MSG Networks stock fell hard Wednesday after the regional sports network said subscribers dropped 6.5% in the fiscal fourth quarter.

MSG Networks, which includes New York area RSNs MSG and MSG +, said its subscriber base fell more than 6.5% in the period, resulting in a $3.3 million decline in affiliate fee revenue. Overall revenue was down 2% to $168.4 million in the quarter. MSG said in a press release that the affiliate fee decline was also due partly to the absence of a favorable $1.2 million affiliate adjustment recorded in the prior year.

RELATED: Cord Cutting Will Decelerate in Q3, Analyst Predicts

MSG shares dropped as much as 14.2% ($2.39 each) to $14.46 per share in early trading Wednesday. The stock was priced at $14.72 each (down 12.7%, or $2.14 each) by 11:42 a.m. Aug. 21.

RELATED: Cord Cutting Starts to Pinch Affiliate Fees

The subscriber decline seemed to validate concerns that regional sports networks are losing favor with distributors as their monthly affiliate fee prices rise and more and more over-the-top service providers offer packages light on sports programming. Also during the day, Sinclair Broadcast Group, which earlier this year agreed to pay nearly $10 billion for 21 former Fox Sports RSNs, saw its stock fall as much as 5.6% ($2.47 each) to $42 per share in early trading Wednesday. Sinclair shares were priced at $43.22 each (down 2.8%) as of 11:47 a.m. on Aug. 21.

MSG Networks has been speculated in the past as a possible future target for Sinclair, in that it would fill out a hole the broadcaster has in the New York market. 

Cord-cutting was on a torrid pace in the third quarter, reaching about 5.5% in the period according to some analysts.

MSG Networks problems also are exacerbated by the performance of its teams — last season, the NBA New York Knicks finished last in the league’s Eastern Conference and the NHL New York Rangers finished seventh out of eight teams in the Metropolitan Division. MSG airs games from the NHL New York Islanders (finished second in the Metropolitan Division), New Jersey Devils (finished last in the Metropolitan Division) and the Buffalo Sabres (finished sixth in the Atlantic Division) and other content from the NFL New York Giants (last in the NFC East) and Buffalo Bills (third in the AFC East).

In a note to clients Wednesday, Evercore ISI Group media analyst David Joyce wrote that the subscriber loss was nearly double his estimate of a 3.7% decline, and dramatically lower than the 3.9% decline MSGN reported in fiscal Q3. Joyce noted that RSN losses have been abnormally high in the most recent period, mainly due to the expiration of promotional offers, meaning that he does not expect the heavy declines to continue. But he added that the “the underperformance experienced by MSGN vs. the broader industry is concerning.”

As a result he lowered his rating on the stock from "in-line" to "underperform" and dropped his 12-month price target on the shares from $22 to $18.

Despite the losses Joyce said MSGN continues to be a strong generator of free cash flow -- at $63 million in the period that segment was up by 45%, but still about $6 million below his estimates on the affiliate revenue decline and increased expenses.

“This cash flow should help de-risk the balance sheet and counter some of the business model risk,” Joyce wrote. “We also think it is possible that the company could allocate some of its [free cash flow] to share buybacks to signal comfort in the business model.”

On a conference call with analysts to discuss results, MSG Networks CEO Andrea Greenberg said the declines were primarily related to two unnamed distributors, one who has said publicly that it is being impacted by a roll-off of promotional customers. Both said they experienced overall subscriber growth in the prior year period, which resulted in difficult year-over-year comparisons.

“Subscriber declines are aspects of the business we continue to monitor closely, and we continue to pursue new distribution outlets for our networks,” Greenberg said.

MSGN EVP, Business Affairs Adam Levine said on the call that the company is focused on all opportunities for incremental distribution with existing and new distributors, and expects its networks to be available on a new pay TV broadband offering from an existing partner scheduled for later this year or early next year, and is discussing new potential content offerings with new and existing partners.

“There’s no shortage of interest in sports content, especially live professional sports content,” Levine said. “As exclusive rights holders for live games for seven local professional teams, we’re going to continue to explore all opportunities that properly value our content and make sense for our business.”

MSGN’s 10-year carriage deal with Altice USA’s Optimum unit expires in about three months. On the call, Levine and Greenberg said they are confident a favorable deal can be reached.

