Madison Square Garden underwent a restructuring this week as part of wide-ranging changes at both its sports and entertainment companies. Here’s what you need to know:

  • Layoffs hit the two companies this week, with several people leaving MSG as a result.
  • MSG comprises two separate publicly-traded companies: MSG Sports and MSG Entertainment. James Dolan is the executive chairman of both companies and the CEO of MSG Entertainment.
  • The restructuring is part of wider cost-cutting across the Dolan-run companies. AMC Networks is also expected to undergo layoffs and restructuring.
  • Partnerships will now be under the domain of MSG Sports president David Hopkinson.

Backstory

MSG Sports is the parent company of the New York Knicks and New York Rangers, as well as the franchises’ minor league and G League teams. MSG Entertainment owns the Madison Square Garden arena, as well as MSG Networks, other venues and is currently building MSG Sphere in Las Vegas.

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What it means for MSG

The company continues to finish construction of MSG Sphere, its new music and entertainment venue in Las Vegas. While highly anticipated, the Sphere continues to run over budget. The latest cost estimate went up to $2.175 billion last month, according to MSG Entertainment CFO David Byrnes, up from $2 billion.

MSG hopes to open the venue during the second half of 2023. But it is also facing questions about how it will continue to fund the project. Byrnes said on the earnings call that MSG will be able to pay for it with its cash on hand and through cash flow, noting that it’s now the busy season for the Knicks, Rangers, and Radio City Music Hall, another MSG venue.

What they’re saying 

“We have made organizational changes that will enable us to more effectively meet the needs of our partners and position us for the future,” MSG Sports and MSG Entertainment said in a statement provided to The Athletic on Friday.

Byrnes said last month during a quarterly earnings call that the company was expecting to “implement a cost reduction program across our businesses and reduce and or defer certain discretionary capital projects.”

(Photo: Andrew Harrer / Getty Images)

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