WWE Third Quarter Financials: Trick Or Treat?

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WWE released their third-quarter financial results on Thursday, October 31st. It’s Halloween today, so it’s both the “scary day” holiday and a scary day for WWE. As with any major corporate financials, there are positives and negatives depending on where you look. The top revenue stream for WWE this quarter, the same as it always is, is there television rights fees. WWE earned $44.1 million in television rights, nearly doubling their second largest revenue stream, which are live events ($25 million). While on the surface, everything may look fine on paper, but if you follow WWE on a regular basis, all signs point to the fact that issues could be coming in the future.

WWE television ratings are dropping at a more rapid-pace than a Mike Tyson opponent in the first round of any major Heavyweight Championship prize-fight in his 1990s prime. The WWE talent roster is so weak at the top, that interest in buying tickets to attend a WWE live event continues to decrease. The fact that WWE is not delivering major Superstars that are advertised on what is becoming a regular basis, only point to the fact that they are alienating fans who spend their hard-earned money to attend a WWE live event. If you buy a ticket to an event expecting to see specific talent, only to show up and realize they are nowhere to be found, you may be less inclined to attend an event the next time WWE comes to your town.

As far as television is concerned, who hasn’t noticed the increasing negative response week in, and week out to both WWE RAW and WWE SmackDown? This is where the WWE creative team needs to shine. When fans are begging for a Daniel Bryan reign as WWE Champion, something so simple to execute, and you continue to deprive the fans of what they want, interest in your product continues to decrease. If you promise a pay-per-view, the company’s third largest revenue stream ($14.6 million) and fail to deliver on what the fans expect, and even more so deprive them of any real main event finish by the time the event is over (WWE Battleground), how willing do you expect them to be to open their wallets when the next pay-per-view rolls around?

On paper, things can look good or bad depending on how you spin it. But the bottom line is — all of WWE financials emanate from one key factor — the creative direction of the company. If you do not have storylines and talent that fans are invested in, you’re going to have less interest from fans in your television product. Less interest in your pay-per-view product. And less interest in your live event product. With these being the three biggest sources of revenue for the company, you need to deliver. It’s so simple. The fans want something, give it to them. Sure, there’s the argument that you can withhold from the fans the thing they are dieing to see in hopes of building additional anticipation. But when the smoke clears, the dust settles, and Randy Orton is holding the WWE Championship up high, while still being the secondary attraction under Triple H and Big Show, two performers who haven’t been working live events or wrestling on pay-per-views, you’re chopping your nose off to spite your face. You can only do this for so long before fans stop caring.


Unfortunately, the ship has sailed for fans hoping for Daniel Bryan to finally “have his moment.” Plans for Survivor Series do not have anything to do currently with Bryan in a Championship picture, so that is prolonged yet again. Say, for example, Bryan wins the WWE Championship at the WWE TLC pay-per-view in December. That would be a basic case of “too little, too late.” If he did win the title, however, which again, is not currently the plan, how much would you care? Certainly not as much as you might have on any of the last, hell, three pay-per-views.


It all goes back to the numbers. It’s Halloween, everybody! Trick or treat? You can certainly trick investors by spinning the numbers a certain way, but it won’t be long before that trick gets harder and harder to play out. The solution? Give the fans, the core of your product, the treat they so desire. If the fans want something, give it to them before it’s too late and they stop caring. Otherwise, when it’s time to reveal your fourth quarter financials, all of the tricks in the world won’t convince investors that things are looking up.

Scary stuff. Happy Halloween everybody.

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