“We have multifaceted relationships with virtually all of our distributors, and we expect that to continue with Altice,” Greenberg said. 

MSG Networks stock rose more than 8% Tuesday after a report in the New York Post said the sports network's chief, James Dolan, was "sounding out" possible buyers, a list that could include Verizon Communications.

MSG Networks, which includes regional sports channels MSG Networks and MSG Plus, carries games from the NBA's New York Knicks and NHL’s New York Rangers, New Jersey Devils and New York Islanders. In a report Tuesday, the Post, citing unnamed sources, said Dolan was “gauging interest” in a possible sale with some of his friends, including Guggenheim Partners executive chairman Alan Schwartz, a noted media dealmaker who also sits on the board of Madison Square Garden Co., the arena where the Knicks and Rangers play. Dolan, executive chairman of MSG Networks, also serves as executive chairman of Madison Square Garden Co.

The Post said there was no guarantee a deal would happen, but named Verizon Communications as a possible suitor.

Verizon could be on the hunt for content assets as its chief telecom rival, AT&T, moves closer to cementing its $108.7 billion purchase of Time Warner Inc. The Post said AT&T also is looking for RSN properties to add to the five it already owns, but may want to hold off until after its Time Warner deal closes.

The news sent MSG Networks stock skyward. Shares traded as high as $24.85 each (up 8.3% or $1.90 each) in earlier trading Tuesday and closed at $24.40 per share, up 6.3% or $1.45 each.

A sale of the networks wouldn’t be out of the question. Many analysts speculated that the MSG channels could go up for sale after the company was split in 2015. In that deal, MSG was split into MSG Networks and the Madison Square Garden Co., which houses the sports teams, the Madison Square Garden arena, and other venues like Radio City Music Hall, The Forum and The Chicago Theater.

The Madison Squarer Garden Co. has named Jordan Solomon as executive vice president for MSG Sports, effective Feb. 11.

Reporting to MSG president and CEO David O’Connor, Solomon will focus on the Garden’s professional sports teams – the New York Knicks, New York Rangers and New York Liberty – as well as its development league franchise the Westchester Knicks.

“Few companies anywhere have the breadth and depth of passion, loyalty and tradition that our sports teams have built,” O’Connor said in a statement. “As we look to the future, we need visionary and fearless leaders like Jordan who readily embrace all of the possibilities inherent in today’s frenetic environment – so we can ensure we’re using all available tools to maximize our relationships with fans, partners, leagues and athletes, and best position ourselves for long-term success. Jordan is a perfect fit and we look forward to his arrival at MSG, and his immediate impact on our operations.”

Solomon joins MSG from the National Basketball Association, where he served as vice president, Team Marketing and Business Operations since 2014. In this role, he led the organization’s strategy and analytics group, which provides NBA teams with financial, marketing and consumer analysis. He also advised teams on all elements of their business operations and strategy, including ticket sales and service, sponsorship, marketing, and analytics.

Among Solomon’s responsibilities at MSG will be developing the overall commercial strategy and goals for the franchises’ businesses; daily oversight of financial and operational matters; and identifying and building key strategic relationships. In addition he will be responsible for the in-game experience, as well as working with colleagues across the company to create marketing, sales, and sponsorship plans, along with fan development and community relations events and programs that strengthen the teams’ brands.

“I am thrilled and honored to become a part of The Madison Square Garden Company, and look forward to supporting Doc and my new colleagues in driving innovation and performance,” Solomon said in a statement. “There is no greater stage than Madison Square Garden and no bigger names in sports – I cannot wait to join the talented staff at MSG and collectively accomplish even greater success in the days to come.”

Prior to the NBA, Solomon was with McKinsey & Company for seven years, where he held a number of positions with increasing responsibility, including his last role as Associate Principal. During this time, he advised an extensive array of media and entertainment, gaming, and financial services clients in the areas of sales and marketing strategy, pricing, and customer experience. Mr. Solomon began his professional career at Silicon Valley Bank, where as part of the company’s Venture Capital Group, he led due diligence, recommended investments and advised senior management of early-stage technology companies.

