WWE Q4 2020 Earnings Report Preview: Suggested questions ahead of report of record profits

WWE is expected to report 2020 was the company’s most profitable year ever tomorrow (Thursday). Fourth quarter and therefore full-year 2020 results will be reported just after the market closes.

Below we’ll look at some questions that might be (and some that almost certainly some won’t be) discussed during the call. The Q&A session in which stock analysts get to ask questions to WWE executives is of particular interest here.

I’ll be covering the report and earnings call as it happens, on Twitter (@BrandonThurston) and here on wrestlenomics.com.

WWE officers scheduled to be on the call are the same as the Q3 call in October: WWE chairman and CEO Vince McMahon, president and chief revenue officer Nick Khan, chief financial officer Kristina Salen, and chief brand officer Stephanie McMahon. As always, anyone can listen to the conference call live on corporate.wwe.com at 5:00pm ET.

If you’re reading this, you probably know who Vince and Stephanie are. Khan and Salen are relatively new to WWE. They were hired by the company in 2020. Both started around August of last year. When he was with CAA (Creative Artists Agency) Khan negotiated WWE’s current U.S. television deals with NBCUniversal and Fox. Salen is a former CFO at Etsy and Moda Operandi.

The new deal with Peacock, granting the NBCU streaming service U.S. rights to all WWE Network content is Khan’s first major deal as WWE president. Expect information about the Peacock deal to be a frequent topic of conversation on the conference call.

1. Future of the WWE Network on Peacock

How does the Peacock deal affect WWE’s expenses? Does the Peacock deal entail employee reductions? Are there commitments to data that WWE (including employee positions) no longer needs to invest in? Are there other expenses NBCU will absorb? Will Endeavor continue to provide CDN for WWE Network?

What are some key lessons the company learned from the seven-year WWE Network project? It may have been a challenge for a company that has a long history of producing content to tackle a tech-heavy project like this. How much of a factor does WWE feel that was in the Network not driving more revenue on a purely direct-to-consumer model in the U.S.?

How seriously was selling select events like Wrestlemania as a standalone pay-per-view event (like ESPN+ does with UFC) considered? Wrestlemania is clearly included in Peacock Premium this year. Is that something that’s off the table now?

Other than the reported $1 billion in fees over five years, how does the deal affect WWE’s revenues? What does the deal mean for WWE’s media advertising and sponsorship revenues? Does NBCU now get a portion of revenues from WWE’s major advertisers like Snickers’ official sponsorship of Wrestlemania?

There’s a vast library of content currently available on the WWE Network. Should subscribers expect that 100% of the content they had access to on the WWE Network will be available on Peacock Premium?

Are there incentives in place encouraging WWE to produce monthly pay-per-view events that drive people to subscribe to Peacock? The new deal with Peacock has a five-year term, so there is the incentive that WWE wants its content to perform well so that there’s a better deal waiting at the end of this one. That’s a kind of incentive. But is any part of WWE’s compensation based on performance? Are there an incentives based on subscriber activity or viewership on Peacock?

2. Does the Peacock deal bring WWE closer to being acquired by NBCU/Comcast?

There will be no straight answers here, but NBCU now owns U.S. rights to Raw and the Network content, paying WWE somewhere around $465 million annually ($265 million for Raw and $200 million for Network content). Over the course of both of those agreements, NBCU will have paid WWE more than $2 billion, nearly half the market capital of WWE. Does the latest deal get NBCUniversal closer to acquisition? Is acquisition on the table when Raw rights are renegotiated, likely beginning some time next year? This might be a question for Comcast’s (NBCU’s parent) executives as well.

3. How does WWE see NBCU folding NBC Sports and moving sports content to USA Network (and other NBCU platforms) affecting WWE content? NXT in particular.

It likely is, but can investors have some reassurance Raw is safe Monday nights in primetime? Will there be an preemptions of Raw in the future due to sports programming?

Are there cross-promotional opportunities between WWE and other sports programming? Granted, WWE’s matches are predetermined, but with USA Network taking on more sports content, is there any consideration into categorizing Raw and NXT as sports like how Fox categorizes Smackdown and how TNT categorizes AEW?

NXT is currently on Wednesday nights where it runs head-to-head with AEW Dynamite. It seems possible if NBCU retains NHL rights that hockey could take precedent on Wednesday nights on USA. NXT hasn’t beaten AEW in viewership in months and hasn’t led with viewers 18-49 in more than a year. Is it better for building the NXT brand to move the program to another night? How important does the company view directly competing with AEW? Does higher viewership for AEW pose a risk to WWE’s own future media rights value?

