WWE Reports Record Revenue and Q2 2017 Results
WWE issued the following today:
WWE® Reports Record Revenue and Q2 2017 Results
Second Quarter 2017 Highlights
* Revenue increased 8% to a record $214.6 million as WWE’s Live Event and Network segments achieved their highest quarterly revenue in Company history
* Operating income was $10.7 millionand Adjusted OIBDA1 of $18.1 million was essentially in line with the Company’s guidance
* WWE Network averaged more than 1.63 million average paid subscribers over the second quarter 2017, which represented an 8% increase from the second quarter 2016
* Launched localized weekly TV shows in India and Middle East. WWE Sunday Dhamaal in Hindi with Sony Pictures Networks and WWE Wal3ooha in Arabic with OSN feature highlights of Raw and SmackDown
* Completed multi-year agreement to televise Raw and SmackDown on SuperSport, Africa’s premier sports broadcaster. WWE programming will be broadcast live for the first time in more than 50 countries
* Through the first six months of the year, digital engagement metrics continued to grow with video views up 18% to 9.1 billion and social media followers increasing 19% to 800 million
* Global sponsorship revenue increased 25% year-to-date, driven by new deals with blue-chip companies (KFC, Nestle and AT&T) and gaming partners (Psyonix, Square Enix & Activision)
* Lagardère Sports, a best-in-class sports marketing agency, was selected to further develop the Company’s global sponsorship business
* Completed agreements to develop new mobile games with GLU Mobile, maker of Racing Rivals and Kim Kardashian: Hollywood, and Sega, creator of Sonic the Hedgehog. Sega’s WWE Tap Mania launched July 20
* Extended Mattel’s global master toy licensing agreement through 2021. WWE action figures continued to rank among the top three action figure properties in the U.S.
Selected WrestleMania Highlights
WrestleMania (April 2, 2017) broke the attendance record for the Orlando Citrus Bowl, attracting 75,245 fans, and reached a record 1.95 million global households on WWE Networkalone, making it the most-watched WrestleMania in history. WrestleMania was made available live in China for the first time on PPTV Sports via pay-per-view with a choice of Mandarin or English commentary. During WrestleMania Week, WWE Network subscribers watched 22.5 million hours of content, averaging approximately 13 hours per subscriber. WrestleMania was the most social event in WWE history with 5.19 million interactions on Facebook and Twitter during the broadcast alone. WrestleMania accounted for nearly 30% of all social TV interactions on April 2nd, surpassing the Country Music Awards (13%), The Walking Dead Season Finale (10%) and MLB Opening Day on ESPN (10%). During WrestleMania, the Company launched its first Snapchat show yielding over 5 million unique viewers. A series of Snapchat shows, co-produced by NBCU, will start later this year.
STAMFORD, Conn.–(BUSINESS WIRE)– WWE (NYSE:WWE) today announced financial results for its second quarter 2017. For the quarter, the Company reported Net income of $5.1 million, or $0.06 per diluted share, as compared to Net Income of $0.8 million, or $0.01 per diluted share, in the prior year quarter. Operating income increased to $10.7 million from $1.5 million. Excluding items affecting comparability, Adjusted OIBDA1 increased to $18.1 million from $7.5 million.
“We are pleased with our ongoing efforts to execute our multi-platform content strategy as evidenced by the continued year-over-year growth of WWE Network, the increased production of localized programming across platforms and markets, and the attraction of new sponsors,” stated Vince McMahon, WWE Chairman and Chief Executive Officer.
George Barrios, WWE Chief Strategy & Financial Officer, added “We achieved record revenues in our Network and Live event segments, continued to grow WWE Network’ssubscriber base, and generated results that were essentially in line with our guidance. As we continue to drive WWE’s digital and direct-to-consumer transformation, we remain on track to achieve our 2017 financial objectives with record revenue, record Adjusted OIBDA results, and record subscriber levels.”
Q3 2017 Business Outlook
For the third quarter 2017, the Company projects average paid subscribers to WWE Network of 1.54 million (+/- 2%). The Company also estimates third quarter 2017 Adjusted OIBDA of approximately $31 million to $35 million.2 This range represents an expected year-over-year increase from $24.5 million in the third quarter 2016 primarily due to the contractual escalation of television rights fees and continued growth of WWE Network subscribers.
WWE is unable to provide a reconciliation of third quarter guidance to GAAP measures as, at this time, WWE cannot accurately determine all of the adjustments that would be required.
WWE management continues to expect the Company to achieve another year of record revenue and has targeted Adjusted OIBDA of $100 million, which would be an all-time record (up approximately 25% from 2016 Adjusted OIBDA of $80.1 million).2 Given that the Company generated Adjusted OIBDA of $36.7 million in the first half of 2017 and projects Adjusted OIBDA of $31 million to $35 million for the third quarter, reaching the full year target indicates a range of fourth quarter results of at least $28 million to $32 million. Estimates for the third and fourth quarter 2017 represent significant year-over-year growth, which is based on sustained revenue growth and more favorable year-over-year comparisons in the Company’s fixed cost base.
Comparability of Results
For the second quarter of 2017, Operating income included $1.1 million in film impairment charges. For the six months ended June 30, 2017, Operating income included $5.6 million in expenses primarily related to certain legal matters and other contractual obligations, and $3.2 million in film impairment charges. As these items impact the comparability of results on a year-over-year basis, they have been excluded from the Company’s 2017 Adjusted OIBDA. For the comparable periods of 2016, there were no such items that impacted year-over-year comparability.
A reconciliation of 2017 Adjusted OIBDA to Operating income (GAAP) for the three and six month periods ended June 30, 2017 can be found in the supplemental schedules on pages 14-16 of this release.
You can read the full release on WWE Corporate at this link.