probably will be a little bit choppy. But as we start to look towards '27, and '27, we start to see some of the rise in sort of promoters as we've struck new deals. And those will start to flow in, I think, in '27.

We're already having engaged conversations on the media front with respect to renewals that we have, or deals that are going to come up. And then in sponsorship, it is still predominantly endemic sponsors and that's going to be an area of opportunity. And as we sort of again create the brand -- excuse me, not create it, but build that brand. And then monetize against it, we'll see sort of a more general sponsors come in. I think an important thing here is it is an amazing sport and an amazing brand with a long history. So there are a lot of stories to be told. We just need to tell it to more people, and we will build that audience, and we will build that fan engagement. .

To that end, you've got your team deal up, I think, at the end of '26 with the MotoGP teams. What are your main objectives? What are you trying to get out of that renewal to help realize the opportunity? .

I think we're close to getting that done. And I think what we're trying to do there is sort of build a construct with those teams where people, again, have a similar level of trust with each other, understand that we're all in this to build the business. And I think we will get there. I think there's opportunity that is playing out on the team side. Tech3 was sold recently to a group led by David Blitzer, both Main Street, IKON.

And look, these are people that understand sport as an entertainment asset and the fact that you actually need to invest. I know a couple of other teams may sort of have new investors come in at some point. And what we're looking for is those investors to have a similar mindset to us. And again, how do we invest and build this sport together. And I think you'll see sort of a lot of success over a several year period once that happens.

Okay. Maybe in the last couple of minutes, Derek, Liberty always has or not always, but certainly under the F1 Moto world has a high-class problem generating a lot of cash flow and deleveraging pretty rapidly. You guys, I don't think have a sort of formal leverage target anymore, but how should your investors think about deploying capital over the next couple of years as the balance sheet gets to be at a leverage level that's pretty -- at least my words conservative over the next few years? .

Sure. I think -- and I think we talked about this at the beginning, but we are deleveraging. And to your point, hopefully, we'd be at a point relatively soon where you'd say, "Hey, how are you investing your capital." And I think what we talked about is we would like to invest in growth, growth in our businesses, growth alongside our businesses, similar types of businesses, kind of what I was talking about earlier and then maintaining sort of that disciplined approach to it, trying to leverage off of what Liberty has done in the past, what it is now, our relationships, our ability to spot those sorts of opportunities, our ability to finance them creatively -- and -- but we're also not going to do sort of dumb deals. And we also understand sort of what the expectations are. And so we've got to make sure that whatever we do, we have the ability explain that properly to our investors.

But I do feel like Liberty now after what we did last year with a lot of corporate maneuvering the acquisition of Moto, the split-off of Liberty Live at the end of the year, we're in a good position. We've talked about the financial strength, and I think we should use that.

Okay. Well, we're out of time. Derek, thanks so much for coming. Good to see you.

Thanks for having me. Thank you, everyone.

Thank you, everybody.

Hello, and welcome to Liberty Media Corporation's 2025 Year-end Earnings Call. [Operator Instructions] As a reminder, this conference will be recorded February 26.

I would now like to turn the call over to Hooper Stevens, Senior Vice President, Investor Relations. Please go ahead.

Thank you, Kevin. Thanks, everyone, for joining us today on Liberty Media's Fourth Quarter and Year-end 2025 Earnings Call. This call today includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual events or results could differ materially due to a number of risks and uncertainties, including those mentioned in the most recent Form 10-K followed by Liberty Media with the SEC. These forward-looking statements speak only as of the date of this call and Liberty Media expressly disclaims 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 change in events, conditions or circumstances on which any such statement is based.

On today's call, we will discuss certain non-GAAP financial measures for Liberty Media, including adjusted OIBDA, constant currency for MotoGP, the required definitions and reconciliations for Liberty Media can be found on Schedule 1 and MotoGP or Schedule 2 at the end of the earnings press release issued today, which is available on Liberty Media's IR website.

Speaking on today's call, we have Liberty Media's President and CEO, Derek Chang; Liberty's Chief Accounting and Principal Financial Officer, Brian Wendling; Formula One's President and CEO, Stefano Domenicali; MotoGP CEO, Carmelo Ezpeleta and other members of management will be available for Q&A.

With that, I'll hand the call over to Derek.

Morning. Thank you, Hooper. And before I start, I just want to welcome Hooper to our team. This is his first earnings call for Liberty. Many of you know, Hooper already, he has obviously been part in and around the Liberty Complex, but we are very, very happy to have him with us here.

It has been an exceptionally productive and successful year for Liberty. We are energized by the slower progress we've built across our businesses and are focused on accelerating our momentum this year. We have delivered against each of the priorities we articulated last year, namely one to continue F1's growth trajectory; two, to augment our portfolio with the acquisition of MotoGP; and three, to execute the Liberty Live split-off.

Following the split-off last December, we are now a premier global sports investment vehicle anchored by 2 world-class motor sport leagues and operating in an industry supported by strong secular growth tailwinds.

Looking ahead to this year, operational excellence at MotoGP and F1, while remaining disciplined and opportunistic with our capital to drive value for our shareholders and across our portfolio.

Turning now to our operating businesses. At MotoGP, we see tremendous upside over time and are in the early stages of unlocking that potential. We don't expect to see these investments bear fruit immediately, but are laying the necessary groundwork to drive this sport forward. Since closing the acquisition last July, we've continued building on our commercial functions. We hired key personnel across sales, public relations, social media strategy with more additions to come. We're focused on driving knowledge sharing between MotoGP and F1 and believe this can support long-term value over time.

I just recently returned from our Partner Summit in Barcelona, where we clearly articulated our strategy to teams, promoters and partners across the ecosystem. The enthusiastic response was a very positive sign as we build share momentum with a strong collective commitment to the future of our sport.

For Moto, our 3 key priorities are: first, we remain focused on strengthening MotoGP's foundation and expanding its global footprint. We recently announced we are moving our Australia race to Adelaide, marking our first modern era circuit in a city center and we are excited to return to Brazil this year after a 20-year hiatus and look forward to adding Buenos Aires to the calendar next year, strengthening our presence in major international cities.

Second, we remain focused on elevating the Grand Prix experience into a must intend event at every circuit. We continue to further enhance our hospitality offerings and improve the on-site fan experience.

Finally, this work underpins our efforts to unlock our brand value to scale the sponsorship roster. We remain disciplined in our approach to sponsorship and are prioritizing brand alignment with high-quality partners over near-term wins.

Now turning to F1. F1 once again delivered an exceptional year with the sport firing on all cylinders across growth, engagement and commercial momentum. We renewed with multiple long-term existing partners, we signed several new marketing partners, including Standard Chartered, our official wealth management and banking sponsor. As you saw earlier this morning, we just announced our broadcast extension with beIN in the Pan Asia region. And earlier this week, we announced the extension of our ESPN partnership in Latin America.

Our third year of the Las Vegas Grand Prix was a resounding success and our relationship with the Las Vegas community has never been stronger. Importantly, we finalized the new Concorde Agreement to cover the 5 years from 2026 which provides us with durable financial economics in all F1 constituencies and constituents a stable base to invest into the sport and drive long-term value creation and an even healthier ecosystem.

And 2026 should be an exciting season on track with Cadillac and Audi joining the grid. The new brands, cars and engines should lead to an incredibly competitive racing season ahead. Stefano and Carmelo will both provide more updates on their businesses later in the call. We look forward to continuing to support their strategic vision.

Now I'll turn it over to Brian for more on Liberty's financial results.

Thank you, Derek, and good morning, everyone. At year-end, Liberty Media had cash and liquid investments of $1.1 billion, which includes $539 million of cash at F1 and $197 million of cash at MotoGP. Total Liberty Media principal amount of debt was $5 billion at year-end, which includes $3.4 billion of debt at F1, and $1.2 billion of debt at MotoGP, leaving $499 million at the corporate level. F1's $500 million revolver in MotoGP's EUR 100 million revolver are both undrawn. At year-end, F1 OpCo net leverage was 2.8x. This is down from 3.3 that we gave at 6/30 pro forma for the MotoGP acquisition. And MotoGP's net leverage was 4.7x at year-end, down from 5.6x at 9/30. We expect to continue delevering at MotoGP this year. Liberty Media's overall net leverage was 3.6x.

Turning to the F1 business. I'll make some brief comments about the fourth quarter but focus on full year comparisons primarily. A reminder that every quarter in 2025 had incomparable race count and mix. 2026 will also have incomparable race count and mix except for the fourth quarter. Majority of the variability in Q4 year-over-year results is due to one more race being held in fourth quarter compared to the prior year period. Q4 '25 had 7 races compared to 6 races in Q4 '24, with Singapore being included in the current year period but not the prior year period. Note that we operated the same number of Paddock Clubs during the fourth quarter, given that the Singapore Paddock Club is operated by the local promoter.

For the full year, the business performed exceptionally well. Revenue grew 14% and adjusted OIBDA grew 20%, driven by growth across all revenue streams. Sponsorship revenue continues to increase from new partners and underlying growth and contractual increases. Media Rights revenue grew due to underlying growth in contracts, continued growth in F1 TV and the onetime benefit of the F1 movie revenue that was recognized in the second quarter.

Race promotion revenue increased due to underlying growth in contracts. Other revenue grew primarily driven by higher hospitality and growth in licensing and freight income. Higher hospitality revenue includes revenue from the Las Vegas Grand Prix, and also revenue generated at Grand Prix Plaza from its growing private events business and the various new activations we opened in May of last year.

Touching briefly on the Las Vegas Grand Prix. As Derek mentioned, our third year operating the race was a success, and we saw improved financial performance year-over-year. We continue to see a material benefit accruing from LVGP to the broader F1 ecosystem across various revenue streams, especially sponsorship, hospitality and licensing. Vegas continues to serve as a very successful test bed for product expansion and is integral to the continued growth of our sport in the U.S.

Adjusted OIBDA increased during the year, driven by the strong revenue growth discussed above, outpacing increased operating and SG&A expenses. Higher operating expenses included higher team payments, and increased expenses associated with servicing our revenue streams. The increase in SG&A and -- the SG&A expenses was due to higher personnel and marketing costs. Team payments as a percent of pre-team share adjusted OIBDA were 59.7% for the full year 2025, representing 185 basis points of leverage against 2024. Over the past 4 years, we've seen an average of roughly 200 basis points improvement in leverage each year, and we expect 2026 to be approximately in line with this average. After 2026, for the remainder of the term of the new Concorde Agreement out to 2030, we expect the payout percentage to remain relatively stable. A reminder that team payments are best analyzed on a full year basis due to quarterly fluctuations in team payments as a percent of adjusted OIBDA.

Looking quickly at MotoGP's results. As a reminder here, we closed the MotoGP acquisition on July 3. Our financial results are presented on a pro forma basis as though the transaction occurred on January 1, 2024, and the trending schedule will be posted to our website after the 10-K is filed including results in U.S. GAAP for the full year '24 on a pro forma basis. The majority of MotoGP's revenue costs are euro denominated and as such, are subject to translational impacts from foreign exchange fluctuations.

In the following discussion, I'll focus primarily on constant currency results. Similar to F1, I'll make a few comments about the fourth quarter, but we'll primarily focus on the full year. Year-over-year comparisons are impacted by the mix of races, and generally, MotoGP flyaway races carry higher costs, which includes freight, travel and higher earth fees.

MotoGP held 5 races in the fourth quarter of both this year and the prior year. Revenue increased at MotoGP during the fourth quarter as increased race promotion fees due to the race mix and contractual uplifts were offset primarily by lower proportionate recognition of season-based income with revenue from 5 out of 22 races being recognized this year versus by about 20 races recognized last year. For the full year, MotoGP had 22 races compared to 20 and 2024. Revenue grew across all primary revenue streams, primarily due to the 2 additional races held and contractual fee increases.

Media Rights revenue also increased due to growth in VideoPass subscription revenue and other revenue benefited from increased hospitality revenue, which saw 2 additional races and increased attendance, partially offset by a decrease in fees related to MotoE. Adjusted OIBDA grew for the year driven by the higher revenue, offset by growth in operating expenses. SG&A expenses were lower, primarily driven by recognizing less bad debt expense in 2025 compared to the prior year. Note that bad debt expense in '24 was primarily related to race cancellations from years prior to 2024.

Looking briefly at Corporate and Other results for the year, revenue was $414 million. This includes Quint results up until the split off on December 15 and approximately $33 million of rental income related to Grand Prix Plaza. Corporate and other adjusted OIBDA was $5 million and includes Quint results up until split off, Grand Prix Plaza rental income and corporate expenses.

As a reminder, Quint business is seasonal with the largest and most profitable events taking place in Q2 and Q4. Note that Quint intergroup revenue from MotoGP is eliminated in our consolidated results through the spin date. Going forward, Quint will no longer be reported in our operating results. F1 and MotoGP are in compliance with their debt covenants at quarter end. And with that, I will turn the call over to Stefano to discuss Formula One.

Thanks, Brian. 2025 was a thrilling season as we celebrated the 75th anniversary of Formula One with standout performances across the grid. 9 drivers across 7 different teams reached the podium, including phenomenal performance from rookies like Isack Hadjar. Congratulations to Lando Norris for winning the Driver Championship and McLaren for winning the Constructors' Championship.

2026 is set up to be another captivating season as it represents the next generation in F1 incredible history with new cars, engine and regulations. All signs point to an exciting kickoff in Melbourne next week, which we know will sell after intensive precision testing in Spain and Bahrain. We look forward to welcoming Cadillac and Audi to the grid and for the return of Ford with Red Bull and Honda with Aston Martin. In December, we also successfully completed the signing of various elements of the new Concorde Agreement with all teams and the FIA.

Engagement across our fan base continues to grow. We welcomed 6.75 million attendances last season, our largest combined attendance in history, up 4% relative to 2024. Australia, Silverstone, Mexico and Austin, each, respectively, welcome over 400,000 fans over races weekend, and we had 19 events sellout with 11 setting new attendances records.

The Paddock Club serve 65,000 race day guests, up 10% on the prior year. Last season, many of our Paddock Clubs sold out, and we increased revenue 20% per race on average. Robust demand continues for 2026 with record preseason sales and in partnership with our promoters, we are increasing capacity at certain races while looking to keep enhancing our guest experience. For example, at our Austin Grand Prix, the promoter is currently constructing the new facility at Turn 1, which will host a new Paddock Club space to accommodate more guests. Our promoters also have plans to upgrade the Paddock Club space in Mexico and introduce a new Gordon Ramsay experience in the Paddock in Shanghai, just to name a few developments. We continue to see strong engagement and reach across viewership and our digital and social platforms.

Cumulative viewership is up across our broadcast and digital platforms. Global Live TV viewership across all session was up plus 21% year-over-year, showing increased appeal for our core product. F1 race weekends continue to broaden, with practice sessions showing strong increases in viewership. Screen popularity continues to increase with Sprint session viewership up to 10% year-over-year, and qualifying delivered the largest growth across all sessions with audiences up 23% year-over-year.

For the Sprint races, we are currently in active discussions to expand the Sprint format up to 12 races in 2027 due to the high demand for promoters and fans. The Sprint format has also demonstrated the impressive performance across fan engagement. Our YouTube content generated 1.65 billion views, up 48% relative to 2024 and with YouTube highlights view, increasing 21% year-over-year. Passenger Princess reached 7.6 million total views, including 1.5 million views within the first week of release, highlights from the first 3 days of the preseason test in Bahrain reached over 8 million views on YouTube, which represents an increase of plus 64% compared with the Bahrain preseason testing session in 2025. And highlights from our first ever Barcelona shakedown reached nearly 17 million views on YouTube. We hope you will be tuning in for season 8 of Drive to Survive.

For the fifth consecutive years, F1 continues to be the fastest growing sport on social media. We ended the year with 150 million social media followers, up nearly 20% year-over-year. Commercially, we had another strong year of renewals and new partnership. We have an active year of media rights negotiations, signing or renewing with broadcast partners across multiple territories, including the United States, Pan-Asia, Canada, Brazil, Latin America, Mexico, New Zealand, Japan and India.

Apple is now our U.S. Media right partner, and we are excited by their vision, innovation and unmatched ability to reach and engage wider audiences through their platform and marketing scale. This was clearly demonstrated by the success of the full-time Oscar-nominated F1 movie last summer. Apple will be a key driver of our U.S. growth strategy, and we are excited to work with them to drive our next phase of growth in the years ahead. We see major brand alignment between Apple and F1 as this partnership brings together 2 global brands with a shared passion for innovation, excellence and entertainment.

We also renew our extended contracts with 9 of our race promoters, including most recently with our promoter in Barcelona. The race will now be officially called the F1 Barcelona-Catalunya Grand Prix, and we rotate with our Belgium race year-by-year throughout 2032. And we will host a Grand Prix in 2028, 2030 and 2032, in addition to the race scheduled for this year. We are also excited to welcome back Portugal to the calendar under a 2-year deals starting in 2027.

The third year of the Las Vegas Grand Prix was an outstanding success. Congratulations to the Vegas leadership team for delivering an exceptional race weekend that showcase the very best of Formula One. We sold out the weekend and welcome over 300,000 fans to Las Vegas, while setting up a number of new event sponsors.

Content related to our race generated 1.8 billion impression over the weekend, and we are gearing up for another phenomenal race this year. Picking up on sponsorship, we closed out another strong year of growth and continue rising the momentum into 2026, having built out a good pipeline of discussions. We recently signed Standard Chartered as our official banking and wealth management partner in a new multiyear deal. Equally impressive is growth across our other revenue streams, including licensing and hospitality.

Our legal partnership delivered great results in its first full year, generating over 27.5 billion impression across marketing activation. Pottery Barn Kids and Pottery Barn Teen continued sales momentum following the launch late last year. Our collaboration with KitKat is also thriving with the new F1 KitKat bars available in stores, driving enhanced retail visibility, and we are excited to roll out a new dimension of our partnership with Disney later this year.

Following the successful launch of House44, our premium Paddock Club hospitality partnership with Lewis Hamilton and Soho House, it will expand from 5 to 9 races this year. Visitors to Grand Prix Plaza enjoyed 90,000 track rides at F1 drive last year, and we are excited to reopen Grand Prix Plaza to the public at the end of the January. We are also encouraged by the growth of F1 exhibition, which has sold 1.3 million tickets across all its exhibition and F1 Arcade, which recently opened in Atlanta and has 3 more new locations planned to open later this year.

Track side retail sales grew over 30% last year, and F1 hub pop-up merchandise experience operating in Austin, Miami and Las Vegas. This hub saw strong foot traffic and retail sales, and it is planned to open hubs in more locations this year, monetizing untapped merchandising opportunity in key locations.

2026 brings continued focus on inspiring the next generation of F1 fans through our creative activation, partnership and collection appealing to all audiences across our fan bases. We are seeing incredible momentum across all phases of our business. Our sport has delivered exceptional growth, and we see significant upside ahead. The strategy work we are doing now will deliver lasting benefit to our partners, shareholders and our fans. In only a few years, we have achieved so much as a sport and as a business. But we have only begun to scratch the surface of what is possible and the potential for F1 is not being underestimated as we enter another exciting new chapter in our history. Avanti tutta, full speed ahead.

And now I will turn the call to Carmelo to discuss MotoGP. Thank you.

Good morning, and thank you, Stefano. Liberty Media commitment and support of our strategic vision has been a strong ride out of the gate. We are encouraged by the collaborative approach and early progress we are seeing and we are working together to build a strong foundation to drive our sport forward.

The 2025 seasons delivered the very best of our sport, through racing and dramatic story lines. We saw a standout performance across the grid with 13 riders on the podium across 10 teams. Congratulations to Marc Marquez on extraordinary come back and winning his seventh MotoGP World Championship. We welcomed a record 3.6 million attendees last season up 21% year-over-year and set attendance record at 9 different circuits. First-time attendees, representing 27% of our total attendance for season, up from 18% in 2024.

The 2026 season is gearing up to be another thrilling season. We held our second season launch event in Kuala Lumpur with global attendance and video viewership year-over-year. Fans enjoy musical acts by global artists, including The Script, DJ PAWSA and DOLLA. The 2-day event culminated in a live launch show featuring show runs from teams and riders. We look forward to kicking off the season in Thailand this weekend.

Our global fan base now measures 632 million fans, up to 12% from last year, and we continue to strengthen our brand. We recently launched our first event season marketing campaign. Why that's different? Which bring our evolved brand positioning to life and create brand consistency and amplification across all fan channels and touch points.

We continue to invest in our fan insight platform to track brand awareness and engagement. This will support the long-term scaling of our commercial functions and enable more targeted and localized content initiatives. We added over 3 million social media followers in 2025 and ended the year with nearly 61 million followers across our own platform, including 4.5 million followers on TikTok, social engagement increases plus 61% and video views across our digital platform, excluding VideoPass, increased 20%. Fans consuming 1 million minutes on our YouTube content last season. Average household tuning into our broadcast grew 9% year-over-year. Satellite sprint races ratios continued to close the gap to Sunday's race coverage with average audience viewerships growing over 26% year-over-year for the Sprint.

Subscribers to VideoPass, our direct-to-consumer video service, grew 5% from 2024. We recently extended our Sky Italia broadcast rights deal, and we have also renewed our Moto partnership through 2030. We also had an active year promotor of renewals, including the recent renewal of the Thai Grand Prix through 2031. We are excited to return to Brazil this year after 20 years, and welcome to the grid Brazilian MotoGP rookie, Diogo Moreira. Initial capacity in Brazil has already sold out, underscoring strong demand, alongside coverage from ESPN 41 will be the free-to-air broadcaster of the Brazilian Grand Prix Estrella Galicia 0,0 as title sponsor.

Finally, last week, we announced the move of the Australian Grand Prix into Adelaide beginning 2027 under a new 6-year agreement. The landmark race will be the first MotoGP race to be held in a city center, and we are able to do so without compromising our safety standards. Adelaide is an ideal location, bringing MotoGP closer to its fans, and we are excited to put on a fantastic 3-day fan experience. We look forward to continuing to update the investor community on our progress.

Now I will turn the call back over to Derek.

Thank you, Brian, Stefano and Carmelo. We appreciate your continued interest in Liberty Media. And with that, we'll open the call up for Q&A. Operator?

[Operator Instructions] Our first question today is coming from Stephen Laszczyk from Goldman Sachs.

Maybe 2 on margin at F1, if I could. Brian, I appreciate the commentary on team payment in 2026. It sounds like the expectation for team payment operating leverage is for it to be in and around 200 basis points in 2026. So 59.7 going to 57.7 in 2026. Just wanted to confirm that thinking and then see if there were any upside or downside factors that you think investors should be mindful of as we track performance on that throughout the year?

Yes. I'd point you to, we said that we added the word generally or primarily or approximately around the 200 basis points. So I wouldn't lock it in stone. As you know, we talked about before, there are different things that can impact the team payment percentage depending on where the profitability is coming from. But generally speaking, we would expect to see about 200 basis points of leverage related to the team payment piece in 2026.

Great. And then maybe just beyond the team payment operating leverage point this year and thinking longer term opportunities to grow margins at F1 over the next 3 to 5 years. What factors are still available to you to grow margins maybe outside of the team payment line item that could expand margins for the foreseeable future?

Yes. Certainly, as we grow primary revenue streams, you would expect to see some leverage around those revenues. But we continue to invest in the business. And when you look at some of our other revenue streams, they certainly have costs associated with them. We've looked at growth in other costs of F1 revenue in the past. And you can certainly see partner servicing costs there as we grow our sponsorship revenue base, there's incremental Paddock Club obligations that are associated with that. So there is certainly costs associated with growing those revenues. But as we grow the primary revenue streams, we would hope to see some leverage there, but we're also going to balance that with continuing to invest in the business and try new things and try to grow the overall pie.

Yes. And Brian, if I may say -- add something on that to complete the answer that Brian said, is that all the costs related are connected to the growth of the marginality because, of course, the more we are getting stronger, the more we need to serve what is important to activate. Therefore, that's our philosophy. And in all the revenue stream that we are bringing home, that's the approach.

And if I may, also when we are talking about a deal that we have with promoters in the long term, we have the leverage to increase the possibility of investing through them to acquire more possibility to invest with other experience with Paddock Club extensions. This is one example, for example. But that's the philosophy is cost. It's always associated to an increase of marginality related to increase of our revenues.

