WWE - Earnings call transcript Q4 2019 | World Wrestling Entertainment, LLC

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Operator

Hello, and welcome to the webcast entitled WWE Fourth Quarter Earnings.

We have just a few announcements before we begin. [Operator Instructions]

I will now turn the call over to Michael Weitz, Senior Vice President of Financial Planning and Investor Relations. Please go ahead Michael.

Michael Weitz

morning good and you everyone. Thank fourth Welcome conference full-year earnings and to WWE's call. XXXX quarter discussion our Financial Leading as Vince are today's McMahon, Frank our well Chairman Riddick, Interim Chief Officer. as CEO, and followed by Their remarks will a session. Q&A be business website, We this release corporate.wwe.com/investors. release, earnings morning and supporting other the earlier presentation posted outlook and issued have materials earnings our our XXXX XXXX and on our

to forward-looking current assumptions materially will not include results statements. and subject views, and them. based discussion statements Actual our placed These be in Today's reflect and disclosed various are on are filings. should our risks uncertainties forward-looking on undue SEC reliance differ may

matters as measures. our available forth include the in website. Additionally, non-GAAP I discussing on release our is will non-GAAP Reconciliation presentation, and mentioned, set today earnings financial are which may to we be of GAAP information

conference to today's be At being reminder, privilege my available a call our and will this website on as call later today. over to turn a it's replay Vince. is Finally, the time, recorded

Vince McMahon

for Thank morning everyone. today. joining us Good you

for you record which profit, and SmackDown. distribution we Raw our year, new As revenue reflected agreements achieved with the know, and

However, of as work agreement original our the at we our distribution our efforts and Middle customer guidance East to ongoing engagement. was through our strengthen performance and low-end brand

the our during FOX up XX%. ratings, growth as was platforms provide driving live XX%, with for including attendance, live powerful engagement ratings and increasing showed metrics, television attendance Network growth, well USA broadening SmackDown our our event audience, event TV as quarter

expansion, was on areas our all of This focus. engaging of reflect on and remain decision, change careful decision Board growing was transition different consideration. focused and I of We the not content, in across As made international announced course, a It recently the management the you based view value execution management of transition. on after a fans know, furthering platforms. The our and highly strategy. did

strong a made contribution and supported management Michelle team, significant George years, WWE. more XX by than the Over to Barrios

However, WWE change, we won't misspeak.

executives talented to executing are our than We more have capable company who committed our of deep a of team strategy.

fundamental strong. to capitalize The and of the of on unchanged live including the value content growth, sports remains long-term sources rising ability our

providing frankly and are we initiatives substantially of for strategic enhance that well the the next Middle XXXX, India, note quarter. While performance. our the direct-to-consumer content quite as and evaluation implemented today service, business in should as our perspective you which distribution in for outlook pursuing our could are These and include East we the of could alternatives execution be

culture We’re to more in growth we're and long-term going be currently to the opportunities. our new confidence frankly bringing recruiting by We optimistic company more collaborative, our our our than all ever extremely remain and global future exploit talent. changing WWE and team about to our Quite I more inclusive; re-imagine enhancing of initiatives have ideas; executive potential. content; developing our that

I’d Directors. member to turn Financial to Board Riddick, of So, long-standing Chief Frank and Officer it now of Frank? over Interim like the

Frank Riddick

today. review key There are topics and progress of outlook. key Thank which to include business like financial These of the performance, you, our Vince. several initiatives, discussion we our strategic

United $XXX In start content quarter. significant became generated the of reflecting fourth revenue States. XXXX, the our in from million, in record growth agreements we new effective the of It

lower accelerating and content other of impact as lines and performance by $XXX creation. was million product OIBDA the to in support weaker incentive offset compensation adjusted across were growth our Our rights fees investments core the

made easily, our our create a course a believe increased This the represented was thing well in changes to ability disruption action. prudent ultimately that brand do. we the compelling from services not to heightened new Given media but direct and the increasing both was consumer as as competition to of for industry, the viewers, decision challenges right engagement, that content

As we first XX% fourth attendance XX% Domestic ratings event XX% increase marked engagement our quarter in and transition improved XXXX, TV increase including with improvement. the TV broadcast, quarter SmackDown of a nights lives declined FOX down, in showed in which metrics to of ratings Friday to December. for smacked a

