World Wrestling Entertainment Inc. body-slammed another financial quarter Thursday, validation of its top-rope standing in the industry and a relentless austerity program.
The wrestling industry’s heavyweight
reported net income of $66.1 million, or 77 cents a share, compared with net income of $43.8 million, or 51 cents a share, in the same quarter a year ago.
WWE’s net revenue improved 27% to $333.4 million from $263.5 million last year. The company’s three major revenue sources — media ($278.1 million), consumer products ($32.2 million) and live events ($23.1 million) — all were up significantly year over year.
Analysts polled by FactSet expected net earnings of 65 cents a share on revenue of $325 million.
WWE’s stock rose 4.7% in after-hours trading Thursday.
The last fiscal year was a body slam for WWE. The preeminent name in the industry racked up its biggest revenue year ever ($1 billion) and most profitable ($180 million), but it came at a price: More than 100 wrestlers were let go in a steady drumbeat of job cuts during 2021 that made the year such a money-making success for Chief Executive Vince McMahon.
The quarter included a two-night version of its WrestleMania extravaganza that drew 156,352 fans at AT&T Stadium in Arlington, Texas, and the most-viewed WWE premium live event ever. “We believe WWE offers a compelling reopening trade and that business momentum will stay elevated,” Benchmark analyst Mike Hickey said in a note late Thursday.
“We are off to a strong start in 2022, highlighted by record quarterly revenue and Adjusted OIBDA,” McMahon said, announcing the results.
In a webcast with analysts late Thursday, WWE President Nick Khan noted the enduring appeal, and potential future growth, of live sporting events on streaming services such as Comcast Corp.’s
Peacock, a key licensing partner of WWE. He pointed to MLB games on Apple Inc.’s
Apple TV+ and the NFL on Amazon.com Inc.’s
Prime Video. He also indicated WWE will ramp up live events at larger venues in the U.S. and abroad.
Still, the past year’s cost-cutting and aftereffects of COVID have contributed to reduced TV ratings, smaller live crowds and a general malaise toward the product, argue critics of WWE and McMahon.
“It is hard to teach an old dog [McMahon] new tricks,” Bryan Alvarez, a former wrester and a radio host on Wrestling Observer Live, told MarketWatch. “Vince trusts [longtime wrestlers] Randy Orton and New Day. He needs to let younger talent learn and fail. He does not have patience.”
Nonetheless, WWE’s stock is up 20.6% so far in 2022, while the broader S&P 500 index
is down 13%.