Source: Nielsen

Is there any update the company can give on NXT negotiations? Will the company publicly confirm the NXT deal with NBCU expires in the fall? Under prior management, WWE stated part of the reason for moving NXT off of the WWE Network and on to linear TV was to grow media rights value of a third weekly brand. Two years later, does the company feel that’s been a success? Furthermore, is Peacock a possible future home for NXT?

4. Hiring of Christine Lubrano as SVP of Creative Writing Operations

The former IFC executive joins WWE, where she’ll work with Bruce Prichard. The press release states Lubrano will work under EVP of operations Brad Blum, but it sounds like Lubrano and Prichard are now the key people on the creative team under Vince. What skills does Lubrano bring that will be especially additive to WWE’s programming? WWE’s talent roster of women and obviously the company’s focus on female talent as serious athletes have grown tremendously in recent years. What percentage of the company’s creative team are women?

5. What’s the company’s latest analysis of Raw and Smackdown ratings? Why are AEW and NXT not seeing similar trends?

Source: Nielsen

Raw and Smackdown have stabilized since the addition of the Thunderdome. Both programs are actually seeing an upward trend in recent weeks. Raw is boosted by lack of competition from the NFL since its season recently ended. Both programs still are not back to where they were before the pandemic, while NXT and AEW held up more consistently since full live audiences were restricted.

This is especially noticeable in trends among younger viewers like those in the 18-34 category. In fact, the majority of viewers for WWE’s programs are 50 or older. It seems wrestlers, too, (at least those on flagships Raw and Smackdown) on average are getting older. What’s WWE doing to address this?

Source: Wrestlenomics Pro Wrestling Industry Report 2020

6. Why was it important to announce locations for Wrestlemania this far in advance? Will Wrestlemania be a two-day event going forward?

WWE usually doesn’t announce the Wrestlemania location for the event two years ahead. Was this simply due to the Tampa postponement reordering the schedule? Or were there other factors?

Wrestlemania events for 2022 and 2023 are referred to in the press release as one day only, yet this year’s event and last year’s are two-day events. Is the company considering making this a permanent feature going forward? Might that be the best way to monetize the company’s peak annual event? Seems there would be further opportunity to generate ticket and merchandise revenue, and the company has a growing roster of talent. One-day Wrestlemania events in previous years were several hours long.

7. Is WWE trying to integrate talent and advertisers?

Stephanie McMahon has spoken in interviews about the value of integrating advertising opportunities within the programming itself. Was Rey Mysterio’s Victoria Beer wrestling attire an early example of things to come? How does WWE feel this benefits advertisers and the talent?

8. What’s the latest with NXT’s “Global Localization” strategy?

WWE recently aired its “Superstar Spectacle” event aimed at India. Are there more localized programs like this in the works? Will an NXT India brand be launched in the near future? Would that mean a Performance Center would be established in the region as well? Are there other regions that are closer to being developed? How has Covid affected this strategy overall?

A docket showing WWE involved in litigation in Connecticut against the U.S. Citizenship and Immigration Services appeared in public legal resources recently. Does the company foresee any issues with obtaining visas for international talent? Are travel restrictions enacted by the new presidential administration seen as obstacle?

9. What are the company’s plans for the Twitch platform? Cameo?

In September WWE talent were ordered to stop using third-party video platforms like Twitch and Cameo. What opportunities does WWE see there?

10. Has WWE made any decisions about the future of live events?

In the most recent pre-Covid quarters, the live events division struggled to report positive operating income. Losses on live events were particularly evident in quarters not containing Wrestlemania. An increasing amount of WWE’s revenue is coming from media sources. What value does the company see in running house shows (non-televised events)? Is it safe to say, post-Covid, WWE will run a reduced touring schedule?

11. Are there any decisions on the stock buyback program?

WWE stated in July it was considering restarting its stock buyback program that was put on hold at the beginning of the pandemic. Shares have been climbing since the last earnings report. Many analysts have raised their stock price targets recently. It seems this is a subject CFO Kristina Salen would be the key person to hear from on.


Brandon Thurston has written about wrestling business since 2015. He’s also an independent wrestler and trainer. For more, see our About page.


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