TV demo domestic night Raw, and XX program aggregate the outperformed the Top declined the the which XX% XXXX of Similarly, in was for XX performance saw to In quarter, Friday increase in networks. networks. Raw coveted aggregate X X rated of of the first the a X% broadcast ratings ratings the quarter broadcast Top outperformed cable Number December. SmackDown the among XX ratings

in attendance average engagement, Early strengthening first the an quarter. for events fourth to indications in trends. the improved which of declined continued showed at live XX% America, increase our indicative North positive January, Also quarter XX% in of

During large-scale growth a absent the partially from our U.S. network. was as agreements timing as fourth new event, of strong distribution revenue the WWE by lower subscription offset to original series quarter, well

the of accrued was content balanced our in creation by compensation with support reduction a Importantly, associated performance. full-year management the to our ongoing investment

To performance quarter, presentation, to in turn income, compared the year. prior shows revenue, of OIBDA Page X the segment which review and our let’s as our operating adjusted business the to contribution by

and related for our network at subscription $XX.X last programs. Revenue year, challenge of absence partially escalation our to was original offset Raw reduction domestic the segment, XX% OIBDA the of expenses. Facebook series content Looking driven right Media or adjusted growth and million, increased license matched and increased a by mix by fees SmackDown in

driven to average impact quarter, lower the the million approximately in X.XX Networks fourth decreased paid subscriber the subscriber additions earlier WWE for of primarily by XX% year.

basis on the quarter paid for XXXX. average that of We first subscribers have million increase projected sequential the X.XX will to approximately a networks

we monetize evaluating and WWE streaming maybe the value Thus believe us services there content. options strategic the to for evolution of of options. alternative new which enable the on strategic live premium increasing would we’re valuable alternative Given Network, currently those content, further

important the During brands. this strategic made WWE extended on progress quarter, we of that other initiatives reach

which agreement Channel and with the will a our in X create distribution channel. Specifically, dedicated agreement WWE Africa, we ViacomCBS’ completed extended a free in SuperSport air UK with

X. on premiered also second beginning E! of Mrs season announced on season to Total USA Miz on and & Network the air Bellas the April fifth of We

Turning to Page primarily OIBDA of ShowDown, event million, on our presentation, from scale we to of in $X.X of Australia XXXX. X Event a Live business large adjusted held the our the Super quarter that as due Events absence shown declined fourth in Live

XX we had change on this adjusted fewer in limited Although OIBDA. North the impact quarter, events American had

Survivor for Super continued our XXXX. Despite weekend and that extended event event nearly successfully in anchored our partnership in staged Domestically, ShowDown, the second four-day we in absence announced an of country We XX,XXX Series, that thereafter a which expansion our the Arabia stage fans. year hold every second to scale an held large of events over to the attracted Saudi Arena fans such Chicago. Allstate to through shortly we period

In a our as Consumer expenses. by reduction offset segment, was year Product quarter video increased game adjusted lower loyalties OIBDA from the in slightly prior operating

the game continued on to led During installs the portfolio across by nearly games, million growth WWE we to quarter, Champions. mobile our drive XXX distribution of increasing

our capital selected of X Page presentation our shows elements structure. of

cash short-term WWE As investments. held of December XX, approximate $XXX and million XXXX, in

facility. capacity $XXX that has estimate we revolving approximately Additionally, million under in debt credit our WWE

quarter The payment as of incentive compared prior In and management unfavorable in $XX to generated in capital year. Saudi year’s the decline changes related cash compensation. to $XXX was event Arabia free approximately we in prior working million our due of XXXX, flow, accrued million fourth the to

Additionally, a was expenditures, the increase cash the plan. million of change $XX in majority flow which free the into in also execution reflected of capital workspace laid our

paid. consisting under in million than Notably, repurchased the capital we more and million XXXX approximately program. included This million repurchase share in in shareholders authorization in $XX representing of repurchase $XXX $XXX dividends of of fourth million to the our quarter, nearly of $XX million returned approximately XX% stock $XX

live of over the ahead, significant entertainment international and sport businesses, opportunities. Network. the that next WWE advantage and to specifically, other well-positioned evolution we is value take believe rising content, the growth the in of Looking include WWE few media growth markets, These years, of of

In $XXX contractual rights provides of of revenue fees XXXX, approximately growth escalation the million.

sources, will new expenses of and annual growth this management impact XXXX costs. higher expect sources partially in operating content full-year rise revenue, the develop incentive staff to compensation of increase costs of investments, the an reset We by related of the from offset multiple performance-based be

