Q3 2021 Liberty Media Corp Earnings Call
Ladies and gentlemen, thank you for standing by when it come to the Liberty Media Corporation 2021, Q3 earnings call.
During the presentation, all participants would it be in a listen only mode.
After watch we will conduct a question and answer session.
At that time, if you have a question. Please press star one on your telephone.
As a reminder, this conference is being recorded November 4th 2021.
I would now like to turn the conference over to coordinate Chang Chief portfolio Officer. Please go ahead.
Thank you good morning, before we begin we'd like to remind everyone that this call included certain forward looking statements within the meaning of the private Securities Litigation Reform Act of 1995.
Events the results could differ materially due to a number of risks and uncertainties, including those mentioned in Liberty media. Most recent one.
10-Q, our Liberty media acquisition form F. One registration files.
You said.
These forward looking statements the only as of the date of this call and Liberty Media and Liberty Media acquisition expressly disclaim any obligation or undertaking to disseminate any updates and revisions to any forward looking statements contained herein to reflect any change in Liberty media, where Liberty Media acquisition Corporation expectations with regard there too.
Already changing 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 and Siriusxm, including adjusted OIBDA and adjusted EBITDA required definitions and reconciliation for the Ramirez media and Siriusxm schedules wanted to can be found at the end of their earnings pressure.
Issue today, which is available on Liberty media website, now I'd like to turn the call over to Greg Mizsei liberties, President and CEO.
According and good morning to all of you.
Today's become a call. We will also have portable ones, president and CEO, Stefano Domenicali and liberties, Chief accounting in principle financial officer, Brian One way.
This quarter no surprise, we're going to start with the Braves.
World Champions for the first time since 1995.
As Hank Aaron seven playing ball and then like.
A person occasionally gives me opportunities or something great. When the time comes only two things matter.
Third received a moment Ed having encouraged to take your best way.
Clearly the brave to that and I want to thank Ted Turner for reminding us of that quote so congrats towards tremendous players and their performance to branch library.
Snip, all the players have such well deserved admiration.
Alex and Babblings with his excellent midseason trade it for the rest of our top quality Braves management team, Terry Mike and Derrick at all the Braves country most of all.
This was an excellent team effort, particularly in game six in Houston, starting with Solaris Ginormous 503 run Homer and a third that cleared the train tracks.
And Max free pitching the lines out despite getting staked spike in the first inning.
It was amazing comeback since the all-star break while we were $44 45, and the team wisely invest in town that trade deadline, which helped turn the season around and also generated a great financial performance.
As I said the financial performance of the team was as impressive as the on field performance.
The season to take baseball revenue for home game is up 11% compared to 2019 at retail per caps are up 33% versus 2019.
The Braves ended the season number two in major League baseball regular attendance at $2.3 million. This is closed doors snorkel average of two point forward, despite only reaching 100% capacity in may.
With our on field success, we've already sold thousands of new season ticket plans for the 2022 season.
The battery was booming throughout the play offs.
And we estimate crowds were well in excess of 100000 for each of our World series games.
Very exciting.
So let me turn now to Liberty serious exam. This morning, we also had some good news going over 80% at Sirius XM through a tax free exchange and we now expect it to be an ATB accordingly, all future distributions from Syria will be tax free.
We did continue our share repurchases repurchasing 98 million across the as in the case from August through September excuse me through October.
The discount remains and we repurchased having looked through price Ansari of just over $4. We continue to take advantage of that discount.
We also sold our entire Ir's taken an average price of 25 31 per share or after tax proceeds of 175 million a majority of which we sold after quarter and in October.
This was well timed.
We sold the stock for a 40% pretax gain.
This investment was intended to take an option in adjacent business.
But we liked the hand, we haven't series and now have additional cash to fuel incremental buybacks.
Looking at Syria itself strong results for the quarter 616000, self pain that adds the highest quarterly figure ever recorded we obtained our full year guidance and nine months.
We also reported for the quarter, the highest revenue inhibitor ever.
We have a continued focus on growing engagement outside the vehicle. Perhaps you saw are very entertaining Syria, Sirius XM House AD campaign.
And we have been driving impressive growth on the advertising platform with revenue up 31%.
