WWE - Earnings call transcript Q2 2021 | World Wrestling Entertainment, LLC

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Operator

Hello, and welcome to the webcast entitled WWE Second Quarter Earnings. [Operator Instructions] I will now turn the call over to Michael Weitz, SVP, Financial Planning and Investor Relations. Please go ahead Michael.

Michael Weitz

Thank you, Keith and good afternoon, everyone. Welcome to WWE's Second Quarter 2021 Earnings Conference Call. Salen, Vince and Chairman McMahon, Chief Brand and are Khan, CEO; WWE's discussion Officer. Officer; President Financial WWE's Revenue Kristina today's McMahon, and WWE's Nick Chief Leading Chief WWE's Officer; Stephanie Their remarks Q&A by session. be will followed a quarter site. our this release release, second posted supporting materials afternoon and earnings presentation We other have on the earnings issued and our our Web statements. will include forward-looking discussion Today's our assumptions SEC reflect These uncertainties views, and various are current on and subject our statements disclosed based in filings. risks to are may results undue should Actual materially differ reliance not and them. on be placed

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

all unless are ago comparisons year that otherwise the quarter versus should You described. note

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

Vince McMahon

Michael. you, Thank

generated have engagement content results solid focused in production. and we We creating financial efficiency and on our client second quarter as

evident July positive at at television the consumption. have full events digital ratings are aired as event in as been and trends live and demand for our have that Live XXth ticket sales, have We through our well capacity. closer

advances for ratings significantly. SummerSlam we've Television ever event shows for look excellent, in which largest the United including initial events States. have our We that were SummerSlam, had live be I might would add our the up here

environment Cristina drive demo, and we extraordinary. all business well. quarter, changes be up looking efficiency also information of certain content increase we that. XX. engagement, we develop was that that as we on production. we've First XX% bit will is always In XX, crowd growth. a But business more We're XX-XX on the implemented played time new July XX% the increase the build organizational believe can ahead, evolving let as advantage would before have, give live will you take little I'll up in a It our which

Nick Khan

thank in. for calling Thanks I to appreciate with it. And all Vince. speak you again. you everyone Nice

new like the earlier we'd and Baseball in In NHL call, perspective. League media lower Major industry how the as year, of saw higher NHL rate with of media realized television for this than we getting game its a its NFL rights tripled Major even earnings always, the to deal. linear XX%, The with Baseball discussed ratings. per NFL, substantial their more Disney our rights League AAV increase As fees is start of rights license programs some increases part last and

deals as A On a and Also The well private premium continues would views yet assumption both primarily busy equity quarter firms of other teams, was as activity. deal in deals on closed another substantial their we saw in number both in home second invest based media number market increases this quarter, or holders with rights product their sports quarter the rights territories. saw that there in briefly international run to call, the these content. few our a like reinforce as opportunity the was through to to outline as well at today's for growth realized their rights. place media on I of domestic be how economics live that marketplace, of

segment. growth and touch in opportunities I that the on sponsorship like to Steph Additionally, exists would our

the from its the three and BN. the an prior Liga, the UK, eight announced Capital, closed a League deal increases. number between rising live for $XXX that stake you sports WWE deals both was rationale that of an value We the quarter from because end Division, it significant streams. Disney in in La team, this own stems Spanish Part and The rights by this million new team led BBC to updating in on all acquiring year Premier top extension Soccer extension saying a their We're for the we're the a quarter, XX% deals will Wimbledon with year US million, United similar media equity from this with in a growth represents RedBird States investment of million. announced with firm, $XXX Indian content Also saw recently in in of deals. with confident have estimated an which seeing AAV international year for with increase $XXX XX of cricket Disney our private deal valuing XX% revenue of this globally.

our of our deal for in Australia increase an package renewed securing in of partners rights we week, Foxtel, last territory. with Just that

to efforts encouraged confident saw WWE we internationally, see are with to our internationally. this our partners we that continue future. the will quarter, the begin we we and on to as Network More by we're As come success license trends in engage

and the we're Stephanie Bank will to of year continues at return Backlash shows pay prior shortly. to Money was mentioned from the call, ratings all live of Hell growth and considerably Peacock a what broad partnership, that fans. months seeing a up top on WWE standalone XX% ratings a the distribution details more the from XX%, up WWE Allow platform Peacock, moment. are Network also This the performance Cell the a XX% Vince to benefits in their provide pre of grow. has numbers. per of with with events viewership pandemic across into viewership As on numbers up partnership view following the our have for of are up Network. moving us Since our in Peacock discuss up our Four increased streaming

