It’s WWE financials day!
We’ll have more once reports come in from the investor conference call with Vince McMahon and sharper business minds than mine have had a chance to pour over the statements WWE released this morning. But a quick glance at the press materials (a full copy of the release for the publicly traded company can be found at this link) reveals a continued focus on growth of the over-the-top streaming Network service and global expansion, with less emphasis on historic metrics like television viewership.
Here’s the synopsis, with quotes from Chairman & CEO McMahon and Chief Strategy & Financial Officer George Barrios:
WWE® Reports First Quarter 2017 Results
First Quarter 2017 Highlights
* Revenue increased 10% to $188.4 from $171.1 million in the prior year quarter
* Operating income was $4.0 million and Adjusted OIBDA1 was $18.6 million
* WWE Network averaged 1.49 million paid subscribers over the first quarter 2017, which represented a 16% increase from the first quarter 2016
* WWE Network continued to super-serve its global fans with live, in-ring content by producing new episodes of its cruiserweight series, 205 Live, and holding a U.K. Championship Tournament, featuring local talent
* Announced partnership with HBO Sports and the Bill Simmons Media Group to produce Andre the Giant, a documentary film examining the life of the WWE Legend
* Completed multi-year agreement naming StubHub as the Company's exclusive ticket resale marketplace for fans in the United States and Canada
Selected WrestleMania Highlights
* WrestleMania (April 2, 2017) broke the attendance record for the Orlando Citrus Bowl, attracting 75,245 fans
* Over WrestleMania Week, WWE had an unprecedented five consecutive nights of sellouts at the Citrus Bowl and Amway Center
* WrestleMania reached a record 1.95 million global households on WWE Network alone, making it the most-watched WrestleMania in history
* During WrestleMania Week, WWE Network subscribers watched 22.5 million hours of content (or an average of approximately 13 hours per subscriber), representing a 4% year-over-year increase
* WrestleMania was the most social event in WWE history with 5.19 million interactions on Facebook and Twitter during the broadcast alone and 2.8 million tweets about WrestleMania throughout the day
* WrestleMania accounted for nearly 30% of all social TV interactions on April 2nd, surpassing the Country Music Awards (13%), The Walking Dead Season Finale (10%) and MLB Opening Day on ESPN (10%)
* WrestleMania was made available live in China for the first time on PPTV Sports via pay-per-view with a choice of Mandarin or English commentary
* Launched WWE e-commerce site in India (WWEShop.in) for the first time ever, beginning Monday, April 3, concurrent with the broadcast of WrestleMania in that country
STAMFORD, Conn.--(BUSINESS WIRE)--WWE (NYSE:WWE) today announced financial results for its first quarter ended March 31, 2017. For the quarter, the Company reported Net income of $0.9 million, or $0.01 per share, as compared to $13.9 million, or $0.18 per share, in the prior year quarter. Operating income was $4.0 million as compared to $22.0 million in the prior year quarter. Excluding items affecting comparability, Adjusted OIBDA1 was $18.6 million as compared to $27.6 million in the prior year quarter.
"We are pleased with the continued growth of WWE Network, which is a critical building block of our content strategy," said WWE Chairman & CEO Vince McMahon. "The recent production of WrestleMania set records for network viewership as well as digital and social engagement. As we leverage continuing innovation to extend our reach in India, China and around the world, we are confident that the enduring and increasing global power of our brands will provide a solid foundation for long-term growth."
George Barrios, Chief Strategy & Financial Officer, added, "During the first quarter, increases in key operating metrics, including event attendance, network subscribers and global content consumption, supported strong 10% growth in revenue. As anticipated, our earnings reflected the timing of certain expenses, a significant portion of which are expected to reverse over the coming months. As we continue to focus on producing engaging content across all platforms, we remain on track to achieve our 2017 financial objectives with record revenue, record Adjusted OIBDA results, and record subscriber levels."
Q2 2017 Business Outlook
Based on the performance of subscribers following WrestleMania, the Company is raising the low end of its projected range of subscribers for the second quarter. For the second quarter 2017, the Company projects average paid subscribers of at least 1.63 million. The Company also estimates second quarter 2017 Adjusted OIBDA of approximately $13 million to $17 million.
WWE is unable to provide a reconciliation of second quarter guidance to GAAP measures as, at this time, WWE cannot accurately determine all of the adjustments that would be required.
The range of financial performance projected for the second quarter would result in Adjusted OIBDA for the first half of 2017 that is essentially flat to the prior year period. The Company anticipates significant year-over-year growth in Adjusted OIBDA over the second half of 2017.
WWE management continues to expect the Company to achieve another year of record revenue and has targeted Adjusted OIBDA of $100 million, which would be an all-time record (up approximately 25% from 2016 Adjusted OIBDA of $80.1 million).2
Comparability of Results
Our reported Operating income reflects several non-recurring items that Impact comparability on a year-over-year basis. These included $5.6 million in expenses primarily related to certain legal matters and other contractual obligations and $2.1 million in film impairment charges. These items have been excluded from the Company's Adjusted 2017 results. For the first quarter 2016, there were no such items that impacted year-over-year comparability.
A reconciliation of Q1 2017 Adjusted OIBDA to Operating income (GAAP) can be found in the supplemental schedules on pages 14-15 of this release.