Liberty Media Corporation Series C Liberty Formula One Common Stock

Company Overview

Business Model: Liberty Media Corporation, through its subsidiaries Formula 1 and MotoGP, is primarily engaged in the motorsport and live entertainment industries. Formula 1 holds exclusive commercial rights to the Fédération Internationale de l’Automobile Formula One World Championship, generating revenue from race promotion, media rights, and sponsorship arrangements. MotoGP holds exclusive commercial rights to the Fédération Internationale de Motocyclisme Grand Prix World Championship, with primary revenue also derived from media rights, race promotion, and sponsorship. Both businesses coordinate with governing bodies, teams, promoters, media organizations, advertisers, and sponsors, and provide critical event-related services like filming, technical support, and logistics.

Market Position: Formula 1 and MotoGP hold exclusive commercial rights to their respective premier global motorsport championships until 2110 and 2060, respectively. The F1 Championship is a global series with 24 events in 21 countries in 2025, followed by hundreds of millions of television viewers in approximately 200 territories, and live audiences exceeding 450,000 at its largest events. The MotoGP Championship, with 22 events in 18 countries in 2025, also reaches hundreds of millions of television viewers in approximately 200 territories and hosted cumulative live audiences of over 3.6 million across the season. Both entities leverage their exclusive rights and global reach to attract promoters, broadcasters, and sponsors.

Recent Strategic Developments:

• MotoGP Acquisition: On July 3, 2025, Liberty Media Corporation acquired approximately 84% of the equity interests in MotoGP Sports Entertainment Group, S.L. for approximately $3,659 million (approximately €3,122 million), aligning with its motorsport strategy.
• Corporate Restructuring: The Company completed several strategic split-offs: the Atlanta Braves Holdings Split-Off (July 18, 2023), the Liberty Sirius XM Holdings Split-Off (September 9, 2024), and the Liberty Live Split-Off (December 15, 2025). Following the Liberty Live Split-Off, Liberty Formula One common stock is no longer a tracking stock, and the Company's primary focus is on its motorsport assets.
• F1 Concorde Agreement: In 2025, Formula 1, the Fédération Internationale de l’Automobile, and the Formula 1 Teams entered into the 2026 Concorde Agreement, securing team participation from the 2026 to 2030 F1 Championship seasons. A one-time incentive payment of $50 million was made to the 10 teams for signing the 2026 Concorde Commercial Agreement.
• F1 Academy Launch: In 2023, Formula 1 launched F1 Academy, an all-female driver series aimed at developing young female drivers, which was featured as a support race at seven Formula 1 Events in 2025.

Geographic Footprint: Liberty Media Corporation's operations are primarily headquartered in the United Kingdom and Spain.

• Revenue Distribution (by country of domicile, 2025):
  • United Kingdom: 84.4% ($3,782 million)
  • United States: 8.4% ($378 million)
  • Spain: 6.9% ($310 million)
  • Other: 0.3% ($12 million)
• Operational Regions: Formula 1 Events took place in 21 countries across Europe, Asia-Pacific, the Middle East, and North and South America in 2025. MotoGP Events took place in 18 countries across Europe, Asia-Pacific, Australia, the Middle East, and North and South America in 2025.

Financial Performance

Revenue Analysis

Profitability Metrics:

• Gross Margin: 33.7% (2025)
• Operating Margin: 12.9% (2025)
• Net Margin: 12.4% (2025)

Investment in Growth:

• R&D Expenditure: Not explicitly disclosed as a separate line item.
• Capital Expenditures: $119 million (2025)
• Strategic Investments: Acquisition of MotoGP for approximately $3,659 million (2025).

Business Segment Analysis

Formula 1

Financial Performance:

• Revenue: $3,873 million (+13.5% YoY)
• Operating Income: $632 million (+28.5% YoY)
• Operating Margin: 16.3% (2025)
• Key Growth Drivers: Contractual increases in media rights fees, continued growth in F1 TV subscription revenue, one-time revenue from an F1 movie, contractual increases in race promotion fees, revenue from new sponsors, contractual increases from existing sponsors, growth in digital advertising revenue, higher hospitality revenue (Paddock Club, Las Vegas Grand Prix), growth in licensing income, higher freight income, and income from new activities at Grand Prix Plaza in Las Vegas.

