WWE releases its second-quarterly earnings report on Thursday posting a profit of just over $29 million for the period that included WrestleMania 37.
The second quarter reflected the business generated between April 1st and June 30th, including the two-day WrestleMania 37 event staged at Raymond James Stadium.
For the quarter, the company reported revenues of $265,540,000 with an operating income of $46.3 million that works out to a net income figure of $29,201,000.
The net income figure was down from last year’s second-quarter mark of $43,789,000 and a lot of that is attributed to an uptick in operating expenses.
Last year, the second quarter featured great savings on television production from the empty Performance Center compared to this year where the costs of running and operating the ThunderDome were sizable. This quarter also reflected a severance expense of $8.1 million related to layoffs as they consolidated its television, digital, and studios divisions under one banner and cut staff along with previous employees returning from furloughs.
The company also paid out $27.9 million to shareholders with $18.8 million in share repurchases that added up to approximately 336,000 shares bought at $55.77 per share. The allotment for the stock repurchasing program remains high with $323 million available for buybacks of the $500 million they authorized for the program. They also paid out $9.1 million in dividends for the quarter.
The Media sector brought in $233,790,000 and were responsible for the lion’s share of the quarterly revenues. The operating income of this division was $80.8 million, and those figures compare with $81.6 million in OI and $200,166,000 in revenues for Q2 2020. The increase in revenue reflected the higher licensing fee for the WWE Network with Peacock and escalators in their core content rights deals.
For the quarter, the core content rights fees brought in $141,765,000 compared to $132.9 million in last year’s second quarter.
In breaking down the ratings figures, the company stated that Raw was down 5 percent compared to Q2 in 2020 while USA Network is down 11 percent over the same period, and the top 25 cable networks dropped 18 percent.
SmackDown was listed as dropping 3 percent from Q2 2020 with Fox down 13 percent and the top four networks down 15 percent.
Last year’s episodes of Raw and SmackDown were the empty arena shows at the Performance Center, which had a detrimental impact on numbers until the switch to the ThunderDome in August 2020. It was a double-edged sword as expenses were greatly reduced at the WWE PC but numbers were dropping badly prior to the move, which was very expensive.
Live Events were essentially limited to the two-day WrestleMania event, although fans had begun attending the Capitol Wrestling Center for NXT tapings. For the quarter, they reported revenue of $9,239,000 compared to $983,000 last year where their live event business was halted due to the pandemic. North American ticket sales brought in $6.7 million compared to nothing in 2020.
In the Consumer Products department, they reported $22,511,000 in revenue (up by $200,000 this year) with operating income of $7.9 million reflecting a $300,000 uptick.
The company’s eCommerce business brought in $9,918,000, which was down from last year’s second quarter with $12.6 million. One of the interesting notes last year was the increase in online spending for merchandise during the early months of the pandemic that offset the lack of venue merchandise with no events for fans to attend and purchase items.
Venue merchandise for the quarter was only $1,295,000, but again, that’s largely coming out of two days of WrestleMania in Tampa.
For the remainder of 2021, they are not changing their adjusted OIBDA guidance of $270-305 million for the year.
They expect total capital expenses of $85-105 million as they re-start the work on moving in their new headquarters that will be built out this year and have projected an overall cost of $160-180 million for its new HQ.
After the first six months of 2021, the company has reported revenue of $529.1 million and net income of $73 million.
With the return to live events with fans and the potential of going to Saudi Arabia (which Kristina Salen noted as part of its guidance for the rest of the year), the company stands to have a significant second half of 2021 if the worst of the pandemic is over and there are no unforeseen problems they encounter.
On Friday, we will be joined by Brandon Thurston of Wrestlenomics to discuss the WWE’s second-quarter earnings report and its call with analysts after the release of the report.
Members of the POST Wrestling Café can listen to the entire Q2 earnings call featuring Vince McMahon, Nick Khan, Kristina Salen, and Stephanie McMahon-Levesque.
