Sphere Entertainment Expands Beyond Las Vegas, CEO Calls New Venue In Abu Dhabi 'Significant Milestone'

Sphere Entertainment Co. SPHR is building a new venue in Abu Dhabi, the capital of the United Arab Emirates. 

The Details: The Sphere venue in Abu Dhabi would be the second in the world after the Sphere's Las Vegas location opened in 2023.

Abu Dhabi's Sphere will echo the scale of the 20,000-capacity Sphere in Las Vegas and plans to offer a unique visitor experience with events, concerts and shows. 

UAE officials predict Sphere will be a year-round draw for tourism and said the partnership aligns with the country's Tourism Strategy 2030 which aims to establish Abu Dhabi as a hub for culture and innovation. 

"We are excited to bring Sphere to Abu Dhabi in partnership with Sphere Entertainment, providing our residents and visitors with an extraordinary new form of entertainment. Sphere Abu Dhabi will seamlessly integrate advanced technology with captivating storytelling, creating unforgettable memories for everyone who visits," said H.E. Mohamed Khalifa Al Mubarak, Chairman of DCT Abu Dhabi. 

See Also: Amazon Analyst Expects Q3 Earnings With Revenue Growth, Margin Expansion, Relative Stable E-Commerce Demand

Sphere’s Franchise Opportunity: Sphere operates a global franchise model under which DCT Abu Dhabi will pay a franchise initiation fee for the right to build the venue using Sphere's designs, technology and intellectual property. After construction, DCT Abu Dhabi will also pay annual fees for creative and artistic content licensed by Sphere Entertainment, including the use of Sphere’s brand, proprietary technology and operational services related to venue operations and technology, as well as commercial and strategic advisory support.

“The vision for Sphere has always included a global network of venues, and today’s announcement is a significant milestone toward that goal,” said James L. Dolan, CEO of Sphere Entertainment.

Analyst Take: In August, JPMorgan analyst David Karnovsky upgraded Sphere Entertainment stock to Overweight and raised the price target from $37 to $57.

Karnovsky said Sphere's stock is undervalued given the company's opportunity for international franchising. 

“The financials since launch give us further confidence that the company will succeed in signing up international franchise partners, the potential upside from which we do not believe is reflected in the stock price," he said. 

Price Action: According to Benzinga Pro, Sphere Entertainment shares are up 1.82% in Wednesday's premarket trading after gaining 6.35% following the announcement on Tuesday. 

Read Also: 

• Cybersecurity Firm Warns Of Threats To 2024 Presidential Election Integrity 

Image: Courtesy of Sphere Entertainment, Co.