You over we to to long-term the our working growth we support XXXX. while that are initiatives, investment note in anticipate incremental moderate should that investment

that and Network. our direct-to-consumer the of increase several in could subsequent our years. monetization of also alternatives East content We’re and strategic and strategic distribution include in the WWE initiatives of for the evaluation service, XXXX content pursuing These Middle India

this the considerable these subject At to time, of uncertainty. initiatives is outcome

this time. these but to to impact XXXX Excluding we million believes exceed unable of it $XXX initiatives, $XXX range, Management the guidance to of provide additional at OIBDA adjusted we’re anticipate has potential the million. this potential

Previously in expenditures our strategy. we workspace discussed the conjunction step-up in capital with

million million total new For capital $XXX build includes $XXX to million, to $XXX XXXX, which we $XXX out approximately headquarter to facility. estimate our of expenditures million

For of $XXX we capital including estimate construction. million to to XXXX, $XXX total to million, million million $XX $XXX approximately expenditures complete

range We X%] to by existing approximately revenue maintaining [X% which revenue X% XXXX, of is to expect of related a approximately with predominantly total expenditures to of capital return and in-line infrastructure. historic to is

XXXX, large-scale The the million U.S., quarter, in the times new achieved estimate February in OIBDA of estimate OIBDA and million, adjusted agreements prior effective growth year to adjusted reflects of which of $XX in a Saudi our quarter the we quarter. fourth event in five Arabia. first Riyadh, revenue substantial staging represents the from the content approximately For distribution which the became results $XX

live hour associated to full-year We investments. impact by NXT growth offset four SmackDown includes in one anticipate the and broadcast operating expenses Wednesday day former reflecting resources produce nights, than accommodate developing of to production nights. also and partially an be on Raw, the quarter following revenue an of will costs additional XXXX Friday of the higher that The program first rather increase of on with

growth unchanged. The fundamental strategy our of elements remain

well of rising As well-positioned sports markets. growth are to as in as media life strong value believe we mentioned of earlier, international content, take entertainment advantage the and we

grow and that our digitization confidence sponsorship expand leverage our increasing and business to have can engage we audience. Additionally, we

revenue of model. our seen we With share rights content arrangements that expect we’ve increasing of to further the contractual escalation business trend transforming from and fees, coming continue an

our and We’re a by our growth the in of materially first communicate strategy. initiatives the quarter to process of evaluating date strategic we’re that several trajectory targeting could the long-term end impact

our on look we creating to roadmap providing to investors our perspective We’re comprehensive shareholder a you, analysts. forward and value meeting and for with committed

now it back That Michael. and portion of concludes call this turn our I’ll to

Michael Weitz

the Nicole, Thank ready open Please you, for we’re Frank. questions. lines.

Operator

you, Thank sir.

We first will Ben Stanley. Morgan question from take our with Swinburne

Ben Swinburne

Two you. for for morning. Thank the all you. Good questions color. Thanks

it have zero guidance India in is, rights I to you’d better your and with you I some that a to just to if right, color just I that see so see First, to want we add there can for want that's want I'm I Middle if or why guide rights, the confirm, deal, XXXX hearing so understand just since highly a media seems understand presumably rights unlikely assumes, correct associated revenues distribution but have follow-up. your is if you if TV path and way, East, then And some guidance. the to could

Frank Riddick

we on that’s we’re the in place feel you’re have We existing deal we the uncertainty I would ultimate the uncertainty it put taken we of be said, is because confident On the agreements deal have around about India, Well, an that timing and in be new not from will as what pretty and we new The India because India in correct. agreement and value existing – that already. media, these out place, weather. of the increment an have receive. that in that

Ben Swinburne

And air India in you right, now, right first see. in as the on I this work quarter, still correct? of

Frank Riddick

correct. That’s correct. that’s Yes, sir,

Ben Swinburne

it. got Okay,

love strategic or looking I color media it's turn business, is else ongoing there, maybe know realize would you review, more hear then to stream for what an sort the like partner or great. this you a secondly, something you’re I sell just review this the are a an I’d a that of with guys there? share. could can you of license but broader into And that? sort Okay, mean you like you your business it on trying network, achieve think if to like say de-risk anything can don’t ESPN+ I to

Vince McMahon

We options. an can we Well, tier. and more an now enhanced we are tier of a paid option. free a with But have a of we as that as lot on continue enhancement have

terms the a of We could selling right mean be revenue. so now, to frankly, in rights, better obviously you the there’s know, really majors majors exercise, our more no also and, all have increase, significant an our I quite the to that all climbing you option, time for of are content, know,

Ben Swinburne

Got it. Thank you very much.

