A giant sphere-shaped concert venue that went viral over the summer opened for business in Las Vegas last week — and rave reviews have boosted the stock of the company behind it.
Sphere Entertainment (SPHE) stock soared about 15% on Monday. The company's Las Vegas Sphere at The Venetian takes up about two city blocks and went viral after it used its outside screen to broadcast a blinking eyeball.
On Friday, the inside of the venue surprised the internet once more as U2 played the first show at the Sphere.
"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," said Macquarie analyst Paul Golding, who attended the event, in a research note.
Sphere Entertainment is one of several live venue ventures from Madison Square Garden Entertainment Corp. (MSGE) CEO James Dolan. With it, Dolan hopes to redefine live entertainment by surrounding concertgoers with an immersive 16,000-by-16,000 resolution LED screen.
"Sphere is [a] brand new, never-before-seen medium and we believe that," Dolan said on the company's most recent earnings call on Aug. 22. "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."
Shares of the company have more than doubled this year amid excitement around the new venue.
Dolan noted the eventual plan for the Sphere is for it to be a 365-day venue with events several times per day. U2 will play a residency of 25 dates while other artists are expected to be announced in the future.
The more than $2 billion investment in building the sphere is still in its early stages. The Sphere segment of Sphere Entertainment posted an adjusted operating loss of $90 million in the most recent quarter, which ended June 30.
But investing in the experience could be worth it, according to Macquarie, which sees opportunity in the Sphere's success to franchise itself.
"We think it could be the 'live' disruptor — more intimate, impressive, premium, and purpose-built than stadiums and arenas," Golding wrote.
Josh Schafer is a reporter for Yahoo Finance. Follow him on X @_joshschafer.
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