We are back to producing live content and experiences will small for our small stage series and we hosted Dave Matthews, Brandon Carlisle Cold plate and John relating.
Either on content, we completed an investment in a content agreeing with audio up which will create new original scripted podcast for the series platforms.
Turning briefly to live nation I've noted reports later today, so I really can't comment on the results other than to say demand has endured is now being met with supply.
And we are pleased with the equity performance up 43% year to date.
Turning to Formula One group therapy thrilling season continues.
The lead for the drivers championship has gone back and forth between Max and Lewis.
Among the rest of the drivers there are tight competition across the grid.
And then the Constructors championship Mercedes and Rip over fighting for first with Mclaren and Ferrari in a tight battle for third.
Fans are attending and tuning it.
We have never seen such a crowd Austin for example, which said in F. One attends rent attendance record over the race. We can of the 400000 people that showed up in Austin, almost 70% were attending their first grown prey youth.
Usually his fingers more like in the mid thirties.
Ah Stefano will discuss in a moment recently results release result of effluent fan serve way survey in our Democratic is skewing younger something few of the sports can claim.
We are already looking towards 2022 and have announced a 23 race calendar.
We are excited to have our second race in the us and welcome the Miami GP and May demand is high 275000 people pre registered to purchase tickets as compared to a planned capacity of around 80000.
1800 people have placed a 5000 dollar deposit for luxury hospitality padded club and sweet sold throughout they sold out the available inventory and the first day.
We've also told through the available grandstand tickets and the first day.
Trained briefly Almac, we continue to review opportunities.
We believe the changes in the stock market will ultimately be to liberties benefit and with that I'd like to turn it over to Brian for more on our financial results.
Greg hard to follow that but we'll give it our best try good morning, everyone Liberty Sirius XM group is attributed cash in liquid investments are approximately 165 million plus $50 million in public debt and equity securities at the corporate level. This excludes $164 million cash it held directly at Siriusxm. We also.
Have $1.1 billion of Undrawn margin lung capacity at the parent level those.
Note that a portion of our cash will be used in early 2022 to repay or 2% to 5% live nation exchangeable bonds.
We issued the redemption notice on these bonds just after the quarter.
Based on the fair value of the liability a quarter and the amount of cash used would be $532 million.
As of November 3rd the value of our Sirius XM stock held at Liberty Siriusxm group pro forma for the exchange announced today was almost $28 billion and the value of live nation stock held with seven 3 billion.
$3.2 billion principal amount of debt against these holdings.
Total Liberty Siriusxm group attributed principal amount of that is $13 1 billion, which includes a point 9 billion of that Sirius XM.
As you saw an earnings release, the Liberty Sirius XM group outstanding share count as of 10 31 pro forma for the exchange would have been 336 million shares.
Formula One group had attributed cash in liquid investments of 1.6 billion, a quarter and which excludes $585 million of cash at at one.
You have one group also know of 194 million of public debt and equity securities.
Total Formula One group attributed principal amount of that was $3.4 billion, which includes $2.9 billion to add F. One, leaving 546 million at the corporate level.
F. One is 500 million revolvers on wrong.
In Formula one leverage at the end of the quarter was five six times very near our target range of five to five five times.
Note that we are still in a period of covenant waiver until March of 2022.
Please also note that beginning January 2021 F. One began reclassifying certain components previously reported another up one revenue into primary upon revenue to better align with the way. It currently evaluates.
Bonus reclassified into primary up one revenue include F. One television subscriptions up to an a three related fees broadcast origination and support these in digital advertising among others additional detail included including the impact of the revenue reclassification for the years ended December 31, 19, and 28 can be found as scheduled.
Three of earnings press release posted to our web site.
At quarter end Braves group had attributed cash in liquid investments of 134 million, which excludes $83 million a restricted cash.
His group had attributed principal amount of depth of 721 million.
Pretty in our consolidated subsidiaries are in compliance with their debt covenants, a quarter and and with that I'll turn it over to Stefano to discuss formula one.
Thanks, Brian.
2021 season continues to underline F. One position as the undisputed pinnacle of motor sport.
<unk> and the step in as still battling for the chat fish.
With the lead going back and forth almost everybody's.