Operator

with Our comes from Morgan. question JP David next Karnovsky

David Karnovsky

Wrestle would When such on you of question. for that know, the on that you of premier you hearing of the when as willing you Vince. your Rumble, parties that over Hi, think thanks or Mania, what’s be you for taking kind kind I follow-up it more network a right know, linear some off move now, be that am point from network? to interest is about limits, you just the guess with content, I Royal anything pay-per-views say off third will

Frank Riddick

think I there's nothing.

know nothing doing the the network with that would us stop the different but, be arrangements, obviously we in would like if of any – these there's know, You looks at is in chose details devil you that transaction would from this type of point there a to. anything

David Karnovsky

week investors, [indiscernible] this asked whether with plan WWE or, can I bunch merge to but Okay. with invest definitively of from you even here [indiscernible] the say And, times, the point since with, future? in last know, know, partner you just you question

Vince McMahon

No, a entity completely. the XFL separate was

XXX You coming about kick off know separate. of It’s employees completely course Saturday. this

David Karnovsky

it. Got

Okay, thank you.

Operator

The Laura from Needham. on next comes Martin question

Laura Martin

USA Ben’s country you clamoring do for the we contract off one cash said maybe cash took you dying from about is near-term Hi, flow a coming eco-system that philosophical doesn't on cash, for fact TV of U.S. NXT answer get compared monetize but your the subs things the network that and it might pulled In that today, a away which question proprietary question which Vince, and I different you can flow it's is in can you that which this de-risks is OTT, did growing, the to alternative? sort we the how take and to more put have but it, people fell. there's the more that in with way network, structurally of like that you give now, just think also valuable programming to rights but linear be it

Vince McMahon

So, That’s on but capitalize have OTT. our said, there’s very a It’s we to. nonetheless we a as our premium was way us another I And in as going OTT. network content know, you we like referring it’s for Laura, there’s more, have many and strong to the network. – so into subscribers, measures I major it all as interest what to again, relates obviously is most –

Laura Martin

the we or have talked you And talked advertising. It service? stream you when doing revenue earlier OTT to past sponsorships second about something in adding like you about were was the ads OTT, re-thought adding a

Vince McMahon

a fact revenue but right partners. is, as much that That’s leave open, enhance up We continue possibility. to definitely can be looking consider if If we’re then we’re our going again, we to the network that. in to now pretty will that one

Laura Martin

I sense. see. That makes

early done the MENA XXXX is, in then, to And questions were and the so the have I get – be – those what's when most one do India overview done of be great. end deals think? there like we will they by going this we quarter Okay, by be of will to for going those comprehensive long is we thought a the you done think end of – frequently first the we because taking WWE and you're with do

Frank Riddick

complicated have long. government answer reason did first primary own we Saudi delay infrequencies and really there. the your you the some and dealing business. the regulatory so MENA that In just, going doing changes question, the their and Laura, the ways part what’s so really taking India, the with know, The that about is there Arabian rights, to of of for negotiations,

uncertainties timing deals around these specific amount, done. the the don't that want be I eventually said date, we not the predict think and I before, but will as a

Laura Martin

you. Thank

Vince McMahon

deal add me to that I’m Let the quarter, players. the that We’d if first be reference just that making we long how major and of all go in the way OTT far are. interests that’s we announcing

Laura Martin

you. Thank

Operator

Securities. Curry from with our Baker Okay. question next We’ll Guggenheim take

Curry Baker

guys. Thanks

buy guys the the active the in fourth quarter. more On were it like back, you in market looks

you I’d current dislocation? of following guess, was balance here. or you to the more the You on its you these near-term if your authorization levels using have under know, attractive aggressive undervalued Will assume the to have stock on, know, be and think that, to you leveraging will I market significant thought sheet take then consider at in you advantage

Frank Riddick

liquidity first us think the of we and a a allows resources having the we even the I structure answering capital to – don't important of – opportunities Well, last flexible have I have your part the to question, pursue in probably now. a structure going think, right the strategy lot I capital do that is more know, term isn’t short growth you change believe lot. to

think buy I significant would we that stock. to in So, a don't way leverage up

On significant program existing of way $XXX run buy to million trying the has remaining authorization what a so only feel discount we have buyback. – or follow about regulations you and and the the to constrained on that to going we know, by regulations existing other, we intrinsic the know, you program, regulatory value, we’re have know is to have program continue that a disclosure you in we to

now clearly it it know, with you where it’s, stock than the was. more attractive right trading is, So,

