The rise and fall... and rise again of the Las Vegas Sphere

A $2.3 billion concert venue that lost $193 million its first quarter — saved by a 70-year-old movie and foam apples.

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By The Numbers

$2.3B

total construction cost

$193M

loss in first quarter

$65M

Wizard of Oz presales

What They Nailed Early

Built the world's most audacious entertainment venue with 16K screens, wind effects, and a spherical design that became an instant spectacle. The technology and scale were so unprecedented that construction itself drew crowds in Las Vegas.

What Changed

The residency model failed — too few artists could fill 17,600 seats multiple nights weekly, and the venue sat dark constantly. Then management discovered films could run multiple times daily at 100% margin versus splitting concert revenue with bands. Wizard of Oz became the breakthrough, selling 500,000+ tickets at $150 each after they invested $80-100M to customize it for the Sphere's tech.

Where it Landed

Stock up 50%+ post-Wizard of Oz success. $300M stock buyback announced. Abu Dhabi sphere in development. Movie revenue could hit $400M annually as they add Star Wars, Harry Potter, and other major IPs to the rotation.

The Principles

Business model pivots save companies. When residencies failed, films running 2-3x daily at full margin beat splitting concert revenue with artists.

Beloved IP reduces risk at scale. Wizard of Oz presold 6 months of tickets because audiences already loved it — no education needed.

Complement, don't replace. Movies during the day plus concerts at night means the venue generates revenue 18+ hours instead of staying dark.

Builder's Takeaway

If you're building a capital-intensive venue business:

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Multiple revenue streams beat single-use — engineer for flexibility from day one

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High-margin owned content beats revenue splits with talent partners

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Keep iterating when underwater — your 'Wizard of Oz' might be one pivot away

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