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to of grows Peacock viewership expect base of its We users. to as WWE particularly increase, continue

discuss to live return wanted touring event you. also to with We our

Fox this one not week miss. Smackdown Houston, return What you us. return We to to here, fans for with live As held live not video pandemic, to events via new of made Texas. of July screens throughout live on many production from we Friday, a on events with was wants touring the XXth, know, our events know

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me However, a give WWE's in to events out. event highest how Houston, at today, taste event the the in Houston. non-pay-per-view Texas, Center was of Friday, allow in XXth history grossing you On This July our performing. we sold live Toyota are

sales keep sales event Money Two period merchandise nights come Sunday, merchandise Arena, COVID. for WWE were phenomenal XXth figures the sold for greater event than in event XX% at on of we in a mind Bank, throughout grossing e-commerce that that almost Worth our in at the these Please Our out. they highest This later Houston. Fort Dallas night, Dickies area. in non Texas, WrestleMania last July Fort the history off in was worth,

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night, our were XXXX area. that XX% Our merchandise Dallas in Fort they event last almost the for greater in sales Worth than

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drop successful John SummerSlam, planning NFT to second time follows we're this NFT with ahead launch the look This Undertaker for we our being with our SummerSlam As in Cena. WrestleMania.

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Stephanie McMahon

you, This an time Thank for is business. Nick. exciting our

fan inflection precisely point Although, holds, engagement we positions the our and to live the don't at know in an of what events financial us potential terms touring our return future performance.

event attendance well mentioned, the we time July a returned first with for in XXth Nick touring to year. over in As live fans on

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Kristina Salen

Today, you, shareholders. Stephanie, WWE discuss Thank WWE's hello and financial performance. I'll to

all As of platforms, on ago. higher monetization the WrestleMania WWE production. to increasing a and Center Total fan increase ticketed extent, financial second James across unless reminder, Raymond results attendance. our year solid in of of in Adjusted versus In an $XX.X fans with driving Stadium, revenue WWE which $XXX.X ThunderDome million, otherwise. a of WrestleMania content say lesser produced was the both X% expenses of were year from OIBDA Performance comparisons content the due primarily the television generated associated are in a including our declined we production I to with million, to staging WWE growth staging ago XX%, as the organization at engagement, reflecting quarter, focused and strengthening our efficiency quarter, increased

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Michael Weitz

Thank we're you, questions. Kristina. Please ready Keith, Operator open for the line.

Operator

[Operator with JPMorgan. Instructions] We'll take our from first David Karnovsky question

David Karnovsky

week. on we your saw news accurate this sports the landscape, rights really with Nick, you've including college predictions been conference the

uptick this believe by perspective As streaming. is you And of where noted, on soccer WWE value value that driving proposition rights generally maybe have and love what's utilized an in they're I'd seen your the similar? you

Nick Khan

to it a back you. It's this can so little the audio Just on I shaky, repeat end.

You're soccer the asking correct? about rights, am I

David Karnovsky

Just as in view WWE proposition to the streaming? you value how similar

Nick Khan

for appealing positives one to know, there's as equal soccer things, football, to soccer/international but We of global soccer many, many a countries. globally. think been that our the different I brand, the scale we sport the has appealing on certainly not number couple see

So rights at Liga United that that's even which of I if that for significant a property deal a States. you look referenced, the deal, La almost place exclusively out takes

out as audience types world is years So think to we're is more there's think there's we of there. ago, the that. of beneficiary We we as those think going beneficiary a know XX that. be deals of now soccer XX of a of to flat. And We an

David Karnovsky

international And your then low then at the said think of guide. impact all was how I XX% just quarter? end, from sort guidance, XX% at the you a events of last higher in maybe are embedded for the start to to had this you And either Kristen. pandemic year, many say overall at the has Can the shifted

at point? to curious hold kind those would know Just of figures if roughly this

Kristina Salen

I expect we think events specifically. total we for haven't released the number XXXX of

our have to can below that second we're guidance events be mentioned, of we shortly, level I schedule in tell or end include sale half half and We Right second the about of have events we second forecasting you at now, had our through XXXX on for Nick of the XXXX. XXXX said will well. as international large-scale XX September. sale… announcing go be on remainder those we'll of the And events of events what as does the that half the

David Karnovsky

XX% the out impact kind of the And with regards beginning the had to of you to XX% year, impact? pandemic. pandemic the anything Just on called at

on the is you roughly in if ballpark? that an figures or still those if update curious Just have