Curry Baker

as well to, know, Okay, managements building the more know, are investments, in know, in internationally, investments, – out know, pay of you talent maybe looking as about know, you’re centers you buckets on, these, of at, you if and next performance opportunities capabilities, areas, as considering? you’re more which there's, that includes localization, this you think know, maybe the and color also helpful. main more know, investment that data technology then, think I your couple on three how one thanks. just you Any other, the That’s over the you as, years, etcetera. you’re focused you know, on And past, well year each I continuing think you

Frank Riddick

I looked is, where strategic think to on has the up end network be only other would the around we at that enhancements course the we of know, somewhat you – area that that alternatives. on dependent been and

the to so service So, with primary focus up rights new or the market. where you and setting we areas can because the international, in are, and the that be brand know, and increasing for renewals opportunities continue continued customers, other for engagement products value investment content growth put that’s new or they’re the

Curry Baker

put kind spending you there can like for range framework way Is you of the expected anything? XXXX you’re an a any level investment of know, around, aggregate or

Frank Riddick

Well, looking hard investments growth look all maintaining is we’re find shareholder two acceptable you we’re the I think in XXXX full effect the a what investing – the year, and of said know, we performance know to that, going level. the investments and XXXX an try – to see for business you from at at balance the taking to in right follow-on but we’re to have future in value between and financial the and the

that we look change. not So, areas taking more at think we’d that the are XXXX XXXX I hard we investment the right but a will and did say see investments, all now than

Curry Baker

Okay, thanks guys.

Operator

next question Our comes with from Brandon Partners. Ross LightShed

Brandon Ross

guys. morning, thanks taking for Hi, the questions. Good

you Hayman input engagement success And spend business quarters strongly several help how and since content to What life blood much on the obviously last various I of is upon you you do much units. is content the on the stimulate to your of SmackDown? need have very company quality this and improve trends? over think and correlated the your then specifically engagement? have and first, the done to more with content of believe And talent to Raw Richard related

Vince McMahon

terms time with allocation that. talent of lines, in is in better ratings that things talent on We higher story production think of at terms we’ve on same couple value, top the new of far bringing our thus of what television paramount. A done

ratings, can current see what’s happen ratings to going You the again the with first quarter. notwithstanding the in

is of there see can and the investment. hence You sort like growth there

And right don’t of going think just takes what put – in right place, that right now, going it one to the was be talent right talent. and have as want injured. that We had everyone lot into lines, story WrestleMania, able it’s we we a and At well. we again, exactly time, a while have we a to forward

Brandon Ross

one clarification. have And it. maybe I actually then a – more, two is Got

sure attributing for in So in rate I the about actually out India, are India you that. deal of guidance? Or you the the did prior the zero guidance? wasn't

Frank Riddick

left took we're increment be that deal we out. the would current We expecting It guidance. the in the that

Brandon Ross

it misplaced And direct-to-consumer WWE have or and Okay. would in the the just then, you Network matter keeping to was any a the think data, philosophically, of do those that real first be in important you alternatives of relationship key aspects to one allows strategic do access that past? the to you been has and part these still to a priority

Vince McMahon

our it’s of you’re holding to was goals, on think or continues majors, depends be, I we still to misplaced. playing some on negotiate it but It of when things the not nature. with one whether that can of

could know a you themselves, keep keep we really big who want what it’s absolutely. the that all so if is for it Sometimes, matter negotiation of boys we of

Brandon Ross

it's but you? a must-have not Right, for

Vince McMahon

Not what?

Frank Riddick

have. Must

Vince McMahon

necessary. Well, not it’s

Brandon Ross

Okay.

Vince McMahon

is Nothing must have. a

You would majors we and to it’s somewhat, to have what with want this. the what's going you deal know fluctuate again, with know, available,

Brandon Ross

Okay, got Thank it. you.

Operator

Eric next from Research. comes Our question Wolfe from Katz

Eric Katz

the it's when that Middle excluding, India a I driving deal, Is the $XXX morning. guess, million guide also on mostly that strategy? the range? million big good XXXX what's and million, on Thanks, range question pretty $XX $XXX East increments from of to One network the the

Frank Riddick

interim terms is, you the cost uncertainty number in know, that say could level ranges where that of subscribers what through would the and reductions for the the of including we other we the you things, achieve rest the get. and around actually know, business I the going of of in network reason cost perform, to is the No. structure

know, that realistic achieve. that guidance wanted make sure with was, thought we So, we we what to we could provided you

Vince McMahon

place, going one deal. these know, and these I to of numbers certainly be it’s be going transformative. takes big me add, you just are again, let deals And just – some It’s think because any color a if to conservative these numbers that to