These continues to produce breathtaking moments such as in Monza, where the coming together, so Mexico and up on the top of Lewis and in Austin, where we witness as fetuses ways to emerge ahead offset somewhat.
Few spiteful extend further down the field.
We continue to see if added phases on the podium include the one and two for Macleod a shake.
<unk> finding these dry the verbal and so that is returned to the buzzing in such.
In the constructor championship, let's say this is managing to retain the slightly deliver.
With the fight for the third between Macleod and surrounding even close.
We have our second sprint event in London, which was again, whether it received and certainly impacted the 70 race outcome will.
We will hold our third and final safety vest in Brazil, and actively collecting feedback to make this priest events, even Bethany doesn't 22.
As restriction have started to be easier we have seen the return of lost throughout two hour races. Many at capacity and the public let these operating fully once again.
We were thrilled as full of influence example for the first time since 1985.
The Orange Army came out in full force to see Maxine and the promoter over delivered in every aspect in Austin, We welcome 140000, some sandy and set a new attendance is Rachel with 400000 over the weekend, we finalized the 2002.
One callender with cut.
The weekend of November 1921 that by creating the three race run in the middle East to the end of 2021 season.
This agreement is part of a longer 10 year deal to start in 2023 Africa tab host the FIFA World Cup of 2022.
The draw and popularity approval one has never been greater this is reinforced by a recently published in Nielsen them multiple survey covering 187 countries.
Participants identified that's exciting is for more of a number one brand attribute.
Competitive and entertaining also making the top five for the first day. The Central response was the largest and most diverse ever we'd see laid participation dobbin and the average age is degrees in four years to 32.
We know we are moving in the right direction and engagement remains strong across all platforms.
On the digital front unique users across the airflow website, an app. These shed a up 56% compared to 2020, social engagement continues to grow reaching nearly 35 metres social interaction for the uscb, 52% higher than the last few at <unk>.
19, and 80 million social interaction for the <unk>.
Remember fulfillment of what's.
The total number of those following F. One on social media now stands at over 45 minutes.
<unk> and we have seen strong growth over 2020, and 2019 and in many markets, notably, France, The Netherlands, Greece, Spain, Hungary, and the United States.
PV remains a great way for us to catch all the action of the race weekends.
Concurrent view four races. These have consistently been more than two.
Seven times higher than 2020 season leverage we've.
We were excited to announce a 23 raised calendar for 2022.
It is a great mix of historical newer venues and we will welcome Miami, which will be our second release in the United States.
We look forward to this calendar, which when paired with the new regulation and cause designed to create closer Lacey should produce another signal.
We do hope that 2022 fields more normal done the last two years, but we can draw on the skills. We have one to deal with the any challenge that we continue to face due to the ongoing pandemic condition, China will not be included on the 2022 column, but will be restored to the calendar as soon as <unk>.
Allow and we look forward to our long term partnership.
We remain in debt and viable position of demands of races continued to exceed the available supply of weekends in the area of media rights. We made it to announcements following the news that the top sport channels in Asia would close we have reached agreement with multiple broadcast to have partners across the region through the.
And those 2022 C's.
This ensures that our friends in Singapore, Thailand, the Philippines, Malaysia May Indonesia.
Indonesia Vietnam.
And the Chinese have missed the region of Hong Kong can watch the conclusion of the 2021 season and every race in 2022.
We also extended agreements with the Disney in Japan, and India, So that India.
On the other side of the World we extended our successful broadcast partnership we cannot boosting trusts until 2024, which includes they have dedicated lift one channel.
Session from full grumpy weekends will be broadcast live in three to Ed alone with event highlights throughout the third.
We continue to work with our commercial partners and announced the Crypto come Overtake Award. In addition to the titles sponsorship of our sprint events. It will be awarded to the driver was completed the most of our biggest throughout the entirely all of the 2021 season, which currently is a battle between two better.
Them throughout this vessel animals.
It doesn't 21 F. One east <unk> Pro Championship presented by an uncle is now two events seen following our highest ever number of fans attempted to qualify.
Drivers continue to waste remotely, but the hugely popular competition is broadcast it from the G. Infinity esport that in London, along with the live shows that include necessarily Pinkham, Tom Deacon and the chemical the action in the Pro Championship is mirroring the action on the track with multiple volume finish it.
