WWE released its financial results for the quarter this morning. We'll have an extensive look in the next Observer on it. Revenue was $152.3 million, largely due to WrestleMania. With the show being more successful as far as generating money, the revenue was up from $141.6 million last year.
However, profits declined from $11.9 million in the WrestleMania quarter to $5.2 million. which is a very low figure for what is traditionally the biggest period of the year.
A lot of that was expenses in getting ready for the network and opening up the new performance center. They push that long-term, the performance center will be a major plus when it comes to creating new talent, and that television long-term is strong with the belief they can get significantly higher rights fees when the current U.S. contracts expire.
They did concede that profits in 2013 will be at the lower end of projections from when the year started.
House show attendance was down 2%, but that was impacted by a bigger WrestleMania or the drop would be slightly more. The post-WrestleMania European tour was up somewhat.
PPV, even with WrestleMania's increased price was down, partially due to cutting back on one PPV, the former Over the Limit show.
PPV total buys for the quarter were:
WrestleMania 1,039,000 - down 15% from last year based on numbers recorded at the same time
Extreme Rules 231,000 - down down 14%
Payback 186,000 - down 4% from No Way Out
Increased television revenue more than offset that, but it's not that revenues are down, but that profits are down.
Again, a lot of that is future investment and PPV and house shows are no longer the main revenue source.
Toy sales were up, but the video game issues that are not the company's fault hurt them. DVD business was down.
Web site business was up 27% to $6.1 million, while merchandise on the web was even.
To fully evaluate the quarter, the key would be costs. For example, in prior quarters there have been increases in PPV and television when it came to revenue, but in spending more to get those increases, profits have been down.
Vince McMahon admitted they were down more than they expected to be, but they are donig a lot of things to prepare for the future, so evaluating certain aspects by just profit/loss may not be fair.
However, the decline in a lot of categories when it comes to selling product to the consumer is real and not something that is a growing pain of building the future.