Eric Katz

could guess to just Okay, sounds is like so the completely network like revenue it other even gotten anything monetize or stream you a I in there the – a the comments shut And clear we’ve where on different some of down, where be questions I’ll dual there's but the sounds than from it a understood. the assessment? be guess your way is still the figure network and just decide what this at scenario that expense And and whatever that be perspective? quarter, before to sounds will sounds and generally try I out like mean of better it is from fair like end the the is far, economics potentially timing you event current structure. both revenue I a

Vince McMahon

to a think said, transformative. just we trying minute [indiscernible] that achieve I of terms for other with majors we’re OTT. mean, ago, I would Again, successfully in the be desire available. if what it’s as I

Eric Katz

it, I in you do the currently? what on $XX will Is maybe profitability Okay. million, $XX guess the million be you know, for helpful the a is, network range? number have

Frank Riddick

don’t information. We provide that

Eric Katz

question be entirety last my your on are XXXX rate then we in run the guess the for I Well, not a XXXX? moderating, would based should investments QX of Okay. assume investments comments for

Frank Riddick

down I said, to were would XXXX quarter, XXXX. – during to you’re existing were isn’t rate in that’s Obviously, continue the the XXXX. going first have they we the as asking. go in rate I about increment of that run XXXX going say if in that think investments made the level we what talking are we into because run

Eric Katz

you. Okay, thank

Operator

MKM from Partners. with Our Eric comes Handler question next

Eric Handler

just and the on give little bit thanks the for color Wonder morning you Good question. if could TV deals. of a

you there that mean of step-up, Does million, north you is, You believe all China, were know, UK, on talked that $XXX you And free-to-air incremental NXT in money? but in XXXX, down? which take I the about is the $XXX million U.S. reconcile. number maybe you America know, if then can Latin out

Frank Riddick

Basically around India. MENA component is assumptions around or increment and that excludes around all the the

renew, I deals else small everything in is contracts is forecast the but but included exclude that, you that. around into haven’t you our built been the mentioned. There’s that relates other contracted So, vast we’d that know, [Indiscernible]. majority portion a to that yet,

ahead. go Sorry,

Eric Handler

Did grow? UK, Latin China and America

Vince McMahon

terms wouldn’t terms contract get of specifics and we Eric, specific specific into deals. around and

Eric Handler

second – now? then question, you a some incremental maybe XXXX, down how of in enough. color downloads? fair you beta in a tier, Can do performed the And a did is terms with and that Okay, of Network, continuing free WWE it's give us maybe late

Vince McMahon

wasn’t… It

Frank Riddick

The launched tier in December. was

early been. it’s think too the have what results say that exactly to I of

to we’ll going and there. you have its like feel data good analyze around, having, out something. We’re know, continue have to that effect we we put we When what

Vince McMahon

And one]. was [softer again it a

Eric Handler

Right.

Okay, very you much. thank

Operator

Karasyov Our Cannonball with Research. next Vasily from comes question

Vasily Karasyov

to clarifying Thank East specifically you, Middle say good you the morning. the a What on in question and mentioned the guidance, initiatives and about India.

to your initiatives because the So, if go first those not, made correctly all, ahead for an which that I if understand were been of then, to remarks that with to correctly the would the upside from for or ahead they would more and prepared EBITDA require decision what's be of it the timeline? And do EBITDA understand XXXX? for would year? a negative spending the that be go Do a I

Frank Riddick

Yes.

to know, pursuing perspectives paid and addition the in India, guidance. we’re – because are – already our that being as those And MENA for. on quickly but there's their from We’re – under what that's we’re do India it the arrangement. I would rights India I think can we be for as would and get yes, It already them explained an earlier, already agreements the existing it increment you have and, done, new as guidance – they aiming we rights still are be

Vasily Karasyov

Alright, thank much. you very

Operator

with Bazinet question Citi. from is Our next Jason

Jason Bazinet

Thanks.

are call can second nervous a the of just something a who but in I to is they're the things stock, but there investors bet. curveball. a are this and very maybe I some of there's unorthodox, that take your some to you x – lot are in out – them with just sort know, what address factors, know just bit can so, speaking marketplace it, So, put and you of interested I’ll about

one others, the is there you in give I’ll Comcast is in surprise to XFL, flexible the one on payment we turns some related on what Fox of that potentially? an a the hear? two anything So, that’s whether embedded then, other they is of not are? and can payment, anything those second trajectory the is, the whatever sort to that’s fixed and free count add And dollars words agreement Or there feel of investors, viewership? sort, And

Vince McMahon

We are. we your couldn’t on certainly contracts to question the they That’s more and/or and was XFL? know, with what you No, them are not do others. say programming, couldn’t what

Jason Bazinet

concern in investment some WWE, the there's in case just of XFL that up for it’s will somehow sort into equity? public swelled way Whether investment the get personal your

Vince McMahon

there it’s like said, XXX all is again WWE. No, I no itself whatsoever know, by you know none there. that. run in, investment and employees hardly is there have of It’s you over – Basically, we

Frank Riddick

Yes.

just back into So, independent I – no to know there's It’s the asking. investments think WWE you’re XFL part as – – a you the a of plan the put completely entity.