Product Portfolio:

• F1 Championship (exclusive commercial rights)
• F2 and F3 race series (exclusive promotion and commercial exploitation rights through 2041)
• F1 Academy (all-female driver series launched in 2023)
• Formula 1 Paddock Club hospitality program
• Freight, logistical, and travel-related services
• Television production and post-production activities
• Digital and social media activities
• Licensing of the Formula 1 brand

Market Dynamics:

• Global series with 24 events in 21 countries in 2025.
• Followed by hundreds of millions of television viewers in approximately 200 territories.
• Largest events host live audiences in excess of 450,000 on race weekends.
• Ten Formula 1 Teams competed in 2025, with an eleventh, the Cadillac Formula 1 Team, entering in 2026.
• Engine suppliers in 2025 included Ferrari, Mercedes, Renault, or Red Bull Powertrains; Audi and Honda will supply engines from 2026.

MotoGP

Financial Performance:

• Revenue: $325 million (consolidated from July 3, 2025)
• Operating Income: $38 million (consolidated from July 3, 2025)
• Pro Forma Revenue (full year): $573 million (+13.9% YoY, +8.6% YoY in constant currency)
• Pro Forma Operating Income (full year): $54 million (+86.2% YoY)
• Pro Forma Operating Margin (full year): 9.4% (2025)
• Key Growth Drivers (pro forma): Contractual increases in media rights fees, continued growth in VideoPass subscription revenue, favorable currency exchange rates, two additional MotoGP Events, contractual increases in race promotion fees, contractual increases from existing sponsors, and higher hospitality revenue.

Product Portfolio:

• MotoGP Championship (MotoGP, Moto2, Moto3 classes)
• FIM Superbike World Championship (WorldSBK)
• FIM Women’s Circuit Racing World Championship (WorldWCR)
• Various junior motorcycle racing championships
• MotoGP hospitality program (VIP Village, MotoGP Premier)
• Logistical and travel-related services
• Television production and post-production activities
• Digital and social media activities
• Licensing of the MotoGP brand

Market Dynamics:

• Global series with 22 MotoGP Events in 18 countries in 2025.
• Followed by hundreds of millions of television viewers in approximately 200 territories.
• Hosted cumulative live audiences of over 3.6 million across the 2025 season.
• Eleven MotoGP Teams competed in 2025, supplied engines by Aprilia, Ducati, Honda, KTM, or Yamaha.

Capital Allocation Strategy

Shareholder Returns:

• Share Repurchases: No repurchases of Liberty Formula One common stock during 2025. Approximately $1.1 billion was available for future share repurchases under the approved program as of December 31, 2025.
• Dividend Payments: No cash dividends have been paid on common stock, and there is no present intention to do so for the foreseeable future.
• Dividend Yield: Not applicable.
• Future Capital Return Commitments: The Company has an authorized share repurchase program with $1.1 billion remaining.

Balance Sheet Position:

• Cash and Equivalents: $1,055 million (as of December 31, 2025)
• Total Debt (Principal Amount): $5,022 million (as of December 31, 2025)
• Net Cash Position: $(3,967) million (Net Debt)
• Credit Rating: Not disclosed.
• Debt Maturity Profile:
  • 2026: $52 million
  • 2027: $558 million (includes 2.25% Convertible Senior Notes due 2027)
  • 2028: $84 million
  • 2029: $643 million
  • 2030: $195 million
  • After 2030: $3,490 million
  • Formula 1 Senior Loan Facilities: $3,350 million (Term Loan A matures Sep 30, 2029; Term Loan B matures Sep 30, 2031).
  • MotoGP Credit Facilities: $1,173 million (Term Loan A matures Aug 18, 2030; Term Loan B matures Aug 18, 2032).

Cash Flow Generation:

• Operating Cash Flow: $908 million (2025) vs. $567 million (2024)
• Free Cash Flow: $789 million (2025) vs. $492 million (2024)
• Cash Conversion Metrics: Not explicitly detailed, but the company notes that customers generally pay for services in advance, resulting in deferred revenue.

