WWE has released its financial results for the first quarter (Q1) of 2020, and what do you know, this company is still absurdly profitable.
Here is their statement on the strong first quarter results, which remind us that the COVID-19 impact and “unprecedented times” weren’t much of a factor for Q1, which ended Mar. 31:
“Our first quarter financial performance was strong and largely unimpacted by the COVID-19 outbreak,” said Vince McMahon, WWE Chairman & CEO. “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. We are taking precautions to protect the health and safety of our performers and staff as we produce content in new ways, engage fans with a much-needed diversion and operate effectively in this evolving environment.”
Frank Riddick, interim Chief Financial Officer, added “In the quarter, we delivered revenue of $291 million and Adjusted OIBDA of $77.3 million exceeding our rescinded guidance as we offset the impact of canceled events by reducing production and other costs. Given the current uncertainties of the potential impacts of COVID-19 on our business, we have reduced employee, talent and other costs and delayed approximately $140 million in capital spending related to our new headquarters to strengthen our financial performance going forward and to ensure we have the resources necessary to execute our value creation strategy.”
Here is a numerical breakdown of their Q1 2020 results.
WWE divides its business into several categories - Media, Live Events, and Consumer Products.
Overall, their “Media” division revenue is up 90% from Q1 2019 thanks to the new TV deals.
The “Live Event” division revenue is down 33% from Q1 2019, and the “Consumer Product” division revenue is down 19% from Q1 2019. But the “Media” revenue is so much higher that WWE’s overall revenue for Q1 2020 ($291 million) was up 60% over Q1 2019’s ($182 million).
WWE uses adjusted OIBDA as its measure of profit, and their OIBDA breakdown for Q1 2020 also shows that it’s all about the Media division. The overall adjusted OIBDA of $77.3 million beat out their projections, which were closer to the $60 to $65 million range.
The “Live Events” division continues to struggle. Here is their explanation for that result:
“This reduction in ticket revenue was driven by the staging of 49 fewer events, resulting from the Company’s efforts to optimize its touring schedule and, to a lesser extent, COVID-19 related impacts.”
The average paid WWE Network subscribers were down in Q1, as you can see in the red columns below. Out of the 1,461,00 average paid subscribers, roughly 1,053,000 were domestic subscribers.
The paid subscribers for WrestleMania 36 were down from the last two WrestleMania events, though WWE tries to spin the result as a 5% increase over 2019 in the lower right chart, by adding on the numbers for free subscribers.
WWE declined to offer any guidance on their projected Q2 numbers due to the uncertain impact of the coronavirus pandemic.
Finally, WWE is temporarily halting its stock buyback program:
“The Company paid $9.3 million in dividends to shareholders during the first quarter. Given the economic uncertainties of the current business environment, the Company has temporarily suspended purchases of WWE stock under its $500 million share repurchase program.”
Speaking of which, WWE’s stock is benefiting as a result of their strong performance in Q1 2020.
And be sure to let us know in the comments below which numbers stand out to you.