Jason Bazinet

Okay, thank you.

Operator

Cahall Steven Wells next Fargo our And from question. has

Steven Cahall

on I bit more the you the some provide guide. XXXX expenses operating Thank color little wondering a that of if driving you. was are could

maybe did a especially quite a follow-up. that months? that quick last as And little those And then, if stock developing was you down I over got color more you. the I well us cost new XX management you also increase what on resetting mentioned performance-based might You incentive in that so XXXX sources wondering mentioned Thank why comp. could a be. of given the is bit revenue, give

Frank Riddick

going the you know, the are XXXX days Again effect we cost SmackDown four fact know, of full-year around, production. that that. a the increasing in you do areas, to events, now we have we’re later, talked about So,

we in and did that and We I increase say to we initiatives of costs are in new question? and some will over. relative are was What content, have your think the quarter, There – talent as talked the roll about expense higher developing third considerations the second that there in around well. new for cost some production

Steven Cahall

in The part of second was that …

Frank Riddick

it we course in achieve of target. and the a targeted quite straightforward. of – in is Because at the lower plan incentive for we would were MFP put XXXX, payoffs than we the on management where Restating when rate the the build performance relative the XXXX, we plans under

for stock OIBDA. the accounts not plan. That's adjusted in the that short-term, the cash bonus increment. is The component So, for

not if the difference. So, lower clearly, doesn’t any adjusted be explain it’s an so lower, the stock stays but OIBDA compensation anyway it of stock might

Steven Cahall

India Vince, there? tell than Okay. transformative, TV that meant I wondering just just if more those could color was mentioned you contracts be more you Thank Any deals. you you. or be could And MENA what that, could then, rights by us

Frank Riddick

potential referring Vince believe – transaction be to transformative. I net network will was a

Steven Cahall

Okay, thanks.

Operator

John has Evercore Belton next from And our question.

John Belton

updated you hoping you’ve thought was whether I four edgy about done Vince, it with that to could launching niche How category? the they're [technical to nights and a in has their some do give a the fill for how competing do, and Basically, content, on has promotional AEW it’s What more about trying for us changed content strategy? the difficulty] been year-end about Thanks, feel you your months. general Wednesday with business?

Vince McMahon

characters about all all content our at it’s has AEW because storylines resolutions. changed and and the not

changed terms one of it the our hasn’t really edgy, and it view need point of programs you what content, as really of call there out PG, few don’t we more a present that we PG. in is So,

So, confident know, on well night NXT those as success. NXT. far we're that will Wednesday we’re continue with competing competing doing NXT, and as AEW extremely on It's you

John Belton

it. Got Thank you.

Operator

McTernan a from with Bernie And Securities. question Rosenblatt we have

Bernie McTernan

what the thresholds morning. Or over question. how you the see was the that’s those Great, based taking and returns all Is for Thanks Or U.S.? for investment, time it wondering, I a be? prior? renewal good being in increased next will we And thought frame? position in rates the what can the on know, about return better about?

Frank Riddick

the look but payoff investments, all and on brand tied largely in at return the the get are renewals. to building building investment for engagement incremental we quality to content they with course, next fans the content the Of the and

at tension the future that is that’s off those look invest the like – and objective. that landscape It’s do much what always So the but made. going healthy how were are you time around judgments for pay to the a and

Bernie McTernan

up that impact just Superstars the you on potential revenue, of pay talent you has because Got then so revenue well. is or believe talent gone is has And rate pay up as I based increasing follow just it. the that the a cost, what on WWE

Vince McMahon

done speaking money talent conversely so We’ve are with revenue, generally the increasing. they cost it. mostly percentages up has proud and is linked the always talent revenue It more our the and gone more we of

Bernie McTernan

lastly, wondering a day-to-day your next a time over the short-term thank you. spending just you with the Got management years? and you change it. basis Vince, expect few And And know if you’re – changing, on you’re turnover anywhere

