WWE held their Q4 Financial Results conference call on Thursday. The call featured Vince and Stephanie McMahon, Nick Khan and Frank Riddick. You can check out some highlights from the call below:
* The call starts with the SVP of Investor Relations, who welcomes us to the call. Vince McMahon, Nick Khan, Stephanie McMahon, and Frank Riddick are on the call. XXX notes that the Q4 Earnings Results were released and goes through the usual legal stuff.
* Vince McMahon takes over and talks about how much increase they generated in profit and revenue at over $1 billion and reimagined their business over the year, which he says is something they do every month if not every week. He says they remain focused on their upcoming year and years to come with more record revenue. He says their performance pretty much speaks for itself and their longevity, with opportunites to grow exponentially.
* Khan takes over at that point and says before they jump into future outlook, he wants to talk about what WWE has done over the past few months. He brings up how they announced almost a year ago that they would license their Network and library to NBC and Peacock. He compares Peacock’s numbers to the previous numbers on the Network, and says Money in the Bank 2021 saw a 20% jump in viewership from 2019’s MITB. Summerslam 2021 was up 30% from 2019, and Extreme Rules 2021 was 20% up from 2019. WWE Crown Jewel saw viewership up 75% over the 2019 Saudi event, and Survivor Series was up 25% from 2019.
* He notes that over 3.5 million fully-paid Peacock subs have watched WWE content since they moved over, compared to 1.1 million WWE Network subs in the US. He says they’ve expanded their viewership with the move to Peacock and in-ring product, which has helped Peacock as well, and more fans are watching the WWE events than ever before. It’s allowed them to fully focus on their own IP and that the marketplace puts considerable value on their IP, which has allowed them to enter into categories.
* Khan says they currently have over a dozen scripted and unscripted projects sold based on WWE IP, with announcements coming soon, and include existing partnerships and new buyers, networks, and streamers.
* Khan talks about their other deals including their trading card move to Panini and their NFT marketplace, with more announcements coming soon. He also pointed out the WWE-branded lotteries that will be launching in several states later this year. He also talks about the new extended deal with Mattel for WWE action figures and properties, toy license, and put their toys in 50 global markets with more growth expended.
* Khan goes on to say they “quickly got back to work” in the new year with WWE Day 1, which they added because they believed the holiday date would attract more viewers, ticket sales and merchandise. He notes the show sold out and was one of the highest viewed premium events on Peacock ever, with viewership up 60% from any live event in December for them ever. He adds that they kicked off the Road to Wrestlemania with the Royal Rumble, which had the strongest merchandise sales and second-largest gate in Rumble history. Peacock viewership was up 45% from the 2020 event. He put over Ronda Rousey and Bad Bunny’s returns and Johnny Knoxville’s debut, noting they weren’t just “checking off a box” but instead partnering with them to promote their successful events (Bunny’s tour and the upcoming Jackass Forever).
* Khan said their next live event is the February Elimination Chamber in Saudi Arabia and noted they’re key revenue drivers for the company and demonstrate their global appeal. He said they they couldn’t be more pleased to be getting back to staging major events internationally, and promised more on that coming this year.
* In further international news, he put over the new deal with Disney in Indonesia which follows their Peacock deal in format, and which deepens their relationship with Disney as does WWE executive producing Ronda’s Places which premiered on ESPN+. More in the international media rights space will be announced in the not-too-distant future.
* Moving onto gaming, he mentioned WWE 2K22 and Rey Mysterio being the cover star and said Stephanie will talk about that more. He mentioned “further consolidation in the gaming sector” (Microsoft’s acquisition of Activision Blizzard) and said they are not surprised by it and also mentioned Take-Two and Sony’s acquisitions as well. They expect the companies to monetize their value with four or five major players emerging. He also mentioned this happening outside of gaming such as WarnerMedia and Discovery merging, and publishing and theme park consolidation as well. They believe it will continue.
* Regarding sports rights, he said that it’s a big focus for services and talked about ESPN and Amazon making big money deals, as well as NBCU’s deal with the NHL and more. He said it’s a matter of time for Apple and Netflix to find partners and with their company focused on value, they couldn’t be more optimistic for future growth.
* Stephanie McMahon then took over and talked about the value of WWE IP, discussing how WWE stars are in high demand. She mentioned Sasha Banks appearing in the cold open for the ESPN College Football National Championship broadcast, Drew McIntyre appearing at the MTV EMAs, Big E. appearing in the cold open of Tyson Fury vs. Deontay Wilder. She also talked about Paramount using WWE to promote Jackass Forever and put over Knoxville’s social engagement over his appearance which resulted in 12 million social media views. She talked about the Rumble, calling Bad Bunny a “Grammy Award-winning artist, and I would say part-time WWE Superstar” and putting over Rousey’s return and Rumble win. She talked about the Rumble’s viewership and says that the day of the Rumble was the highest usage of the Peacock app to date. She also talked about their new sponsor in Door Dash from the show.