Across the first six races. This year qualification are open to a challenge is the official F. One one the beta gate developed by code mustard and lie with our goal of the net zero carbon by 2030, we are aiming to help develop a 100% sustainable fuel for our new generation.
A formal one hybrid engines.
The focus is on the dropping of fuel that can be used as a standard internal combustion engines without any modifications to the engine with a target to achieve greenhouse gas emissions savings of at least 65% relative to fossil decorative pretzels. The impact of these developed could be enormous with one.
A brilliant caused estimated to be ordered by 2030 with only 8% of those be Duke Bethany and that two vehicles internal combustion engine and hybrid will continue to be essential to add and see travel as well as the hopefully industry.
Our partners at all focused on E. S. G initiatives Williams set an ambitious target to be climate positive by 2013, they have launched comprehensive suitability strategy that and compresses the climate biodiversity stewardship sustainable.
<unk> industry access for all of the Poeple dreamily the sheet.
On the promoter site the guilt brio the Frost became the first grumpy organizers to receive the highest level of certification by the FIA.
That commitment to a sustainable development approach includes the elimination of a single use plastics mobility plan does significantly reduce the capital improvement or.
Or stick tape of travel and historical meet them through social responsibility with 17 races completed and well on our way to delivered in the championship break of 22. This season. Despite the ongoing pandemic I'm. So incredibly proud of the F. One team and all our partners the flexibility of the posts evidence display.
All year is truly impressive and it has been sort of warden to see huge number of fans backup races celebrating our sports.
We will see the enormous opportunity in front of us and we have committed to our vision and strategy to Google and continue to evolve over sport.
Two thirds full speed ahead, and now I'll return the call back over to Greg. Thanks Bye-bye.
Thanks, Stefano and Brian.
And to our listening audience, we look forward to seeing you on Thursday November 18th at our annual Investor meeting.
The full experience will be offered in person at the New York Times Center and virtually the link to register can be found on our homepage. Please note all in person attendees must be fully vaccinated against COVID-19.
We appreciate your continued interest in Liberty media and hope you all stay safe and healthy.
And with that offer I would like to open up for questions.
Thank you we.
We take our first question from Brian Craft with Deutsche Bank. Please go ahead. Your line is open.
Thank you and good morning, and congrats on the Braves, winning the World series.
I had two questions.
One on one on Formula one on Formula One you seem optimistic that twenty-two will market return to full operating performance assuming that happens do you think 22 could be the year, where we see for the first time all of the benefits of the last four and a half years initiatives coming together at once to drive financial performances.
A step change higher than than 2019 pre Covid and then my other question is.
Just curious Greg what made you decide to sell your Iheart stock is that no longer a strategic interests for siriusxm. So just change their thanks.
Well I think I'll, let Stefano comment on the Formula one as well.
Look I think 2022, we're going to see a return of many elements of the business, but we'll everything come to pass and will we be on a new higher plateau I think it's just the beginning and we will see continued success from that level and above.
Well everything come together.
Always hard to predict nominally because some of the issues around.
What contracts get executed and what sponsorship opportunities, but obviously could there be the risk of attendance issues into 2022 with COVID-19.
To be determined but I do think we will perform better in 2022, then 2021 and better than we did in 19 substantially better and I think the trend continues to be up.
Definitely I don't know what you would add.
I would say, Greg you synthesize perfectly what I believe it will.
And of course, you said one thing that is really good.
The success, we were able to to do to to to leave that this year. Despite the pandemic was due to the south but we were flexible and with the other teams with the partners with the promoters to make sure that we would then check with you I think that it is too low.
To put into perspective, because we build more accepted how this is lucia develop of course, we believe that we can see you mitigate the situation is improving and I would see that all the elements and all the initiatives that we put in place in the last couple of years for sure we got to pay back starting next year.
And as far as Iheart.
We took a stake because we thought it was attractive and and creates a potential optionality. It's not something we're looking to pursue so it seemed to make sense to recognize the game, we had and utilize the proceeds to go after our own discount on our own opportunities.
Okay. Thanks, you both appreciate it thanks for the question and thanks for the call out on the Braves.
Thank you we take our next question comes <unk> with Evercore. Please go ahead to your line is open.
Good morning, So Greg did interesting transaction at least some started out last night.
