Recap From WWE’s Second Quarter Earnings Call – Vince Speaks, Network Additions, More
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– Vince McMahon and other senior members of WWE management will be hosting an earnings call from WWE headquarters in Stamford this morning at 11am. Below are highlights:
* SVP of Financial Planning & Investor Relations Michael Weitz kicks off the call. He will be joined by Vince McMahon and Chief Strategy & Financial Officer George Barrios.
* Vince takes over and says domestic attendance, TV ratings and the Network are their new key factors. Vince says attendance is up as are TV ratings. He says they consider 700,000 Network subscribers a strong number to build on. He mentions compelling program and new pricing options coming up. He hypes them launching the Network in 170 countries, beginning with a roll-out on August 12th. Vince also plugs the new TV & Network agreement with Roger Communications in Canada.
* Vince said they developed plans to improve their 2015 business outlook by several million dollars, including a 7% decrease in staffing. Vince said they are very optimistic about the future.
* Barrios takes over next and touts the WWE Network. He says 90% of subscribers access the Network at least once a week on an average of 2.5 devices. They expect a gradual increase in subscribers as awareness grows and technology expands.
* Barrios then talks about the international expansion of the Network. They’re planning on stepping up third-party advertising going into SummerSlam. He noted they’ve mostly relied on RAW and SmackDown to advertise the Network. They feel they can turn the 424,000 domestic WrestleMania buys into Network subscribers.
* WWE Rivalries and The Monday Night War will be added soon and will give a documentary style look at WWE history. They’re also working on new Network features like a “resume play” ability.
* WWE Network generated $19.4 million in subscription revenue based on the first subscriber count. This was offset by the decline in pay-per-view buys. He goes over other increases and decreases from the earnings report. Live attendance was down in part due to the stadium configuration of WrestleMania XXX, which caused lower attendance for that event. Excluding WrestleMania, average attendance is up. WWE Studios’ Scooby Doo, Road to Paloma and Oculus movies are performing in line with their expectations.
* He mentioned the 7% decrease in staffing that Vince mentioned earlier. He did not say when these cuts will be made.
* We go back to Weitz before taking investor questions. Vince is asked about Network pricing. Vince said as they grow and learn, they will possibly be presenting other pricing options.
* Barrios confirmed the Network being rolled out internationally will be identical to what we have in the United States. Apparently it will be English only until they get to other languages.
* They were asked about why they chose to go the new route with Rogers Communications on cable in Canada. Vince said Canadians look at things a bit differently. They’re happy with the deal but wouldn’t go into terms. Vince called it an offer they couldn’t turn down. They do plan on eventually launching an authenticated version of the app in Canada so it has the same look and feel that we have here. Rogers could have advertising on that authenticated app.
* They are still expecting just about full cannibalization of pay-per-view. There will be a few countries where that won’t be the case but not a significant amount.
* They were asked if they still expect 1 million domestic subscribers by the end of 2014. Barrios didn’t answer that directly but said from day one they’ve said they would be very happy if they hit that mark and said they still feel that way.
* The subscribers that are picked up through the Rogers deal in Canada will indeed be included in Network subscriber counts.
* We go back to Weitz to wrap up the call.