Our next question today is coming from Kutgun Maral from Evercore ISI.

Maybe following up and expanding on the margin discussion. I had a high-level question on the durability of your EBITDA growth, which was very strong in '25 and looks positioned to be healthy again in '26. Maybe taking a step back for a second. Since Liberty took over the growth algorithm has been fairly consistent and straightforward. You had rising popularity of the sport and brand combined with strong execution, monetizing revenue streams with a lot of untapped runway. In other words, there was comfort that regardless of the quarter or even year, there would be a lot of room to grow over the upcoming 3 to 5 years, and that vision has clearly played out.

As you look out over the next 3 to 5 years now, though, how should we think about what sustains that attractive EBITDA growth profile as some areas either face tough comps or see new dynamics, whether it's lapping very strong sponsorship growth, managing the strategic balance and media rights, a race calendar that's already largely contracted or the new team payout structure? And finally, are there any underappreciated drivers or levers you'd point to that helps support growth from here?

Stefano, why don't you take this because you've obviously got the thoughts around the growth of the business more holistically. So I think that's a good place to start.

Absolutely. Thanks, Kutgun. I mean let me start on one thing that I take the opportunity to thank, first of all, our shareholders, our team, the FIA, the teams and all the relevant stakeholders because we have left an incredible moment of our sport. I remember all the earnings calls since I was involved in that, every time was what's next, what's next, what's next. That's a mindset, it's not a guidance. So we have always proven to invest in our future because we do believe in the growth of our sport. And we do believe that in the future, there are so many new opportunities to keep running this rhythm because this is exactly what we are doing together. And the more is strong the ecosystem, the more we are able to catch new opportunities and all the driving force of our revenue streams.

And that's why you see what has happened so far in the last couple of years not only in terms of turnover, but also in terms of EBITDA. And this will continue because we see, as we said so many opportunities to keep growing. And the fact we are stabilizing in certain ways, certain promoters deal will allow us to leverage, as I said before, other investments that will bring us other opportunity to return.

We are able -- we were able to explore the possibility of engaging with new categories of our partners and largely, for example, if you look at the financial services, we were able to contract with other -- with multiple partners because we are identifying different categories. We are opening up the opportunity of digitalization so new opportunity. We are having licensing that is just starting a great momentum with the big deals that we have just even today announced for the bigger relationship with business and so on. So there is a lot of things that we're going to bring and to keep growing the sport business at all level. That's I definitely confirm. That's our mindset, our approach, we wake up in the morning with these things. We are in a competitive world, not only on the track that remains our focus for sure, but that's the aim of all of us doing this job to increase the return of our investors for sure.

Yes, I think that's right, Stefano. And look, I think what's -- what people need to appreciate also is just the strength of Stefano's team and the creativity there and sort of what they've been able to accomplish over the last several years in terms of revenue streams and categories that may not have been fully sort of appreciated in terms of what they could be. And if you look out now, what they've done, for instance, in the U.S., where can you take -- what other geographic markets are still out there that are large significant and potentially untapped. So we are constantly looking for those opportunities and ways to drive the business. I think the heart of it is what Stefano keeps pounding at, which is to help the sport, the engagement that the sport creates and all that sort of stuff is really the fundamental basis for this.

Our next question today is coming from David Karnovsky from JPMorgan.

Maybe just zeroing in on the prior question, but for sponsorship, really strong results this year, though arguably, that sets up a tough comp this year. So wanted to get your view on '26 growth? And how we should think about the follow through, not only from deals executed last year, but maybe kind of what's in the pipeline?

I can answer on that, David, stay tuned. As we always shown, we are not -- and also, as Derek says, we are quite creative in finding new opportunities. You're going to see already this year some deals have lifted with new opportunity that we can offer new quality and new things that we want to offer. We don't have to forget one thing at the end of the day. Of course, now that the quantity is really, in a way, great, we need to focus on the quality of what we're bringing in. And this is really the thing that we are focusing because of course, we have a trajectory of new projects in the pipeline, but our focus is to keep the quality of the partner that now are trusting and following Formula One.

Therefore, it's a trajectory that will continue. It's a trajectory that will enable us also in a competitive landscape to make some decision. And as we have in the field of promoters, we have the quality problem to have more often than -- more demand than offer. We are in the same spot also on the sponsorship side.

So as I said, all the partners are happy. Our point is to create quality content for them, qualitative experience, qualitative value of what they're investing in Formula One. And that has been so far the case and will continue because, of course, the more we are able to succeed on it, we are able to attract even new ones approaching from other disciplines that is happening already, as you have seen, new partners to us.

Okay. And then maybe just following up here. The press release had called out contribution from digital advertising. I think that's the first. Can you just clarify, is that inventory on the website apps or F1 TV? And what's the opportunity here?

Well, the opportunity is quite important because now we are not only in the world of physical advertising, we have the digitalization that will enable us to use in all the different channel possibilities to put to the advertising but we have different platforms. We have the Podcast, we have YouTube. We have other social media opportunity, we will monetize in the future even stronger.

Our next question today is coming from Bryan Kraft from Deutsche Bank.

I guess I'll ask the Vegas question. It seems like Vegas didn't generate really incremental revenue versus last year, but it did generate significant incremental EBITDA due to the cost side. So I just -- I guess I wanted to ask, is that a fair assessment? And what do you think the opportunity is in 2026 to grow Vegas, both in terms of top line and bottom line? Are there any key changes in how you'll approach the event or go to market with tickets this year versus in 2025?

Stefano, do you want to just talk about Vegas broadly? And then Brian and I can you talk about some of the more specifics?

Sure. Sure, Derek. I mean, first of all, in a synthesis, or trying to be set at that point, it has been an incredible strong progress in what will deliver in the short term, even a big cash flow aim in that investment. I think that the key turning point of that has been our ticketing proposition. The fact that we have also a new different way of proposing the partner, the experience and the sales to them. But the most important one that will have a factor in the next couple of years is the new dynamic that we are creating with the community. And with the new things that we will announce in the due time, this will enable us to have an impact also on the P&L of this that is incredible, positive.

And you will see soon that we want to make sure that this Grand Prix will keep being something incredible to be a sort of a spotlight of the year because the focus is to keeping that as a unique experience. And of course, you reduce the cost that is associated to the building up of this event in a new city like Vegas. And so therefore, the huge potential is definitely there. We have been very happy about the outcome of this year, and we're definitely going to be even more happy in the projects that we're going to do together in the next couple of years in front of us.

Yes. And then specifically on the -- on Vegas results for 2026, we did see revenue growth. It's a little bit difficult with our various categories within Vegas because it doesn't all show up in race promotion. Where we really saw growth was we saw increased sponsorship revenues. We saw increased hospitality revenue associated with Vegas. And then also 2026 was a year of trying to achieve some greater cost savings. So we definitely saw some cost savings there. So pretty significant incremental profitability. It just doesn't show up in the race promotion line. It shows up in other spots.

If I could just ask, I mean, it sounds like based on Stefano's comments that you do see the opportunity to continue to grow Vegas from here though. Just to make sure I'm interpreting that correctly?

Yes. Absolutely, yes. Sorry, I can't show the different numbers, yes.

Yes, very happy and excited about it.

Next question today is coming from Peter Supino from Wolfe Research.

A question on capital allocation and your communication and then another one on media rights. So I actually start with the media rights. We were excited about your deal with Apple because we've long believed that the movement of important sports rights to streamers was a growth opportunity for the intellectual property owner. In your case, we've had investors go as far as to call your deal with Apple "a disaster" because of their perception that Apple means less distribution for F1 in an important growth market, the U.S.

And so I wonder if you could comment on why in your prepared remarks today, you expressed so much confidence that Apple can expand awareness and engagement of F1?

And then on the communications side, and I guess this ties to capital allocation, your stock in the last 6 months has become, at least from our perspective, mired in sort of a myopic discussion about team payments, margins and operating leverage, and it's ironic because Formula One is a growth company. And so I wondered if you could talk at all about ways in which your communications might help investors appreciate the duration and magnitude of your growth opportunities going forward?

Stefano, why don't you start on Apple?

Yes. Thank you, Peter. I mean, first of all, I think that we are very, very happy about the deal with Apple for many reasons. And I think that it's important that the one that in our opinion, not so many, but anyway we respect that, of course, they don't understand the deal is because beyond that, there is a huge opportunity to increase the reach. There is an incredible opportunity for Apple to use all their channels, all their platform to promote our sport in a way that has never been done before. There will be the opportunity for the younger generation to be connected with the tool that is more logical for them to use in living the sport and our business.

So I do believe that this will represent a big step opportunity to increase also our revenue streams, not only in terms of direct one, but also in terms of awareness in the American market that will enable us to convince also the one that are not believing on that, that is the right move. But on that, we are not even a single doubt. It's a great move. It's great things that will happen that will give a big boost to our performance in the American market. And that our community has not even a single doubt.

Yes. And I would add on that. I mean, look, everyone understands that the landscape has been changing for many years now. And the former sort of terminology around reach and things like that are a bit antiquated. And we see from an Apple standpoint is complete 100% dedication to F1. I saw Tim Cook and Eddy Cue at Super Bowl, and they've got the full weight of the organization behind it. And in that respect, it's not just sort of Apple TV, it's Apple music, Apple news, the Apple stores. So from a reach standpoint, there's many different ways that we will be able to reach and engage with our fans.

I think the other thing that's interesting about Apple here, and we saw the news with the broadcasting races and IMAX theaters, right? And this sort of draws on my prior life in the pay television industry, like you wouldn't be able to do something like that necessarily with the traditional broadcaster because of a lot of restrictions that get put into traditional media deals, right? So Apple in that sense, and I think you'll see here in the near future, other announcements along those lines that will sort of bring more life into that. But I think there is that sort of ability to create new ground here, which we will do with Apple, are committed to do.

I think the other thing that will be something to watch closely over the next 5 years is sort of what happens with the actual product. As we know, Apple is at its heart a tech company. We are a tech company. The broadcast is sort of very technical in nature, what you can actually do with that as a collective force will be interesting to watch over the next several years.

I think on the second question, which was capital allocation. What we talked about at our investor conference was familiar themes, which clearly, we're in a deleveraging phase right now. Everyone understands that will sort of hit a point that we feel comfortable with respect to making additional investments. We've been pretty clear about our discipline in this respect and our desire to invest around sort of into the actual businesses themselves in and around those businesses, certainly, and then in similar sorts of asset classes where we've got great IP, low capital intensity and the ability for us to actually bring value either through insights we have, relationships we have, capital structures that we have, things like that, that will continue to allow us to have ourselves be a growth vehicle.

Certainly. Our next question is coming from Joe Stauff from Susquehanna.

I wanted to ask, just following up on the number of changes in F1 this year, engine, regulatory and how that affects certainly competition in parity. I'm sure that's naturally the goal over the long term sort of drives interest in the sport. But just wondering the best way to think about how maybe some of this higher competition could affect the P&L in the near term, call it, 2026 versus next year? What are the near-term sort of impacts of how we think about the financial implications of that?

Stefano, why don't you talk about the changes and what you're seeing and all that sort of stuff and then we can get into what the implications are?

Yes. Well, first of all, the implication -- let me start from one thing. The F1 has the duty to be always an innovator league sport, has been always -- that has been always the duty of our sport because by innovative, we can attract new investors. And the immediate effect of this regulation has attracted new manufacturers back into the sport. We have Audi, we have Ford, we have Honda, we have Cadillac that did come in because of this regulation.

And if I may, before, of course, that has taken the second part of the financial, this would be an immediate effect on the financial because they will invest in our sport. They will invest in our initiatives. They will invest in all the ecosystem that would generate for them a sort of a platform to invest to let the brand be known by the customer. So that's a direct effect.

On the other side, of course, there is a great interest, a great opportunity to showcase that the level of technology is always relevant to what is needed in the technological world. We have sustainable too. We have hybrid engine, and we've been always the first to believe on that. And we create excitement because the nature of the regulation will allow all the teams to develop this year car race the race.

You're going to see a season where every race will be different, that will be, for sure, at the beginning bigger gaps that will be restricted because of the nature of the regulation. And therefore, as always, F1 understand when there is the need to move forward faster than the others, and that has been always our philosophy. And that will attract the interest not only of the one that I said to you before, but the new fans that through the new content that we are generating will connect to us and of course, by enable to be connected directly with them, we can even leverage the fact that we will offer something new to them.

They're going to be a big push on the merchandising side of it. It's going to be big push also to our partner Quint to create new packages to promote to them. So this is the reason why we change the things for multiple reasons.

Yes. I mean just to follow on that. I don't think we sat here and said we're building a kind of incremental into the '26 business plan because of these changes. But that being said, as Stefano hit on quite clearly, these changes are going to drive continued interest and engagement in the sport. And hopefully, as he says bring in new participants, new fans and all the sort of accrued benefit that comes with that, that ultimately results in monetization.

I think the other thing in parallel here that is happening this year, as you know, there are some big names that have come into the sport between Audi and Cadillac and Ford, Honda coming back. It's pretty significant in terms of someone like Cadillac spending on a Super Bowl ad and what they're doing to promote their team on the track. So this is all part of the evolution of what F1 is and Stefano and his team have done a fantastic job of cultivating relationships, cultivating these partnerships, building the sport into something that we do look at on a multiyear basis, not sort of how this is going to drive something in the next week or next month. And that's constantly what we're trying to do is built for the long term.

Understood. Maybe one just quick follow-up. Could you maybe just give us an update on the changes of the commercial team at Moto? And any other obviously changes that you're making, obviously, now that you own it for about 6 or 7 months and how to think about that?

Sure. This is Derek. I mean, as we stated, or Carmelo stated, we're in the process of sort of putting out our brand and executing behind it, really. And I think that part of that is what's happening at the track in the hospitality, and we're going to see some pretty dramatic improvements, I believe, over the course of this year, where we're putting these tracks -- our races, excuse me, as we're getting them closer to cities where we can benefit from all the infrastructure and the attendance and all of that sort of stuff, including, as we mentioned, in Adelaide, it's going to be right in the city center.

And then how we go about sort of ultimately monetizing, commercializing that, we need the right team in place. And that's probably an area where we haven't had the sufficient sort of personnel there and we are building that. It's obviously not a heavy lift to sit there and hire folks up. So that's what we're in the process of doing.

As we have stated previously, this will take some time in terms of the ultimate commercialization. We'll see some areas pick up sooner rather than later. But over -- if you look at F1 as a parallel, we're in our 10th year and you're still seeing some of these new revenue streams sort of being activated. So we continue to be even more sort of bullish on Moto even if the results don't necessarily show in the short term, it's clearly a long-term proposition for us, which is -- which -- and we like to invest in for that long term. So we're very excited.

Our next question is coming from Ryan Gravett from UBS.

Just to follow up on the media rights topic. Now that you're through the latest round of renewals, not just in the U.S. but some markets in Latin America and Asia as well. Just curious what your key learnings were and how you think you're positioned for the next round of renewals in Europe over the coming years? Do you expect similar interest for digital players in those markets as well?

Stefano, do you want to start?

Yes. Thank you. I mean, I think that our position with the media renewal, as you see, is quite dynamic. And I don't want to anticipate anything, but stay tuned in the next days, you will see something else coming up. The real point on that is the interest is very strong. The numbers are very strong. And the key focus on what we need to make sure we keep doing is understanding if we keep going because we are a worldwide market in the so-called traditional way of the delivering our sport to our credit broadcaster or in certain markets, there is an opportunity. As we did in U.S. to move into the streaming platform because each country is different.

We have the incredible opportunity to be so strong worldwide, that we cannot have one single way of delivering our content in the same way and there are different time lines that we need to consider. So it's a bigger ecosystem. And I think that we have proven so far to make appropriate analysis before taking the final decision. So for sure, we want to be active and proactive in this world because the media right is not totally media right on the sports, the media rights are following other things in this moment. Therefore, I think that the reason why you see so many good news coming in is because we want to be proactive, and we feel that we are able to understand the evolution of the market, considering the difference that we have from area to area. But stay tuned because already next week going to be something new happening.

Our final question today is coming from Ian Moore from Bernstein.

When we look at trailing motor results, I think everyone sees an opportunity to drive monetization, particularly sponsorship to where F1 kind of is today. But F1 itself seems to continue to overdeliver on sponsorship. So I guess, more generally, what do you guys kind of see as the right mature mix directionally of media rights, race promo, sponsorship for these businesses? And then, I guess, for motorsport businesses more broadly?

Yes. I think -- look, it's early, but I think along the same lines is probably not a bad place to end up. And it's going to be over time that some of this stuff happened. But I think you've already seen that we're announcing new races next year, which will lead to some uptick there. And -- but then the sponsorship side of things probably lags a little bit as we build the brand and reengage with the potential partners.

But I do think that the ability for us to draft off of what F1 has done there and the Liberty name being able to sort of have credibility around what we're going to deliver with respect to Moto is something that we are excited about. Again, it will take some time, but we feel comfortable that that's going to happen.

I'll just end by saying there's good receptivity in the market. This -- we had a partner someone, as I mentioned in Barcelona last week, a lot of good enthusiasm, a lot of good energy there. There's a lot of good enthusiasm in the investor base around teams. I can't tell you how many people have reached out expressing interest. So I think people see it.

The other thing about Moto in comparison to maybe other sports right now of its size, which tend to be more emerging sports, Moto has a long, long history to draw on and many stories to tell as a result and an established fan base and established brand recognition. So we're starting from a place that's much different, and hopefully, it's something that we can accelerate here over time.

Thanks, everybody, for your participation in today's call. Apologies if we didn't get to your questions, we'll look forward to speaking with more of you offline. Thank you.

Thank you. That does conclude today's teleconference webcast. You may disconnect your lines at this time, and have a wonderful day. We thank you for your participation today.

Good morning. Welcome, everyone, to Liberty's Annual Investor Day. We are thrilled to have you here coming to you live from Las Vegas in advance of the third Las Vegas Grand Prix. Thank you to those who have joined us in person and to those who are joining us virtually. And speaking of in person, we are thrilled to have our Chairman, John Malone here joining us in person. John, thank you for being with us.

As we are in the entertainment capital of the world, what better way to start the day with a tantalizing forward-looking statement. Actually, it gets shorter this year than prior years. So there's a gift. Starting with a review of today's agenda, we have presentations from Liberty Media starting right now with both Derek Chang and Brian Wendling speaking. Then we'll go to Formula One, MotoGP and Quint. We will then welcome John to the stage for some Chairman remarks and close the day with Q&A with both John and Derek. After that, we will break for lunch and then have the Formula One Business Summit.

Unfortunately, that will not be webcast. But for those who are in the room, we hope you will stay around this afternoon for what promises to be some very exciting content on behalf of the Formula One community. I have to, of course, tout our hash tag that gets very little traction in this audience, but we have one for the Investor Day and the Business Summit. So maybe the business summit will be more your style.

We encourage you to please tweet something perhaps. And finally, we thank you for your patience. The slides will be posted. They just will not be posted right away. So thank you in advance for your patience as we wait to get those on. And finally, I will note a very big thank you to the team that puts us all together, in particular, to Amber and [ Marianne ] from my team as well as [ Alicia, Laura Robin ] and too many names from Liberty to mention. If you see them, please give them a very well-deserved thank you today, it takes a village to put this on. So we appreciate all of their work.

And with that, let's get to the show.

Good morning. and welcome to the 2025 Liberty Media Investor Day, live from Las Vegas. It's great to see everyone, and I am thrilled to be here doing this from Vegas because in addition to all the great programming we have this morning, which will be highlighted by John in his comments later, along with doing Q&A. But in addition to that, we have the F1 business Summit this afternoon and then 3 great days of racing, weather permitting.

I'm also thrilled to be here just because this is my first year as the CEO of Liberty Media and really capping off this here I want to take you guys through what we've done and where we're going. So first, Liberty Live, we announced we were splitting that off, I think, late last year. We expect that to be effective on December 15, further highlighting the value of our position in Live Nation.

In addition to that, it will make Formula One Group a stand-alone asset-backed security, which will highlight the values of both Formula One and MotoGP. Our operating businesses continue to perform. We closed MotoGP on July 3, and we continue to drive growth at Formula One. From a governance standpoint, some of the changes that have happened over the last year are one me becoming CEO. John, I think everyone knows, we announced a few weeks ago, we'll be moving from Chairman to Chairman Emeritus as of January 1, 2026, Dob Bennett, who is here, will be -- Doug Bennett, who is a longtime Liberty employee and affiliated with Liberty will be going from Vice Chairman to Chairman as of January 1.

And then finally, most of you guys know Chase Carey, who used to run for Formula One. Chase joined our Board at the beginning of the year. I've worked with John and Dob and Chase for, I don't know, close to 30 years. So I'm grateful for their presence as I will continue to lean on them for their support as we move forward. And then finally, we talked a lot about structural and corporate simplification, which you can see from this slide. We accomplished this year in terms of the [ Liberty Trip ] merger, closing that merger, spinning off of GCI Liberty -- GCI to create GCI Liberty, and then the Liberty Broadband Charter merger, which will hopefully happen and get accelerated through the Cox transaction at the middle -- hopefully in the middle of next year.

Now on to the operating companies. F1 continues to really hit it out of the park. Everything Stefano and his team have done has been really, really incredible this year, highlighted by the F1 movie which came to this summer, $600 million at the gate, Brad Pitt's highest grossing movie ever, and it solidified our relationship with Apple, which we then turned into a U.S. media rights deal, and we are very much looking forward to see what the folks at Apple can do with respect to the content and the product and the promotion that they're going to put behind it.

In addition, Stefano and his team have been driving hard signing up new brands, including Disney, Pepsi, PwC and Pottery Barn. This year, we are looking forward to the end of the season. There's still a lot of stake over the next 3 races, and we're very excited to see what happens. But we're already looking forward to next year where we're going to see Cadillac, Audi and Ford join the grid.

And then with respect to the Concorde Agreement, which all of you know, governs the sport, we are close to signing that with the FIA and with the teams, which will provide stability for the sport for the next 5 years through the 2030 season. And then finally, hopefully, many of you will stay and join us for the weekend to watch the races -- to watch the race, excuse me. This is our third year in Vegas, and we expect it to be better than ever. We are on track to sell out without having to reduce ticket prices, which is always good. But really, more importantly, Vegas has become a linchpin, I think, to our U.S. strategy. And you see the number of sponsors that have come in, American Express, Disney, LEGO, they're all activating in a huge way this weekend.

We have music. We have everything. This place, I think you guys walking around, we'll see it's alive. And then finally, I just want to say thank you for the entire LVGP team who have put on -- who have been working at tails off this entire year to get to this point that we can have a successful race this weekend. So thank you, guys. Very much.

And then moving to MotoGP, where we now see ourselves starting with a whole new opportunity to invest and grow. And already, we're working on a brand refresh building global awareness of the sport, investing into the commercial function so we can further monetize. We've been on track with certain race promoter renewals as well as signing up new tracks for the future at good increases. And then finally, we refinanced the balance sheet, which will reduce our interest expense going forward.

Today, we believe that Liberty Media is the premier public investment vehicle for global sports IP with exposures to 2 scarce lead-level properties. We believe we have the best attributes of sports and live entertainment with foundational IP, attractive fan demographics, a global footprint and what we believe are clear secular tailwinds, which help buttress us against things like AI and trade disputes. We pair that with attractive financial results with durable and diversified revenue streams, capital-light and highly free cash flow generative profiles, which we believe have -- which we believe will continue to demonstrate strong adjusted OIBDA margins.

The power of these businesses is that they are more than just sports properties, they're global entertainment brands. And the success story at F1 is, I think, unparalleled and we believe MotoGP has similar potential.

So you see from this flywheel that F1 has created, it starts with building the global brand value while maintaining the heritage of the sport. We then leverage that brand to attract new fans. We now have over 830 million fans, which is up 60% from 2018. And then furthermore to own the fan platform through advanced analytics and data. This then gives us more information that we can bring to partners and sponsors who can then further monetize their brands against our fan base.

So opening up new commercial opportunities which then allows the cycle to repeat. And looking a little bit more closely at the strong top line performance at F1, we've built a strong contracted revenue base which reflects growth in the underlying contracts, new inventory that's been created, things like Sprint races and F1 Academy. And this has led to existing partners wanting to renew early therefore, demonstrating further the power of the sport. And if you look at the bottom of the chart, we believe that we've been operating at levels that are far in excess in terms of growth rates of our peers in the industry.