Just curious why that with the structure.
Stock swap with a shareholder to increase the owners it looks like your past 80% on serious now.
Does that.
Sort of suggest that this could be qualified as an APB. If that is the case now you probably have three atb's in January I think probably the one the covenant ATV. So what does that mean, we sort of undoing the whole tracking stock structure, what are the flexibility does that get to you.
Johnson that thanks.
Yeah.
Well I think you rightly noted we undertook a transaction where we did a tax free exchange to make.
Out of this.
And are famous line around here is no planner intent and that's when we if you ever visit my office, you'll see I have some pillows would you say that thank you for courtesy of Courtney, but look R.
Our whole idea to create optionality, we have nothing to announce today about that we would have gone over 80, probably with serious has continued buyback, but the way we transacted with the tax free exchange allowed to become an eight television or something we expect will be in HEB and greets optionality.
And flexibility so no plans, but we always like having atb's can have enough of them.
Great. Thanks, so much.
Thank you and we take our next question from Jeffrey Dot check with people, Tennessee. We hatch. Please go ahead to your line is open.
Good morning, and I'll also congratulate you guys on the Braves, winning the World series I think that was kind of adela fields for a lot of folks so congratulations and crossing 80% barrier in theory.
Guess I'll follow up on the theory question with the obligatory now that you're at 80.
Should we expect something like what you're doing charter will you'll maintain your steak around 80 and then.
State and thereby back and then also on Cirie post their call. The U S. Steel CEO made some comments that multiple auto manufacturers are ramping their steel deliveries, implying that trip sure juice it bottomed out.
Beginning in the fourth quarter first quarter.
Are you seeing the same thank mehrotra punters. Thanks.
On the.
What we'll do we obviously have no as I said no planner intent we.
We try to keep our options open we would not be able to sell directly back to or sell our stock in the marketplace and hold that 80 above 80, unless we had an agreement to sell right to the company, which we do not have at this time.
So.
Probably.
Dividends are the tax free most attractive thing and we can make a determination about whether we want to sell stock and into the marketplace and be above 80, we'll make that determination over time, but I would note that that would not be tax free unless we had the ability to sell directly company, which we do not have at this moment.
Uhm.
On the SAR and where it's going I think.
Things will get better that's our expectation.
But clearly the fact that we had a lower SAR for many months in the second half of 2021 means the top of the funnel is not as full we do expect it to recover and refill, but it will mean, we will have a look.
Less opportunity for net new net ads sell.
Self pain that adds into 2022, so we will see what it comes but we are optimistic that our partners will get on track, but we will have a we had a great sale.
They'll pay net at quarter, it'll be a little tougher in 2022, as we head in unless that SAR refills quickly.
Thank you.
Thank you and we take our next question from Dr. Mitchell with credit Smith. Please go ahead. Your line is open.
Thanks, so much congratulations on the Braves as well Gregg now, we all have to say that the.
A couple questions was it the 253 letter agreement between Liberty in theory required for the ATB consideration I think you were implying comments I just wanted to be sure.
We constructed a transaction, where we had a tax free exchange of our stock which that is what was required to we believe to make this an ATB.
Rather than the alternative which looked like it would might naturally occur which was to have seery bias over Oh excuse me find back their own stock and pushes overeating. So the actions. We took the positive action of doing is tax free exchange. We believe allows us to be in ATB.
Thanks for that and then maybe I'm missing something simple, but what was the purpose of the 253 letter agreement between Liberty in theory them I'll, let I'll, let Renee talk about that.
Sure.
The letter agreement was actually the result of the negotiation between us and necessity of theories that then there was some additional materials that needed to be delivered in connection with our tax we exchange that we didn't need to engage in a negotiation with the best Committee and this has been asked that they made and we retail.
Okay and then.
Hi, Greg I think it can be hard to get you to talk too much about the relationship between Liberty, Syria, and Syria until the analyst day, but let me try this way is it more appealing to create long term value bite taken advantage of a persistent discount over a long period is capital becomes available to do so say using theory dividends buyback Liberty searing chairs or would you rather closed the discount as rapidly as possible.
What's the better path to the greatest long term value creation.
