WWE held its 2020 third quarter earnings conference call on Thursday that featured WWE Chairman & CEO Vince McMahon, President & Chief Revenue Officer Nick Khan, Chief Financial Officer Kristina Salen, and Chief Brand Officer Stephanie McMahon. Here are the highlights:
– The conference call opens with a welcome to everyone on the call.
– McMahon started by praising the new management team in place (Khan and Salen) and said there is a new spirit and vibrance in the company with a view of optimism. “I’ve never felt as confident as I currently do about our new management.”
– Khan ran through his professional background before going through the revenue numbers.
– Khan announced that WWE has sold a multi-part documentary series to Netflix on the life of Vince McMahon. Bill Simmons will be the executive producer on the project. It will be one of the highest budgeted Netflix docs in the history of the streaming service.
– Khan stated that conversations have resumed for “alternative strategic options” on selling the rights to WWE Network content to major streaming platforms.
– Khan mentioned that WWE is working on an event in 2021 that will primarily feature developing Indian superstars.
– Stephanie got on the call and put over the ThunderDome in addition to WWE’s perseverance through COVID-19. She touted an increase in ratings after introducing the ThunderDome.
– Salen brought up more revenue highlights. WWE Network average paid subscribers were 1.6 million, an increase of 6% . Revenue was $221.6 million, an increase of 19% or $35.3 million. Operating income was $63.4 million, an increase of nearly 9x or $57.0 million. Free Cash Flow was $110.8 million, an increase from a $16.4 million use of cash.
– Salen stated that while WWE doesn’t know when ticket live events will return, they have the intention of doing so as “quickly and as safely as possible.”
– This was when they opened the call up for questions.
– The first caller asked about TV ratings and WWE’s plans to increase the numbers as well as how it impacts their next contract talks. McMahon said TV viewership is only one of their measurements and that they have far more fans than they have ever had if you include social and YouTube. “That’s not to say we don’t want to increase [ratings]. Of course, we do but aside from that, our total audience is much bigger. You can’t just hang your hat on, ‘okay ratings are down’… We’re never off the air.” He noted that they’re doing all they can to improve the ratings with the ThunderDome, better writing, and talent. Michael Weitz noted they’re confident about their TV rights going up in the next rounds of contract talks.
– A caller asked about their alternative plans for the WWE Network, Weitz noted that WWE is looking for a licensing deal, but they won’t sell the streaming service. He stated that WWE is in constant talks with various players both domestic and international about licensing it.
– Salen was asked about expenses, which she mentioned that WWE estimates that the majority of furloughed employees will return by the end of the year.
– A caller asked about the outlook on 2021 including any assumption on Saudi Arabia events for next year, Salen didn’t answer. Regarding when their Amway Center deal expires, she stated, “Our assumption is we’ll be at a venue like the Amway Center for the rest of 2020.” She added that there are many places that they can go in 2021.
– When asked about when WWE’s TV deal for NXT with the USA Network expires, Khan wouldn’t give an exact timeline, but praised Triple H for the ratings on Wednesday night and that the deal with USA has a long runway.
– A caller asked about President Trump saying that McMahon was in a meeting regarding sports returning during the pandemic, McMahon said that he was on a panel via conference call with Roger Goodell. He noted that they will return with fans once COVID lets up and they can do shows safely for their fans and performers.