The growth in the F1 business has translated into value creation across the entire ecosystem. We love the fact that we've been able to deliver very good returns, we believe, for our shareholders. At the same time, we know that in order for us to succeed, the entire ecosystem has to succeed. And that means the teams, for instance, which we believe they have succeeded, growing in value at 4x since 2017. Valuations of F1 teams are sort of in the neighborhood now of $5 billion to $6 billion, which is comparable to the upper echelons of sports like the NBA and MLB.

So it's pretty amazing where this has come in a short amount of time. I just saw Toto and Zach yesterday afternoon. They both look very healthy because their teams are healthy. And then finally, our promoter partners also have succeeded because of the growth of Formula One. And if you go to races now, you see the stands are full, attendance is pretty much sell out every place we go. We're reaching record attendance every single year. And what this allows the promoter partners to do is to invest behind the business. So they see the demand, they build better facilities, they invest in the fan experience at the track. And again, the cycle continues.

And following from the last slide, F1 races command large in-person attendance across these multi-day events. So we sell out events and new attendance records as promoters expand their capacity. We successfully are also successfully expanding and diversifying the attendee profile. We are now much more female skewed than we were before and much younger than we were before. But we also realize that not every fan can get to a race. We're only in 24 places and we have fans around the world. So through digital content, social media, we found other ways to democratize access to the sport and allow fans to engage.

F1 is the fastest-growing sport across social media for the fifth consecutive year. Our social media followers have grown 8x since 2017. And most importantly, 60% of our fans engage with F1 content daily. So that means they're not just watching races or race content. They're watching all the other content that's happening around the F1 ecosystem. And we continue to drive much beyond race day in terms of engaging with fans. This is the F1 always-on strategy where we're trying to meet fans where they want to engage, starting with Drive to Survive that broadened our fan base. We then launched new experiential venues, things like F1 Arcade and we've been expanding into consumers' licensed product with people like Disney and LEGO, again, leveraging off of their own customers to bring new fans into the ecosystem.

And finally, I think the Apple movie was a huge highlight this summer of this strategy. As I said earlier, grossed over $600 million and no doubt brought new fans into the ecosystem. But there's a lot of room left on this track. As you can see from this slide, we've also taken a much more sophisticated view of our fans. Historically, we viewed our fans as sort of a one-size-fits-all.

And now we're driving deeper into fan segmentation. We know that we need to develop content and products to meet every consumer, from premium to mainstream from die-hard gearhead to lifestyle fans. And I think this page demonstrates a lot of that. And we believe we are uniquely positioned to continue to deliver and serve our fans across the board.

Now on to MotoGP, where we think we can take a lot of the learnings from F1 and apply them to MotoGP and grow that business also. We call this the pattern recognition playbook. And if you think about the slide I threw up there earlier, translating sports into entertainment brands. Again, it starts with building a global brand, reaching more and more fans, owning the platform through investing in data and analytics. And we believe that this will open up broader commercial opportunities and really grow MotoGP.

And finally, the 2 teams have been fantastic in terms of working together since we closed to share best practices, looking for ways to great synergies on the revenue side as well as on the cost side. And really, what we're trying to do here is pretty simple. We're trying to close the monetization gap between MotoGP and Formula One. So you can see from this chart, Formula One has about twice as many fans as MotoGP. But F1 is clearly outperforming at a much higher multiple across the 3 major revenue streams, even at 10x on the sponsorship side.

But we know we have the skills and we have the learnings from F1 and we can apply that to MotoGP. It's not going to happen overnight. It will take a while. And we're not going to close the gap probably completely. But clearly, there's a lot of headroom, and we think this is where true growth is.

And finally, to wrap up, I'd like to spend a little bit of time on John's favorite topic, capital allocation. Liberty's hallmark is that we remain opportunistic and flexible while being disciplined about how we allocate our capital. And near term, we said, once we close MotoGP, we would delever, which is what we're doing. At the same time, we think the highest potential for investment is within the existing businesses.

So Stefano and [ Carmelo ] and their teams find opportunities for us to invest behind, we will do that. And third, we do always canvas the market to see what else is out there, what might be relevant to our businesses what might be relevant to our investment profile. We do recognize that we have simplified our structure. We are now a pure-play asset-backed security focus on the motorsports world but we do think that there are potentially opportunities that we can invest behind and we will continually look for those.

And at the same time, we are always maintaining an opportunistic view towards capital returns for our shareholders. So with that, I want to thank everyone. I want to thank all of you who have come here in person, those who are listening in. Thank you for your interest in Liberty Media. I'll be back later with John and Shane to do Q&A. And right now, I'd like to turn it over to Brian Wendling. We always leave the most interesting stuff and the most insulating stuff for Brian to do. So Brian Wendling. Thank you, guys.

Well, that's a high-pressure lead in. This is going to be some exciting stuff. Good morning. Thank you for joining us here in Las Vegas. It's good to see everybody. Last year, we announced the split-off of Liberty Live to be completed in the second half of this year. We're going to make it. December 16, we'll start trading as a separate public company. We're excited about this further simplification step as both Liberty Media and Liberty Live will now be asset-backed securities.

We expect to see certain benefits from split off, including enhanced liquidity for both securities with exposure to a larger group of investors, the elimination of tracking stock complexity, narrowing trading discounts to net asset value and enhanced flexibility. There will be a presplit off reattribution to move Quint and the final cash amount over to Liberty Live in exchange for certain assets coming over to Liberty Media. We can see the final composition of that on the next slide.

So here, we'll take a quick look at our NAVs. You can see both are highly simplified at this point from an asset composition standpoint. Liberty Media will be comprised of Formula one and MotoGP, along with a healthy cash balance, even after accounting for the cash that will be reattributed over to Liberty Live. There's a handful of private investments with the most material ones being the land and building associated with the Las Vegas Grand Prix and then our investment in the Kroenke Arena company. The FWONK convertibles and debt at the Formula One and MotoGP opcos round out the liabilities here.

And true to form, there's more information about the FWONK convertibles in the appendix, so give those a look. At Liberty Live, you have our 30% ownership interest in Live Nation and the Quint business as our primary assets. You also have a healthy cash balance, which will be bolstered by the $150 million to $200 million that will move over to Liberty Live in the reattribution. There's a few other private assets that were made on Liberty Live books following that reattribution. And we intend to provide final cash balance and the estimated private asset values. At the time, the reattribution is completed, but just giving estimates for right now. And then lastly, note here, you see the Live Nation collar. In May of this year, we issued a collar against some of our Live Nation shares. This collar was issued to provide a source of liquidity, if needed to satisfy any puts or exchanges of the [ 2 3/8 ] Live Nation exchangeables because the split off creates a put window for holders there.

To the extent investors do not elect to put or exchange, we don't intend to borrow on that collar. The FWONK balance sheet is in great shape. As of 9/30, we have $5.1 billion in debt. Net leverage at the Formula One business is 3X, 5.6X MotoGP, and we expect both to delever quickly. The opco debt, combined with a bit over $600 million of corporate debt, gets you to a 3.8x consolidated net leverage on a trailing 12-month basis. And we're still in a strong liquidity position with $1.2 billion in cash on the balance sheet and $600 million -- a little over $600 million of availability between the F1 and MotoGP revolvers.

Common theme here near term, the focus will be on delevering post the MotoGP acquisition through adjusted OIBDA growth and free cash flow generation. This slide shows a consolidated leverage at the Formula One Group, including corporate level debt and cash. As you can see, we have successfully delevered from 3.3x in 2021 to 0.4x at the end of last year. I would note that this 0.4x is artificially low because of the cash we raised and the FWONK equity issuance to fund the MotoGP acquisition.

But you can see here, the businesses have a proven ability to delever organically as illustrated by Formula one being at 7.4x when we closed the acquisition in 2017 down to 3.0x. Familiar slide here for most as we look at the 5-year average of OIBDA to free cash flow generation. Now this year, we have, obviously, MotoGP being compared to Formula One. F1 continues to have a very strong free cash flow generation profile. And MotoGP is very similar at 86% unlevered free cash flow conversion.

Cash interest expense is a bit higher at MotoGP, given the greater leverage. But as we just mentioned, the recent refinancing activity at Moto will help drive that down along with our deleveraging efforts going forward. Both of these businesses have a very attractive margin structure and low capital intensity. There continues to be a modest uptick in F1 CapEx driven by our Grand Prix Plaza start-up costs this year, investments in the media and technology -- technical center at Biggin Hill and investments in other digital and technology platforms.

A reminder that the teams [ share in ] CapEx investments to the team payment calculation, which allows F1 to make strategic long-term investments. Compared to last year, we continue to see interest expense come down at the F1 opco level, 18% this year versus 20% in the prior year, driven by positive refinancing activity there and reduced debt balances prior to the MotoGP acquisition.

Working capital variability is always going to be driven by really the timing of race promotion fees that's consistent with the past years. And then cash taxes at F1, generally stable as a percent of OIBDA, but we expect to see a modest uptick in the cash tax rate as profits increase and the future utilization of certain U.K. tax attributes stays constant. We expect to have a low double-digit cash tax rate at F1 and kind of mid-double digits at MotoGP for the next couple of years.

Although MotoGP has a slightly higher tax rate than Formula One, its team payment structure represents a lower percentage of revenue, which drives a higher OIBDA margin starting point. And then you can see at the bottom of the slide, Vegas CapEx investments have been about a 300 basis point impact on free cash flow conversion over this time frame.

The financial outlook is very strong at Formula One with nearly $16 billion of future revenue under contract at the end of the quarter, This is over 4x the amount of revenue in the last 12-month period and represents a 14% CAGR since 2022. This is very much a diversified revenue base with a growing number of partners as evidenced by the logos that Derek just walked you through with his slides. Revenue for the trailing 12 months has grown by 6% compared to full year '24 despite having one fewer race in that current period. And this consistent revenue growth has been driven by stable -- this consistent revenue growth has driven stable and expanding adjusted OIBDA margins finishing at 24.3% for the trailing 12-month period.

You can see here team payments as a percent of pre-team share OIBDA have continued to come down, which has fueled investments for continued long-term growth in the top line. While the percentages come down, the overall dollar amount of team payments has increased each year as we continue to grow the overall F1 pie, which supports continued health in the overall ecosystem, as Derek pointed out.

As a reminder, last year, we finished team payments at 61.5% as a share, [ pre-team ] share or adjusted OIBDA. We expect to continue to have leverage on that number for the full year 2025. And as discussed throughout the year, the new Concorde agreement will provide for a simpler payout structure beginning in 2026. Going forward and under the new Concorde structure, we expect to generate strong adjusted OIBDA growth and stable margins. Hopefully, these revenue categories look pretty familiar to you as MotoGP has a very similar revenue profile to Formula One.

Media rights include fees paid by the broadcasters as well as subscription fees for Video Pass, which is Moto's direct-to-consumer product. Items in race promotion and sponsorship revenues are consistent with Formula One. Note that we have reclassed some amounts that were previously in MotoGP's commercial category to be consistent with F1's presentation.

As a result, hospitality has moved out of commercial and it's moved into other and is in there with licensing revenue and other championship -- revenue from other Championship series, most notably World Super Bike. Primary revenue streams also benefit from multiyear contracts with annual escalators. This revenue mix is comparable to Formula One for race promotion, but lower for sponsorship and other revenue, while media revenue at MotoGP is a higher proportion. This is similar to the early days of our F1 investment and represents the opportunity we see as MotoGP scales the sponsorship and hospitality side of the business.

Looking at the MotoGP cost structure. Motor and F1 have very similar types of expenses, including personnel, freight, broadcast, operations, commercial activations and team payments. Similar to F1, we'd encourage you to look at these as these categories as a percent of total revenue. Moto has a more fixed payment structure to the teams through [ IRTA ] with a per race fee, which is also higher for flyaway events than for European events. This results in a more fixed cost structure compared to Formula One.

Cost of motor sport revenue is higher in the last 12 months, primarily due to the higher race count, as you can see here on the chart. Personnel costs represent about 2/3 of SG&A and have been growing as the company has been building out its commercial functions and investing in the business. In the trailing 12-month period, there's been an uptick in organizational costs as the company invests in commercial activities and then also due to the race count. Looking at adjusted OIBDA, you can see that adjusted OIBDA is down a bit slightly in the trailing 12-month period due to the investment that we discussed here and then also the impact of a bad debt recovery that was very early in 2024 that's kind of impacting the comparability of these results.

All right. And lastly, looking at the currency mix of where we sit with MotoGP in the portfolio. The majority of F1's contracts, as most of you are familiar, are in U.S. dollar, just a refresher that they're London-based or U.K.-based SG&A costs are in pounds with a handful of revenue contracts in pounds that helped to offset that cost exposure.

MotoGP is primarily euro-denominated with nearly all of its revenue and costs in euros. U.S. dollar costs at Moto are mainly comprised of freight and organizational costs, but it has very limited exposure to currencies outside of the euro and the dollar. So you can see at the table down below, the majority of our revenue and operating costs are still in U.S. dollars with pretty good matching of cost to revenue for all 3 major currencies there.

And in August, refi of the MotoGP debt, the previous all-euro capital structure that was in place was refinanced with a mix of euro and U.S. dollar term loans and a new multicurrency revolving credit facility. This combination of euro and U.S. dollar debt is better aligned with Motor's current currency exposure. Be sure to look in the appendix for the slides when they're posted, as Shane pointed out, for additional information. It's always fun to end on a high note with something like currency exposure. So thank you for that. Thanks for joining, and thanks for your continued interest in Liberty, and thank you to Shane for your partnership over your very short 11-year tenure here at Liberty Media. It's been a pleasure. We wish you the best. Thank you.

Hello, everyone. This year, we celebrated the 75th anniversary of F1, and it has proved to be a truly season. The championship battle has delivered the thrilling, unpredictable rating that fans love, driving incredible engagement and strengthening our business fundamentals. This on track excitement is matched by extraordinary strengthened financial performance with revenue up to 9% and the adjusted OIBDA up to 15% year-to-date.

When I look at the state of Formula One today, I'm not only proud of the financial and operating success we have achieved, but I'm very optimistic about the growth we have at hand. We have evolved our sport from a B2B model with attractive contracted revenue streams, successfully grown this contracted revenue base and increasingly moved into that to consumer channel that benefit our financial and continued fan growth.

Our teams are also driving and in robust financial health, attracting prestigious blue chip sponsor and demonstrating the unparalleled attractiveness of the F1 ecosystem to global brands. This vision is validated by the entrance or return to F1 in 2026 of a number of major automotive manufacturers. Audi [indiscernible] team with their own power unit, Honda will be the power unit supplier to Aston Martin. Ford will partner with Red Bull and Cadillac will join the grid. We have welcomed the highest total attendance in Formula One history. Over half of our events have sold out completely with many setting new attendance records.

We currently expect full season attendance to reach approximately 6.7 million total fans, a new record and nearly a 60% increase from pre-COVID attendance levels. Our multi-platform engagement and reach continue to break records. We also recognized that the definition of reach means something different in today's sport and entertainment ecosystem. When fans are engaging with our content in increasingly diverse ways, you can see here the incredible rise of digital platforms that are relevant to our F1 fans, especially younger audiences.

For the season so far, over 1 billion cumulative TV viewers have tuned in for [ races weekend ]. Average audience is nearly 70 million with an additional 25 million estimated to view on digital channels. Our reference F1 social media following has grown to EUR 111 million, a nearly 20% increase driven by rapid growth on platforms such as YouTube and TikTok, increased engagement from younger fans and a strong interest in both on and off track narratives, including The F1 Movie. Last year, I outlined our 5 strategic pillars. I'm pleased to report significant progress across each pillar with incredible momentum heading into 2026.

First is maximizing value across commercial rights. Formal One growth has and will continue to come from all primary revenue streams. It is important to look at the financial picture altogether, as these revenue streams work with one another to grow our entire F1 business. Media rights are benefiting sponsorship. Race promotion is benefiting hospitality, sponsorship is benefiting licensing and more. Going into more details across each area. On race promotions. 2025 has delivered exceptional event with our '24 risk calendar at what we believe remains the current optimum maximum.

The scarcity of available slot creates robust competition among prospective host, building a solid pipeline and driving meaningful increases upon renewals with promoters also committed to make improvements to circuit infrastructure and hospitality capacity. Our recent renewal in Austin includes the building of a new private members club at the iconic [ Turn One ] with a portion of it to be used for the Paddock Club. Yet another example of our race promotion and hospitality revenue are closely interconnected. We have 18 races contracted to 2030 or beyond, providing exceptional long-term revenue visibility. We are managing high inbound interest from potential new hosts and seen increasing demand from existing hosts who are focused on retaining the place on the calender.

On media rights, renewal activity this year has focused on the U.S., together with other markets, we have secured Canada, Brazil, Mexico and more and are close to finalizing the remaining markets coming due, including Japan, Latin America and markets across Asia. The U.S. deal with Apple brings together 2 global brands with a shared passion for innovation, excellence and entertainment. It will enable us to reach a huge audience across the U.S. through Apple TV and Apple extensive ecosystem.

Apple holds also incredible social relevance for our target demographic in the U.S. And we believe these 2 brands coming together will be able to capitalize on younger, more diverse fans. We also are pleased to offer our fans outstanding value with the full suite of Apple TV content and the ability to add F1 TV premium at no incremental cost. Importantly, F1 will retain all first-party data from subscriber to F1 TV through the Apple platform. Our team is actively focused on completing next year renewals with term either contracted or agreed for all but the smallest market and positive outcome achieved.

We will also continue to invest in improving our F1 TV product offering with the new premium tier having been especially well received this year, making up nearly 20% of [indiscernible] subscribers.

On sponsorship, our momentum with existing and new names alike is impressive. The full list is shown on the slide here, with the F1 brand strengths continue to attract world-class partners on an unprecedented scale. This year, we work on an additional luxury brand under our historic 10 years partnership with LVMH. This partnership represents one of the largest sponsorship deal in sport history and reflects F1's position at the intersection of sport, luxury and global culture.

We also recently renewed our long-term partnership with Heineken, accelerating the renewal cycle given our shared appreciation for growing our relationship together. Last year, we discussed the high degree of visibility in our sponsorship revenue heading into the 2025 season, helping to derisk this revenue stream and enable a clear focus on quality of partners. I'm proud to report the same dynamic holds today with high visibility of continued growth in 2026 from our existing partner renewal and a good pipeline of further opportunities. F1 Now has 26 global and official partners in the upper tiers of our offering, more than doubling from just 11 such partners back in 2020.

This growth reflects our strong brand resonance and the success we have had in expanding our commercial inventory. We have also significantly developed our licensing strategy and are seeing new deals with like-minded brands. While still early days in developing this revenue stream, the progress is impressive. F1's ability to pair its premium IP with that of other [indiscernible] rights holder is unique. We will continue to scale the consumer license product area alongside our license experiential venture like F1 Arcade and F1 Exhibition, which brings the thrill of F1 to ever more fans outside of the race we can.

The Paddock Club, our premium hospitality offering, continues to go from strength to strength as we expand capacity strategically and develop new premium experiences to meet surge in demand from corporate clients and the high net worth individuals. [ House 44 ], a collaboration with Lewis Hamilton and Soho House was successfully launched this year and sold out in Silverstone, Monza, Mexico, Vegas, and Abu Dhabi with plans to expand to 9 races start in 2026.

Our second strategic pillar is augmenting our diverse and valuable fan base. F1 enjoys the extraordinary advantage of a large, growing, diverse and commercial attractive fan base. Drive to Survive is an ongoing success, continue to attract new fans with a cumulative global audience of nearly EUR 1 billion across [ seven seasons ]. This year, we celebrate the global release of F1 the movie, which we believe will provide the tail to our fan growth for years to come.

This film represents a cultural moment far beyond traditional sport marketing. Additionally, F1 Academy is helping draw in new female audiences and a growing list of corporate partnerships. We look forward to expanding our pipeline of female talent and supporting this series as it scales. Growing our direct-to-consumer business and deepening fan relationship is an increasing strategic focus. We are enhancing our fan segmentation capabilities, recognizing that our audience spans from hard-core racing enthusiasts to casual lifestyle-oriented fans drawn to F1's claimer, travel and entertainment elements. This sophisticated segmentation allows us to position F1 more strategically towards various cohorts, creating both premium and mass market touch points through tailored commercial partnerships.

This enhancing site can deliver tremendous value to our B2B partners, helping promoters improved fan experience and data capture capabilities, enabling media rights partners to produce tailored content and providing sponsorship partners with highly targeted audience alignment activations. Third, is investing in strategic markets. We maintain a holistic approach to growing F1 presence in markets with significant fan potential, making coordinated strategic decisions across broadcast partnership, race location, sponsorship and licensing. The in roads F1 has made in the U.S. and broader North America market is impressive. But we continue to believe our growth in the U.S. has a long runway ahead.

Looking at sponsorship as one of examples, when Liberty bought Formula One in 2017, there were no U.S.-based sponsors. Today, 8 of our global and official partners are U.S.-based companies, comprising over 20% of 2025 sponsorship revenue with iconic U.S.-based brands also partnering on licensing deals, as I mentioned. The Grand Prix [indiscernible] our business in Las Vegas continued to play a key role in our U.S. growth strategy, driving bus and fan awareness and generating mass local and global sponsorship interest.

Outside of North America, we see opportunity, particularly in under monetization markets. China now claim over 200 million F1 fans with over half having started following the sport in the last 5 years. The democratic profile is particularly attractive, 46% female and 40% aged 16-34. China was the largest international market for The F1 Movie with over $60 million at the box office. We continue to cultivate strong interest from potential new host cities in Asia and believe our growth will be supported by these prospective new races location and through experiential licensing opportunity that bring F1 closure to the many fans in the region.

Fourth is delivering world-class racing. This is a core foundation of our strategy. This season continued the multiyear trend of improved competitiveness. 2026 will reset the new engine and car regulation. We are already counting down to the season opening in Melbourne. The new technical regulation introduced active aerodynamics, new power units with advanced sustainable fuels and refined car dimension aimed at maintaining competitive variation while advancing sustainability. This is one of the key reasons for Audi, GM and Ford joining and Honda saying in the sport. And our fifth strategic pillar is prioritizing sustainability in our operation and partnerships.

Our sustainability strategy centers on the 3 things: achieving net 0 by 2030, promoting diversity and inclusion and transitioning to the sustainable events that drive positive change. We are on track to achieve our goals, having delivered a 26% reduction in carbon emission by year-end 2024 compared to 2018. Our promoters partners have also made great progress in modernizing and reshaping their events operation to become more sustainable.

In the years ahead, our commitment to reaching net 0 by 2030 will only intensify. F1 is uniquely placed to show that performance and sustainability can support one another. We approached 2026 with sustained strength, combining regulatory transformation, grid expansion and visibility of commercial growth. Clearly, on-track competition is driving unprecedented fans growth and engagement across every metric, a compelling sustainability vision is becoming an operational reality. Interesting partnership is coming at a scale we have never seen before and improved financial sustainability in benefiting the league, teams and partners.

In summary, the growth profile ahead is very strong, and we have clear visibility into these drivers over the coming years. We remain excited about what lies ahead, and I want to thank our friends, the FIA, the teams, the partners, the promoters for their fundamental contribution along this path. Avanti tutta!, full speed ahead.

Hello, everyone. We are very excited to be at our first Liberty Investor Day and share more about our incredible sport with all of you. 2025 has been a very strong year for MotoGP, as we have continued to develop not only our sport, but our brand. We launched our new identify at the end of the fantastic 2024 season, showcasing a new look for MotoGP that reflects the bold, fast, defying nature of our sport and positioning as well for our next chapter of growth.

We expanded on our brand [indiscernible] with our first season launch held in Thailand in February. The event brought the excitement of MotorGP to the heart of Bangkok with riders parade through the city streets and ending in an amazing stage show featuring live music and a chance for fans to interact with the riders. The event had a huge impact on our local fan base and beyond with more than [indiscernible] across 27 countries, airing the launch live. We look forward to bringing the excitement of MotoGP to our fans around the world once again with our 2026 season launch in Kuala Lumpur.