Operational Excellence

Production & Service Model:

• Formula 1: Coordinates with the Fédération Internationale de l’Automobile, Formula 1 Teams, race promoters, media organizations, advertisers, and sponsors. It is responsible for filming, providing technical support at events, producing the international television feed, and managing logistics for equipment transport.
• MotoGP: Coordinates with the Fédération Internationale de Motocyclisme, International Road-Racing Teams Association, MotoGP Teams, Motorcycle Sports Manufacturers Association, race promoters, media organizations, advertisers, and sponsors. It performs activities related to filming, technical support at events, production of the international television feed, and logistics for equipment transport for overseas events.

Supply Chain Architecture:

• Logistics: Both Formula 1 and MotoGP manage the transport of their own and their respective Teams' equipment to events worldwide, ensuring high quality and reducing delivery risk.
• Key Suppliers & Partners:
  • Governing Bodies: Fédération Internationale de l’Automobile (Formula 1), Fédération Internationale de Motocyclisme (MotoGP).
  • Team Associations: International Road-Racing Teams Association (MotoGP).
  • Manufacturers: Motorcycle Sports Manufacturers Association (MotoGP).
  • Engine Suppliers (F1 2025): Ferrari, Mercedes, Renault, Red Bull Powertrains. Audi and Honda will supply engines from 2026.

Facility Network:

• Corporate Headquarters: Owned in Englewood, Colorado.
• Formula 1:
  • Media & Technology Centre: Owned land and principal building in Kent, England, for television production and technical operations. Leases adjacent properties.
  • Head Office: Leased premises in London, England.
  • Las Vegas Grand Prix: Owns land and a building adjacent to the Las Vegas Strip; leases office space in Las Vegas.
• MotoGP: Leases office space in Madrid and Barcelona, Spain, and Rome, Italy.

Operational Metrics:

• Formula 1 Events: 24 events in 2025 (same as 2024).
• MotoGP Events: 22 events in 2025 (up from 20 in 2024).

Market Access & Customer Relationships

Go-to-Market Strategy:

• Distribution Channels:
  • Race Promotion: Grants rights to race promoters (circuit owners, clubs, event organizers, governmental bodies) to host, stage, and promote events.
  • Media Rights: Licenses broadcast rights to television and other media platforms (free-to-air, pay television).
  • Digital Platforms: Operates direct-to-consumer over-the-top broadcast products (F1 TV for Formula 1, VideoPass for MotoGP).
  • Sponsorship: Sells event-based sponsorship (trackside advertising, race title sponsorship) and global/official partner status.
  • Hospitality: Operates premium hospitality programs (Paddock Club for Formula 1, VIP Village and MotoGP Premier for MotoGP).
  • Direct Promotion: Formula 1 directly promotes the Las Vegas Grand Prix, receiving revenue from ticket sales and other commercial arrangements.

Customer Portfolio:

• Race Promoters: Typically circuit owners, local/national automobile/motorcycle clubs, special event organizers, or governmental bodies.
• Broadcasters: Over 50 broadcast agreements for Formula 1 (e.g., beIN Sports, Canal+, DAZN, ESPN, Sky, Viaplay, SuperSport). MotoGP has 19 free-to-air and 45 pay television agreements (e.g., DAZN, Sky Italia, Canal+, TNT Sports, SPOTV, Trans7, Ziggo Sport, ServusTV).
• Sponsors: Global partners and official suppliers for both Formula 1 and MotoGP.
• Customer Concentration: Not explicitly detailed, but mentions that many race promotion and media rights contracts are directly or indirectly with, or guaranteed by, governmental bodies or agencies.

Geographic Revenue Distribution:

• United Kingdom: 84.4% of total revenue (2025)
• United States: 8.4% of total revenue (2025)
• Spain: 6.9% of total revenue (2025)
• Other: 0.3% of total revenue (2025)

Competitive Intelligence

Market Structure & Dynamics

Industry Characteristics: The F1 Championship and MotoGP Championship operate within the global motorsport and live entertainment industries. They compete with various alternative forms of entertainment, including other sporting and live events, for television and online viewership, live event attendance, and advertising and media rights opportunities. The market is characterized by strong competition for fan attention from other global and regional sports rights holders such as the Olympic Games, FIFA World Cup, Champions League, La Liga, and Premier League.