Kristina Salen

into And ballpark. about think been that I was what XXXX the XXXX. again, based have in that's making on roughly XXXX, expectation assumptions would the from

what purely haven't an was. actual the number. opposed it's in forecasted thought yes, we So we impact changed as But XXXX number a to

Operator

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

Curry Baker

if help So and you is the guys be you wondering brackets was opportunity put areas if opportunity on size three help would but I don't see the increased know great. you sponsorship, to maybe I us what can around monetization sponsorship two the That for maybe years. there. think maybe could ultimate the it, us next over on

Stephanie Levesque

is there grow. significant It's much in But projections upside. tough of business believe we do to give believe that this terms can we just

in opportunities opportunities we really standpoint across lines engage across business. There's sales and seen with social. Peacock of have production bring throughout tracking. us open We of opportunity digital and fully really it sponsorship a and all up partners our and content already more sponsorship from also as year have the to our for now And to ton the a later of

So do see continued we look to positive trend. a

Curry Baker

And deal? in then there add Is just still or Nick. for any there? guys TV to conversations this one, on be Are anything might the one MENA rights you new update quick

Nick Khan

pound last the which I compound think I by question, completely. was time And four answered way, a Curry, we it think

did we you the this them breaking appreciate up time. you So way

Curry Baker

Getting concise, more yes

Nick Khan

to On others the some situation remain hope entire the MENA rights, on good and We optimistic Vince, still have are it. shortly. into myself, deep news

Operator

We'll take Partners. Handler MKM Eric our with next question from

Eric Handler

Wondering you you. start ring little Nick, your we'll a with could about if talk bit of out TV plans. more production

so programs? you risk you this, Are at you of looking move create do preselling goal have you profit just rather as and looking don't tools? with than with these different hours financial you forward have a as promotional these Specifically, centers are to any you're many how

Nick Khan

from based the space more of us Vince series, on good in of and superstars the center, series already news the the as The telling profit us. of marketplace that. through WWE on have as memorabilia all of life, of went more hopefully, scripted that we'll we Steph unscripted referenced at that and the to look meaning soon. vehicle, show brand from of extension, television think A&E scripted eight the to promotional part scripted look we all part out McMahon's unscripted end, with that there, the I ratings stories on see the for dramatic we're on for Yes with many the and series

Eric Handler

new that then, When you a just sell then to start production previous offset a headquarters headquarters does and How looking the at on question Kristina, increase? much could move. cadence your the CapEx of And for still the in And into plan was had goal XXXX? existing CapEx you decline? you the as and look you that off-site some the are that to Is how facility that Stanford.

Kristina Salen

take add a or television point little to a in our not the a and to that or is studio on to studio Nick's bit would, to a is, would, content. changed. the look expectation comments changed, way our out-of-ring regard financial has Just HQ, a budget it has it it, risk put our With studio movie think at expenses to on great production way regard I would pacing with just not to to of finer a

chains to So we've because on primarily pulled backed are forward it's making I'm be in supply anyone XXXX, would expenses that chain. up. supply that sure we thought in bit we the call a making not XXXX. We're of lost them

time of we to already We're material And so they new in quarter to we meet time ground line, order some for that. so sooner fourth moving broken now XXXX. June. anticipate very into in We've 'XX. that on arrive HQ need them excited when right need in our We our in order

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So we're sell ability those in buildings confident about future. our to the

Operator

from We'll Brandon LightShed with next Partners. take our question Ross

Brandon Ross

to First, just question Curry's kind sponsorship. follow-up of on a

on real to start when drill see down to the wanted So just timing growth. you of expect to I

slightly down think XXXX. compared very QX, in I to sponsorship went

And come does the return new should have a opportunities? away With step right up that touring, you time as we in or explore that kind then of to follow-up. function see I

Stephanie Levesque

to the live energy our the in opportunity So return of engage. the events excitement sales absolutely fans, terms to and increases sponsorship, with and

a as our well. business, But obviously. time significant growth up expect end period. course, throughout to and and business, the there's is and year across again, year-over-year. the forward, that seen upside increases stopped we financial the Of sponsorship we've XX% yes, And moving the that that COVID not growing due from us has But to of sales continue to see

Brandon Ross

counter to the roster situation like your we back investment in eventually and media wondering additional how competitor? boats? be where significant And making currently guess And all AEW own since competing had you I with in need tides then, a in you their gained them in feel one day be especially viewership, demo. for as seems rights, you rising roster lift do could be was view for I investment in you their investments to or it a Vince. the some saw could