Madison Square Garden Co., said it has named Donna Coleman executive vice president and chief financial officer. Coleman had been serving as interim CFO since May, after former CFO Sean Creamer resigned.  She will report directly to MSG president and CEO David O’Connor.

Madison Square Garden split its sports teams, entertainment venues and regional sports networks earlier this month in a transaction that created two separate publicly traded entities. Madison Square Garden includes professional sports teams the New York Knicks, The New York Rangers and the New York Liberty as well as noted entertainment venues like Madison Square Garden, Radio City Music Hall and The Beacon Theater. MSG Networks includes regional sports networks MSG Network and MSG Plus.

Coleman had previously served as executive vice president of corporate financial planning and control at Cablevision Systems for more than 15 years before retiring in December 2014. Prior to that she served as  senior vice president of corporate financial planning and control from 2011 to 2012, after serving as senior vice president of planning and operations for more than 10 years.

“We are extremely pleased that Donna has agreed to stay at MSG,” O’Connor said in a statement. “Over the last five months, Donna has proven to be an invaluable member of the team, helping to guide the company through our recent spin-off. With her considerable financial and operating experience, we are confident that she is the ideal executive to help lead the company as we implement our ambitious plans to build on our tremendous legacy."

Coleman will be responsible for strategic financial insight on all facets of the business, helping prioritize opportunities and drive value creation. Additionally, she oversees all of MSG’s financial and accounting matters, including forecasting, budgeting and financial planning and analysis, as well as the company’s treasury, investor relations, tax and risk management functions.

“I am thrilled to be at MSG during such an important time for the company,” Coleman said in a statement. “We have worked hard over the last several months to position MSG for its next chapter. I look forward to working with the management team and employees across the company to ensure we continue to deliver excellence across our operations, and pursue strategic growth initiatives that will allow us to expand our leadership position and create long-term shareholder value.”

Madison Square Garden Co. said its board of directors has approved the long-awaited split of its sports and entertainment assets, creating a media company dubbed MSG Networks Inc. and a sports and entertainment unit that will retain the Madison Square Garden Co. name.

The distribution will take place on Sept. 30 to MSG shareholders of record as of Sept. 21.

Madison Square Garden first announced its intention to split the company in October.  As part of the split, its cable sports networks MSG Network, MSG + would be housed in the MSG Networks unit while its professional sports teams (including the New York Knicks and New York Rangers) and entertainment venues like Madison Square Garden, Radio City Music Hall, The Forum and the Chicago Theater would remain in the Madison Square Garden Co.

For the distribution, each MSG Class A common stockholder will receive one share of the new Madison Square Garden Company Class A common stock for every three shares of MSG Class A common stock held as of the record date. Each MSG Class B common stockholder will receive one share of the new Madison Square Garden Company Class B common stock for every three shares of MSG Class B common stock they hold as of the record date.

“We are now one step closer toward our goal of creating two distinct, focused companies for investors, said MSG CEO Doc O’Connor in a statement. “The live sports and entertainment company will comprise a portfolio of celebrated venues, legendary sports teams and exclusive entertainment productions, while the media company will continue to own and operate award-winning regional networks that deliver compelling sports and entertainment content. We are confident that this transaction will further enhance the long-term value potential of both companies as each continues to build on its considerable record of achievement.”

Upon completion of the spin-off, MSG’s current repurchase program, through which $241 million of MSG Class A common stock has already been purchased, will be terminated and the new Madison Square Garden Company will have in place new Board authorization to repurchase up to $525 million of its Class A common stock.

 “Our anticipated stock buyback program for the new sports and entertainment company is a reflection of our confidence in the strength of those businesses, and of our continued desire to generate greater value for stockholders,” O’Connor said in a statement.

Statement containing details regarding the distribution of the new Madison Square Garden Company common stock and the new Madison Square Garden Company’s business and management following the spin-off will be mailed to MSG stockholders prior to the distribution date.

The spin-off has been structured to qualify as a tax-free distribution to MSG stockholders for U.S. federal income tax purposes. Cash received in lieu of fractional shares, however, will generally be taxable. MSG stockholders are urged to consult with their tax advisors with respect to the U.S. federal, state, local and foreign tax consequences of the spin-off.