Competitive Positioning Matrix:

Direct Competitors

Primary Competitors: The F1 Championship and MotoGP Championship compete with other global and regional sports rights holders for media rights and advertising opportunities. Examples include the Olympic Games, FIFA World Cup, Champions League, La Liga, and Premier League. Emerging Competitive Threats: The potential establishment of rival motor racing series involving existing or different teams, or existing motor sport events becoming more popular, could diminish the competitive position of Formula 1 and/or MotoGP. New technologies and content distribution platforms also pose competitive challenges. Competitive Response Strategy: Formula 1's strategy includes maximizing the value of its commercial rights, deepening fan engagement, improving on-track competition, and enhancing environmental and social impact. MotoGP aims to strengthen brand awareness, increase global reach, expand its fan base, transform races to attract and engage fans, innovate the sport, cultivate a sustainable pipeline of future athletes, and enhance environmental and social impact.

Risk Assessment Framework

Strategic & Market Risks

Market Dynamics:

• Decline in Popularity: The success of Formula 1 and MotoGP is highly dependent on the continued popularity of their respective championships. Competition from rival championships, other forms of motor sport or entertainment, changes in societal views on automobiles/motorcycles, and unfavorable economic climates could reduce viewership and attendance.
• Inability to Expand: Difficulties in attracting race promoters for new events in new markets, or obtaining necessary approvals (e.g., FIA/FIM approval for more events), could limit growth.
• Economic Conditions: Weak or uncertain economic conditions globally or in the U.S. could reduce discretionary spending on entertainment and sporting events, adversely affecting revenue and increasing operational costs due to inflation.

Operational & Execution Risks

Supply Chain Vulnerabilities:

• Event Cancellations/Postponements: Events may be postponed or cancelled due to factors beyond control, such as inability to transport equipment, power failures, natural disasters, extreme weather, geopolitical conditions, international conflicts, promoter contract terminations, embargoes, sanctions, homologation issues, security/terrorism risks, or disease outbreaks. This could lead to loss of revenue and potential refunds.
• Accidents/Terrorist Acts: Racing accidents or terrorist acts at events could cause losses not fully covered by insurance, disrupt events, and damage reputation. Key Relationship Dependencies:
• FIA/FIM Actions: The FIA (Formula 1) and FIM (MotoGP) as governing bodies may prioritize safety and sporting concerns over commercial interests, potentially taking actions that conflict with the Company's interests (e.g., increasing team costs, diminishing entertainment value, cancelling events, withholding approvals).
• Team Participation: Formula 1's ability to stage the F1 Championship depends on ongoing team involvement (committed until 2030). MotoGP's ability depends on MotoGP Teams (committed until 2026). Failure to secure participation beyond current agreements or team withdrawals could diminish competitive value.
• Contract Renewal: Inability to renew or renegotiate race promotion, media rights, or sponsorship contracts on favorable terms could lead to reduced fees, shortened terms, or termination rights for counterparties.
• Credit Risk: Exposure to credit-related losses from non-performance by counterparties to commercial contracts, especially those with governmental bodies or agencies, or due to currency appreciation against local currencies.
• Confidential Information Disclosure: Leakage of confidential business arrangements could harm relationships with counterparties and teams, leading to less favorable commercial contracts.

Financial & Regulatory Risks

Market & Financial Risks:

• Tax Liabilities from Split-Offs: Potential significant U.S. federal income tax liabilities if the Liberty Sirius XM Holdings Split-Off and/or Liberty Live Split-Off do not qualify as tax-free transactions, or if ownership changes trigger Section 355(e) of the Code.
• Capital Needs & Financing: Future capital needs may not be met on acceptable terms, or cash generation may be insufficient to service corporate-level debt. Debt agreements contain restrictive covenants limiting financial and operating flexibility.
• Interest Rate Risk: Variable rate indebtedness exposes the Company to increased debt service obligations if interest rates rise.
• Foreign Exchange Risk: Fluctuations in the U.S. dollar and/or Euro against functional currencies of businesses and counterparties could adversely affect profitability and increase non-payment risk. Regulatory & Compliance Risks:
• Competition Laws: Risk of enforcement actions, investigations, or challenges by the European Commission or national competition regulators, potentially leading to unenforceable contracts, modified terms, damages, or sanctions.
• Advertising & Broadcasting Laws: New restrictions or bans on advertising specific products or services, or requirements for free-to-air broadcasting, could reduce sponsorship and media rights revenue.
• Environmental Laws: New environmental regulations (e.g., engine design limits) or bans on motor sport in host countries could adversely affect revenue.
• Data Privacy Laws: Compliance with evolving global data privacy laws (e.g., GDPR, CCPA, CPRA) is costly and complex. Failure to comply or security compromises could damage reputation, result in fines, and limit data use.

