WWE Revenue Tops Estimates as TV Fees Aid Virus-Impacted Wounds
(Bloomberg) -- World Wrestling Entertainment Inc. exceeded Wall Street expectations for profit and revenue owing to an increase in U.S. television rights fees for flagship programs Raw and SmackDown. The results may temporarily soothe investor fears about measures the pro-wrestling giant is taking to improve operating performance and cost reductions due to the coronavirus pandemic.
- First quarter earnings were 41 cents per share on $291 million in revenue. Analysts predicted earnings of 27 cents a share on $271.7 million in revenue, according to data compiled by Bloomberg. Digital video views increased 25% to 9.6 billion while hours consumed climbed 15% to 344 million across digital and social media platforms, the company announced.
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- WWE’s two-day WrestleMania event in April broke records as social interactions for the event amassed more than 13.8 million total interactions across Facebook, Instagram and Twitter. And WWE Network subscriber adds during WrestleMania weekend were also the highest in its history as total users reached 2.1 million.
- First-quarter revenue saw an increase primarily due to the escalation of domestic rights fees in addition to “the favorable timing” of WWE’s large-scale international event Super ShowDown.
- Live events revenue for the first quarter revenue fell to $17.5 million from $26.2 million the same period a year prior due to the staging of 49 fewer events, an effort by WWE to optimize its touring schedule in addition to, although to a lesser extent, Covid-19 related impacts.
- CEO Vince McMahon said first-quarter financial performance “largely unimpacted” by coronavirus outbreak but “now we are in the midst of unprecedented times, which require us to be especially nimble, creative and efficient in order to ensure the long-term value of WWE.”
- WWE previously withdrew its 2020 guidance and is not reinstating the aforementioned outlook as management “remains unable to quantify the potential impact of Covid-19 on its business.”
- WWE rose as much as 10% during extended trading in New York. The stock is down 40% this year as investors weigh if the pro-wrestling giant can pull itself out from a string of headwinds. The performance has underperformed the S&P 500 Index’s 13% drop.
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