This is a debate since the beginning of time and you could think about buybacks are buybacks to be done to buy your own stock at a discount or to try and get your stock up we generally favor the long term path and like a and that alternative but clearly there is an advantage here to seeing the discount clothes as well. So I think it's a win win Doug.
Okay.
Away for the animal style for for more on that one thank you.
Thank you when we take our next question from Ben Swinburne with Morgan Stanley. Please go ahead to your line is open.
Great. Thank you good morning.
And like I say anything about the Braves, it's been covered.
[laughter] Formula one I guess to question to me all of the sort of qualitative and quantitative but certainly qualitative data is the sports having an unbelievable year and I'm wondering if you could talk about sort of two opportunities one and raise promotion are you do you think your strengthening kind of your price.
Empower with.
Your host partners as you move into renewals over the next few years, given all the attendance trends and I realize we just came out of Covid, where things were incredibly dicey on that front, but it seems like that part of your business may have more pricing than we've seen in the past. That's the first one and then secondly next year, you've got a new car.
The budget cap I think steps down again you.
You guys wanted to make the sport more attractive for new teams.
In new capital to come into the sport New engine manufacturers. I guess question is there's a lot of rumors out there, but I'm curious if you are bullish you're going to see that start to really show up in the business and 22 and beyond.
<unk>.
So I'll I'll take the first shot an outlet Stefano obviously at.
I think we the strength of the sport in terms of the demand and the audience helps us in many ways we've seen new.
Cities want to enter like cutter, we've seen.
Increased performance and increased success of existing promoters.
For example, Austin, adding extra seating all of those allow us frankly, both sides of that allow us to get a better deal and to do better both with the new partners and with the existing partners. So all to the good on the promotion site.
Seven up would you add anything on promotion.
No I think that you are totally right then we'll take that not only a metronome fee.
I'll also something related to the quality.
All the all the shows that were beginning.
What we are also keen on these off putting to the people that that are attached to the races that unique expedience, a physical experience remedies former one with all the things related to the concept trans partisan and sponsored together and leaving or something that they should give me so.
Situations. These really positive debates when how cold so bad bad match.
Then if I may jumping on the second part of the question, where I think this would be for you.
I think that's it.
Talking about the new regulations, we are talking about.
The fact that the discussion with these coming out you see the superbowl.
Of each team needs that you'd get to do the investment that we are doing them on the control of the cost of the fact that this 14 is a very good health. Despite the COVID-19 situation and therefore, the fact that we want to have a more attractive sport. That's what made the mold teams.
E as really focusing in on sorry.
The new regulation will enable the cost will be more and more easy to be overtaken by one.
One to the other we have any critical number the closet, though we cannot let that sports. So he's been the method of find the right balance with the fact that will be for sure new ones that want to come me. This is if I don't want to get the value of the dollar already into the sport and then.
The discussion that we have all of the heating.
On the public domain about what the future technological.
It does get taken for the future poetry, the fact that the new money fracture of discussing with yet.
It's a very very encouraging situation because that means that the X one let's take it that is technical decisions for its future. So once again, we haven't even been an incredible moment of a great opportunity.
Just to confirm the date this board that these really and the great shape debate.
Yes, and I would just echo some of the thoughts I have that Stefano said.
What are the important things was to help the ecosystem and you've really seen the strength of the teams do so much better and I. Appreciate all the kind words, they now say about liberty and about Formula One management and I think that's because guess what the value of the teams has gone up dramatically and we knew that was necessary in the actions.
We took with the budget cap and the like and changing some of the payouts all were designed to create healthy ecosystem and that's happened. So in many ways. The teams have gotten that success because it was necessary to make them healthy for us to get to build to the next level and the interest you are seeing of new entrants to come in and buy teams is only an echo of that.
Success. So I think there's a lot of things that are setting up well for us.
But.
All those pieces about demand all those pieces about the strength of the system.
All set up well for future success and.
I mentioned, the 2022 is going to be a step up but certainly not the last one I think we have a long trajectory of success in front of us I'm very optimistic.
That's great and maybe if I could do one quick follow up on the Braves.
Not to sound like Debbie Downer after the World series, but there's obviously a lot of going on.
Going on with your RSM partner to say the least is that something that concerns you Greg given the revenue contribution that the Braves get from local media rights as we look into sort of what's happening with diamond sports and dish and et cetera.