Our newly evolved brand positioning [indiscernible] will shape how we connect with our fans moving forward. It will craft the stories we share from the world's most exciting sport, helping us build deeper connections while continuing to expand our areas. Similarly, the action on track has been great across all the racing. Every race weekend host both a sprint and a Grand Prix for MotoGP as well races in the Moto2 and Moto3 clashes.

The format brings outstanding value to our global fan base with consistency across each event as well as energy and action for fans at each country with a program designed to deliver nonstop entertainment. Decision in MotoGP has been defined by extraordinary story. [indiscernible]

After a dominant start during his career winning 6 titles in 7 seasons, he went through 5 long years of setbacks, injuries and recovery before reclaiming the crown this year. It is one of the greatest comebacks in sporting history, a testament to the resilience, talent and commitment. In Moto2, we've seen a record number of different winners, including historic victories for Colombia and Brazil. And in Moto3, the racing has been [indiscernible] decided by only 100s of a second. Racing on track and our effort to showcase more historical of our sports have resulted in higher engagement from our fans.

We crossed a record 22 Grand Prix across 18 countries this year, including returning to the Czech Republic and Hungary and had another year of record attendance with over 3.5 million fans. This is a significant increase on the 3 million fans we welcomed to the race weekend in 2024. According to Nielsen, our global fan base now stands at an impressive 632 million. We are seeing a strong year-on-year growth with the U.S. up 38% and the UK up 10%, while it's still early in realizing the full potential in this market, we are encouraged that our efforts are making an impact.

As we look ahead to next season, we are excited about our opportunities, another 22 event calendar awaits, perfectly placed for fans around the world. A major highlight will be the return of Brazil to the MotorGP calender for the first time in 2 decades arriving just as a new resilient [indiscernible], representing nearly half of the South American total population, Brazil is already an important market with a passionate fan base and also one with incredible potential for sport.

Finally, we also welcome a new chapter for one of our longest standing teams with the Red Bull KTM Tech3 now under the leadership of formal Formula One. Together, this milestone marked an exciting step forward as we continue to expand MotoGP, which bring in new global audiences and unlock greater commercial opportunities for all our stakeholders. Now I'd like to hand over to [ Carlos Handan ], who will share more about our business and the key priorities on driving the new era of MotoGP

Good morning, and thank you for joining us. I'd like to welcome everyone to MotoGP, the world's most exciting sport. Born in 1949, MotoGP is the first motorsport world championship with now 77 seasons of incredible racing, passionate fandom and global growth. 2025 has marked an important milestone for us, with our biggest season yet, comprising a record 22 Grand Prix, up from 20 in 2024 and the first ever MotoGP season launch fan event held in Downtown Bangkok under our brand-new logo. This year has seen us return to Hungary after 30 years and again in Czech Republic after a 4-year break.

In MotoGP, each event includes all 3 classes: Moto3, Moto2 and MotorGP. And since 2023, also Sprint race every Saturday, providing nonstop entertainment on track from Friday to Sunday and a clear pathway for MotorGP's future champions. Our main race is on Sunday are just 45 minutes, which are well suited to attract new audiences and having all classes and the Sprint race every GP builds a valuable product to broadcasters and a consistent format defense.

It also elevates the riders for tomorrow who become relevant icons at young ages. MotoGP is a sport you can't look away from. One moment can change everything. Jaw dropping action with continuous overtaking, dramatic crashes and epic plot twists. The nature of the sport captures fans who are drawn in by the racing and its continuous ability to deliver the unexpected. This year, for the first time ever, we've had 5 different world champions on the grid, the average difference covering the top [indiscernible] qualifying was just 0.7 seconds, and 10 out of the 11 teams are on the podium.

Above anything else, 2025, marked one of the greatest compacts in auto sport as we've seen Marc Márquez return to the top after 5 years plagued by injuries.

And that incredible racing along with our new determination to broadly promote MotoGP has led to some early success. We welcomed a record 3.6 million fans to our circuits, which led 40% of them to have an all-time attendance high, an aggressive pursuit of new audiences, a recurring theme, started with a brand refresh one year ago and the constitution of a marketing function that is still developing.

We have welcomed fans to our weekends with the help of our circuits and our promoters. And in social and digital, we have importantly increased engagement and coupled that with a 30% increase in reach.

2025 has been a landmark year for growth over the sport, both in new and existing locations. We've secured 7 key renewals in major markets, whilst adding new events that strengthen our global footprint. In March, we will return to Brazil after more than 20 years, a market with huge potential, and it cannot be at a better time as just a couple of days ago, we saw Diogo Moreira become the first Brazilian world champion clenching the Moto2 title.

Looking ahead, 2027 will see us race in [indiscernible], a city with a global appeal as we push to bring Mot GP closer to fans in major cities. We're also very excited to welcome Guenther Steiner into the MotoGP family as he's led the acquisition of Tech3. Guenther will be taking over the team in 2026. And as a new revenue line, we will now include IND in Paddock.

2026 will be the start of an exciting new racing series, the Harley-Davidson Bagger's World Cup, which will see the [ notorious ] American brand return to the world stage of racing after their last appearance in 1976. We will welcome the Great Harley community at 6 of our events during the year.

We have a runway to build our commercial business, and the work has already commenced. We are very fortunate to have solid industry support and have used strong, competitive interest to expand partnerships in oil, gas, lubricants and tires. Regarding the latter, we have gone to a single supplier in MotoGP, uniting all 3 classes with Pirelli. Simultaneously, we are iterating media distribution and fan events to expand our presence in and out of race action.

Earlier this year, as Carmillo mentioned, we held our first season launch in the heart of Bangkok and we'll do the same in February in Kuala Lumpur. With a strong foundation, we are occupied with shaping the future. Carlos will expand upon how this manifests itself on the sporting side, but here are some key enterprise priorities, while we have much to do if everything is a priority, nothing is.

It starts with continuing to deliver the world's most exciting racing to fans in the best possible fashion. Our envious position, controlling production allows us to showcase the action in a manner consistent with our brand. From there, we must meet fans, especially younger ones where they are. Discovery has been obliterated by the fragmentation of media so we will develop content to match each platform and search out new fans.

Similarly, we will use a world-class sporting product, create a deeper connection with current fans and then augment race weekends with entertainment components to attract new audiences.

We already have a fantastic sport, one of which we're hugely proud of, but we always try for more to make MotoGP even better, even safer, even more entertaining and even more sustainable. Big changes are coming to MotoGP in 2027 as we reshape technology to deliver more of what fans love, racing and the stories behind it, smaller engines, reduced aerodynamics and [indiscernible] dynamic suspensions will have racing safer and more competitive, putting rider talent at the forefront.

High-level GPS data will be available from all riders to all teams, improving broadcast features like [indiscernible] like comparisons. Finally, one of the most significant technical milestones of MotoGP, the introduction of 100% sustainable drop in fuel, developed by each team's fuel partner, this innovation ensures compatibility with existing internal combustion engines while paving the way for global adoption in the future.

We're also continuously innovating the technology in our sport and our product, including the continued work on our audio communication project. We're developing pioneering technology, specifically for MotoGP, which will go into the riders' helmets and their leathers, so they can talk to their teams even when they're off their bikes. This will give fans unprecedented access and deeper connections with their favorite personalities.

To capitalize on exciting evolutions on the racing side, we are building on our brand identity refresh with new positioning called magnetic defiance. The brand essence aims to attract fans disaffected by fabricated storylines. The defiance seek authenticity coupled with unpredictability. Our current fan base is predominantly high income, male and millennial and is more likely to be settled with kids. We will deepen our engagement with this existing base and extend the brand to new audiences via content creation aimed at a broad cohort inclusive of kids and families.

Turbo riders is in the development phase as an animated series with licensing and fan extensions. Let's remember that we have 22 races in the year, but we will satiate fans appetite for MotoGP 52 weeks. We must use all media levers because despite having record numbers of fans flowing through our circuits, just half of 1% of MotoGP fans will go to a race next year. Crucially, we have an easily consumed sport with our longest races around 45 minutes. That leads to mind blowing avidity where over 80% of our fans watch 75% of the races.

Another part of our job is educating potential fans and we'll do that in myriad formats. Here is a quick demonstration of that.

[Presentation]

I often say that we are a true global sport, and we are lucky to bring it all over the world, with more than 115 broadcast partners in addition to our social and digital efforts I mentioned, we can reach all corners. Riders, local heroes help us not only open markets but drive viewership. With a Turkish rider and the Brazilian Moto2 champion coming into the primary class, we saw a significant increase in viewership in those markets. A global sport brings a global audience, and we have taken the time to divide the world into different target segments. We will take a different approach depending on the state of each market's tandem.

For example, Indonesia is our most engaged market, but we have room to grow our numbers of fans significantly. And in the U.S., where we're not yet a household name, there is extreme [ lividity ] once fans learn about our sport.

Due to the physical stress and demand on the riders who compete in MotoGP, we don't anticipate increasing the current 22 race limit in the short term. However, as we mentioned previously, our race promotion business is doing very well with strong demand from new locations and very positive renewals at existing circuits. Looking ahead, we do expect a shift in race distribution with more events outside Europe as we grow the sport globally and target key markets.

Our goal is to bring new events to strategic locations closer to major cities and with a broader entertainment offering. We've created a dedicated team to work with promoters to enhance event promotion and fan experience across circuits.

The global reach of Mot GP, plus the aforementioned industry support puts us in a position to ramp up key areas of growth. We are busy having expansive dialogues with like-minded brands who have put MotoGP inside their marketing initiatives. I cannot overstate the importance of brand partnerships that are authentic and can market us in new and unique ways.

Likewise, we have upgraded our hospitality offering and that work will continue to make it both a strong, self-sustained business but also a driver of our commercial partnerships. That includes working closely with Quint on the product ladder and innovation. The business and the existing audience have been established on the back of the sporting attributes. As part of the ongoing effort to introduce ourselves and potential new fans, we will continue to integrate entertainment and cultural elements into our race weekends and marketing efforts, prerace activations and emphasizing the natural connection with music and Hollywood, will lead us to show up in places we have not been previously and to represent MotoGP in an elevated manner in places we already have been.

We're seeing huge interest in investment in MotoGP teams, which has been accelerated by the Liberty Media announcement. Our goal is to help racing teams evolve to become sport franchises and then build their own brands. This new investment interest will support that evolution with teams improving their positioning, talent and value, leveraging 11 teams with 11 unique identities.

We've created a dedicated team to work side alongside the racing teams and riders to accelerate development in marketing and promotional initiatives. We're pushing for more stories beyond the racing, engaging audiences both current and new with content outside GP weekends and creating awareness during over 30 weeks of the year we don't race.

MotoGP has always strived not only to grow our brand and championship, but to drive the growth of the entire sport. Through our efforts, we aim to create accessible racing platforms worldwide, ensuring as many kids as possible can practice the sport, widening the base of the pyramid and setting clear paths to the top. Recently, we announced the new look and feel of the road to MotoGP unified under word Moto and our new brand, starting at just 10 years old with MotoMini, there's now a clear and structured progression with equal machinery all the way up to MotoGP. We hope this work will open the sport globally, creating opportunities for young talent and building the next generation of Champions.

MotoGP is a strong legacy, and we are entering a new phase with confidence because we have both a premium and accessible sport with valuable long-term partners. What comes next is to share the sport, make it intertwined with popular culture and scale it to new audiences. Please come to a race because despite [indiscernible], it is truly an indescribable experience. Thank you all for coming. And unless you guys have more currency questions for Brian, we'll turn it over to Quint. Thank you.

Thanks, everybody. Pleasure to be here. Quite inspiring to be following F1 and MotoGP, especially considering the amazing collaboration that we already have with them around our experience business. It's quite an honor. But that's what we're here to talk about, we're here to talk about our experience business. We've seen continued engagement and growth in the experience economy, the trend around people moving towards buying experiences versus things continues to gain momentum. It's cross-generational and it's global.

And it's affected inside of our business. We see it in 3 primary categories, really as we look at it. And the first one is really the consumer marketplace. The individual that's just looking to entertain themselves and experience life in a different way. We're also seeing this from brands and corporate clients that are looking to engage with customers, with partners in a very different way. And then I think one of the most important things that we're seeing today is the idea that the organizers and leagues are seeing the growing economic impact of what this can truly do for them across their entire ecosystem.

So from that standpoint, this is where Quint's expertise falls in. Now with that, we jump into our model. And our model has 4 key pillars that drive our business. The first one is we are a ticket-plus business. Everything that we do is intended to have a VIP experience or hospitality, transportation, some type of coordination of multiple events to make it easier on the customer and the consumer to have the best experience of their lives.

Number two, is we focus on the white label. These fans love F1. They love MotoGP. They love the Kentucky Derby. They love the NBA and they love the brands that we represent. We don't interject Quin's brand into that. We just quietly sit in the background and provide the service we need to provide. Next, turnkey. We engage from strategy around hospitality, experiential, the production of those assets. the sales and marketing and the delivery. So full service turnkey from top to bottom. We also engage in any one of those components that our organizers might ask us to do.

But we are capable of doing this from top to bottom. Next, technology enabled. I believe we've built the best -- the best packaging technology on the planet to optimize the number of components, the number of tickets, the number of assets, the incoming leads, and the most important thing that we've done there is we've been able to globalize this so that we can manage currencies, time zones, leads coming in from all over the world, languages. We have to be able to service people where they are and the language they want and the currency that they want to spend.

So the last bit and very importantly is we talk about our business being global. The technology has been globalized. But we've also built the footprint. And that footprint has allowed us to do several things. First off, we'll just talk about offices. We've got an office opening in Barcelona here shortly, which will give us 9 offices in 8 countries. We'll execute 70 events this year in 30 different countries. We've got customers from 148 countries in 2025 alone, 60% of our customer base is international outside of the U.S., and it truly positions us for global growth.

Now I always like to have a visual to explain what it is we do and how we grow. So it's a proxy for our business, I've got the Kentucky Derby here in our first year. And what you'll see here is 2 seating locations, 2 dining locations and a hospitality center. Fast forward to our 2026 model. This is what it looks like today. different package levels, 26 dining rooms, 5 hospitality centers that we're producing on our own, 3 parties that are externally outside the 4 walls, 3,000 rooms, 400 transportation vehicles and 12,000 guests a day over the weekend.

And there's a lot of room to grow in this business with Churchill Downs. So as we move on and just look at our 4 key partners and kind of where we are positioned today. F1 experiences, we continue to see growth across all products. We're expanding premium products. You heard Stefano talk quite a bit about House 44 and garage and the like. And those products are very well positioned for us to continue to sell.

Additionally, we see very strong demand going into next year in MotoGP and MotoGP Premier. So we saw triple-digit high-end premium hospitality growth this year. we're seeing price elasticity in the area of 30% to 40%, showing that there's an upside potential to build better and more expensive products that have assets that go along with it that make it valuable. And third, I would just say that we really have a runway set. Dan talked about a collaboration going into 2026, and I think we're well positioned to have an impact there.

As we look at NBA experiences, double-digit program growth this year. The concentration in growth is really around the global games. We're seeing a lot of focus coming from the NBA. So we're operating internationally with them quite a bit. And then key new product lines. We're developing new product lines with the NBA, event by event by event. And the last thing that I'll just mention is the Kentucky Derby, which has been a pillar partner of ours. We continue to see significant upside growth as they continue to build and try to make the venue larger.

And with a 15-year partnership we're on solid ground, and we expect to continue to grow that business. And 2025 has been a fantastic year. So milestones that we are on pace to deliver record revenues and profitability the highest package sales volume we've ever achieved before. And we're seeing the strongest annual sales booking, which is an indicator for future years. 2026 is looking very, very strong for us. Areas of business where we will continue to focus, we'll continue to drive that scalable technology that makes us best in class.

We will -- Barcelona will expand our global footprint this year, brick-and-mortar. We're seeing margin expansion at the event level. And we're getting to a size of the business where we're starting to see economies of scale. Our partner portfolio is robust. As you look at this, and I'll quickly move to the next slide, you'll also see that there is plenty for us to continue to add. This year alone, we've added [ Barrett Jackson ], which has returned to the family, ATP and an exciting new area of business that we're working closely on exclusive track promoter deals, which we signed for this year.

As we think about the look forward and the road map for '26 and beyond, our core business has several areas where we'll continue to see growth. There's organic growth, as we've talked about in our existing partnerships. We expect new logos. There are literally dozens of logos out there that we are chasing and looking for the time frame for RFPs and renewals. So there's plenty of opportunity for us to grow there. The travel business for us while robust has tons of opportunity. 84% of our clients today are traveling 1,000 kilometers or more to attend our events, yet only 25% of them are buying travel packages from us.

So there's an opportunity to close a gap and there's an investment being made there. And oftentimes, the dollar amounts and money they're spending on the travel portion is as big as the package themselves. There's adjacent verticals for plenty of industries in and around what we're doing today that we'll look to invest in and acquire. And then finally, data and analytics. We see more information as people are searching, tracking, submitting leads, buying hotels, transportation and engaging with our team on site that we think that the data and analytics piece can be very, very important to our organizers just so they can better understand their customers as they interact with us.

So there's an investment being made there. F1 in particular, and I'm just going to hit on 2 here. F1 in particular, they continue to innovate their product and that benefits us. We're well positioned to continue to sell that. We've seen our Champions Club, which is a franchise brand that we have built with Formula One, which we will do 34 clubs at 24 races, and we're continuing to expand there. And this expanded promoter model really is an unlock around data and analytics for us.

A 9-year revenue CAGR of 71%, strong, and we expect growth. As we look at MotoGP Premier. So very positive early indicators. There is an absolutely untapped premium hospitality an experienced market for us to get into, which we're very excited to work on. And we have a proven road map. And while what we develop and what we build has to be authentic to MotoGP, the road map is there. We've already seen a 159% revenue CAGR over the last 4 years. And this for us has not even begun to hit a hockey stick. So there is a lot of opportunity here for us. Best is still ahead for us. This year will be record-breaking performance by all measures, diversified growth across our portfolio and a clear road map for 2026 and beyond. So we're feeling really good about the business. Thank you.

Thank you, everyone. Without further ado, we're going to turn it to John to make some [indiscernible] appreciate you being here.

Thank you, Shane. And before I get into my grandiose form, I want to thank Shane. We're really going to miss you, Shane. You've done a great job for us. I asked for this little moment because there's some confusion about me, my role and my title and my intentions, I wrote a book. First of all, it was to tell my story, my personal story, how I got involved, my challenges so on.

Second of all, it was to thank the people who've helped me along the way. The team that we've had, the fabulous support I've had, the mentors, et cetera, I've been very lucky, has been a great group of people all the way along. And in writing the book, I kind of tried to understand why we were successful, exceptionally so actually Singleton Foundation decided that we were the highest public company return over 50 years. So introspection says, well, why? Where we got good probably not.

But we had one thing consistently that we experienced. We tried to be very efficient in everything we did in terms of capital structure, tax leakage, I got famous for that. But primarily because we were -- we had a core investor group that stayed consistent and was willing to look at long-term deferred gratification. As a result, we almost always felt that either our holding company or components of our company because we did start to diversify. We're cheap, undervalued. The public markets didn't realize what a great asset we had, they undervalued our free cash flow.

As a result, pretty much every year, that we had any [indiscernible], we shrunk our equity, okay? And why I say that's important is because shrinking your equity if you don't have a core group maybe a little bit like [ kissing ] your sister. And there's really no governor on saying, you're no longer cheap, right? A lot of companies will buy back their equity and lose sight of the fact that it gets to a point where it may not actually be cheap in any real confident sense. So I just reflect on in the book, all the transactions we got involved in where we took equity positions in other public companies and encourage them to shrink their equity because we were the control group, and we believe that they were cheap.

So whether it was companies like Sirius, or DIRECTV. When we swapped Rupert out of his equity and directory, we own 38%. By the time we spun it off to our shareholders and it was bought by AT&T, we were up to 63%. And we didn't put any more money in, but we believe that it was a better investment for them to shrink their equity as capital returns. So it was numerously mentioned that I focus on capital return, and I do.

So I just wanted to point that out that consistent willingness to shrink your equity when it's cheap, generally speaking, not with leverage, but with the free cash flow of either yours or the entity you invest in and getting them to do it has been a very consistent theme and has created a lot of economic value over the years, of which I certainly personally have been a beneficiary. So I wanted to point that out.

With respect to my role, okay, I announced that I was stepping down from chairmanship of 2 companies this -- at the end of this year, the Liberty Media and Liberty Global. Now this is part of a trend because I've gone from being on board to being Emeritus on a number of the companies that I'm involved with. First of all, I want to say that I am still regarded as the control shareholder of 8 public companies. And then I'm deeply involved in a 9th, which turns out to be particularly focused on today because it's Warner Discovery, and we're expecting our bids to come in this morning.

I went to emeritus role at Warner -- Chairman Emeritus in June. And I have to say I've been more deeply involved since then than I ever was before. I'm not a control shareholder anymore. I used to be, but not anymore of Warner Discovery. But I have a very large personal stake in the company. And I've been extremely involved really from David Ellison expressing his interest in negotiating back in July to today, I got a very nice just, just showed it to Derek, a very nice e-mail from Brian Roberts, who with a picture of him signing his bid with my pen this morning, and he was prominently displaying my book.

So yes, some people involved in a lot of things. When you're the control shareholder, frankly, it doesn't really matter what they call you. This is something Rupert pointed out to me when he welcome me to the Chairman Emeritus Club. Because you're deeply involved in the company, the government regards you as an insider, whether you care to be or not, you have essentially all the restrictions of being an insider in terms of trading and disclosure. So your situation doesn't change. So I've played a lot of roles over the years.

By the way, this is my 53rd year as the senior Executive or Chairman of the Liberty Media and its predecessors. So I do have a little bit of gray hair. But my roles have changed over the years, and I've played whatever role seem most appropriate. At this point, with so much involvement. And by the way, I have a lot of diversified interests. I was happy to see pictures of the Kentucky Derby in Lexington. We came in second this year in the Derby with journalism, but we actually trained the winner Sovereignty for Sheikh Mohammed, we train all of Sheikh Mohammed's horses. So I've got a lot of diversified interest that -- the principal reason for a guy like me saying, "I don't want to be Chairman anymore," let Dob do it. And by the way, Dob was cofounder of Liberty Media 35 years ago. And He's been was actually CEO for an extended period of time, has always been on the board, and you won't find a more qualified guy on the planet.

We have the dream team now looking after Liberty Media, which is principally now becoming Formula One, MotoGP, between Stefano operationally and Derek with his deep experience in television sports. And Dob, who is probably the best and most conservative financier you're going to find. I think you got just a terrific organization with a great future. So I don't feel least bit nervous about not attending 100% of every Board meeting.

And in fact, in the role of -- when you're Chairman, by the way, common courtesy means you've got to sit through the whole Board meeting. including all the administrative stuff and a whole bunch of operating details and whether Susie is a good marketing executive and all that kind of stuff, which at this stage of my life, I don't have that much interest in. But I am very interested in structure, finance, tax and M&A and strategy generally. And so this gives me the opportunity to be totally an insider access to everything and everybody, express my opinions, whenever I want, I tend to express opinions that increasingly look like a shareholder as opposed to an insider, but it's a very flexible posture.

And I'll point out that, for instance, I was Chairman for a while of Lot Nation Ticketmaster when the company is merged. I was promised that Shakira would come to my birthday party, and she didn't show. I got Gladys Knight & one of the Pips. So you don't always get what you try for. But just to amplify my role is to look after the equities that I have that stepping down from the Board actually has one advantage in addition to freeing up some time. And that is that I can actually move my control positions up without conflict of being on the board. Somehow or somebody thought that the Board had a duty to stop somebody from going to hard control. And if you're on the board, you're stopping yourself. So I find it more flexible. As a result, we actually filed a Hart-Scott-Rodino filing to go to hard control personally of Liberty Live once it's spun off.

I'm also moving toward hard control of the Atlanta of the Atlanta Braves. And the spin-off of a little company that I'm going to talk about in a minute, GCI out of Liberty Broadband because I was already over 50 of the voting control of Liberty Broadband, I end up in hard control of it. And it will be, let's say, by next summer, the only company that I expect to still be on the Board of a public company, where I'll be Chairman, at least until it figures out what its strategy is.

