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WWE Q3 financials: Revenue, Network subs & attendance decrease

This story was updated at noon Eastern on Thursday.

Prior to their investors' call Thursday morning, WWE released their 2019 Q3 numbers, showing a small year-over-year decrease in revenue to $186.3 million and 1.51 million average paid WWE Network subscribers.

As of this writing, WWE stock was down nearly 16%, trading at $55.91 a share. 

Notes and audio from today's call can be found below. 

WWE attributed the decrease from $188.4 million a year ago to declines in live event ticket sales and merchandise offset by increase in their Media segment.

They highlighted the following quarterly highlights in their release:

  • $6.4 million operating income, down from $18.1 million in last year's Q2 due to a decline in revenue and "increases in fixed costs including the impact of certain strategic investments".
  • $25.4 million adjusted OBIDA (operating income before depreciation and amortization) as compared to $35.8 million the year prior.
  • They adjusted their full year guidance of a record $180-$190 million OBIDA, down from their $200 million OBIDA forecast from last quarter. The downturn was attributed to a TV deal in the Middle East being delayed and an increased investment in content creation.
  • The Network subscriber drop (9%) was in line with their Q2 prediction of 1.53 million. They predicted a further drop to 1.43 million in Q4 and a year over year decline of 10%.
  • They said that that through the end of September, "digital video views increased 12% on a year-over-year basis to 25.6 billion and hours consumed increased 14% to 957 million hours across digital and social platforms."

Other notes:

  • Live event revenue declined to $23.2 million due to "weakened performance" and fewer North American shows. Excluding NXT, there were 74 total events in Q3 (67/7 domestic to international split) compared to 90 in Q3 last year (86/4).
  • Their average ticket price increased by 6% to $56.64 while overall North American sales declined by $4.1 million with 19 fewer shows and lower attendance. International revenue was virtually identical.
  • Consumer products decreased to $17 million, down from $19.6 million last year.

Call Notes

  • Vince McMahon was not on the call as he's in Saudi Arabia for Crown Jewel. George Barrios did the majority of the talking.
  • He acknowledged reviews for WWE2K20 were mixed.
  • He was asked about NXT's move from the Network to USA and the continued drive toward live rights. A question about leaving Full Sail University didn't get answered.
  • They expect their India TV deal to be done by end of '19 and gives no timeline for the Middle East deal.
  • Barrios believes 70% of total growth in years ahead will come outside the U.S. and both India and China are a big part of that growth.
  • They said investors couldn't be guaranteed two Saudi Arabia shows per year going forward.
  • Network tiers were again brought up, but no timeline was announced. They see their value prop as different than HBO Max and Disney+ so there's a not a drive to reduce the monthly cost to keep up.
  • They brought up "accelerated investments" in their in-ring product when asked if this year's Crown Jewel was more expensive due to Tyson Fury and Cain Velasquez. The creation of the storyline, the in-ring talent, and producing the actual content are all part of the process and all saw increases.
  • Asked about AEW, Barrios said there is a lot of competition for eyeballs through all media and sports entities. Their expectation is that they win.

Full audio from the call:

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