Yes of course, it concerns me, but let me give you a few facts.
We have a good deal not an amazing deal, it's not a dodger like deal at R.
RSM partner it is probably one of the two or three most profitable orison out there right now.
And our territory 12 plus million cable households is the largest territory that baseball has so when you think about a digital conversion, where as well sit up and when you think about what the alternatives are to the traditional artists and Marvel at that really does devolve, which I suspect it will over time, whereas well set up and position does anybody in baseball.
So lots of reasons to things that are are artists and partners doing pretty well. They can continue to to do well the deal is not done until 28.
And we have as I said alternatives and opportunities I think in the digital footprint, which are unparalleled in baseball.
Thank you.
Thank you.
We take our next question from David Karnofsky with J P. Morgan piece go ahead. So your line is open.
Alright. Thank you Gregg maybe just to follow on your prior comments just given the value F. One is creating the teams and some of the team principals I think spoke about achieving.
Valuations. This week, how do you think about what the right economic split should.
It should be between four and and the teams maybe a little longer on and then just on the phone a repurchase do you expect the buyback more sure. Some here was that kind of more about capturing the discount between to indicate shares as they wiped out a lot over the summer.
So.
I'm very happy to see the teams do well as I think as I said that was necessary.
For the.
The success of F. One the new carpet agreement has some incentives that is revenue and profits increase we take back some of that which had been given over the last several.
Deals.
I already warned the teams expect more demands from us based on how much success, they've had and they smile. So we will see how those negotiations go but I'm optimistic.
Domestic that we can continue to have success with the teams as we've had over the last couple of years and will both benefit.
On the <unk> I think we liked both the valuation and which obviously tried to take advantage of the discount we'd like to winning twice in that transaction and as we generate free cash flow of one as we will you.
You'll see us take action to try and take advantage of pricing and other things that we think are attractive in the market but.
As I said earlier, no planner intent announced today.
Thank you.
Thank you we take our next question from David Choice with Barclays Capital. Please go ahead to your line is open.
Thank you.
I appreciate the the great numbers on the Austin.
Growing pretty could you also provide color on.
The perch up spending increases during the third quarter.
Orange attendance.
The overall.
The races is wells with a pet a club just been comparing it to 2019.
And then Linda the fourth quarter for the remaining the races. What is the capacity looked like thanks.
Yeah, I think that's a hard comparison because in 2019, we had.
Different timing of different races, and shifted around so it's not it's not a per it's not an equivalent saying because the calendar has shifted so we're not prepared to dissect that or announced that forecast for 2000 or the fourth quarter yet.
And the further color that we can learn about the perk up spending.
Compare rates to race.
I'll, let either.
What do you want to comment, but I think yeah, we'll call it up.
Yeah, I mean, what I can see that for sure the last events where people back at them. We see we sold includes of course the older projects of licensing we have growing now because that is the possibility to shed experience and had the right to buy so that I can see I can see that it's happening.
And what I can add on top of it you said revenues for sure now we have a head into races Webb.
We have capacity full capacity.
Grandstands and also by the flat so that is something that we are looking forward to see people back again.
Okay. Thank you.
Question.
We take our next question from Matthew Harrigan with benchmark. Please go ahead. Your line is open.
Oh, thank you.
Amongst formula ones.
<unk> as you know is on CNBC early this morning to talk about the improvement in the aerodynamics next year closer following better passing more exciting racing and then you also elaborated in the developments in the Saudi Aramco J view that thank you formed in March of last year and he really is Stephanie alluded to if he really talked about.
<unk>.
Applications for road vehicles, as well as on track and I almost have the impression that even though.
There are some nuances smaller engines and all that.
Might even be backward compatible for existing vehicles on the road, which.
Don't know how reasonable that is.
Stefano completely excluded that either or maybe even bother mentioning it.
And this is kind of a wild question, but if there's any possibility for years back to just involve the mail and I think it's Monday. This is limited to the TMT, but clearly this is something that.
No. It's a it's a moonshot, but it sounds like it's it's pretty interesting given some of the principles involved like formula one in Saudi Aramco. Thank you.
I'll, let Stefano comment on some of the technical capabilities and then I'll get onto this back.