I personally believe I can start another Liberty Media with appropriate strategy and capital structure using that as a core vehicle. It got spun off with extraordinarily good tax attributes guess that. Why would you think that? And I think a sustainable cash flow generation, relatively modest capital investment requirements to sustain the business. And I think it is appropriate to think of as a vehicle for growth and for recreating something like the original delivery media. The benefit, of course, is that the great staff at Liberty Media that has been assembled, the young folks, quite talented are available to support that enterprise on a contractual basis.

And I've asked some close friends and to be involved. Now I made the original investment, I believe, in the Alaska Communications business in 1989 I believe, Ron Duncan, who's been consistently CEO since, done a great job. It does a wonderful job for the state of Alaska. It's not like most companies, it doesn't face multiple competitors in every aspect of its business. It's a duopoly really in the cellular business in the larger towns and it's a virtual monopoly in terms of the terrestrial broadband business.

So it's a little different than what you see under a lot of stress in terms of the average cable company right now or old cable company. So that differentiates it. But using my thesis that you can do well by accumulating undervalued assets, sheltering them, sheltering their taxes, appropriately managing their tax liabilities and their use of capital, I think it represents kind of an interesting opportunity for me and for anybody else who chooses to come along, we are doing -- we've announced the rights offering where we're going to raise $300 million of new equity. It's not an overlevered business. It's only levered about 2.7x with pretty good debt.

So I'm setting it up basically to be able to do deals and grow. And I personally am backstopping the $300 million rights offering. So we'll see what happens. It's an interesting thing. Of course, today, Warner Bros gets its bids, very interesting topical thing. Generally speaking, the old industry, which I'm still pretty involved in, whether it's Charter indirectly through Broadband or Liberty Global, [indiscernible] America or Sunrise in Switzerland or I'm even a shareholder in Comcast, believe or not. Those businesses are facing a lot of headwinds ever since network neutrality was proclaimed as the policy which then became essentially the global policy.

It would be a little bit for our industry like Walmart being told that they have to build shelves in their stores for their competitor, but they're not allowed to know what's sold on the shelves nor participate in the economics of those sales. That policy and then the transition to streaming has put enormous capital pressure on the industry to keep up with the demand with the capacity needs to take care of streaming. Simultaneously, we've seen this transition in the broadcast mode, it takes one channel to distribute an NFL game nationally, one channel. Whether it's a streaming channel or a linear channel or an MPEG channel or an IP channel, one channel.

When big tech decides to take a live event and convert it to streaming, then it takes one channel per household per viewer for TV set, basically. So for instance, 40 million or 50 million channels to accommodate the streaming of an NFL game for which the industry does not get paid. The industry traditionally participate in the economics of the broadcast of these things, but does not participate in the economics of the streaming unless it can charge its end consumer for connectivity.

And in that regard, it's pretty much one size fits all. So whether John McCain's mom, wanted to watch sports or not, she had essentially paid the same as people who were sports fanatics, and were consuming enormous amounts of capacity on the network. That capacity pressure combined then with probably cheap financing available of when rates were cut to stimulate the economy after the financial crisis led to a lot of speculative investing in the business.

So people -- I know we're going to ask me, perhaps, do I see a place for this to go. Obviously, consolidation reduces competition and reduces CapEx and therefore, is one thing that will start to reconcile this. In Europe, we've seen an appreciation that competitors can work together and be supported by regulators in doing so to reduce wasteful excess competition. And so whether it's consolidation or whether it's the creation of commonly owned netcos where the backbone network, for instance, can be shared by multiple competitors. This is not uncommon in the cellular side where the sharing of towers has been a big capital saver.

And I always use the expression that when trucking companies exist or discount airlines, they're not asked to build their own airport. They can share in the same thing with truckers. So I think enlighten regulators may be able to help and address the excess capital that the current environment is forcing to be spent. Capital intensity, great example would be Charter when Tom Rutledge announced that their capital intensity would be dropping from roughly 20% of revenue spent on CapEx down to he believed 14% or lower over the next couple of years. The stock rallied from roughly $300 to $800, direct equity response to predicted growing free cash flow.

When they started on a program of rebuilding their network and building out their low density, their stock went from $800 today, it's under $200. Not great. Okay. So the market is very sensitive to levered free cash flow and the trends there of and therefore, how capital free capital, what do they do with what their levered free cash flow, what are they going to do with it? And then, of course, in Charter's case, they had a very consistent program of redeeming their own shares, buybacks which I think, as I said earlier, is great if you have a core group that wants to continue to own the asset.

Unfortunately, the principal shareholders actually wanted to sell into the buyback, which I don't think is very reassuring to institutional investors about whether or not these buybacks are rational. And perhaps in their case, in some cases, going to a dividend structure to demonstrate that not only did you have free cash flow, but you're willing to give it back to your shareholders might be a way to put a floor under the economic values in these companies. I personally believe they are capable of generating large amounts of sustained free cash flow.

And therefore, I think there are opportunities in the consolidation of some of these businesses that have terrible market valuations even though they're generating meaningful levered free cash flows. And so I use the simple paradigm that personally, my risk-free return right now is about 4%, which means 25x capital values 25x my risk-free return in government securities and some of these companies are trading at below 5x their levered free cash flow.

So they seem cheap to me. if you believe that you can curtail this defensive CapEx and come to a structure that reduces that. And that's really all I really want to say about that. Finally, I just want to say for this organization for Liberty Media for Formula One, this is the dream team, guys. You got Chase Carey, you got stuff. I know you got Dereck, you got -- you don't get better than this. I think it's just a wonderful business being very well run, and I'm very proud of it. So that's all I'm going to say.

John said if you spoke, then maybe that would alleviate all the questions, if people -- he would cover everything. I

said, I doubt that's the case.

So just logistically, we have some mic runners in the room. What we're going to do is I'll call on you, just if you don't mind waiting for a mic before you ask your question. And then just so you know, we're here on stage, but we do have Stefano. We have Carmelo and MotoGP management, other members of management in the audience who can chime in as well.

I was going to start in advance, but I think I'm actually going to go right to audience questions. So we'll start in the front row here with Ken, if we can. Thank you.

I have 2 questions, both some of M&A. When we think about [indiscernible] portfolio that you had another you've been talking about right opportunity you see to use GCI to [indiscernible]. And so I was curious to see if you could reconcile those 2 things? And what opportunities you think are most compelling for GCI specifically and how that [indiscernible]

Second question, here on Formula One. When we think about the growth out of your head and for cash flow generation, [indiscernible]. and I think we're trying to figure out on the outside over the next few years, it seems to more like MotoGP ? Or how much outside interest does this generate? And how do you see.

Well, first of all, on my scheme for what do I do with GCI. When markets [ dump ] sectors. They're not very discriminatory, okay? They throw the baby out with the bathwater. So trust me in this huge world, we've got there are a number of communications businesses that are going to generate a lot of free cash flow for a very long time that are selling very cheap okay? And so the goal is to find those, be selective, own enough of them that when you shrink them, you're just driving up your own economics, okay?

Same model. And shelter their free cash flow because you have extraordinary tax attributes, use financial engineering where it's appropriate. When we created the spin-off vehicle GCIL, we did it in the state of Nevada, which has much more flexible charter governance than Delaware. We set it up with the ability to do tracking stocks, for instance, to do preferred of anything I can dream up. I might point out the first Liberty Media when we first created it was because we didn't think we were getting appropriate valuation on miscellaneous assets.

We threw them into an entity called Liberty Media. We did a simultaneous incorporation. Within a month or so of its creation, I issued a preferred stock, distributed to all Liberty Media shareholders that had a bigger face value than the market cap of the company because I wanted to shift tax basis from common to preferred. And then those people who wanted to recover their tax base is like me, could sell the preferred, recover the capital and go forward with an equity that was more levered, but without a risky type of leverage because the preferreds were very soft and very flexible.

And so it was a little financial engineering, but it was very important to effectively in one transaction, double the value of the common equity, which effectively happened. So financial engineering in some situations is important and the flexibility to do so is important. So that's kind of the way I look at it. So I look at opportunities in a space that I'm familiar with.

If you can't find them in the space you're familiar with, you look at tangential synergies where your tax attributes, your financial attributes, your timing, you can be truly opportunistic. I mean what the hell did we know about satellite radio when Sirius became an opportunity, for instance.

So being opportunistic, making sure you've got flexibility and currency to be able to take advantage of opportunities when they present themselves. I think -- so timing is a very important thing. I think that's the way I see it as an opportunity because I've got some pretty smart staff members over at LMC. The other thing you have to understand about LMC, the vast -- they were saying -- have been saying Grace that staff over a number of public companies that LMC has nothing to do with it, right? On a contractual basis. So as a practical matter, the Liberty staff has been running everything from Sirius to Liberty Broadband and so on.

I mean, companies in which they had nothing to do with except [indiscernible] because I was the control shareholder, so and they get paid and there's the auditors look at the numbers and everything. So it's a way to be very more efficient. You can have higher quality folks that you couldn't afford in the small enterprise. But you can take part of their time and therefore, you can be more creative. So that's kind of it. I think I've told Derek from day 1 that his biggest challenge is what to do with all the cash that he's going to generate, this becomes a very real issue. How do you grow a business like this that is about as perfect the business as you can find. How do you make it bigger?

Is there going to be an M&A opportunity? They found MotoGP. They believe some of the same attributes that allow them to -- what they've done with F1, right, applied to MotoGP. And so we expect that, that's going to be a growth engine, and it will require some investment of some of that free cash flow that F1's generating to deliver a MotoGP profile that has that kind of growth curve and valuation and celebrity and personality, which are very important in these kind of businesses.

The other thing that you can point to is there's just a lot of touch points in a business like F1 that you can improve your performance by incremental investment. Those usually have very high returns. And so you're always looking at the edge of a little money over here, a little money over there will have a really good result because of all the synergistic relationship that you're creating. So you constantly are looking for those synergistic relationships that can have on the margin, great returns.

Now the one thing I should mention is if you look at the business strategy, for instance, of Live Nation, which frankly, Michael Rapino has done a fabulous job. And I'm a huge fan of Michaels. He has a strategy that is synergistic for him, for his business in about 3 different ways. And that's the strategy of looking at the world and the underserved nature of many countries and regions in terms of what he supplies, which is concert entertainment. And he's out there building or buying venues which have exceptional financial returns, these are real estate investments with exceptional financial returns because of its ability to fill them up with talent and audiences and sell the tickets.

And sell the soft drinks. And so he's essentially built in this incremental growth engine that's global. So to some degree, it's out of the reach of U.S. regulators. But if you think about valuations, the kind of real estate asset he has as a spun off REIT down the road, we'll have wonderful economic capitalization. So these businesses are sort of looking bright management looking for synergistic opportunities, and that's the management team at F1 has that challenge.

Now in the short run, just getting the debt leverage to where they want it. That's going to take a year, I think, maybe a little more. You should ask this question to Derek, I'll turn it over to him because this is really the #1 question. You got a company that's trading at a 30 multiple of EBITDA or 28 multiple of EBITDA, how do you sustain it? How do you grow it? And what do you do if you're a cash generator that that enhances that instead of [indiscernible]

On that point, John, I would point to probably a couple of examples. One is actually right here in Las Vegas, right? And I'm going to caveat this and say, do not take this as a signal that we're going to go self-promote in other locations. But look, what we built here in Vegas, and I see Rene here, Rene he spent several years of her life doing this is an ecosystem for F1 and for new partners to have come in that probably without Vegas, they wouldn't have done.

So if you look beyond sort of what happens here on the direct revenues attached to being here in Vegas. I think the sponsors and some of the other partners who have come in because we had Vegas on the map, we had to do that and having the capital and the firepower to do that allowed us to capitalize on that opportunity. You See Stefano here. Stefano has a great team. They've got some really creative folks thinking of new ways to invest and drive. Ultimately drive growth and drive revenue.

Stefano also has a great CFO who is pretty much a [indiscernible]. They're going to have that right balance on making sure that we're disciplined in how we do this. And then you look at MotoGP, which is frankly almost a clean canvas in some ways. There's the teams at F1, as I showed earlier, those guys are now well capitalized.

I think they're all investing in the sport. At MotoGP, it's a little bit more scattered, whether it's the teams, whether it's the local promoters and what they might need. And I think there are ways to collaborate within the existing ecosystem where we obviously do have capital and the ability to deploy it where we can hopefully use that to accelerate the growth of the whole ecosystem.

So I have to say, Derek got invited to the White House for dinner with [ MBS ] the other day. and he went, and I was holding my breath to see if he had made any kind of deal. We're all talking about where are the Arabs going to spend all their free cash flow. And it's been rumored that the [ Elisans ] have been visiting, that Brians have been visiting I thought at least Derek would come back with a second race and Derek..

I'm moving that the Stefano now.

I'll build on that note, and maybe Stefano can chime in too. One of the questions we did get in advance separate from capital deployment was Formula One has sustained such robust top line growth. A lot of it lately has been sponsorship-driven. But the question is, if you look going forward, can sponsorship pass the baton on to others? Or how do you think about top line growers for the Formula One business itself going forward in addition to the Vegas and these other opportunities we've talked about.

So I don't know if we want to turn to Stefano to comment on that, we can bring a mic over.

Thank you, Shane. Well, I would say that it's for sure one of the things that looking ahead in our strategy for the next year, it's something that we are really focused on because the demand that we have is generating great interest not only on this [ sponsorship ice cream ], but it is the rating things that we do believe will be beneficial for stronger new revenue in line, like, for example, licensing that is getting a new one where we're going to be strong because they are still small if you compare to other. So I do believe that the actual situation we are living is really asked to make sure that this transition from a traditional B2B business has to be -- will give us or continue to go to the knowledge for our customers. We have been collecting data.

We need to provide counters that we have more than [ important ] to be relevant for our future. Relevancy for us is [indiscernible], which we will we know that we have to be not [indiscernible] everyone can choose to pay. We have a global sport watching a movie, looking to a concert or going to a entertainment platform. So we have this opportunity to increase our revenue stream before, we not done it. Now because we have good foundation and other assets that were very, very important, we can really focus on trying to something for us. And the thing that if I may say the good things that are coming to us progress other things together with us and not only them.

We have the [indiscernible] and a lot of relationships with the government, and we don't want to be political at all, but because they see the benefits for the country, for the community, they are developing [indiscernible]. So I think that in terms of social relevancy, this is an asset type. I know that is not tricky is very, very important. And if I make data point, I think this is really what we want to do, we want to keep growing in the U.S. Social relevancy for us is the key attribute. Our dream is you wake up in the morning NBA every day. And this is really the thing that we, as a team at F1 wants to keep focusing this and that's why we do believe in the future, we have just shared, of course, with our shareholder last week in Denver our progress, they are real facts, but the proving F1 is see in a good mood that we don't want to see. We live in a competitive world, we are coming for racing. So we feel the adrenaline being always under pressure in a constructive way to deliver the result that our view and our shareholders wants to see from us. So that's our way to look at our future.

The other thing that is a good point here is that as we're bringing all these new sponsors in, a lot of these are consumer-focused sponsors. I spoke about this earlier, Stefano spoke about it. Whether it's Disney or LEGO, as they develop product and merchandise and all that and kids who aren't fans of anything necessarily start interacting with that, they come to our sport. And if you think about that for the long term, right, the biggest issue with some of the other sports right now is whether or not they're aging out and what the demographics look like. Our demographics are actually getting younger and broader which is a great place to be because then that provides you additional leverage and durability of your engagement and your revenue streams down the road. So the payback on some of this stuff we're thinking about, and this is John's point on being able to think long term is you can go make -- create these relationships, make these investments even if the returns don't necessarily come next quarter, but 5 years from now, or 10 years from now.

And John, you can tell story about going to Walmart, right?

Yes. No, I walked into Walmart last Christmas, looking for presents for my grandkids. And there was a whole aisle given over to LEGO formula One cars, which I thought, wow, right? And these are kids -- the kids put together or whatever. So it's become a consumer brand increasingly. And who knows how far that can go. It's got celebrity relationships now. I knew when I got the note that Elon was at the Miami GP with his son on his shoulders and Jeff Bezos who's there, we were -- big celebrity. This is what drove basketball crazy, right, is the celebrity association. So working on how you broaden that out, I think it just gives you a lot of longevity in terms of people wanting to be associated with the sport, with the brand, with the personalities back in business, I think, right?

Absolutely.

Incidentally, we had a little inside the family joke here for the last week or so, which is HBO going to have the television rights for this drama that's going on right now about the future of Warren Brothers and said, well, David, who's going to play [ Zasloff ], right, in this and David said, for sure, Tom Cruise. So I asked was I going to be represented in this? And they said, "Yes, John, you're going to be represented by an AI generated young clint Eastwood.

I thought, okay, I'm in the big leagues now. But no, I mean, who knows what's going to happen here, this is show biz, right? I did want to come back and say, when I talked a little bit about what's happening in the old converged connectivity business, A good example would be what Liberty Global was able to do with Switzerland, we're carving out the Swiss business, which is wired and wireless. It's a duopoly for the most part in Switzerland, where the government partially owns incumbent called Swisscom. But they were able to reach an agreement where they had access to Swisscom's fiber build so that you wouldn't get duplicate network build that gave us a much more rational capital intensity, somewhere around 12%.

And with that, the free cash flow characteristics look much more attractive off into the future, and we were able to create a Swiss-traded connectivity business, telecom business, that's trading somewhere around a 7.5 multiple of EBITDA. Now that like it used to be, but it's a hell of a lot better than the 4.4x that Comcast trades it, right? So yes, if you can reduce capital intensity on a sustained basis, these businesses become very attractive.

The margins in the business, which investors usually want to look at are quite high. It's not unusual for a cable company to be 45% or 50% margins. So it is a capital-intensive gain, but if the cost of capital can be controlled and the magnitude of capital can be controlled, it can be quite remunerative to own equity in these vehicles. and we'll see. But like I say, each market could well be a bit different. In the U.K., the government is encouraging the collapse and purchase of these over-builders, these fiber overbuilders, which have been very disruptive to the economics of the business.

As that process rolls forward and you end up with with back scratches between BT and us on fiber, so we're not overbuilding each other. We're basically sharing the economics improves quite a bit. So never say never. There is hope. And I think these businesses will turn out to be slow-growing utilities over time with rationalized capital structures.

We'll go to Peter Supino, if we can, the next 1 in the back, right next to you, Trace.

Peter Supino with Wolfe Research. I wanted to ask a question on the intersection of John, your knowledge of the network technology and economics. In the last 5 years, the supply side of residential broadband, I think we can all agree has deteriorated because of the fixed wireless now around the edges [indiscernible] satellites. And of course, the fiber extension. So my question is, do you believe that 5, 10 years from now, this segment of the market led by fixed wireless, which is lower capacity, lower speed but well priced and well bundled with mobility is going to be a really important segment in the market for you [indiscernible] and it will be passed by a very good demand over time, maybe some less technological relevant.

Well, it's kind of almost a race condition. In other words, will capacity requirements to fully enjoy the realm of streamed things like sports, can that be handled by fixed wireless? Can it be hired by low earth orbit satellites, in a competitive way. Now it's interesting. In the U.S., we have not seen the industry go to flanker brands. Europe, there's flanker brands on both wired and wireless pretty much in every market by every major player. And they're trying to accomplish this question of lower-priced, lower features to the consumer.

And it's been pretty successful in terms of stabilizing the market. I also believe that the legacy linear video programming has put an albatross on the back of the traditional cable distributor where his video programming is just too expensive for most households.

And so you've seen a lot of attrition that is really driven almost by the television cost as opposed to the connectivity offering. So you've seen a lot of migration in the cable business to YouTube because they have a less expensive video offering, which includes a lot of the linear but as well as streaming. Charter has tried to replicate that by essentially the top 4 streamers that also have linear, they've done a bundle where, essentially, they include the ad-supported streams in with their linear bundle. They haven't cut the price, but they've added more service to it.

And the churn at Charter has dropped quite remarkably in the last quarter. I'm not here to make a commercial for Charter. But the reality is that I think how they handle the television side of the business is an important ingredient that it represents something that consumers find to be too expensive relative to the value, and that's why you're seeing so much attrition in the video side of the offering in the video bundle.

And a lot of people are using that as an opportunity to switch over to a different transport at the same time. So if you go from say, Comcast Xfinity full bundle, you got 4 TV sets in your house and you switch over to YouTube for the video and T-Mobile fixed wireless for connectivity, you save a lot of money. And so it's compounded by the video component right now. And I think probably that will get rationalized in terms of that differential over time.

The cable guys are stuck by long-term video contracts and they're all trying to -- as we just saw with the Disney thing with YouTube, they're all trying to rationalize their video packages to get closer to the value offered from cost to basically make it a better deal for the consumer. And this stickiness, if you want to call it that, it's very interesting, you could scratch your head and say, why did -- when AT&T owned Time Warner what did they try to do CNN as a streaming service? And why couldn't it include CNN?

Well, the answer is long-term contracts that create lack of spontaneity or flexibility in terms of the offerings in how they're priced. So a lot of these things are just going to have to work their -- their way out because of the contractual terms. For instance, when we did the Time Warner deal, when Discovery wenttogether with Time Warner, we assumed that we would launch an HBO stream in Europe quickly. Well, it turned out that a lot of the programming was tied up for extended periods of time and couldn't be unwound.

And so how do you launch a service if you don't have any content. So a lot of this delayed gratification, this most recent growth spurt, let's call it, in HBO streaming is primarily because content is becoming available, coming off contract. The biggest would be the contract with Sky in England, Germany and Italy, including Austria and Switzerland, where we just couldn't launch a service because Sky had the principal programming tied up. Now that's coming -- it's coming off contract, and you're going to see quite a bit of growth.

So a lot of these things that you say it's common sense, why aren't they doing this? The answer is, they can't. They got a contract that says they won't. And to uncommit to, say, 5,000 cable distributors where you have exclusivity agreements right, it's just not doable. You're just going to have to wait the contract out. And I think that's been kind of frustrating on the media side on the content side that they haven't been able to optimize against the new consumer demands because their content is contractually committed for extended periods of time.

David Joyce here in the third row.

David Joyce with Seaport. Thinking of applying the Liberty and Formula One play book to MotoGP. What sort of be expecting on -- in terms of the cadence of margin expansion given the synergies but also the constraints from [indiscernible]

Can you repeat that?

The margins?

For MotoGP -- for applying that from playbook at MotoGP, how should they think about ongoing margins, growth opportunities, et cetera?

Yes. Look, I think there's an investment phase we've talked about already, not necessarily a stair step, but as we are bringing MotoGP up to speed and trying to take advantage of all the things we did at Formula One, require some investment we talked about sort of the commercial team and elements of that. So in the near term, I think you'll see that. But given the nature of our our deals with the teams and the structure of that. As we continue to drive further revenue growth, the hope would be that we do see that margin expansion.

And you've seen quite a bit of interest in investment in teams in MotoGP.

Absolutely .

Since we announced the deal, right?

Yes, very much so, which I think -- I mean a whole another point, but the -- we talked about Liberty bringing that interest, our involvement in Moto GP, bringing interest from other strategics or other financial guys who want to come into the sport, which will only help because just like on the F1 side, where you see the teams like McLaren and Ferrari and Mercedes really investing into it and promoting and marketing and all that sort of stuff.

They're on their own sort of trying to bring in their own sponsors, but it does help support. And I think we're going to see similar activity on the MotoGP side, which will again accrue benefit to the entire MotoGP ecosystem.

Pparticularly if you can bring celebrity into ownership of teams. .

John is hot on the celebrity thing?

Yes. Well, that's what it is. I think that's what Chase Carey told me about it. This is really celebrity.

That's why we bring Chase back to races because Chase is celebrity.

Mark [indiscernible], on the back. I see you there.

Currently unemployed John, literally any figure, talk a lot about gratitude and I wonder from 1973 the way investors lined up, all the way to today, you would like to just share your thoughts on gratitude you have.

Yes. No, it's been a wonderful -- what is it, a wonderful life. I was -- if you read my book, you see that I was kind of an autistic kid. And I just been so fortunate. I mean, a, my wife has just been incredible. She would tell you that it took her 67 years to train me to be this social. But just these wonderful relationships, Bob Magnus, who is a virtual father to me, even when I was a salesman at Gerald. When I was selling hardware and turnkey construction and cable, I would go stay at Bob's house, how many salesmen get that. And [indiscernible], God, he couldn't drink brandy. I mean it was like -- so just the whole history of how good capitalism is, how good people generally are, how what a wonderful country America is, how -- take somebody like Mike Milken and what he did to encourage entrepreneurship and growth in noninvestment-grade businesses.