* She talked about the launch of the WWE 2K22 trailer and said it’s still early but thus far, all indications are very positive. She said their mobile game saw a 14% performance increase through WWE Supercard and WWE Champions which saw its best quarterly performance in Q4. She talked about how many people in their audience identify as gamers and say they’re looking at the video game acquisitions.
* Stephanie talked about how the next generation of fans are super-important to them, and talked about the Next In Line program for NIL deals for collegiate athletes. She said these athletes already have strong social engagement and said there’s never been as clear a pipeline to join WWE, then talked about Gable Steveson’s signing and drafting to the Raw roster once he completes college.
* She talked about how WWE has more total fans 18 – 34 than the NFL, MLB, NBA, UFC, and NASCAR when audience is factored across all platforms, and put over their YouTube being way more followed than any of the other sports leagues. She ran down their Facebook and TikTok success and says they had over 50 billion views across all platforms.
* McMahon then talks about their brand partnership and advertising integrations, using Pizza Hut and Red Notice from Survivor Series as examples of where the engagement were. She points out that the audience chanted “We Want Pizza” and said they can’t guarantee it, but said it’s a demonstration of how successful fan engagement can be. She actually mislabeled The Rock as a WWE Hall of Famer (he isn’t one yet) when talking about Red Notice, and talked about how many impressions it drew. Sponsorship revenue was up 30% for the quarter. She said they look forward to growing their business further.
* Frank Riddick took over and ran through the information in the earnings results.
* The Q&A portion began after that, with the first caller asking about if there were any renewals of the rights or update to their one-time payments. There’s nothing yet to call out.
* The second question was about sponsorship, noting that they’ve undermonetized in the past, and asked about guidance for new sponsorship. Stephanie said that there’s no reason why they won’t be in the hundreds of millions over the next few years and any guidance is already backed in. They’re looking into engaging new revenue streams and using their talent to help build that way.
* The next called asked about the Disney+ deal in Indonesia and how, with Disney covering so many countries and more, why start with a one country deal and are they looking for more regional deals. Nick said they’re doing region by region deals and looking country to country for which partners work best for them. Disney was the strongest for APAC and now the US-based companies are expanding at the same time, so they were waiting for that and should be in good shape in a couple of month.
* The next question asked about how WWE views the expansion of Metaverse and VR, and how they’ve been looking there for opportunities. Stephanie said that they’re exploring that as an opportunity, especially with the theory that this is where people will go. They’re learning as much as they can and are actively involved in exploring it.
* Asked about the impact of Peacock as they move into year two, Riddick says they got a major payment upfront and won’t have that in 2022, and they recognize that revenue is based on the timing of live events. The contract has an escalation built in so it will be slightly up for 2022.
* Asked about if there’s any guidance on media costs, Khan said they’re not going to give guidance but noted they will have costs for touring and international shows that they will have to produce and market. He noted there are “at least” two large-scale international shows this year, and said that the Hulu deal is up this year, and also said about the international events “why just limit it to two?”
* Asked about how the NIL program compares to taking independent talent. She said that it’s an evolution of the process and offers WWE the ability to give athletes more than anyone else because it provides opportunities to big brands that don’t make it to the NFL or the like. She talked about how a number of athletes have signed up, with Khan pointing out Big E., Roman Reigns, Rock and Goldberg as examples of guys who moved from football to WWE.
* Asked about BT Sports’ announced venture to pursue new sports rights, Khan noted there’s more buyers in that region and how DAZN didn’t acquire BT as expected. He put over BT as an amazing partner but pointed out the Network is still “agnostic” there and they’re having conversations about that.
* Asked about how they think about fair value of content on media rights vs. linear vs. streaming (direct-to-consumers), Khan said on the linear side, they’ve seen scripted content isn’t working how it used to and scripted content is moving to streaming while live is still working. That gives them more open real estate, and how they have a lot of content that works across broadcast, streaming and digital. He noted that their content is advertiser-friendly content, which helps in broadcast and on basic cable; you also need content that can be sold to advertisers as streaming moves toward ad-supported tiers. They think they’ve outperformed on Peacock and believe they deliver on all fronts.
* They were asked about things are progressing about Raw’s second window renewal, and said they feel as good there as they did with their NBC, FOX, and Peacock deals.
* Asked about how WWE’s strategic placement is, Khan said that everyone wants to be in business with content creators and they have a long history there, with more buyers in the future.
* The caller asked if they will pursue broadcast deals still once the FOX deal ends or if they’ll look toward streaming, and Khan said that they believe in FOX and what they’re doing, and believe major programming will be on both broadcast and streaming. They also realize that premium dollars are being paid for premium content.
* The last question is whether Crown Jewel had any financial changes vs. past events, and Khan said there were no major changes.
(h/t – 411 Wrestling)