Vince McMahon

a broad few case but not a can I I that forward be my direct have moment the terms reports, and will time. lot. have At more reports, going pretty of allocating handle shoulder I in a

Bernie McTernan

you. Thank

Operator

question Gould Capital. a have with we And from Loop Alan

Alan Gould

but especially Thank Domestic between domestic respect percent open international it domestic average has been and a the is you of you. terms live have domestic international function be was always internationally. average the divergence there some have just ratings been Can attendance average changes, on the something up, in it trends up trailing of is a with improving, events allocations going, attendance but of going you to trends in able been looks attendance to like

Frank Riddick

the the I is more logistics international in There of primary. the fundamentally which international nothing because think events this the country, between international of is really U.S. is difference venue. it, the is variable point. and venue but what associated in little mixing number different No, at with that a What and

Alan Gould

you. Thank

Operator

Healy John have And from we a Northcoast Research. with question

John Healy

you. Thank

terms I of corporate structure, what thought about question if on ask a had leadership to hoping was company forward, a us wanted rightfully always of the the little very so a has going structure C-Suites of like could you it over Just look to bit give additionally, transition leadership? would want you to next kind like the years with how long to of might unique the you the take couple to where be of and maybe get you know ideally

Vince McMahon

value in be currently that inclusive Well, strong management or I the we a in forward culture with quite we going going of reimagining frankly for attracting team to the is do to terms business our in changing far more the on you and pay you me, is executive think get on, on air to way that's wouldn’t it sure, as want XX/XX well assets as what with a is what it Tell [indiscernible] of individuals come work for. our we of exciting, an XX% are Who world-class company. WWE?

implement it take all So, to long that. however won’t us

John Healy

Thank you.

Operator

next Our Edge Ray Stochel Research. from Consumer with question comes

Ray Stochel

going disagreements you you’re sense any thinking Thank that taking It be sounded Great. with for just specific a my with exec question, wanted may us explicit could about members more be the granularity? more to of around some had you give there. it how have strategy related, execution team prior to forward business was like about you but clear

Vince McMahon

at resources. execution the lot A successful. is lot know And – of of it well Not focus and related. looking as way different going it is we business more do as as well. of it you Again, was reallocation to the be

Ray Stochel

aside few Great. over do Thanks Thanks. and venture acquisitions next then one when you that would allocation, to for another how years? portfolio, capital XFL, a on you the potential so be what comes and do allocation about the have related think from it non-XFL capital

Frank Riddick

to be meaning opportunities to material – is in don’t the and because of businesses and learning’s do but and will not for going that we investments, enhancements a continue the small into instance organization, that of small valid has the strategy stake be technologies to created WWE are of I those equity so, – the those think taking are I some or size think of I where equity business. Well it the there size can think put that make investments a

we at continue a So, level. I will that modest think

Vince McMahon

totally think mentioned there know is you again, I a just entity. XFL you separate

Ray Stochel

Great. Thanks again.

Operator

question with LightShed a And we Brandon Ross have Partners. from

Brandon Ross

Hi.

continues couple as assume the the of guidance purpose for where that you clarifying guide? from WWE any of or Just network is do questions, excluded a profits the the network

Frank Riddick

we with respect any assume that guidance. and of the be that to at looking options impact the would of the are didn’t network strategic We achieve

Brandon Ross

Right, but…

Frank Riddick

business ongoing operating network in be Obviously, would plan our the and ….

Brandon Ross

assuming So, a you is it contributor? are

Frank Riddick

nothing But will be any doing until strategic that any But are Correct. that an not business new new, we a business you way we network change the how operated. or continue are in we included. would make ongoing who partnering or deal with of and sense business, in it's change in in major know not the we the have

we and guidance, included. plans our is build give our we So, it

Brandon Ross

it. to those additional explain roles And business more fill got you George to additional to going within on bringing is Executives? Senior specifically who in leader what are that’s’ take little and company? Okay, said, or you you can going think responsibilities? going fill then, Are a Michelle's unit the the is How roles? you I

Vince McMahon

our the We’re we to huge with current team. of in At search same in an terms exceptional come now have in. in faith time, management role talent our

Brandon Ross

it. Okay. Got you. Thank

Operator

Instructions] [Operator

Frank Riddick

us. appreciate any do We and Thank call everyone. today have you the Thank not if you. you, out hesitate you to questions, to please listening reach to

Operator

your Once ladies and appreciate that gentlemen again, today. today’s concludes conference. We participation

You may now disconnect.

World Wrestling Entertainment (WWE) 6 Feb 202019 Q4 Earnings call transcript