It was incredible. A lot of these things that the relationships, Rupert [ Murdoch ], what can I say? The guy is incredible. He's toughest nails. But if he tells you, he's going to do something, he'll do it. These are very or the most creative guy I've ever been around. I mean what guy can go turn around 2 movie studios and build a broadcast network for Rupert and then go on and build a company for us. and convert from media into Internet access, it keeps going. I think he's taken over Las Vegas right now with MGM I mean, personalities, Ted Turner, it's been a wonderful life.

I have to say my experiences have all been, even [indiscernible] he sued me for $3 billion personally to get us to back out of the fight for Paramount, the original which, by the way, created the CVR, which we may see come back into existence in this current, it would be very interesting because it would be CVR revisited. But even selling the Redstone, I ended up buying all of his cable businesses for TCI. And I think toward the end of his life, I was probably the only guy that would go have dinner with him. It was -- it's been a great -- life has been a great experience for me.

And it's -- I just wanted to relate that in the book, even guys who sue you, you don't burn the bridges because you don't know there may be a good deal around the corner. They may feel guilty, you might get something back. You just don't know, but it's just been wonderful. Most things have worked out quite well. We've created a lot of wealth, I think. Guys like -- a guy like Bob Johnson with BET, the first black billionaire, to this day, I have a great relationship with Bob, and we're working together to try and make portability in 401(k) plans doable low-income people so that they don't go back to zero every time they change jobs.

I mean those kind of things, good that you're in a position in life to try and think about where your money could do the most good. Whether you put your money in medical research, what do you do with it? Those are just wonderful things to be able to do at this stage of life is to think about who else can you help?

Try to get 1 to 2 more if we can, John, from the audience before we have to wrap. I think Steve Cahall over there, if I'm not mistaken.

Steve Cahall from Wells Fargo. So John, I just want to go back to your cable industry commentary around capital expenditure decelerating. Maybe the market is also telling us that while that happens, a lot of the top line trends will remain challenged, however irrational [indiscernible] might be it seems. So I guess the question is, do you think that the strategy can still work, the revenue EBITDA of the industry remains under sustaining pressure?

And then just Derek, on F1 we got 2 exciting teams joining next year with Cadillac and Audi. What do you need to do to help ensure that those teams are competitive. It seems like a big opportunity to grow U.S. with a native team, Germany, with a native team. So how are you thinking about what F1 can do with some of its new members to keep them in the top tier.

Well, on the first question, I would say it depends on the regulators in the jurisdiction. If regulators are willing to go for efficiency and allow consolidation or joint efforts or back scratching whatever you want to call it, to move forward quickly. then I think you can see a stable utility type industry emerge if they want to keep the 2 cats tails tied together, hung over the close line, tearing each other's guts out, then it's going to be a challenge. I mean that's the way I look at it.

I just look at -- our example would have been SiriusXM, right? When it was XM versus Sirius, they were both going broke. When the regulators finally relented and allowed those 2 companies to merge, it created a very valuable enterprise. And our timing was just very good investing in it. and Mels was very. But I think a lot of it has to do with the rationalization and at some point, it doesn't make sense for people to pour capital into competitive situations that don't make economic sense. They're going to find solutions other than than cutting price to try and gain share in a fixed variable equation.

And to me, it's going to be jurisdiction by jurisdiction. And what we're seeing is countries like Belgium, for instance, are encouraging the development of a concept called the NetCo, where the 2 competitors collectively own the backbone network. I'm hoping we see this same evolution in other areas. But I think that, that's going to be necessary in these -- in the situations where there's just way too much money being spent on defensive capital.

It's just not rational. And so it has to lead to consolidation, but I can't predict when or necessarily where. But I think where it does happen, I think it makes these businesses investable.

You want to touch on the new entrants?

Yes. No, I think as I said earlier, we're very excited about Cadillac and Audi coming in. Cadillac, as we all know, is a new team to the grid. Audi taking over an existing one. I think Stefano tries to make sure playing fields are level and everyone has the same resources and access. And we obviously want not just those 2 teams to be competitive but every team to be competitive, and that's something that we strive to do across the board. And I think that's happened over the years. And that's another thing that's just led to the tremendous amount of fan interest that we have. But Stefano, I don't know if you want to add to that. That's probably the last one.

I think that, as I said, our goal is to make sure that the conditions are attractive, in this case we're actually dealing [indiscernible]. If you think this moment where the big industry of automotive in all around the world are suffering and [indiscernible] that is that we are offering the right in terms of technology between sustainable.

Of course, [indiscernible]lego mobility, but I would say very, very well, but the fact that they are in and the they are going to be in with the lot of maturity exactly what we did is to make sure that condition are for them the right one to develop a new opportunity in this country. And for Cadillac, definitely [indiscernible], they're going to be to attract more in this country that already in this weekend in Las Vegas despite Cadillac have invested a lot and want to promote the brand, we want to go Formula One so that's really our focus and I would say, for us, it's a new lever, it's a new opportunity to make sure that the whole teams will play fairly together. I think there will be a that we have today. There are rules that allow the team to be in that if the competition, but it's really great to see in this moment where all the [indiscernible] big price that that we want to be part of us. Keep focusing because opportunity for them and it is a opportunity for us to be

Unfortunately, we have reached time. So we thank you all for joining for investor. I'll turn it to Derek for some closing comments.

,

Yes. Just a few words to close. First of all, thank you all for coming and taking the time to do this. Hopefully, you found it helpful and informative. I want to say thank you to Stefano and Carmelo and their teams, Brian, for their presentations today. We have members of our Board here. Thank you guys very much. Also to the broader Liberty Media team. I mean it takes a lot to put something like this on. And I think that everyone's been working hard. So thank you all very much.

I think the LVGP team here in Vegas for what they're going to put on this weekend. And then -- and specifically, I'd like to think, Shane, as we already have, but one more time for all of her contributions, all of her contributions over the years. So Shane, thank you very much. I think that you can all tell to that Shane is expecting. So I congratulate you on that. Her husband is actually -- who's a doctor is actually here just in case something were to happen. And then finally, also, Shane's team Amber and Mary Anne, who, I think, played a huge role in this. Thank you guys very much. And then -- and then finally, I want to thank John for taking time out of his schedule. He's John only travels as a day trip these days. He's not allowed to go overnight.

So we appreciate getting one of your slots this year and having you come do this. But then I think more importantly, as everyone here in the audience knows John has obviously been a leader and innovator, a titan of industry. I think multiple industries, whether it's media, sports, cable, telecom, commerce, horse racing, hotels in Ireland and a master conservationist too. So John, for all of your contributions, not only to Liberty and to all of us here, I think, but America and our global industry in general it's been great having you, and thank you for coming today.

Thank you, Derek.

Great. Shane is going to take us home.

I think with that, we thank you, and I think we'll say goodbye to our virtual audience.

Thank you, everyone.

Welcome to Liberty Media Corporation's 2025 Third Quarter Earnings Call. [Operator Instructions] As a reminder, this conference will be recorded November 5.

I would now like to turn the call over to Shane Kleinstein, Senior Vice President, Investor Relations. Please go ahead.

Thank you, and good morning. Before we begin, we'd like to remind everyone that this call includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual events or results could differ materially due to a number of risks and uncertainties, including those mentioned in the most recent Forms 10-K and 10-Q filed by Liberty Media with the SEC.

These forward-looking statements speak only as of the date of this call, and Liberty Media expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein to reflect any change in Liberty Media's expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.

On today's call, we will discuss certain non-GAAP financial measures for Liberty Media, including adjusted OIBDA. The required definition and reconciliation for Liberty Media Schedule 1 can be found at the end of the earnings press release issued today, which is available on Liberty Media's website.

Speaking on the call today, we have Liberty's President and CEO, Derek Chang; Chief Accounting and Principal Financial Officer, Brian Wendling, Formula One, President and CEO, Stefano Domenicali; MotoGP, CEO of Carmelo Ezpeleta, and other members of management will be available for Q&A.

With that, I'll turn the call over to Derek.

Thank you, Shane. Good morning. We are entering the end of the year on a high note. It has been an incredibly productive period for Liberty. And we have executed on the priorities we laid out at the beginning of the year. First, on our planned split-off of Liberty Live, we currently expect to complete the split-off on December 15, and the stock is expected to begin trading as a stand-alone asset-backed equity the following day.

Our shareholder vote will be on December 5. The split-off is expected to better highlight the value of our attractive position in Live Nation and an asset-backed equity that we believe will benefit from enhanced trading dynamics. Looking now at our operating businesses, we continue to invest behind their sustained growth. These aren't just sports properties, they're global entertainment brands.

With this broader evolution comes expanded commercial opportunities to monetize a growing fan base with creativity and innovative leadership. Looking first at Formula One, we continue to build upon the commercial momentum we've seen all year. Just this morning, F1 renewed with their global partner, Heineken, in another multiyear deal. Underlying fundamentals are robust and support strong financial results this quarter and year-to-date despite having one fewer race.

They have successfully accelerated renewal cycles across revenue streams, extending media rights agreements and renewing multiple promoter partners on attractive terms. Across sponsorship and licensing, F1 has partnered with an increasing number of high-quality consumer names, including, Hello Kitty, Pottery Barn and more as they consistently bring the sport closer to today's multidimensional fan.

Additionally, F1 signed a landmark distribution partnership with Apple in the U.S. that seeks to highlight the innovation of both global lifestyle brands and position us well for the next leg of growth in the U.S. market. Stefano will provide more detail on this shortly. Next, on MotoGP, we closed the acquisition on July 3 and have been working diligently with their management team and supporting their strategic plan.

We're fortunate to have the involvement of Chase Carey, Stefano Domenicali and Sean Bratches. Sean, as many of you know, previously led the commercial operations at F1. The top priorities at MotoGP as laid out last quarter remain enhancing the Grand Prix experience, expanding MotoGP's global footprint through capturing new fans and deepening engagement with existing fans and scaling our sponsorship roster.

We are also in the early days in identifying areas of partnership between Formula 1 and MotoGP, some of which are more back-end in nature around sharing best practices and some of which we believe will drive commercial upside in the future. We are developing our long-term plans for MotoGP's broader monetization opportunities, many of which will build upon growth initiatives already underway prior to Liberty's ownership.

Their adjusted OIBDA performance year-to-date reflects elevated costs as these investments are already being made with the associated revenue growth to come. We don't expect a material change in the investment cycle ahead, but we do anticipate continued growth in the cost base as they scale efforts to build commercial functions, enhance sponsorship capabilities and more.

We look forward to continuing to update you on our progress, and we'll have more to share on behalf of Liberty and our portfolio of companies at our Investor Day on November 20, just before the Las Vegas Grand Prix. Before turning it to Brian, I want to also recognize and thank John Malone.

I'm sure you all saw our press release last week, noting that John will be stepping down from the Liberty Media Board and assuming the role of Chairman Emeritus and Dob Bennett, Liberty's long-time Board member and former CEO, will be named Chairman. On behalf of Dob and myself as well as the entire Liberty Board and management team, it has been a privilege working with and learning from John for over 3 decades of partnership.

His indelible influence on the industry, our company and us personally goes without saying. And I'm sure I speak on behalf of all of you in saying that we look forward to having John for our annual Q&A at Liberty's Investor Day in a few weeks.

Now I'll turn it over to Brian for more on Liberty's financial results.

Thank you, Derek, and good morning, everyone. At quarter end, Formula One Group had attributed cash and liquid investments of $1.3 billion, which includes $571 million of cash at Formula One, $176 million of cash at MotoGP and $78 million of cash at Quint. Total Formula One Group attributed principal amount of debt was $5.1 billion at quarter end, which includes $3.4 billion of debt at F1, $1.2 billion of debt at MotoGP, which leaves $523 million at the corporate level.

F1's $500 million revolver and MotoGP's EUR 100 million revolver both remain undrawn at quarter end. We refinanced MotoGP's debt in August, shortly after closing. We priced approximately $230 million of new Term Loan A denominated in U.S. dollars, a new EUR 800 million Term Loan B and a new $100 million multicurrency revolver, all at reduced rates. with future reductions in margin expected as the business delevers.

This new capital structure reduces interest expense, extends our maturities and presents a currency mix that better reflects the euro and U.S. dollar exposure of the business. In F1, we obtained an incremental $850 million Term Loan B and an incremental $150 million Term Loan A in July to fund a portion of the MotoGP acquisition. At quarter end, F1 OpCo net leverage was 3.0x, down from the initial 3.3x we gave as of 6/30 pro forma for the MotoGP acquisition.

F1's covenant leverage was below the threshold of 3.75x to trigger a permanent reduction in the Term Loan B margin to SOFR plus 175 basis points. Interest will begin accruing at the lower rate promptly after earnings. MotoGP net leverage was 5.6x. In the near term, we very much expect to delever at both Formula 1 and MotoGP. Turning to the F1 business. I'll make a few brief remarks on the third quarter, but we'll focus on the year-to-date comparisons.

A reminder that every quarter in 2025, luckily we will have incomparable race count and mix, which will impact quarterly comparisons. And our year-to-date 9/30 figures also have an inconsistent year-over-year race numbers and mix.

The majority of the variability in Q3 year-over-year results is due to fewer race held in the third quarter compared to the prior year period. Q3 '25 held 6 races compared to 7 races in Q3 '24 with Singapore being included in the prior year, but not in the current period. Year-to-date through the third quarter, F1 also had one fewer race with Singapore included in the prior year period, but not in the current period.

Despite one less race, the business is performing incredibly well with revenue up 9% and adjusted OIBDA up 15% and growth across all revenue streams. Sponsorship revenue continues to benefit from new partners and underlying growth in renewals in existing contracts. Media rights revenue increased due to underlying growth in contracts, strong revenue growth at F1 TV and the onetime benefit of the F1 movie revenue in the second quarter.

Race promotion revenue was down slightly as underlying growth in contracts nearly covered the impact of one fewer race in the period. Other revenue grew driven by higher hospitality revenue, including from Grand Prix Plaza licensing revenue and increased freight. Note that we operated the same number of Paddock Clubs in both current and prior year periods, given that the Singapore Paddock Club is operated by the local promoter.

Adjusted OIBDA increased on a year-to-date basis as revenue growth continues to outpace increased expenses. Team payments were flat year-to-date as the impact of 1 fewer race was offset by expected higher team payments for the full year. Team payments as a percentage of pre-team share adjusted OIBDA were 61.5% for the full year 2024 as a reminder, and we continue to expect leverage against that 2024 percentage for the full year of 2025.

A reminder that team payments are best analyzed on a full year basis due to quarterly fluctuations in the team payments as a percent of adjusted OIBDA. Turning now quickly to the MotoGP's results. As a reminder, we closed the MotoGP acquisition on July 3 and began consolidating their results effective 7/1/25. Our financial results are presented on a pro forma basis in the release and in MD&A as though the transaction occurred on January 1, 2024, and a trending schedule will be posted to our website after the 10-Q is filed, including the results in U.S. GAAP for the full year 2024 on a pro forma basis.

Also note that our U.S. GAAP reported results for Moto GP's revenue streams are more aligned to our current F1 reporting with previously disclosed MotoGP commercial revenue updated to include only sponsorship with hospitality being moved into other revenue. Majority of MotoGP's revenue and costs are euro-denominated and as such, are subject to translational impacts from foreign currency movements.

In the following discussion of results, I'm going to focus on constant currency results. Similar to F1, I'll make brief remarks on the third quarter, but focus on year-to-date comparisons as we believe that is the most appropriate way to analyze the business. Year-over-year comparisons are impacted by the mix of races and generally, MotoGP flyaway races carry higher costs, including freight, travel and team fees.

MotoGP held 7 races in the third quarter of both this year and the prior year. Revenue declined in the third quarter as increased race promotion fees due to race mix and contractual uplifts was offset primarily by lower proportionate recognition of season-based income with revenue from 7 out of 20 races recognized last year versus 7 out of 22 recognized this year.

Year-to-date, MotoGP held 17 races compared to 15 races through the same period last year. Revenue grew across race promotion and media rights, primarily due to the additional events held and contractual fee increases. Sponsorship was relatively flat as contractual uplifts were offset by the impact of race mix on certain sponsorship revenues.

Other revenue also increased from growth in World Superbike fees and an increase in hospitality revenue. Adjusted OIBDA declined year-to-date as the revenue increase was more than offset by higher cost of motorsport revenue due to mix of races, which drove increased freight and travel expenses as well as an increased SG&A due to higher personnel costs with strategic headcount increases to grow certain commercial functions, as Derek mentioned.

Year-to-date results were also impacted by 2024 benefiting from a bad debt reversal early in the year. Looking briefly at Corporate and Other results year-to-date, revenue was $266 million, which includes Quint results and approximately $19 million of rental income related to the Las Vegas Grand Prix Plaza. Corporate and other adjusted OIBDA loss was $7 million and includes Grand Prix Plaza rental income, Quint results and corporate expenses.

As a reminder, Quint's business is seasonal with the largest and most profitable events taking place in Q2 and Q4. And note that Quint's intergroup revenue from MotoGP beginning in July is now eliminated within our consolidated results. Turning to Liberty Live Group. There's attributed cash of $297 million.

And on September 12, the Liberty Live Nation or Live Nation margin loan was amended to extend the maturity date from '26 to '28 and reduce the spread from 2% to 1.875%. $400 million of the margin loan capacity is undrawn at quarter end.

And as of November 4, the value of the Live Nation stock held at Liberty Live Group was $10.5 billion, and we have $1.15 billion in principal amount of debt against these holdings. Liberty Formula 1 and MotoGP are all in compliance with their debt covenants at quarter end.

And with that, I will turn it over to Stefano to discuss Formula One.

Thanks, Brian. What an incredible season we are wrapping up at Formula One with thrilling on track action and all teams scoring points. 9 drivers from 7 different teams have stood on the podium, highlighting our depth of talent in one of the most competitive season of the recent time. McLaren claimed the Constructor championship in Singapore, and we are watching the continuing battle for the driver championship as we head into the final stretch of the season.

Our global fan base continued to grow with exceptional engagement across the board. We have seen 5.8 million attendees throughout Mexico, up 4% relative to last year 2024 record at this time. Since summer break, Monza welcomed around 370,000 fans over its race weekend, while Austin and Mexico each welcomed over 400,000 fans. We are also seeing record percentage of female and under 35 attendees, reflecting the growing and broadening appeal of F1 events.

The Paddock Club have serviced nearly 36,000 race day guests through the end of the third quarter, up 8% from same point last year. The Paddock Club remains sold out for the remainder of the season and early partners request for 2026 already signaled robust demands ahead. Given the consistent sell-out trends at many races, we are looking to add structure in partnership with promoters to increase capacity in some markets in 2026 to accommodate pent-up demand.

Engagement and reach across this platform remain robust. We had a strong first half of the season with cumulative viewership up 10% year-over-year across broadcast and digital platforms and performance remained excellent into the third quarter. Nearly all races recorded year-over-year live viewership growth in F1's top 15 markets. The Sprint race format continues to draw fans with each Sprint season showing year-over-year viewership growth.

Viewership for YouTube by Lights increased over 20% as of the third quarter, and the majority of the audience is under 35. F1 is still the fastest-growing major sport on social fueled by both an exciting on-track season and increased cultural relevance globally, highlighted this quarterly with buzz around the F1 movie. Social media followers are up nearly 20% of the third quarter to 111 million with notable growth on TikTok.

Following the F1 movie, we were thrilled to announce that we are deepening our partnership with Apple as F1 news U.S. broadcaster distributor in a 5-year deal beginning in 2026. This is a partnership between 2 iconic global brands with a shared passion for innovation, entertainment and technological excellence as well as a very aligned customer demographic.

We are working with Apple on an ambition plan to elevate how the sport is presented to U.S. fans through innovation on the broadcast feed amplified across their vast ecosystem of products and services, whether streaming the race itself or showcasing content on Apple News, Apple Sport, Apple Music, Apple Match, Apple Fitness and more. As shown by the success of the Apple movie, Apple marketing and activation power, coupled with its integrated ecosystem can have a significant multiplier effect on brand awareness.

We look forward to sharing more with Apple in the coming months. Turning to other commercial updates. We continue to see competition for our exclusive rights and IP across revenue streams. We had another active quarter of media rights negotiations. We recently announced that Grupo Televisa has become our official broadcast partner in Mexico throughout 2028, and we are close to finalizing the remaining agreements required for territories where rights expire at the end of the season, including Japan, Latin America and Pan Asia.

We are constantly innovating across both content and distribution to keep the fan engagement. F1 TV is a strategic cornerstone, not only for the flexible and dynamic ways we can distribute race content, but also the direct access it gives us to fan data and insight. We recently announced a new show, Passenger Princess, which aired on YouTube. The first episode featured George Russell and reached 1.5 million views within 1 week of release.

This underscore our original content strategy, embedding F1 deeper into pop culture, reaching new audiences beyond race weekend and strengthening our always-on approach to connect with fans. Turning to race promotion agreement. F1 has an active quarter. We renewed Azerbaijan 2030, Monaco through 2035 and Austin through 2034. We are counting down to another unforgettable Las Vegas Grand Prix and are very pleased with the progress we have made this year.

Congrats to the Vegas leadership team on the momentum. With a couple of weeks to go, we are pleased to say we are on track with our ticket sales targets. We have a full week of programming across Las Vegas kicking off on Wednesday and culminating on Saturday night with a very special 2 hours [ pre-greet ] show and post race entertainment. On F1 sponsorship, we are finalizing out an incredible strong year with sustained momentum and visibility into our 2026 pipeline and beyond.

We continue to roll out new dimension of our partnership with LVMH, including French Bloom and Volcan Tequila. Closer integration between our F1 Global and Vegas Sponsorship team is also benefiting their commercial momentum with strength in Vegas sponsorship coming from both renewal as well as new logos partnering this year.

The growth across our other revenue stream is equally impressive, especially in licensing as we continue scaling up our partnership announced early this year. We have also renewed Momentum Group until 2030 to run the F1 authentic website and supply F1 official licensing show cars. We recently announced partnership with Disney, Pottery Barn Teens, Pottery Barn Kids and Hello Kitty, all of which should be a long tail benefit into next year.

The announcement of our Hello Kitty and F1 Academy product collaboration reached an outstanding 3.7 million fans over the 3-day announcement period and increased our F1 Academy social media followers by 5,000 across all platforms on the day of our announcement. [ Tracks ] retail sales have grown over 20% through the third quarter. Looking ahead, we aim to continue growing our retail footprint of the track in key races location.

We opened a pop-up F1 hub store during race weekend in both Miami and Austin as well as our store activation, where we celebrated F1 75 through historic and new merchandise lines. Strong sales and traffic reinforces the untapped opportunity in fan merchandising in these key location. Formula One momentum continued to span every part of our business.

We have built a powerful platform that has enjoyed tremendous growth, and we are increasingly confident in the continued upside ahead. We believe the groundwork we are laying today will continue to benefit our partners, shareholders and most importantly, our fans.

I look forward to providing more details on our sports and growth momentum at Liberty's Investor Day and the F1 Business Summit in a few weeks. So for the moment, avanti tutta, full speed ahead.

And now I will turn the call to Carmelo to discuss MotoGP.

Good morning, and thank you, Stefano. We are 4 months into our partnership with Liberty Media and are proud to be working together to drive MotoGP forward for the benefit of our fans and partners. We continue to see many ways that we can benefit from Liberty and Formula One's expertise. and have started collaboration on ways to work together.

We look forward to sharing more of our strategy at Liberty's Investor Day later this month. The 2025 MotoGP season continues to deliver exciting moments on track. Congratulations to Marc Marquez who secured his seventh MotoGP World Championship at the Japanese Grand Prix, capping a remarkable multiyear comeback from injury and securing his place in MotoGP history.

Despite Marquez dominance this year, we have had 13 different riders on the podium across 10 teams and all 5 manufacturers. And in Moto2 and Moto3, we are seeing some of the tightest racing in all motorsport from tomorrow's MotoGP stars. We continue to welcome record crowds across the calendar. This year, we set attendance record at 8 different [indiscernible].

