MSGK’s first quarter after the Rangers spin-off: Knicks revenue up 15% to $45.5 million on championship merchandise

MSG Knickerbockers Corp. filed its first quarterly results Friday under the MSGK ticker, and the numbers still carry the Rangers for one more report. Revenue for the three months ended Sept. 30 rose 15% to $45.5 million. The operating loss narrowed to $25.5 million, a 7% improvement, and the adjusted operating loss was $20.0 million. The Rangers spin-off closed Oct. 26, so this quarter is the last one that consolidates both clubs before the Knicks stand alone on the books.

The New York Knicks and New York Rangers reported first-quarter financial results Friday morning for the first time since the NHL team was spun off from the renamed MSG Knickerbockers (MSGK).

MSGK’s stock is up 4.6% since the split was completed on Oct. 27, while the newly… pic.twitter.com/VvFSPu3pJC

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What moved the $45.5 million

Two lines did most of the work. League distributions rose $3.1 million, mainly from payments unrelated to national media rights fees. Food, beverage and merchandise sales rose $2.6 million, and the company tied that jump to championship merchandise demand after the Knicks won the 2025-26 title. Direct operating expenses climbed only $0.5 million to $8.8 million: higher merchandise costs ($1.6 million), team personnel pay ($1.3 million) and personnel-transaction provisions ($0.7 million) were largely offset by a $3.0 million drop in league revenue-sharing and luxury-tax provisions.

Selling, general and administrative expenses rose $3.0 million to $60.8 million. Spin-off transaction costs alone were $3.6 million in the quarter, partly offset by a $1.2 million cut in employee compensation. Net loss was $31.1 million, or $1.29 a share, compared with $8.8 million, or $0.37 a share, a year earlier on the old combined basis — a swing driven more by miscellaneous items and a smaller tax benefit than by the operating line.

Q1 by the numbers

Line	Q1 FY2027	Q1 FY2026	Change
Revenue	$45.5M	$39.5M	+$6.0M / +15%
Operating loss	($25.5M)	($27.4M)	improved $2.0M / 7%
Adjusted operating loss	($20.0M)	($20.8M)	improved $0.8M / 4%
Net loss	($31.1M)	($8.8M)	wider
EPS	($1.29)	($0.37)	wider

Kurt Badenhausen broke out the Rangers’ share of that combined revenue at $14.1 million. The quarter itself is a quiet stretch on the calendar: neither team played regular-season home games at the Garden between July and September, and last year’s first quarter was only about 3.4% of the full-year team revenue. The useful read is direction, not run-rate.

The stock gap the spin-off was built to measure

Since MSGK’s first day of trading on Oct. 27, MSGK shares are up about 4.6%. MSG Rangers (MSGR) has jumped more than 35% over the same stretch, a move Badenhausen linked to investors treating the NHL club as the more likely take-private or sale candidate. That ranking matches what the Rangers spin-off that created the Knicks-only ticker was designed to show: separate tickers, separate discounts.

The discounts are still large. MSGK’s enterprise value sits near $8.64 billion, about 33% below the $12.8 billion private-market figure in the 2026 NBA valuations. MSGR’s enterprise value is about $2.5 billion, roughly 40% under a $4.15 billion Rangers private figure. Wolfe Research’s Peter Supino wrote this week that a take-private looks more plausible for the Rangers than a change of control, and he flagged a January tax-code change that would raise the Rangers’ annual tax bill by an estimated $17 million unless sports teams win an exemption.

Balance sheet after the championship summer

Cash fell from $164.5 million at June 30 to $40.0 million at Sept. 30 as the offseason drained the account. Long-term debt rose from $242 million to $282 million; total debt stood at $298.5 million including $16.5 million current. The company bought back about $25 million of Class A stock (roughly 314,000 shares) during the quarter. Deferred revenue jumped to $366.4 million from $165.4 million, the usual pile-up of advance ticket, suite and sponsorship cash before tipoff.

Arena license fees paid to Madison Square Garden Entertainment for the current fiscal year are set at $47 million and grow 3% a year through fiscal 2055. That line did not change with the spin-off. Executive chairman and CEO James Dolan said the company is “well-positioned to build on our positive operating momentum” after completing the Rangers separation and opening a new Knicks season with a banner raising and ring night at the Garden.

What the next filing will show

Starting with the quarter that ends Dec. 31, the Rangers move to discontinued operations and MSGK becomes a clean Knicks P&L. That report will be the first real test of whether championship merchandise, national media distributions and Garden home dates can close more of the gap between the $8.64 billion public enterprise value and the $12.8 billion private estimate. Until then, Friday’s filing is a bridge quarter: better revenue, a slightly narrower operating loss, a one-time $3.6 million spin-off bill, and a stock market that still prices the champions at a steep discount to what private buyers pay.