Geopolitical & External Risks

Geopolitical Exposure: Geopolitical conditions, international conflicts, and trade policies can impact event staging, travel, and overall business operations in various countries.

Innovation & Technology Leadership

Research & Development Focus:

• Core Technology Areas:
  • Driver Development: Formula 1 promotes F2 and F3 series as training grounds for future F1 drivers. MotoGP supports Moto2, Moto3, and junior championships for rider development.
  • Diversity Initiatives: Formula 1 launched F1 Academy in 2023 to develop young female drivers and supports the F1 Engineering Scholarship Program for underrepresented backgrounds. MotoGP's Road to MotoGP program increases access for young riders.
• Innovation Pipeline: Strategic goals include innovating the sport to maintain MotoGP's relevance and continuing to improve on-track competition and entertainment value for Formula 1.

Intellectual Property Portfolio:

• Patent Strategy: Not explicitly detailed.
• Trademark Strategy: Formula 1 is the registered owner of trademarks including the F1 logo, F1 Championship logo, "Formula One," "Formula 1," "F1," and "Grand Prix." MotoGP is the registered owner of trademarks including the MotoGP logo.
• Copyright Strategy: Formula 1 owns copyright on footage of each F1 Event since 1981. MotoGP owns copyright on footage of each MotoGP Event since 1994. These copyrights enable licensing to broadcasters and legal action against infringement.
• IP Rights: Under the 2026 Concorde Agreement (Formula 1) and IRTA Agreements (MotoGP), the Company has exclusive rights to use team intellectual property (including image rights) to portray the championships and events.
• IP Litigation: Potential targets for counterfeiting, piracy, and other infringement, especially with the rise of digital pirating and illegal live streaming. New technologies like AI tools could facilitate infringing works.

Technology Partnerships:

• Strategic Alliances: Not explicitly detailed beyond relationships with engine suppliers and governing bodies.

Leadership & Governance

Executive Leadership Team

Leadership Continuity: John C. Malone, former Chairman of the Board, became Chairman Emeritus effective January 1, 2026, remaining an employee. Robert R. Bennett was appointed as the new Chairman of the Board. Board Composition: The Board of Directors has overall responsibility for risk oversight and has delegated primary enterprise risk oversight, including privacy and cybersecurity, to the Audit Committee. There are overlapping directors with QVC Group, Liberty Broadband Corporation, GCI Liberty, and Liberty Live Holdings, which may lead to conflicting interests.

Human Capital Strategy

Workforce Composition:

• Total Employees (as of December 31, 2025): 74 corporate employees, approximately 1,600 full and part-time employees in consolidated subsidiaries.
• Geographic Distribution: Operations primarily headquartered in the United Kingdom and Spain.
• Skill Mix: Not explicitly detailed, but implies a mix of technical, operational, and administrative roles across motorsport and entertainment.

Talent Management: Acquisition & Retention:

• Hiring Strategy: Strives to create diverse, inclusive, and supportive workplaces.
• Retention Metrics: Not explicitly detailed, but supported by competitive compensation, benefits, and health/wellness programs.
• Employee Value Proposition: Offers tuition reimbursement, executive and career coaching, professional seminars, professional organization memberships, on-site educational meetings, and internally led presentations on industry topics. Diversity & Development:
• Diversity Metrics: Not explicitly detailed.
• Development Programs:
  • Corporate: Supports domestic partner benefits, paid parental leave, fertility benefits, flexible work arrangements, ongoing training, mentorship for female leaders, and quarterly town-hall meetings with the CEO.
  • Formula 1: Launched the F1 Engineering Scholarship Program in 2021, supporting 50 students from underrepresented backgrounds in engineering degrees. Launched F1 Academy in 2023 for young female drivers. Committed to creating employment opportunities through apprenticeships and internships for disadvantaged socio-economic backgrounds.
  • MotoGP: The Road to MotoGP program provides opportunities for hundreds of young riders to excel, fostering skills and sporting values, and improving English/communication skills.
• Culture & Engagement: Aims to cultivate a culture that provides a sense of belonging and inclusiveness, respecting diverse perspectives, ideas, skills, and abilities.