Attendance is up to 4% through Malaysia, and we expect another sold-out crowd in Malaysia next week. We are building on the momentum from last year, brand refresh and our early investments are already yielding success. Social engagement is up to nearly 120% through the third quarter, excluding video pass across our digital platforms has increased over 30% year-over-year, and our social reach has grown nearly 30% year-over-year, driven by TikTok.

We look forward to hosting our second season launch event next year in Kuala Lumpur, which is another opportunity to provide content for fans outside of race weekend. Average audience tuning into our broadcast grew 17% through the third quarter, and we are seeing great viewership numbers from the Saturday sprint races, which are closing the gap to Sunday race coverage and demonstrating the value for MotoGP partner across the full race weekend.

Subscribers to Video Pass, our direct-to-consumer video services are up 6% from 2024. We have had positive renewals of a number of promoter relationship this year, including Japan through 2030 and Catalonia, Valencia, France, Germany and San Marino through 2031. Early this summer, we announced our 2026 calendar, which we will see MotoGP Race in Brazil for the first time since 1989 and a return to Buenos Aires in 2027.

This will both be fantastic location for MotoGP in important growth markets in South America as we work towards optimizing both our circuits and race calendar. We are making investment to support our commercial activities with the goal of expanding our exposure to a wider global audience while maintaining the sport heritage. We have renewed our broadcast agreement with SuperSport.

Additionally, we have seen a resulted to a multiyear partnership as the official lubricant supplier of Moto2 and Moto3 and successfully renewed our LIQUI MOLY partnership. Sponsorship remains a large growth opportunity for us, but we expect that it will take time to build our pipeline. We look forward to continuing to update the investor community on our progress.

Now I will turn the call back over to Derek.

Thank you, Brian, Stefano and Carmelo. For those of you on the call, we look forward to seeing you in a few weeks at this year's Liberty Media Investor Day. We will be hosting our Investor Day alongside the F1 Business Summit in Las Vegas on Thursday, November 20, in advance of the Grand Prix. We hope to see you there. We will have limited in-person attendance for the Investor Day, but all presentations will be webcast.

Tickets are available for purchase for the F1 Business Summit. Please check out their website and e-mail our IR team once purchased, so we can confirm their attendance. Before we open for Q&A, I want to take a moment to recognize Shane Kleinstein, our Head of Investor Relations, on her last earnings call with us. She has been instrumental in our Investor Relations and broader communications functions at Liberty and has left an indelible mark on our company.

On behalf of the entire Liberty Media team, thank you, Shane, and we wish you the best in your future endeavors. We will have a new Head of Investor Relations joining us and look forward to sharing that update in the future. In the meantime, we encourage you to please continue to reach out to the rest of the IR team, our e-mail [email protected] with questions. We appreciate your continued interest in Liberty Media.

And with that, we'll open the call up for Q&A. Operator?

[Operator Instructions] The first question today comes from the line of David Karnovsky with JPMorgan.

Maybe for Derek and Stefano, on the U.S. rights agreement, I think the dollar figures are fairly straightforward, but I wanted to see if you could speak a bit to how you're looking at this agreement specifically from an engagement perspective and how investors should perceive any risk regarding a move away from linear or ESPN? And what gives you comfort that you can continue to grow the U.S. media audience?

Stefano, do you want to take that?

Yes, of course. Thanks, David, for the question. I mean I think that, as you know, U.S. market is very, very important for our growth. And the fact that we have done an incredible deal with Apple, it's because we do believe that all the elements that will be important for this kind of growth are there. We know that we can count on an incredible brand that is not a brand, it's a social relevant brand.

And because our -- the nature of our fans is young, it's dynamic, it's multitasking. I think that the decision was the right one. And in terms of engagement, we are totally committed to make sure that all the content, all the platforms that are through the Apple ecosystem can be provided. We're going to increase even more the ratio we have today.

So therefore, as always, when you take a decision on the business side, you put balance risk versus opportunity. And I think on that, it was pretty clear that the risks were minor and the opportunities are huge. Therefore, we are really looking forward to embrace new chapter with them because we know them, we know they can be very progressive in proposing new things that will be very, very important to make sure that the things that I said before, David, on social relevancy of our sport will increase and will go.

And of course, this is a multiyear deal because we know that we need to be resilient on this approach. And that's why we are totally convinced that this is an incredible partnership that will be stronger and stronger in the future.

Yes. Thanks, Stefano. I think I would add that the way we look at it now, and I think a lot of folks are looking at it this way is sort of the definition of reach, which historically has really revolved around sort of the broadcast window on television.

And I think that's, in our minds, is an antiquated definition of reach at this point in the way a company like Apple and a partner like Apple can touch many different demographics in many different ways. And so I think that's an important thing to understand in terms of how we're thinking about it. I think Stefano's other point about this being a longer-term deal is important because when you're thinking about a company like Apple and the way that they invest behind the product.

It's not like the product in the fifth year is going to look much different, I guarantee you, than what you see in the first year. And that's going to be through years of investment in what they do. And I think we are at a great sort of point in time in the U.S. with the races that we've had here with the support that we've received and the new fans that we brought in with the new sponsors we brought in to really take all of this and sort of move it forward in a whole different way with a partner like Apple. And I think we'll see the fruits of this over the next several years.

Maybe just as a follow-on, it would seem to us that with Apple TV, you have an agreement now with a partner that has reach across most of your territories, and they have rights to the F1 movie. And logically, they could be a bidder in more regions. So I just wanted to get your view on that and whether that global factor was something you considered in your decision to partner here.

Yes, I think it's important -- Go ahead, Stefano, I'll let you start.

Sorry for that. Well, I think that what I can say is that, as you know, we are a worldwide sport where the fragmentation of different deals is crucial to be in the right market with the right partner. And what I can say straightaway is that the fact that we signed with Apple immediately has been a sort of a wake-up call from the actual partners around the world to say, hey, we want to stay with you, we want to invest.

So what's next? I think that vitally, it's great because it will attract the fact that Apple is a global partnership. And for sure, if we have countries where we can see different kind of potential where we can work together, we will discuss with Apple, too.

But this doesn't mean that we will cover the entire world with only one Apple deal because we do believe that at this time, we are much stronger the way we have structured all our deal around the world on the broadcast side. But for sure, the effect of having said the deal with Apple has been already big around the world.

Yes. And I would add, just in all of these markets globally, you almost have to still take it market by market. The dynamics within these markets have been shifting. And in some places, you have new entrants in other places, there's consolidation and sort of depending on when your deals turn out, those competitive dynamics can come into play.

And I think having someone like Apple, and we're in early discussions or early stages of this relationship. And so where their interest is in other locations globally, I think we will see over time. But I think we all understand on the call that any time you have a more competitive environment, you're better off. So we'll leave it there.

The next question is from the line of Bryan Kraft with Deutsche Bank.

I had 2, if I could. I guess, first on Vegas, it sounds like you're on track for your budgeted ticket sales for Vegas. I was wondering about the cost side. Can you talk about how you're tracking your cost budget for the event?

And then separately, just on U.S. media rights, -- should we expect to see a meaningful step-up in media rights revenue in the U.S. next year when taking into account both the Apple rights agreement and the loss of the F1 TV subscription revenue given that Apple will be taking that over in the U.S.

If I may start, Derek, Yes. Thanks, Bryan, for the question. I mean, first of all, Vegas, Vegas is one of our priority. As I said, ticket sales are on target. But you correctly take one point that for sure, what we have experienced was a big attention on the cost side of the organization.

And after the first years, I would say that we are on track in minimizing in the right way the cost because at the beginning, you try to cover a new investment in the right way. And now with all the new partners and the fact that we have renewed for big deals for the next couple of years, we are definitely on track also in controlling the cost of it. I have to say that we have seen a big shift on the community perceive on what Vegas race represent for them.

Therefore, working together with them, I think, is beneficial and has already an impact this year with regard to the fact that the cost will be reduced definitely. And this will have, of course, a positive impact at the end on the P&L of the race. Of course, as you know, we are working very hard to make sure that the event will be great, as always has been.

We have, as you know, shipped the starting time of the race at 8:00 p.m. on Saturday night. And this is, for sure, very, very important, the fact that the community is really embracing, as I said before, this event. So cost is definitely one lever that we want to make under the control of it, and we are on track also on that. Then with regard to the second question, you asked me, you're right, if we can expect more money.

As you know, we cannot give any guidance on that. But I would say what is important to say it's the F1 subscription on F1 TV is a great asset also for Apple. We have a great community that will connect through the Apple platform with our popular F1 TV. So I don't expect that this will have a negative effect. Actually, it will be the opposite because I think that this community is quite solid and the fact that we'll be embraced on Apple platform will increase the value globally for the future of both of them together.

Yes. And I just want to say to our team in Vegas who've done a fantastic job, and these guys are in the last few weeks of bringing this thing home that we are all feeling good about Vegas this year. But I think more importantly, almost is what Stefano was saying about our relationship with folks in the market. and really that we're looking at this as a long-term sort of investment.

And I think after coming out of the first 2 years and sort of coming -- as I've seen these guys and interacted with the folks in Vegas, the sort of vibe around the race and where this thing can be longer term continues to be something where we see a considerable amount of opportunity. And I think that's probably the biggest point, the biggest takeaway over the first 3 years of having this race.

Our next question is from the line of Kutgun Maral with Evercore ISI.

Two, if I could, around sponsorship. So first, it seems like every other day, you're inking new and attractive deals. Looking at the year-to-date team payment trends, it seems like the full year budget is tracking exactly in line relative to the first 2 quarters of the year. So should we take this to mean that these new sponsorship and maybe licensing opportunities primarily fall in 2026? Or are there other offsets that we should be mindful of?

And second, I was hoping to dig into licensing a little bit more specifically. Licensing is still a relatively small contributor to the business, but it seems like the team has really focused on expanding your efforts there. So maybe you could talk about the strategy and long-term opportunity you see ahead? And are you able to accelerate the momentum next year under the new Concorde?

Well, thanks. I mean I -- sorry, go ahead, Brian.

Yes, Stefano, I was just going to start on the sponsorship and then please add color. But yes, I mean, I think the team is feeling good about where we sit with sponsorship for '26, and a lot of these are long-term agreements, multiyear agreements that accrue to the future years. So as you sign them later in the year, they're going to have less of an impact, obviously, on the current guide.

Yes. Thanks, -- if I may add, I would say, yes, I think that you know that our strategy is not to talk a lot, but do the things. And the fact that we have shown with facts that every couple of months, we are there to be resilient in continuing the growth, this is our nature. It's our business. It's the beauty of what we have built up now as a great foundation.

And the fact that not only new partners, but also partners that are part of us since many, many years are staying with us long term means we do have a credible platform. We have a credible strategy that is not diluting at all the value of them being with us, with other people, with our partners. It is getting stronger because we do believe in a cross-contamination of big partners that can enhance the value of our business and our sports.

So we are really looking for the fact that we have now deals that is looking into the future. And what I'm saying is not only the dollars that count, is the awareness that we bring connectivity with new fans. The deal what we have done with LEGO, with Disney, with Hello Kitty is showing the fact that we want to have a community that will engage in long term with our platform. That's really our focus.

Our focus is for sure to deliver the result that we promised to our shareholders, to the teams, to our stakeholders for sure, but we have a bigger thing ahead of us. We have a headwind that we want to keep running with it because we feel that the fundamentals are totally strong and totally valid for the next years ahead of us.

Our next question is from the line of Stephen Laszczyk with Goldman Sachs.

Maybe another one on the global media rights opportunity for F1. I'm just curious, as you look out across the globe, where you see the most opportunity up next in terms of increasing monetization? What contracts, what regions, what types of partners do you feel like you could bring in to increase the value either on a monetary basis or along the lines of the holistic partnership where that could be improved?

And then maybe secondly, on hospitality, you called out some of the strength in hospitality in the quarter, Paddock Club at F1. Just curious if you could elaborate a little bit more on the drivers of that growth, whether it's strong pricing, whether you've seen more capacity come into the system this year on the back of some race promotion renewals or if most of that is still ahead of us given the renewal calendar when some of those contracts and an expansion of the Paddock Club kick in perhaps next year?

Thanks. I mean if I may, Derek, I will start. So we have other deals on which we are working on. So I would say stay tuned because there will be some other information going around the media deal in the future. As you know, and I don't want to undervalue what is the value for us to be a global sport. We have a global sport with global deals and the nature of the business is growing everywhere.

So I think that we need to have a sort of mix situation around the world. Some of them will be linear in the future, some other will move in a different platform because what we need to do is to make sure that we see the relevancy and the opportunity monetizing as much as we can every market, but also checking what is the trend that every market is offering to us.

So I think that this deal, as I said before, has had an effect of accelerating the fact that the long-term deal wants to be even be longer with the part that we have. So it's up to us to make sure that we need to do the right choices for the future, but the dynamic in this stream of revenue will be very important in the future. And even if some of the people will say that the shift between linear or pay TV versus digital will have a sort of drop in dollars optimization, I do believe that the nature of the business that is global will cover that for us in the future because the competition is very high in the different platform.

Then with regard to the hospitality, I think that the reason why we feel confident in the future, this is another asset that despite a long-term deal with a lot of partners, some can say where is the gain that you can have with them. Actually, it's the other way around. because we know that the hospitality hand side is a limitating factor in terms of capacity for us.

And the only way that we can have with the promoters to make sure that also this asset will be even stronger is to give them the chance to invest long term. Therefore, that's the strategy we're going to do in a lot of markets because we don't have to forget that we want to increase the quantity of availability, but we cannot lose the quality approach of what we are offering to our customers.

And this is not negotiable. We have some examples this year, look what Hungary did in terms of renovation of the infrastructure, what they're going to still doing in the future. And this has an effect that, for example, you have seen what will happen in Austin in terms of new facilities that will be beneficial to our hospitality plan. So everything has an effect in a constructive way with everyone that is part of our ecosystem.

Yes. I would also just point you to Stefano's previous comments on that we've done -- we just recently announced a deal with renewal Televisa in Mexico. We previously announced the deal with Globo in Brazil. And as he said, there's a couple more deals on the table that are coming on the media rights side.

So I think it is shaping up to sort of be an environment going forward here. We've got the right partners in the markets that are important to us, and that will continue to drive, I think, engagement and awareness of the sport.

Our next question is from the line of Joe Stauff with Susquehanna.

First question is on Vegas. I'm wondering I think in general, is it fair, number one, to assume most of the growth this year will be from the higher end? And if you can give us maybe a little bit more color on what you're seeing from the lower end? That's the first question.

Second question is on MotoGP and race renewals. I guess since Liberty did for Moto, where our count is that there's been approximately 9 renewals. I think there -- I guess it's more of a clarification, another 6 to 7 to go that expire at the end of '26.

Joe, I think we got your second one, but we missed your first. So why don't we have Carlos take the second? And then if you could just repeat your first question after, please.

Yes, we have seen a lot of traction on a number of fronts since the announcement of Liberty Media. One of those has definitely been promoters where we see a lot of interest, of course, with a limited number of races. And we do see a lot of increases in the renewals.

The total number was higher than that actually, but a number of those have already been renewed. We still have 8 events to be renewed for the 2027 season and 8 of which have already been renewed or announced in the past 12 months. And we continue to see a lot of interest from both new locations, but also interest in expanding the current events in Europe and outside with increases.

Understood. I'll repeat my first question. I apologize for the background noise. In Vegas, is it fair to assume most of the growth you'll see this year is coming largely from the higher end? And just wondering if you could comment on what demand looks like VA or the lower end of demand.

Thanks, Joe. I mean I can say 2 things that are relevant to the fact that this year, we do believe that everything is on track and what we wanted to have another successful season. First of all, there has been a big change on the pricing and how we position our tickets during the year. What has happened is factual in the past has been the last couple of weeks a drop in pricing.

But what we have done this year is exactly the opposite. We were announcing a great different packages offer with the fact that we were explaining to everyone that has been that our strategy was different. Therefore, do not expect to see prices going down because this will not happen. It actually is actually not happening. The other thing is it's -- of course, the demand is very strong, much stronger in all the areas.

We have also created packages for GA to allow even the community to be closer to the event. And this is something that is hand-on-hand with the fact that we also have a ticket -- daily ticket that has been in the package. And of course, this is -- we said since the first day coming in Vegas. we had to learn the lesson of being in a community that is new -- was new for F1.

Therefore, I think that the incredible job that Emily and her team is doing is taking the experience that has been done in the first years in order to progress in all the dimensions of this business. That will be -- I don't want to say something that people will not believe me, a great success because Vegas is understanding the value of our business there, too. And this is very, very important also for them.

The next question is from the line of Peter Supino with Wolfe Research.

Shane thank you, and best of luck, you'll be missed. I wanted to ask about operating leverage generally and the Concorde agreement specifically. I think your last comment on the Concorde agreement in '26 is that it provides for modest operating leverage, assuming the business is on track. And I wonder if you could give a perspective on refresh that and then talk about the possibilities beyond 2026.

Yes, Stefano, I can start with that and feel free to add any color. But yes, with the new agreement, we would expect some modest leverage. We can't really say much more than that into 2026 and similar to what you've seen over the last few years. And then beyond that time, the percentage we would expect to be fixed and then you'd hope to see leverage in the underlying base business.

Yes. I mean, Brian, you are very clear. And I would say, for me, what we can add is really the fact that we can see a great stability in the sport in the future with regard to the governance to the fact that we are solid looking into the next 5 years in a condition where we really think that everything will be done, understanding that the team are part of the growth.

And their financial strength is the strength of the business. And this is very, very important to recognize that. Therefore, on everything, I do believe that now we are finalizing the details. I want to thank not only the team, but also the President of FIA, Mohammed Ben Sulayem because we are sharing a great future together that is great because in this moment, we just need to make sure that all the conditions are stable to keep growing together.

The next question is from the line of Steven Cahall with Wells Fargo.

First, Stefano, I just wanted to ask you on competitive balance. We've seen some good racing this year between some of the top drivers and the top teams. I think we still have about 6 out of 10 teams that don't race for podiums most weekends. And I was wondering if there's anything that you might be implementing in the next couple of years that could improve that since it can tie to future growth in the value of the sport.

And then, Derek, I think you said you expect some continued growth in the cost base this year as you invest into growth strategies. I was wondering if you could just expand on what those elements are and what the return on investment for some of those things look like?

Steven, I mean, with regard to the competitive balance, I would say we've never seen such in the last couple of years, a competition with a lot of teams that before we were not even able to score any points. I can nominate one team on top of the other is has, just to give you an example. And the gap between the cars and the driver is minimal.

And therefore, I would say what we are living today is really something unique and which we are very proud of. And all the teams now due to the budget cap, due to the fact that the races are very interesting due to the fact that the business is so solid, are willing to invest and be even more stronger into the future.

And this is very, very important. And we don't have to forget this is very relevant to make sure that without this kind of situation living today, Audi Honda Ford Cadillac would have come next year in our sport or even more with more investment. So as we always said, the sport is at the heart of our platform and never -- and no one has to doubt about it.

You know that next year, we're going to have change in order to be cope with the fact that the technology applied to F1 has been always very relevant. We will have sustainable fuel at the center of the use of new powertrain. And it is normal to think that when there is such a big change of regulation, there could be a big difference at the beginning. But the regulation is done in a way that if this would happen, we know that there are mechanisms to make sure that the gaps can be reduced in a smaller time than normal.

And therefore, this is a very important element to keep the dynamic of our sport at the center. And therefore, I think that no one -- and if you didn't have these dynamics, no one would have been interested to come in, in our sport. That's why, as I said, Steven, this is, for sure, one of the main focus that we need to keep to keep the center of our business, the sport and the racing itself.

Thank you, Stefano. And an exciting off the track news, Charlotte I was engaged yesterday. On the question of incremental costs, I think that was related to MotoGP. And I think we've made this comment in the past, and it's not dissimilar to sort of coming into a new business, trying to ultimately drive growth and drive revenue growth long term, but making upfront investments that will lead us to that point.

I think as we've talked about previously, some of the investment in sort of expertise, personnel with the right expertise to drive the commercial side of the business, but also even revenue-generating assets, including things like the track, signage, investments into the video pass product, enhancements, all that sort of stuff is sort of ongoing and had already been ongoing prior to us closing the deal. But I'll let Dan give some more detail on that.

Thanks, Derek, and thanks, Stephen. I think Derek hit on a few of the really key areas of investment that we have started as early as last year, focused on, one, on the marketing side of the business in terms of new hires and also on the storytelling side, how do we reach new fans -- and not only new fans, but new fans based on the geographies that they are, we have to tailor that content to them.

So that is taking significant time and investment in order to reach those people. Derek also mentioned what we've done to improve the look and feel of both the racetracks, the circuits and also The Paddock. So we've done some investment there. And the last thing I would say is we continue to innovate and iterate on our digital properties, specifically video pass to try to make sure that the digital offerings we have to consumers matches the innovation that we have on track.

The next question is from the line of David Joyce with Seaport Research.

Another MotoGP question. You mentioned that new races are coming in Brazil and Argentina, but you've also had a number of other renewals. So as you go through these renewals, do they allow for some rotating races given that you're already maxed out at 22 per year given your agreement with the teams? And does that somehow impact your media rights renewals cadence? If you could provide some color on that.

Sure. This is Derek. Look, I think right now, we are in a position where we have either some capacity in the sense that some races come up for renewal that we may -- if we choose to go to a different location, we have that capability to go do that. So the concept of rotating races right now is probably not in the near term. And I will then -- I guess, Carlos, if you want to comment on that further, go ahead.

Yes. Thank you, Derek. I would completely agree. We don't see sort of the short-term need to have rotating races. We think it's important. One of our main goals that's been sort of confirmed also in these first months of Liberty Media is one of our key priorities and targets is to invest in our events and turn our races into more and more of entertainment events globally.

And a part of that is, of course, improving the events itself and where possible, also the event locations. We have Brazil coming in already in 5 months from now after more than 25 years and Buenos Aires, which will be another city where we race that. So all these events are a key focus for us in entering new markets. We do see that we still have capacity to bring in new events probably outside Europe, and there's no need to sort of rotate on current events in the short term.

We don't see this impacting our media rights at all. We continue to have 22 events. All 22 events have sprints, and that's been a part of the investment of making these events more of entertainment events, having more action, more notorious action on track around the whole weekend. And that's something that we've also leveraged together with other assets to be able to increase on our media audiences. So we don't see that the race mix will affect our media rights.

The whole concept here is to improve sort of the quality of the product across the board, including where we have races, who our local promoter partners are that help us drive promotion of the sport and all that, which will ultimately lead to deeper and broader engagement, which in theory will drive media coverage and media rights.

Next question is from the line of Ryan Gravett with UBS.

Just in terms of the upcoming split-off, does anything change in terms of your capital allocation plans or priorities at Formula One Group? And along those lines, any expected changes to operations or the commercial relationship between Quint and Formula One after the split occurs?

I'll take that. So that would be probably no on both, and we'll leave it there.

Okay. Fair. Just maybe just a follow-up on MotoGP then in terms of the hospitality offering for that business. I was wondering if you could talk to the opportunity there and when some of the benefits of the integration could start to materialize?

Yes. I think we do see significant opportunity on the hospitality side of Moto. I don't know if any of you guys have been to a motor race, but it is a pretty thrilling event to attend, I think where we do see opportunity is sort of the experience at the track that goes beyond what you're watching and what you're feeling. And so just like the F1, having that opportunity to upgrade elements of that hospitality product is something our team is -- Dan and his team are very focused on and actually working with Quint on that particular dynamic. So Dan, if you want to give a little bit more color, feel free.

Yes. Thanks, Derek. I think what he said is correct. I think we do have a lot of -- we've made some really good improvements at MotoGP in the hospitality offering from both a service and an experience standpoint. We now have to execute on a plan that is to reach both our existing consumers to get them more involved throughout the weekend and also, though, to find a new set of fan base, a new group of fans to purchase hospitality, particularly at the races where we do well but have room for capacity room.

So what I would say is working with Quint, what we're trying to do is not only look at pricing, but look at the ladder, making sure that we get a good product ladder so that we can offer people things at different price points so we can upsell on experiences because what MotoGP does have is we are a hugely accessible sport.

