WWE announces record revenue for 2018, breakdown of the year


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Originally published at https://www.postwrestling.com/2019/02/07/wwe-announces-record-revenue-for-2018-breakdown-of-the-year/

The WWE released their fourth quarter and year-end earnings report on Thursday with a record-setting year of revenue.

For the year, WWE announced revenue of $903.2 million, which was a huge increase from $801 million in 2017. That translates to $99.6 million of net income in 2018, which is up from $32.6 million the year prior. Adjusted OIBDA for the company (which excludes stock expenditures) was announced at $178.9 million in 2018, up from $136.1 million in 2017.

The record revenue can be attributed to the escalation of television rights fees, but the major jump was the events they staged overseas, specifically through the deal with the General Sports Authority in Saudi Arabia.

The company lumps the Saudi Arabian revenue into a media category listed as “Other”, which includes “revenues earned from the distribution of other content, including, but not limited to, certain live in-ring programming content in international markets, scripted, reality and other programming, theatrical and direct-to-home video releases.

For the quarter, that category was listed at $63.5 million in revenue, up from $20.6 million in 2017. This category would also include the Super Show-Down event from Melbourne in October. The same “Other” category increased by $48.7 million in Q2 to reflect the revenue from the Greatest Royal Rumble card so the increases in Q2 and Q4 totaled $92.2 million, although the exact amount paid for the two shows in Saudi Arabia cannot be specified.

The WWE Network had 1,563,000 total subscribers on December 31st, 2018 with a breakdown of 1,528,000 paid and 35,000 free subscribers. They lost 99,000 subscribers over the quarter.

Of the paid subscribers, 1,116,000 are in the U.S. and 412,000 are international, which was an overall drop of 87,000 in the quarter.

As a comparison, they had 2,124,000 subscribers on the day of WrestleMania with 1,808,000 paid and 316,000 free subs. It was noted on the conference call, that the company will be discontinuing the process of releasing a WWE Network subscriber number the day after WrestleMania, beginning this year.

Live event revenue was down year-over-year with $144.2 million in revenue in 2018 compared to $151.7 million the year before. They ran 18 fewer events this past year. They ran 308 shows in 2018 compared to 312 in 2017, 278 in 2016, 271 in 2015, 262 in 2014, 253 in 2013, 232 in 2012 and 224 in 2011.

For the fourth quarter, revenue was $34.4 million on the live events side with 87 shows including 64 in North American and 23 international cards. In the fourth quarter of 2017, they ran 101 events with 68 in North America and 33 international shows.

Attendance averaged 5,000 for the fourth quarter, which was up from the third quarter average of 4,500 but down from Q4 in 2017, which averaged 5,400. International attendance was way up in the fourth quarter with an average of 6,900 compared to 5,200 in 2017.

The average ticket price in North America rose 6% to $57.75 and internationally the average price for a ticket was $64.93.

Television viewership showed notable declines for Raw and SmackDown with ratings down 15% and 14% respectively year-over-year. The report compares the declines to the USA Network and the top 25 cable networks, which didn’t experience the same level of drops with USA Network down 4% and the top 25 cable networks down 7% for the same time period.

On the Q&A call, co-president George Barrios spoke about the live event attendance being down but isolated their television and pay-per-view events being either stable or up, without adding any discussion about the state of house shows, which was a big topic on the last quarterly call.

Vince McMahon was asked about Ronda Rousey potentially leaving and if that would be damaging and not worth the experiment. McMahon stated Rousey became part of the WWE brand, has added to their ability to reach women and called Rousey “one of the brightest people they have ever done business with.” He added that if they know the dates she will be gone for, they can work around that. That led to McMahon rattling off a host of names that have been injured over the past year.

There was a question about All Elite Wrestling and their potential effect on the market. Barrios stated it was “too early to tell” and was confident that they were the premier wrestling organization with the best wrestlers in the world.

The company is forecasting revenue of $1 billion in 2019 with a record level of OIBDA hitting the $200 million mark. They added that goals for the year included more localized content and the “next iteration of the WWE Network.”

With the new television deals with USA Network and Fox going into effect in the fourth quarter of 2019, they are predicting strong year-over-year growth for every quarter in 2020.

They are also forecasting an average paid subscriber number of 1.59 million in Q1 this year for the WWE Network.