Environmental & Social Impact

Environmental Commitments:

• Climate Strategy: Formula 1 and MotoGP have strategic goals to improve their environmental and social impact. Specific emissions targets or carbon neutrality commitments are not detailed in this section.
• Supply Chain Sustainability: Not explicitly detailed.

Social Impact Initiatives:

• Community Investment: Not explicitly detailed.
• Product Impact:
  • Formula 1: F1 Academy series (all-female driver category) aims to develop and prepare young female drivers. F1 Engineering Scholarship Program supports students from underrepresented backgrounds.
  • MotoGP: Road to MotoGP program provides opportunities for young riders, increasing access to the sport and fostering skills and values.

Business Cyclicality & Seasonality

Demand Patterns:

• Seasonal Trends:
  • Formula 1: Recognizes the majority of its revenue and expenses between March and December each year. Revenue and expenses are generally lower during the first quarter compared to the rest of the year.
  • MotoGP: Recognizes the majority of its revenue and expenses between February and November each year. Revenue and expenses are generally lower during the first and fourth quarters compared to the second and third quarters.
• Economic Sensitivity: A substantial portion of revenue is derived from discretionary spending, which typically falls during economic recession or instability.
• Industry Cycles: Not explicitly detailed beyond general economic sensitivity.

Planning & Forecasting: Not explicitly detailed in the filing.

Regulatory Environment & Compliance

Regulatory Framework:

• Industry-Specific Regulations:
  • Competition Laws: Operations are subject to European and national competition laws. Formula 1 modified business practices following a 1999 European Commission investigation, receiving comfort letters in 2001. Risk of future investigations or challenges remains.
  • Advertising Laws: Subject to restrictions or bans on advertising specific products or services in countries where events are held, which could reduce sponsorship revenue.
  • Broadcasting Laws: Potential for laws requiring events to be broadcast only on free-to-air television, impacting pay television contracts.
  • Environmental Laws: Potential for limits on engine design and event activities. Historical bans on motor sport in certain countries (e.g., Switzerland) highlight this risk.
• International Compliance: MotoGP's operations are subject to Spanish and European laws, and local requirements in other host countries.
• Trade & Export Controls: Not explicitly detailed.

Legal Proceedings:

• The Company has contingent liabilities related to legal and tax proceedings and other matters arising in the ordinary course of business. Management expects that amounts, if any, required to satisfy such contingencies will not be material in relation to the consolidated financial statements.

Tax Strategy & Considerations

Tax Profile:

• Effective Tax Rate: 19% (2025).
• Geographic Tax Planning: Operates in various jurisdictions and is subject to changes in applicable tax laws, treaties, or regulations.
• Tax Reform Impact: The Organisation for Economic Cooperation and Development's "Two Pillar" approach to international taxation (Global Minimum Tax Rate of 15%) took effect in 2024. The U.S. reached an understanding with G7 members to remove a proposed retaliatory tax in exchange for an exclusion of U.S. parented groups from certain aspects of the second pillar, which should simplify compliance for affected enterprises.
• Tax Years Open: Tax years prior to 2022 are closed for federal income tax purposes. 2022 is open until October 15, 2026. 2023 and 2024 are under examination by the IRS and remain open until October 15, 2027 and 2028, respectively. The 2025 tax year is under examination as part of the IRS Compliance Assurance Process program.

Insurance & Risk Transfer

Risk Management Framework:

• Insurance Coverage: Formula 1, MotoGP, and their respective promoters purchase insurance coverage for each event, including primary liability policies and coverage for acts of terrorism or active assailant attacks (for promoters). Formula 1's own policies cover broadcast/equipment and employer/third-party liability for terrorism, but not active assailant risks. MotoGP obtains general liability insurance.
• Risk Transfer Mechanisms: Formula 1 and MotoGP occasionally use derivative financial instruments, typically interest rate swaps and caps, to hedge exposure to foreign currency risk and interest rate risk on variable rate debt. As of December 31, 2025, Formula 1 had $2.2 billion of interest rate swaps.