So we have the ability to package in really great experiences with our base hospitality program that I think is unique in the sports industry. So we see a good upside here. It's just going to take some execution, and we're looking forward to collaborating with Quint on that.

Our last question will be coming from the line of Matthew Harrigan with Benchmark Company.

Actually, first of all, thanks to Shane for all the classic Investor Day schedules, which I hope are going to be available on an archival basis because they were really, really great. Obviously, other people at Liberty were involved, too.

I think Shane was a main architect. I think my questions are partially answered, but are you seeing all the teams be able to adequately cope with the new 26 engine regs? And do you see anything commercial and tangible coming out of the Saudi Aramco Synfuels venture? I know you touched on those questions to some extent, but if you could amplify a little more, that would be great.

I definitely think so. I definitely think so. I think the fact that on The Paddock, everyone believes that it's faster than the other means that there are so many variables that everyone believe to have the secret recipe of being more competitive. I do believe that, of course, the level of technology that is needed in terms of knowledge is not only on the power unit. We forget that it's a new car.

We forget that it's a total different dynamic on how you have to drive your car is a dynamic aerodynamics. It's a different way to manage the tires. It's a different way to manage the energy. It's a different way for the drivers to drive with the new regulation. So everyone is really focused on.

And the beauty of that, that we have still teams that are fighting for points that are -- will be converted in dollars at the end of this season for the championship. So there are still some developing during these -- the last couple of races because no one wants to give up. So it's all fascinating. I think that really all the elements of adventure are there and which we should be very, very proud.

Great. Thank you, Stefano. I think with that, we're going to wrap it up. Again, thank you, Shane, for all of your great work over the years. We look forward to seeing where you go next.

Thank you Shane, from the F1 side. altogether, one family.

Thanks, Stefano. With that, we'll wrap it up. And again, just finally, Investor Day on the 20th, followed by the F1 Business Summit in Vegas for those of you who can make it. See you there.

This will conclude today's conference. You may disconnect your lines at this time. Thank you for your participation. Have a wonderful day.

Okay. Great. Let's get started with our next session. Thank you, everyone, for taking the time to join us today. My name is Stephen Laszczyk, and I'm the firm's leading entertainment analyst. We're excited to welcome to the Communacopia and Technology Conference this year, Derek Chang, the CEO of Liberty Media.

Derek, thank you for being with us today.

Thanks for having me.

Amazing. So Derek, it's been a big year for you in Liberty Media. You've taken over as CEO. You've closed the acquisition of MotoGP. You've worked with Apple to promote the F1 movie, which has been highly successful.

Maybe just to start, as you settled into your role what would you say have been your top priorities over the last 6 or so months? And then looking out over the next year, what are your top priorities for both Formula 1 and MotoGP as you grow those properties and then also to Liberty Media more holistically with Liberty Live?

Yes. No. Again, thanks for having me, and thanks, everyone, for showing up today. I think for the first 6 months or so of my tenure really about, sort of, executing a lot of what we talked about late last year, which was closing MotoGP. I think, not Liberty Media per se, but on the Liberty Broadband side, spinning out GCI and getting much further along in terms of the deal with Charter and Cox for those group of assets.

And then to pursue the Liberty Live spin, which we started down that path with the filing of our S-4, which I think we did at the end of July, and still hope to be effective at the end of this year, our fourth quarter this year, SEC sort of dependent.

But I think as we're looking forward right now, the biggest priorities are probably more operational in nature as they relate to MotoGP, just having sort of closed and not really haven't been able to interact with those guys during the regulatory process, getting fully up to speed, understanding sort of their challenges, their opportunities, both in the near term -- really in the near term, excuse me, because as we sort of thought about the thesis for MotoGP, we've obviously been well aware of what we wanted to do with it, which for those of you guys who don't follow MotoGP, it's a really, really fast-paced, dangerous dynamic sport.

I think, the team there has done a tremendous job of building what that is, what that sport is, what that IP really represents. I think where the opportunity there is sort of the further commercialization of it. I think that -- it's -- the fan base is discrete. It is passionate beyond belief, how we expand that fan base, how we expand the concept to make it more of an entertainment asset. It's probably what we're looking at sort of over the next several years and what that can entail.

Maybe digging into that on the MotoGP side, expanding the fan base. And as you think about the strategic pillars of growing the sport over the next couple of years, what are some of the things you're really focused on? Where is the white space that you feel like Liberty Media and Formula One could perhaps come in and help with? What's the, call it, next 12 months look like? And then, as you think maybe more broadly more holistically, the next 3 to 5 years look like?

Yes. I think it's what I just said in terms of the broader commercialization and sort of monetization. I think that happens over sort of multiple fronts. We think about sort of the three pillars of the revenue, both at F1 and Moto, you think about the local promoters, the races, the ad track experience. We think about the media rights, we think about sort of sponsorship.

And I think, if we break all that down in the near term, what we're focused on is, hey, how do we actually build the team at Moto, have the right skill sets and the right people in place. We have done this and can then apply that to what I just talked about. And so that process started even before we walked in the door and it's continuing to bring that level of experience and sophistication to Moto.

I think in the nearer term, sort of you'll probably see us start to -- because this has already been in progress, to be fair, but the local promoters and sort of what we can do at the races in terms of hospitality. Quint is another company that we own at Liberty. And I think bringing their experience there and what we've done at Formula 1 and really enhancing what that means, because you go to an F1 race and you go to Moto GP race, it's a different experience right now.

It doesn't mean it should be the same experience. It just should be a quality experience. It's a different demographic, and we have to recognize that. So I think there's that on the sort of hospitality side and then a little bit longer term, sort of stepping up the financial impact from our local promoters and the deals that we strike.

I think where we put these races is a big factor. We have races around the world, but I think we could have greater geographic diversification. We just announced recently that we're going back to Brazil next year. We've got a race in Buenos Aires coming in '27. We have three races in Southeast Asia. There is more opportunity.

And some of these races to be fair, are not necessarily in ideal locations from an accessibility standpoint. They may be great tracks, which is awesome. But if we're bringing people in and having people come to races, having sort of the all-around hospitality and accessibility being near a major metropolitan area, having access to the hotels, the restaurants or whatever it is that makes the whole experience that much better.

I think on sponsorship, it will be probably a similar sort of opportunity that we've seen at F1, which is we've got a pretty strong base of endemic sponsors right now. And to be fair to the current team, it's not as if they've been necessarily driving that area to expand beyond that. But I think everyone sees that opportunity.

And again, I think it's tied to how we develop the sport and can we go past the core demographic and expand our reach, expand our fan base and that in itself will then bring in -- expand what the brand means in terms of what the entertainment value is. And that itself will start to draw in sponsors.

I think, there's an opportunity probably to do it -- well, it will take a while to do this, and it's a bit of a virtuous cycle. I think we have some advantage in having done this at F1. And so I think there's credibility attached to the Liberty name and the Liberty ownership of MotoGP. So can you have -- you'll have the opportunity to get in front of sponsors tell the story and frankly, have a case study to present that can demonstrate to them what the value is going to be.

Maybe just following up on a few of the points that you made across race promotion, sponsorship and then media rights, which I wanted to discuss as well. On the race calendar, you mentioned geographic diversification. Where do you see the sport going over the next couple of years in terms of the geographic mix? How fast can you move with the existing rights agreements that you have in place today? And then, I'd be curious your thoughts on growing the race calendar, perhaps adding more races to bring it up to a level that we see at Formula 1.

Yes. So I think with any sort of race calendar shift, you need some lead time if you're going to move a race. There's got to be a track there. And if there isn't, then you're going to have to build one. So there's a lot of prep that goes into that.

I think the reality is we probably have a handful of races at any given time that are going to come up in the nearer term. And those are always sort of available to sit there and make that strategic decision as to where they might go or whether they stay where they are and you talk to your partners, your local partners about enhancing what that experience is.

We already are in a lot of great places and that can continue. I think what we are trying to do, which will benefit the local promoters, too, which is if Liberty is investing in the sport, they too can invest in the sport. In parallel to F1 is as we're going through a lot of the next cycle on F1 renewals and stuff, is sort of what we're seeing people do at the track. So in Budapest, not to go off topic, but it's all related anyway.

What we saw in Budapest is, they just finished their upgrade this summer. And so the race this year, you have the standard of the panic and all that is at a much higher standard now. They've increased the capacity, all that sort of stuff that enhances our ability to monetize it also enhances the race experience for people coming to the race.

And I think that sort of parallel can run through the system at MotoGP. And I think you have a better -- you're at a lower base. So the opportunity itself is greater there. I think geographically, we're still pretty heavily concentrated in Europe. And Europe has been great. Southern Europe has been great for MotoGP. It's sort of really embodies what it's all about. But that being said, are there opportunities to diversify a bit and sort of spread our wings, I think there are. And I think we'll be contemplating that here as we go forward.

On sponsorship, similar question in the sense of broadening out the sponsorship base from the endemic sponsors that MotoGP has today to something a little bit more diversified in terms of category. I took Formula 1, the better part of the last 7, 8 years to get to the point that it's at today. Do you see a similar time line for MotoGP to get there? Or are there categories perhaps and relationships perhaps that you could leverage across the two properties to make a little bit more headway there a little bit sooner?

Look, who knows? Right now, I would say that broadly speaking, it's going to take some time because A, you've got to actually build the brand or have enough credibility to walk into a sponsor and say, this is what the brand embodies. This is what we are all about. And if you don't quite have that, how are we going to get there? And then they've got to buy into that and say, "Hey, I want to associate with that."

Now I think where the acceleration could happen vis-a-vis Formula One is having done this at Formula 1, having a lot of relationships out there. Are there people who see this as a complement to what they're already doing with F1 and that could possibly accelerate some of that.

And look, the reality is in some of these places, and sponsors are no different. I think people see where some of the early movers go and you have some pretty fast followers. And I think that could happen here, too. So once -- it's probably a long analogy, but the dam breaks, you can see where that happens. But it's up to us frankly, to invest and build the brand, and that's what we are jumping in full force to do.

MotoGP media rights, mostly concentrated among Spain and Italy at the moment. Would just be curious to get your take on perhaps the sports media rights market more broadly in Europe and globally and how you see MotoGP fitting into that? And then over the medium term, as you think about renegotiating media right deals, what are you looking for in of a partner reach monetization, maybe integration of digital video path, et cetera.

I think that MotoGP is in a great spot because, as I said earlier, like you're not building a new sport. And so you have this passionate fan base. And in certain countries, that's very meaningful, and you know which countries those are in, because those are sort of the bigger deals that we have probably.

But at the same time, being able to leverage off of that, and as I said earlier, expand sort of what the brand means and bring in new fans. That goes part and parcel with the distribution you have. But I think that's an easier sell than a brand-new sports league coming along.

And at the same time, we're not so big and so established from a sort of -- or financial standpoint, that you're sort of got a target on your back in terms of people sitting there going, I got to cut my cost, I'm going to cut this. You're actually at a state where you're hopefully in a bit of our own sweet spot.

I mean, yes, you'd like to be the NFL and command whatever the NFL commands. But absent that, where we sit in being able to leverage off the brand and the fan base that we already have that's taken years and years and years to build, but also not being prohibitively expensive in any one market. So I'd like to see us be able to take that and tell that story to media partners, sponsor partners globally and have them understand what we can do for them as a sport.

On the cost and organizational side of MotoGP, back when you acquired Formula One, there was this investment period for a number of years to get the organization up to a level that it could start spinning this flywheel. It seems like we're a little bit further along on the MotoGP side today than where we were at the onset of Liberty acquiring Formula One. But I would just be curious from your position today, where do you see the opportunity to invest in the organizational structure and then the associated impact on the cost structure? How should investors be thinking about that?

Yes. So at F1, and it's funny because I think I told this story earlier today, like Chase Carey, who I used to work for, who hired me at DIRECTV, obviously ran F1 for Liberty at the very beginning and now sits on the Liberty Board and Chase and I spend a fair amount of time together and there are moments that I get the whole history lesson from Chase as to what Formula One was like when we entered, and it's -- there's a lot there.

And so you're right. I think we're in a different phase than what he had to deal with when he took that over. I think that we are light in terms of some of the sort of expertise that we have really on the commercialization front. But it's not sort of leaps and bounds of what you need to do to invest. It's hiring several good people who know what they're doing, who have done this, who have built global brands and sold global brands. And it's that sort of infrastructure that we're looking for as we sort of move forward.

And they already started the process before we close, and we're continuing that process. It does take some lead time to find the right people. It takes some lead time to mesh them in the culture and have people working together, but it's not like we're talking years. This is all pretty quick.

And on the magnitude of investment that you think is needed to get to that point, should investors think about that similarly to the magnitude of investment made in Formula One?

No, there's incremental increase, but I don't think it's anything that even that noticeable.

That's helpful. Team payments, similar to Formula One, MotoGP's largest expense is team payments, but dissimilar to the Formula One the payments are more fixed in nature. Can you maybe talk a little bit more about the team payment structure, how those costs are calculated year in and year out? And then just maybe more broadly, the nature of the relationships with the teams and the agreement that's in place with the team principles and team owners.

Yes. I think I'll start there. I mean, everyone probably knows the F1 story and sort of the relationships between F1 and the teams in the early days of Liberty's ownership, I mean, that was a pretty tough set of relationships.

And I think over the last 10 years, we've done a remarkable job in terms of -- as a sport, not just Liberty or not just F1, but the F1 and the teams done a great job in coming together and realizing that together, we're much more powerful than sort of disparate factions, always fighting over the wrong stuff.

I think at Moto, we have a huge advantage in that the teams and the guys at MotoGP have good relationships already. And this has been going on for years. And so you don't have to sort of rebuild that or sort of create this element of trust that didn't exist.

And I think that does exist. And now it's about explaining to the teams with Liberty's involvement how we can bring some of the same forces to bear that we did at Formula One and really broaden the appeal of the sport and make their investment sort of worth much more than they are today, hopefully.

I think that from a -- and as evidenced almost by the announcement on Friday with Guenther Steiner coming into the sport and seeing that opportunity and see that what he believes is probably the upside and his investors believe is the upside and having Liberty involved and sort of following on what we did with Formula One.

In terms of the structure of our arrangement with the team, it is a bit different than at Formula 1 in that it's sort of a more fixed nature to it and it has multiple components in terms of payments to the teams on somewhat of a fixed basis. There's additional compensation as it relates to certain types of races that have more expensive flyaway races.

And then there is a component of it where we actually cover costs on a lot of the transport and things like that. But once those are covered and the teams themselves don't have huge expenses. This is in Formula 1. These are sort of tens of millions of dollars, not hundreds. And so I think that from a model standpoint for both the teams and for us, once we can really start to drive incremental monetization and revenue, you can see a lot of that start to come to the bottom line, hopefully.

More operating leverage -- Maybe switching gears over to Formula One. I'll start with U.S. media rights, since that's been the topic of discussion for the better part of the summer. Perhaps you could update us on the status of the U.S. media rights negotiation, where we are in that process and what characteristics you're looking for as we look into the next year, signing a deal before the next season kicks off?

Yes. Look, I think it's been pretty well documented in terms of the negotiations. We are pretty far along, and we're pretty happy and comfortable with sort of where we're going to end up. And hopefully, we'll have something to talk about relatively soon.

The more substantive question is, sort of, what we are looking for and what we've been looking for. And I think it's a good time to talk about sort of the media landscape and sort of not to go do a history lesson, but as everyone knows, in the past, it was like, okay, you do a deal with a media partner, and it's like, okay, there's many games or there's many events that you got and events are 2 hours or 1.5 hours, and that's the focus, and that's what you're selling.

And now it's much more -- and this isn't just Formula 1, but I think across the board, hey, how are -- is your media partner -- is your media partner even just a media partner? Are they also a sponsor? Are they have other ways that they're going to monetize and commercialize sort of the relationship. But then on the flip side, how they are helping you sort of do that same thing.

In the U.S., we've been on a pretty nice growth path with Austin and then Miami and now Vegas, which we're very proud of and very happy with sort of how that's going. And I think bringing in a partner who amplifies a lot of that for us on an overall holistic basis and driving that engagement with fans is what's important. And again, we -- as I said earlier, looking forward to a successful conclusion of this process here relatively soon.

Maybe more holistically on the media rights discussion thinking internationally for Formula 1. Just curious, as you look out over the next couple of years, where you see the most opportunity globally to either enhance maybe the quality of your media rights partner, maybe some of these ancillary benefits that it seems like you're looking for in the U.S. or monetization? Or is there a world where you can get all three of those components working together in some markets in a better way than what they are today?

Yes. I think it's -- we are a healthy property, and I think a sought-after property as we have these discussions around the world. I think we announced that we're doing something with Global being back on global in Brazil next year. We announced earlier this year that we had renewed our rights in Canada. I think we've got discussions going on -- ongoing in several of the major markets that we will have clarity to here relatively soon.

And much like I just talked about the U.S., I think this is like a holistic sort of view of your -- traditionally what's been known as your media partner, but I don't know if it's necessarily a media partner per se in the classic sense of someone who's just broadcasting your race. It is someone who can help fans access your content beyond the race. It is someone who can help your fans interact with even your sponsors. It's all of that.

And I think the guys that are looking forward and sort of view that as part of their own playbook and what we can do to enhance that for them are ones that we want to try to do business with. You're not going to -- it's not a perfect world and timing is never perfect either. And so you have to sometimes deal with the practical implications of what's available and how to make sort of that partner and what's available work for you.

But it's sort of these discussions globally seem like they are very healthy. And I think Stefano and his team are doing a great job and I think we'll continue to see sort of the right partners line up with Formula One.

On sponsorship, Formula One has been incredibly successful over the last several years, adding sponsors. We've seen LVMH, American Express, many others come into the sport. I think there's an investor narrative out there along the lines of the sponsorship opportunity being capped at a certain level, either the number of global sponsors, maybe less opportunity on the official partner track sponsor side with all the inventory that's come in. Just be curious to get your sense of where we are in that opportunity curve. Has the sponsorship opportunity tapped out at the current level that we're at? Or are there more ways to create inventory or upsell sponsor on the Formula One side?

Yes, there's always an investor narrative that there's a finite period at which something isn't going to end, right? And understandably, as people do the risk assessments and all that sort of stuff.

But look, I think that on the sponsor side, this has been an incredible year. Stefano and Emily have done a fantastic job and their team in terms of really on multiple fronts. One is the continuation of just bringing in new sponsors. Vegas has been a big part of that, and I think it has been very helpful to that story and to that narrative.

I think then it's sort of -- as sort of, we are filling a lot of categories, there are still several, I think, that can be filled. But I think in as much there is growth opportunity in terms of existing renewals, that are going to happen here over the next several years.

And I think you can see sort of the demand is there. The inventory is kind of tightened in some ways. And where -- what you will hopefully see is even if the names don't change, which is actually a good thing, because having long-term partners who continually have associated with you and continue to invest in that brand association is extraordinarily powerful. But I think what you'll see is hopefully people coming in at different tiers where you drive demand and drive pricing and that in itself will help the monetization beyond the continued investment in that brand affiliation that these guys make.

On race promotion, Formula 1 is negotiated or renegotiated in several deals over the last couple of months. I think you've had Belgium, Monaco, the Netherlands and Brazil all pretty recently. What does F1 look to achieve in some of these race deals, better monetization? You've spoken a lot about fan experience. So maybe just talk a little bit about what you've been able to maybe extract or negotiate given the limited supply of weekends on the calendar of Red F1. And then as you look forward, opportunities ahead on the race promotion front, where the greatest opportunity lies for improved monetization?

Yes. I mean, clearly, there's a financial component to it, which we're all well aware of. I think there's also a geographical component, which we've been clear about in sort of using races and where we put them as a way to grow the sport, expand the audience, expand where that fan base is, who's the local partner, just like your media partners, who the local promoter is and what they're doing to help promote the sport. So I think that all factors in.

And then, I think another level to that and what you've seen with respect to a lot of our renewals is, okay, just like a hotel, you kind of need to upgrade the facilities, you need to upgrade the experience for people from -- for the fans from time to time, right? And some of these tracks are at a point where that makes sense.

And if we work hand-in-hand with sort of our local partner and as part of a renewal, sort of the agreement is that there's going to be a significant amount of money invested into the facilities. That enhances our business because, a, you're upgrading, the Paddock Club and that experience and what that means. You're probably expanding it in a lot of cases -- and we've been selling out Paddock Club. So that gives us further monetization.

I think one step further, you're even enhancing sort of the overall fan experience. You fix things like entry and exit and knock down sort of travel times and traffic jams and that sort of stuff, that's part of the fan experience. If you're adding sort of activities that they can do with the track, that's part of the fan experience. So there's a lot that goes beyond sort of just here's the rights fee from the local promoter. It's all of that.

And I think all of that continues to build what F1 is. If you go into -- look, here in the U.S., if you go into an old tired arena, that's a different experience than going into the Intuit Dome in L.A. and all of a sudden, that's a vastly different fan experience. And I think that enhanced experience accrues to the brand.

Any sense how much more Paddock Club capacity you can add across the calendar as you look out over the next couple of years? And as you renegotiate the deals, is it a material increase of Paddock Club inventory that could come -- potentially come to market?

I think that's two things. One, I do think there's increased inventory that will come to market as, again, I think Melbourne right now is undergoing sort of their upgrade project. And you've got other tracks doing that. So that will increase Paddock capacity. I think the other thing is just almost product segmentation and within the Paddock Club coming out with new products where you can also potentially create even a higher-end experience, whether it's the garage experience with -- I'm forgetting the name, Jamie -- not Jamie.

You have a number of super premium VIP here from Las Vegas Grand 3, I think...

Gordon Ramsay, sorry, Gordon Ramsay, not just Vegas, but all the other -- in multiple locations. And then, with Soho House, again, a product that we introduced. I can't remember where the first place. I think it might have been Silverstone. And so, I think there's that ability to take existing sort of capacity and actually reformat it in a way that you're creating a wholly different experience that our team has been very creative about doing and coming up with those ideas. So I think there's ways to do this that creates, again, differentiated high-end experience.

On Las Vegas, taken a few new approaches this year to pricing and packaging, also some focus on the cost side as well. Maybe you could just give us an update on how this year is tracking both from a ticket sales perspective relative to your expectations? And then on the profitability side, any way to maybe quantify to the extent you're taking cost out or some of the key moving parts there?

Yes. Look, on the ticket side, I think we said this in our last earnings call, but a couple of weeks, months later, whatever it is, I think we still feel very good about how tickets are tracking year-over-year, but also just against our budget. And so we feel good about that.

We -- as you know, we introduced different pricing schemes and frankly, altered capacity in different ways to try to meet what we thought was sort of the demand side of things. And I think that's all going well.

On the cost side, we've talked about this in the past. But when you stand up a race, it's really hard to stand up a live event like that and know for sure what your costs are actually going to be because there's stuff that happens just last minute, first time something has been done. And I think you saw some of that in the first couple of years. And now with the benefit of that time, that experience, that knowledge and also with a group of partners in terms of the casinos, LVCVA, all this working together to sort of even out what that sort of expense profile looks like.

We can manage all of that much better this year and going forward. And I think you're going to see that in terms of profitability improvement for the race without getting into specifics for this year, but also going forward.

Last question with just a minute or so, leveraging capital allocation. Formula One should delever you're generating a ton of free cash flow at the moment. Just would love to get your latest thoughts on capital returns versus M&A?

Yes. So I think our -- with the acquisition of MotoGP, we did lever up to do that. And I think first order of business is certainly to delever off of that, which will take a little bit of time here. As we go forward, what is the right sort of capital allocation for a company like Liberty Media. We've simplified our corporate structures.

As you know, I think there is certainly a consideration from the market as to what they think we should be, and we are certainly aware of that and cognizant of that. And so as we look forward, how do we take this free cash flow and turn it into something that is accretive to our value enhancing for the shareholders is what we're always looking at between sort of how we get that back to shareholders or whether or not there's M&A that's appropriate for a company like us to do.

I think there is M&A. I think it's -- the bar is higher to go do it in terms of what those thresholds are, because it's got to fit what our mantra is. And ultimately, as I think John wrote in his book, shareholders -- maximizing shareholder value, that is what we want to do.

We'll have to leave it there. Please join me in thanking Derek, for being a part of the conference today. Thank you.

Thank you very much.