Vince McMahon

are. not are, a Turner of what know situation. different or only that Ted is tide, certainly a where know AEW really Time rising it's their that situation I because in us assets after a Well, anywhere was we plans I was coming competition all when a sure I they are. don't Warner's with what more. as well, investments And was in their don't the talent them day. give near to but close so is I'm would WCW them Not way far plans their I consider as that. our back consider some concerned, are as not can what perhaps

Nick Khan

to thing add Brandon, okay. if I that, one can that's

lane on. the everything of look our At looking race sure these ahead where at a blinders we pack. front sort we same stay and the horse in think We're it's I like straight making the that at time, is way of the our situations, competition. horse the has

line and up different content content is If sleep could So our was including competition. providers, with, ours. that hours of a couple weeks be we to up watching XX had someone a agreed hopefully, people ago a about us, from all chuckled day it

at look particularly competitive organization in what of don't yet we we're a we do as terms eyeballs. as competition, trying to with So see any everything

Brandon Ross

was said Hastings Netflix Reed that I think competed who sleep. it with

Operator

Stanley. Swinburne Morgan from our take We'll next with question Ben

Ben Swinburne

production of you expected that all predictable. both have you more comments strong being which When and about I outlook also wanted like quarters. than good looking about I Kristina, to is think, for number together, live a been, XXXX. come event to, the And back efficiencies, forward compared profitability better talked TV expense your it getting say, to put seems

you've about increase a And there cetera. questions still got questions any expenses could to so you company's guidance the term, lines. now you share talk uncertainty about largely full is, for at margins love where is I of in they where and rebase revenues you lack into to what saw longer prior because through? power produce on you an One number now back little guess ability about point et two, are I could to a are of revenue we when certain year relative more think company, at in are along a as guys those a earnings were, visibility context level, cost then the couple we of And to can the the I’d or thinking sort that. confidence that a had share comment try around periods,

Kristina Salen

about I think first our earnings starting with the power. last long-term part,

we year-over-year into we as move my on As that to comments, so basis, as quarter, the we television into production see speak, exit the XXXX. will of the continue I mentioned to we in power, in and we've a the we expenses efficiencies move full gained fourth as expect year, that

we we Again, as are levels, we at live exiting live 'XX. well similar as look if also, at able were year very mentioned, at touring, set some are exit us that expense-wise the in to the for are year, we will XXXX. it We level, touring, up earnings event that to power

a necessarily it's I now pandemic perspective, -- post because guidance where about think where think in I are really this want just fully say post, are don't doesn't feel I in from of we it pandemic, but terms to recovery. we right

our with of events walking our expectations. ahead events ticketed As performance each fans, live the that Nick through we've held, live of has been related

the very excited with as the through we merchandise rest continue so sales, the we're sales. the hopeful ticket are of that will they And We year. move

general go of sale and will recovery those and pandemic a what haven't sense We quarter XXXX look the the much have yet quarter we'll third fourth on When environment, events our schedule. of announced look at we like. rest better

pandemic just it where months we moment want feels see more in right few we and So fits recovery to of this at starts a are activity. that

Operator

Wells from We'll with Steven Fargo. take our next question Cahall

Steven Cahall

follow to Kristina, just picture a for up Ben's for and bigger Nick. question. on one Kristina, first, one Maybe you then

but about you've I a lot this then in So reduction as per as we're episode coming know the cost. to OpEx, back got get you've costs you thinking normal of media got

of we other about how leagues should over then, maybe that they sheer and with one season the move often of sports and in that So of the means media And provide live sequentially, that the to programming rights the as difference tonnage. is we just the think for what shoulder advertisers, the back a it's kind of post hours just lot games the the number in networks and OpEx highlights the year, the between period? Nick,

provide portfolio your to? you're sure that kind So big content those for price you but to like go over scripted of as should hours about you to positioning make to sort content think the And you talked the time? of about of some networks volume enough we ups how think do adding alluding just about

Kristina Salen

creating release in our about was I'll content content unified comments with year. the through finding TV that start in the OpEx The and production. and we more we mentioned efficiencies our our media strategy move press a even as really in reorg and

the And production, second amount previously three. digital there in production activity and across TV had made three are deep the of of production. redundancies those content into only decent a changes We so the expenditures and organizations, of at we May, So terms quarter. end studio really

start we'll efficiencies fourth in to quarter hum those in see So start really and quarter. then the third the to

optimistic sequential in opportunity call would media So OpEx. I production continued what about I'm

XXXX to per-episode when as look pertains close now, for mentioned, in RAW it As the or level. at referenced very as at I I've SmackDown, cost you're to we that the and past, example,

on on year-over-year quarter between continued be second combining function organizations, comparison expect per there as these a be the more as through and visible while yet, because even basis, quarter the and three first perspective. very your answer I we in was move will a a So quarter question, the Steve? visible of episode in the and that not step in third there Does improvement visible fourth it that's efficiencies year sequential the to

Steven Cahall

It does.