Okay. So I stopped on the technical but first of all we don't have to forget that F. One of the oldest pending 14 of innovative technologies, which can be and has been over the piece transfer from the race track to the production of vehicles and this will be the cage also whenever future development come on mute.
Technology and they're having.
And then do you know how powertrain that will be for sure.
Combine the hybrid engine with the sustainable through a part of these equations and this will be very beneficial because it's at the end of the day, what we want to claim as a as a sport platform that ways to keep the motor sports at the center of the technological research will turn to put the vehicle yet but also for the small things that can also.
Technology It would be good equation, so I think that these really.
You have taken the lead of something that we as we notice that.
These way of treatment technology local sport wealthy that that will I want to underline. These we're talking about both the sport we're talking about the motion so the balance between.
Let the lover says what's available and something that the the customer of the <unk> is a very important balance to respect otherwise we can see how the other situations, where these guys noted the cage and the platform Google not to be the best one. So this will deal with the future of the approach of the technological.
The formula one.
Okay and well.
Well, our spec is a pretty broad mandate and we have nothing to announce today, we certainly do look at the advancement in synthetic fuels have looked around them is whether there's an investment opportunity whether it's the spec or some other part of Liberty.
Haven't found one yet, but certainly are not adversity idea and recognize we're in a unique position to try and see opportunity there thinks that promote them as well.
But it just puts my question I apologize.
Almost got the inference from Penn out this morning that this could actually be backward compatible for vehicles that are already.
On the road I mean, it might be I totally misunderstand matters within the scope of what you are trying to do.
Definitely do you want to add a confirmed that yeah.
I think that is absolutely yes.
Yes, because that would be something that we don't have to forget that.
All around the world that are billions of call that that needs to be consumed in the future. So our answer is with a sustainable fuel will be approved so we are working on.
Should we the rancour about for all the all.
All of the oil supply of the Patty and it'd be so for what will be the peace I woke up and I hope that we get the chance to make sure that these path will be sustainable also for these bills will <unk> will be around the world in the future.
Great books, though.
Thank you we take our next question from Jason passing it with city. Please go ahead. Your line is open.
I have sort of it may be a strange question do you guys have an estimate in terms of how much capital you think liberty would need to close to any of the discount on liberty serious if you chose to do that.
Because you.
No.
We don't have an estimate Dave I'm sorry.
Okay. Thank you.
Thank you.
We take our next question from Stephen elastic with Goldman Sachs. Please go ahead to your line is open.
Hi, great. Thanks for taking my questions on Formula one it sounds like there was a lot of demand on the promoter side host sprint races for next year and maybe go enough pens earlier question could you discuss the extent, which we should expect to see on monetize sprint races. On your calendar next year and then maybe more broadly I was curious how much more room, you think there is for formula one.
To expand the sprints or get beyond the 6% races every time.
I'll, let you handle it's definitely.
That's noted we lose you.
Yes, Sir.
Okay, I will take a cut even though I will not be as eloquent as Stefano look the there is a tension.
We like it the fans like it the teams.
And the drivers don't necessarily love it partly because it's there are no the system and partly because it incurs potential incremental expense for them against the cost cap.
There are revenue opportunities around it both in terms of greater attendance at events, including qualifying but also in terms of potentially sponsorship of the sprint race in the lake. So clearly there is an economic reason, but there's attention which were not dismiss above that it puts more stress on the teams and more stress on the <unk>.
Drivers. So we will see how we can manage through those.
Those too.
Counterpoint elements.
Great. Thanks for that and maybe just one more if I could on the Asian broadcast deals that you announced is there any more details you can provide on these deals maybe in terms of how they compared to Fox sports and then maybe the likelihood that they get renewed past 2022.
There we are not I think disclosing that we.
We are somewhat optimistic we can go forward, but we're not at this moment can disclose how they compare thank you.
Okay, great. Thank you.
Thank you.
And that will conclude our Q&A session today I'd like to know I'd like to turn the call back over to your host any additional how closing remarks.
Thank you for your interest in Liberty Media, we do hope to see you on November 18th in person are virtually at our Investor day.
Until then have a good one.
And ladies and gentlemen that concludes today's conference call. Thank you for your participation you may now disconnect.
[music].