Notes from WWE’s Fiscal Third Quarter 2021 Report

WWE held an investor’s meeting this past Thursday to discuss the results from their fiscal third quarter 2021 report.

Notable financial results highlights:

• Revenue for the fiscal quarter was $255.8 million, up 15% ($34.2 million) from last year’s fiscal third quarter.
• Operating income was $64 million, up 1% ($0.6 million) from last year’s fiscal third quarter. WWE stated that the reason for the very small increase was due to it being offset by higher television and live events expenses for the quarter.
• Adjusted OIBDA1 was $77.9 million, down 8% ($6.4 million) from last year’s fiscal third quarter.
• Ticket sales for live events in North America for the fiscal quarter were stated to have generated the highest quarterly average attendance in over a decade for the company.
• Net Income was $43.5 million, down 9.8% ($4.7 million) from last year’s fiscal third quarter.
• Digital video views for the fiscal quarter was 12.8 billion and hours consumed was 411 million. Total views were up by 39% and total hour consumed were up by 20% compared to last year’s fiscal third quarter. WWE stated that both generated a new all-time fiscal third quarter record for the company.
• In terms of television ratings, WWE RAW was up 1% and WWE Friday Night SmackDown was up 6% compared to last year’s fiscal third quarter. USA Network was stated to be up 11% and FOX was stated to be up 13% over the same time period.

Other notable highlights from the investor’s meeting:

• WWE President Nick Khan stated that the company will be “announcing a slew of scripted and unscripted” content within the near future, which will be primarily targeted towards a “young and diverse” audience.
• Khan stated that the company currently feels “bullish” in regards to getting a higher monetary amount for their next set of television contracts.
• Khan also stated that WWE’s current media rights contract with Hulu for the re-airing of RAW episodes expires on the back half of 2022.
• Khan stated that the reason why the company decided to fully announce their pay-per-view schedule for next year ahead of time and plans to run more events in stadiums is due to a recent change in approach to how WWE handles their PPV events. Khan stated “One area we’ve spent the last year examining is our strategic approach to pay-per-views. We’ve looked into all parts of that business and are making adjustments that we believe will enhance our results by making each pay-per-view a special event, not only as content but in all things surrounding each event. As promised last quarter, we recently announced our pay-per-view calendar for 2022. The dates, cities, and venues.“
• Khan also stated that the company felt that it was very important to not run next year’s Royal Rumble event on the same night as NBC’s coverage of the 2022 Winter Olympics. This was stated to be an important decision for both WWE and their NBCU partners.
• Stephanie McMahon stated that these changes are part of larger changes that have been made for WWE’s live touring model going forward. McMahon stated “We are changing from an arena-based touring model to a stadium-based touring model, allowing us to better align all lines of business around our key events. For example, SummerSlam was held in Allegiant Stadium, the first time SummerSlam has ever been held in an NFL stadium, attracting a record 51,000 fans and drawing a record gate. As Nick [Khan] mentioned, more than four times greater than the last time SummerSlam was held with fans in 2019. Merchandise was up 155 percent year-over-year and more people watched SummerSlam across Peacock and WWE Network than any other SummerSlam in WWE history with a viewership increase of 55 percent from 2020.”
• McMahon also compared WWE to Marvel in regards to how the company views each of their Superstars as their own separate brand like how Marvel does for their own superhero characters.
• In regards to brand integration, McMahon stated “In terms of content integration, would you ever see a Pure Life truck drive into Arrowhead Stadium in Kansas City and have Patrick Mahomes spray down fans with a Pure Life brand super soaker as part of a touchdown celebration? Or have zombies replace the offensive line for one down? My guess is no, but you can in WWE. Because we have all the exciting action of a live game, but are scripted like a great movie, we can write those integrations in ways that are fun and memorable for the audience and our partners or we can leverage our creative writing and media teams to create customized content across digital and social media that is relevant to that platform like we did with Old Spice when we introduced a new WWE superstar with the same name as their new scent The Night Panther. We produced 16 pieces of original content that delivered over half a billion impressions and 40 million views with 96 percent of our audience saying they would take action towards Old Spice.“
• In regards to NXT’s new direction with their 2.0 revamp, Khan stated “We think it’s all starting the way that we wanted it to start. So we wanted a younger, fresher, in-ring approach. We think we have it. You’ve already seen some talent from the new NXT elevated to the main roster. There’s going to be more of that. Our recruiting efforts, which we can go through at a later date, which are spearheaded by Paul Levesque and Bruce Prichard and a number of other folks here, are focused on young athletes who may not, at this moment in time, be in the wrestling space. And we think all of those results will come to fruition in the right way, and that NXT will continue the way it’s already building.“

Sources: F4WOnline, PWInsider, Fightful 1, 2, & 3, Wrestling Observer Newsletter