Recap from the WWE Q4 2021 earnings call

Feb 3, 2022 - by Marc Middleton

WWE Chairman & CEO Vince McMahon, Chief Revenue Officer & President Nick Khan, Chief Branding Officer Stephanie McMahon, Chief Financial Officer & Chief Administrative Officer Frank A. Riddick, and Senior Vice President & Head of Investor Relations Seth Zaslow hosted a Fourth Quarter 2021 Earnings call today from WWE headquarters in Stamford, CT. You can check out coverage of today’s press release at this link. Below are highlights from the call:

Zaslow welcomed us to the call. Vince touted how WWE brought in a considerable increase in revenue over the last year. He said they re-imagined WWE and that’s something they do every month. Their performance speaks for itself and what they have done long term. Khan took over and touted the success of the Peacock deal. Money In the Bank viewership was up 20% from the previous year, SummerSlam was up 30% from 2019, Extreme Rules was up 20% from 2019. They had significant increases in viewership for Survivor Series and the Saudi Arabia events.

Khan touted how more WWE fans are watching their marquee events than ever before. He talked about the importance of WWE’s intellectual properties. He said they have more than a dozen scripted and unscripted projects already sold based on WWE IP. These will be announced soon, some domestic and some internationally. Khan touted success of new NFT and trading card partnerships, and their new lottery partnerships. He said fans can be on the look out for WWE-branded lotteries rolling out in multiple states later this year. He praised the extended contract with Mattel and said they see even more growth there.

Khan touted how WWE Day 1 was sold out and one of the highest viewed events on Peacock in the history of the platform. The Royal Rumble brought the largest merchandise sales ever at a Rumble event, and was the second-highest attended Rumble ever, and Peacock viewership was 45% higher than the 2020 Rumble. Khan mentioned the next Saudi Event, WWE Elimination Chamber on February 19, and said WWE couldn’t be more pleased to get back to staging major events internationally. He said more news on international events will be announced later this year. Khan mentioned WWE being an Executive Producer of ESPN+’s Rowdy’s Places show with Ronda Rousey, and touted Rey Mysterio being on the WWE 2K22 video game.

Stephanie took over and mentioned how WWE Superstars have been used in outside mainstream projects – Sasha Banks in the ESPN College Football Championship opener, and Big E introducing Tyson Fury vs. Deontay Wilder. She mentioned the Jackass involvement with Johnny Knoxville working the Royal Rumble. She mentioned how the Royal Rumble was the most social-active event, and the most active WWE event on the Peacock platform so far.

Stephanie said their mobile gaming use is up 14% year over year. She said WWE Supercard is 2K’s highest-grossing game with 24 million downloads. WWE Champions has had 50 million installs, and saw its best quarterly performance in history with Q4. She said gaming is a focus for WWE as roughly 85% of the fanbase identifies as a gamer. They are more optimistic with YouTube and Netflix launching gaming platforms. Stephanie said the next generation of Superstars and fans is important to WWE. She touted the NIL Athlete program (Next In Line) and the first class of athletes, noting that they are looking for elite athletes with larger than life personalities. She said never before has there been such a clear pipeline to being a WWE Superstar.

Stephanie touted WWE’s social media success, which includes more than 50 billion views across the various platforms. Stephanie was touting some of WWE’s advertising partnerships, including Netflix’s Red Notice movie, when she referred to The Rock as a WWE Hall of Famer. That could’ve been an error or a sign of things to come. She said the Red Notice/Survivor Series storyline generated 20 million video views. She also touted the Pizza Hut sponsorship for the Royal Rumble and how The Street Profits came out with slices and a checkered tablecloth. Fans chanting “we want pizza!” in the crowd is a sign the campaign worked.

Riddick took over the call next and went over the stats seen in the press release linked above. It’s now time for the Q&A portion with investors. Stephanie noted that there’s no reason they can’t expect $100’s of millions of dollars in sponsorship advertising in the coming years, and said they are moving from contractual to transactional deals, and are relying on the use of Superstars and IP in those deals.

An investor asked about the Disney+/WWE Network deal in Indonesia, and with Disney and Discovery covering so many markets, why start with a one country deal, and if they wanted to do more blanket deals. Khan said they are doing region-by-region deals with what makes the most sense to their partners in those regions, and Disney+ made the most sense in that region. Khan said WWE will be in good shape on those type of deals in a few months.

Stephanie says WWE is absolutely exploring the Metaverse for various opportunities. They think there are huge opportunities there, especially as more people begin to use the technology. WWE likes to be ahead of the curve so they are actively involved and investigating the Metaverse.

They were asked about large-scale international events this year, and they said at least two are expected. Khan said why limit it with just two, teasing that more large international events may be held this year. He earlier said an announcement for large international events would be made in the coming months. Stephanie was asked more details about the NIL program, and how it compares to taking talent from “regional, smaller promotions.” She said WWE offers athletes more than they can get anywhere else. Khan chimed in and mentions how Big E, WWE Universal Champion Roman Reigns and other Superstars have ties to their colleges, and said the NIL program made all the sense in the world to WWE.

Khan said WWE believes they have out-performed on Peacock when it comes to advertising and subscription. He said WWE has a triple play with streaming, digital and broadcast, and they have the needed content that can be sold to advertisers, advertiser-friendly content that helps in cable and broadcast TV. They were asked about the RAW “second window” rights renewal for Hulu, and Khan said they feel as good about it as they did when they were doing their RAW/SmackDown deals with NBCUniversal/FOX, and their Peacock deal.

They were asked if they will pursue broadcast TV when the FOX deal ends, or if they would consider a streaming service for SmackDown. Khan compared it to sports leagues and said their big events are on Peacock, and their regular season shows, RAW and SmackDown, are on USA and FOX. They still think big events will be on both, and they won’t discount those buyers, but the company realizes that premium money is being spent on premium services. Khan also said they are extremely pleased with the FOX relationship, and they believe in what FOX is doing. That’s it for the call.

Stay tuned for more.

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