Nick Khan

second on part. the I can jump in

least hours pay-per-view terms mind keep go know, at you add what weeks, year, XX already in we In in a a tonnage, three our weeks of seven developing additional always content as talked Steven, asked the on you desirous in ring, about. to five about and out hours way, and by of unscripted, there. scripted, we as And week we're the ring of new

do requirement, marketplace. tonnage off property with like it gives of top to the week of just it's I'd We more us, think entertainment XX No the of that. well. the position we go especially to in we the almost sports the think, think consistency other my do. come. head, exclusive And it So schedule, I an can certainly, like there's

Operator

next with Barclays. from our take Joyce question David We'll

David Joyce

A please. for couple me,

Univision's First, in it CabateGlobal. in thinking about that announced the just global was investing recently, opportunity set,

fan regions? available separately, then those with So have be your ventures, Europe. I will I to platform do you to you to of today just expand some that are be to or maybe still that joint in on think or first was wondering yet some events for Sky the And Do exposure seeing or engagement? tag wondering, a expire there acquisitions would outright and combat crossover have along was in or free -- be was way terms you're you of sports sports have what evolution? it agreements able will just mergers other that in announced Peacock various

Nick Khan

of those think for things couple it. I address A on you. I can

shown MMA. that really did has a Viacom Viacom. Bellator of In a he champion terms they buying Wade he think We of and was Davis of part when Univision at Group and the to was buying the Wade Combate. disposition

it's White time. in that "wrestling" The global I'm sure Dana and intentional Viacom So in whether is the territory of share just guys build big have one the And not their feels UFC. into follow, Fertitas one out UFC I'm ultimately any or like space. intentional, MMA company talked MMA let's product see time in the that was model develop the Combate, to that it at the we that not it market like putting about, what business position, we sort consolidation Bellator. global at Vince the is putting WWE and model sure that

are the well comes over But the sudden, it second to going not does we're a we what do Look, good over build. still that there. into it the again, goes consolidation space what everybody. to like space. the and any along part X/X. map hopefully seen all going of not boxing we're In new been with and all continue MMA That's I'm has so that we globally positioned it, there. space, a or that's the the financed. at And go the the international question, to internationally, with and place. of looking the moment that see fast. all factions just built entrant part for the to Univision yet. we're we're boxing Peacock space, Last back of It's thing space, in a already good uniquely combat from In of our time think, some X/X US all conglomerates situation. to part. In that think all any media different It to happens soon somebody splintered to again, in You've that Eventually sure almost we

us it production business So with automatically. with you with in already have all over rights again, don't something shows substantial a deal send entities, product, a there we want turnkey a trucks to turnkey and they again, and with obviously these existing the us have do license Comcast. of if Germany, with product, out comes they to But

months. there in the We're on let's things optimistic the middle what have of next of couple see So number it. in we we're of and a

Operator

next We'll question with Loop Gould from Alan Capital. take our

Alan Gould

this Two, one that assumes Kristina, large-scale be will you for one format guidance just confirm one and the year? for it Nick. can Kristina event

Kristina Salen

will large does there guidance a event. that assume be Our scale international

Alan Gould

for Strategically, rights you next value? combined revenue renegotiation what see next you start the TV a the move sponsorship, in is it the function the or see do was and big next step do doing strategically linear then you big obviously, Nick. big when of as Is few what increase US the And the I ago. years one, mean, big deals, digital opportunity? as

Nick Khan

talked rights, and scripted you we've sales unscripted about. media identified, International television as and sponsorship as

Michael Weitz

call listening the We everyone. you appreciate Thanks, today. to

please me, contact Michael you. Thank to Michael hesitate as WWE always, questions, have Headquarters. you any Guido, Weitz at If or don't

Operator

We concludes appreciate this conference. and Ladies today's your gentlemen, participation.

You may disconnect. now

World Wrestling Entertainment (WWE) 30 Jul 212021 Q2 Earnings call transcript