Last week a concert venue which went viral over the summer for its giant sphere-shaped LED projection screen is now open for business in Las Vegas, and its rave reviews have the stock of the company behind it soaring.
On Monday, Sphere Entertainment (SPHE) saw its stock soar by about 15%. Taking up about two city blocks, the Las Vegas Sphere at The Venetian went viral after it projected a blinking eyeball on its giant spherical screen.
The internet was again transfixed, when on Friday the venue opened its doors with a performance by the band U2.
Macquarie analyst Paul Golding, who attended the event, wrote in a research note, “Ease of production aside, we feel management achieved its goal of setting a new standard in the live category — premium, totally immersive, blurring the lines between digital and physical planes in ways unknown to us to exist otherwise.”
As the latest of several live venue operations operated by Madison Square Garden Entertainment Group (MSGE) and its CEO James Dolan, Sphere Entertainment is hoped to redefine live entertainment with its immersive 16,000-by-16,000 resolution spherical LED screen, which will surround concert-goers.
On the company’s most recent earnings call on Aug. 22, Dolan said, “Sphere is [a] brand new, never-before-seen medium and we believe that. It will take the world by storm. We are excited for next month’s opening in Las Vegas, what we hope is the first of many Spheres.”
The buzz surrounding the new venue has caused the shares of the company to more than double so far this year.
Dolan said on the earnings call that the company plans for the venue to operate 365 days per year with several events operating per day. U2 has been booked for a residency of 25 dates, and there are more big name artists to be booked in the near future.
The Sphere segment of Sphere Entertainment posted an adjusted operating loss of $90 million in the most recent quarter, ended June 30th, due to the over $2 billion investment in building the venue, which is still in its early phases.
However Macquarie said the investment may well be worth it, since the venue could become a franchise itself. In his note, Goldberg wrote, “We think it could be the ‘live’ disruptor — more intimate, impressive, premium, and purpose-built than stadiums and arenas.”