Beginning on Sept. 17, and continuing until the occurrence of the distribution, MSG expects that its common stock will trade in two markets on the New York Stock Exchange: In the “regular way” market under the symbol “MSG” and under the current name, “The Madison Square Garden Company”, and in the "ex-distribution" market under the symbol "MSGN WI" and under the new name “MSG Networks Inc.”

The new Madison Square Garden Company Class A common stock is expected to begin trading on a “when-issued” basis on the NYSE under the symbol “MSG WI” and under the name “The Madison Square Garden Company” beginning on Sept. 17. "When issued" trading of the new Madison Square Garden Company Class A common stock will continue until the distribution occurs.

The completion of the spin-off is subject to the effectiveness of MSG’s Form 10, funding of the debt financing at MSG Networks and the new Madison Square Garden Company common stock being authorized for listing on the NYSE, as well as certain approvals and consents.   

Madison Square Garden Co. said Tuesday that it plans to transfer the listing of its Class A common stock to the New York Stock Exchange (NYSE) from the NASDAQ Global Market, beginning on July 27.

The stock will trade on the NYSE under its current symbol “MSG” and will continue to trade on the NASDAQ Exchange until the transfer is complete.

 “We are pleased to be joining the NYSE’s lineup of world-class companies as we continue to pursue opportunities to generate value for our shareholders,” said MSG chief financial officer Dnna Coleman in a statement. “This includes our proposed spin-off of our sports and entertainment businesses from our media business, which we expect to complete in 2015.”

MSG plans to spin off its sports businesses –including the New York Knicks, the New York Rangers, the New York Liberty, Westchester Knicks (NBADL) and the Hartford Wolf Pack (AHL) – and its entertainment assets – including Madison Square Garden Arena, Radio City Music Hall, The Beacon Theater, The LA Forum and others – from its media assets MSG Networks and MSG-Plus. The spin is expected to be completed later this year.  

 “We look forward to a long-term relationship with The Madison Square Garden Company,” said NYSE president Tom Farley in a statement. “With a portfolio of legendary brands and a reputation for creating world-class experiences, MSG is a great addition to our community of leading companies and we welcome the opportunity to support MSG’s continued growth.”

NBCSN lit the Nielsen lamp with a number of records with its opening night coverage of the 2014-15 National Hockey League season.

The first game of the Wednesday Night Rivalry doubleheader,the Boston Bruins' 2-1 win over the Philadelphia Flyers, netted 956,000 viewers and a 0.57 household rating from 7:27 to 10:06 p.m. (ET)  according to Nielsen data. That made it the most-watched opening night game on cable on record (data available since 1993) and the highest-rated NHL regular-season game ever on NBCSN. The game also set live streaming records for uniques and minutes consumed, according to NBC Sports officials.

The second game of the twinbill -- the San Jose Sharks shut out of  the defending Stanley Cup Champion Los Angeles Kings (10:06 p.m. – 1:14 a.m.) -- averaged 446,000 viewers, the most ever on NBCSN for an NHL regular-season “late” game (puck drop after 9 p.m. (ET)), excluding last season’s Ducks-Kings outdoor game at Dodger Stadium.

The two telecasts averaged a 0.43 household rating and 679,000 viewers to rank as the best NHL opening night doubleheader on record (data available since 1993). The contests stood 19% and 13%, respectively, over the 0.36 rating and 601,000 viewers for the most-recent opening night doubleheader that faced off the 2011-12 season.

The Flyers-Bruins’ 0.57 household rating surpassed the 0.55 rating for the first-ever Wednesday Night Rivalry game between the Flyers and Penguins on Feb. 2, 2013, and was up 12% over the 0.51 for last year’s season opener between Washington and Chicago.

In addition to the record rating, the Oct. 8 Wednesday Night Rivalry matchup  averaged 956,000 viewers, making it the most-watched opening night game on cable on record (data available since 1993), while tying it for the most-viewed regular-season game ever on NBCSN -- the Bruins-New York Rangers on Jan. 23, 2013. The previous opening night mark came last year with the Capitals-Blackhawks starter that garnered 935,000 viewers.

The Sharks-Kings game scored a 0.31 household rating and 446,000 viewers, up 41% and 30%, respectively, from the 0.22 and 342,000 viewers for the Vancouver-Pittsburgh late game that began the 2011 seaso