Tag: world wrestling entertainment

WWE Q3 2022: Thoughts ahead of earnings call tomorrow

WWE moved the earnings call date back a day, to Wednesday evening rather than Thursday morning. The company noted that was to accommodate scheduling related to their Saudi Arabia event on Saturday.

Does that mean there will be more involvement on the call from the newly-appointed chief content officer, Paul Levesque, than they previously planned? They may want to have him comment and highlight that he’s done an effective job since taking over creative in late July.

I expect positive stories about TV ratings. Monday Night Raw is holding up well in year-over-year comparisons, despite NFL competition starting in September. Smackdown is also up year-over-year in four of the last five months. I expect an emphasis on “Easter eggs” as they point to how they hinted at the return of Bray Wyatt with clues in their programming and QR codes.

Stronger ratings will help their case for an upgrade in live rights fees. I believe serious negotiations for U.S. rights to Raw and Smackdown will start in Q2 2023 (April to June) and may even be finalized in that quarter. Given NFL on Thursdays has done well on Prime Video, Amazon seems like a more realistic player for one of the WWE shows. Current deals with NBCUniversal and Fox expire in the fall of 2024.

NFL Thursday Night ratings make it seem less likely a core WWE show would be airing in obscurity on a streaming platform. Streaming one of the flagship shows may actually expand WWE’s reach, given the younger demographics of streaming and pay TV’s continued decline and aging audience. Although the trade-off of moving away from the wide reach of broadcast (Fox, in the case of Smackdown) in favor of streaming (hypothetically, Prime Video), may be negative. Amazon can to afford to pay content providers like WWE commensurate to the tech giant’s current lesser ability to reach audiences.

Smackdown I believe is more likely to find a new home since it’s held by Fox. It’s questionable whether Fox is happy with the show’s ratings performance. And Fox can certainly live without WWE content. Contrasting against that, NBCU is deeply invested in WWE, so I see them likely to hold on to Raw and keep it on the USA Network.

Next-day Hulu rights are still in question. Did WWE and Hulu agree to an extension? Don’t expect clarity on that, but I’d work with the assumption that those rights will be dealt with live rights. Where NXT ends up in all of this seems in play, as well. It’s not publicly known when the agreement putting NXT on the USA Network expires, but it’s possible WWE has aligned those rights with Raw and Smackdown’s deals.

If Comcast/NBCU really wants to acquire WWE, it seems like 2023 is the time, ahead of another likely rights fees upgrade. Vince McMahon’s exit reasonably opened up speculation about whether WWE will be acquired. However, I’m neither convinced that Comcast wants to own WWE and fit it into its set of brands, nor that WWE is enthusiastic about selling with family members like Stephanie McMahon and Paul Levesque recently elevated in their executive roles. Acquisition seems somewhat inevitable, though. Endeavor is a well-suited acquirer and their president, Mark Shapiro, sounded interested in his comments on The Town podcast recently. Maybe that happens someday.

WWE’s September 3 “Clash at the Castle” event will be another highlight. Because of how WWE breaks down its revenue lines, we should get an idea of what the live gate was for the event since that was the only international event in Q3.

Domestically, I expect them to report an average paid attendance of around 7,000 per event, based on my reading of WrestleTix data, which would be their highest excluding-Wrestlemania quarterly average since the return-to-touring quarter of Q3 2021.

It will be interesting to see what their merchandise numbers are like, too. I built $28.5 million in revenue for the quarter toward the consumer products division, which consists of three areas: product licensing, venue merchandise, and eCommerce.

Consumer metrics have improved somewhat since Vince left, I believe due to the quality of the content. Some fans say not much has changed, but it seems to me enough has perceptibly changed to strengthen TV ratings and attendance, at least in the short term. It’ll be curious to see how WWE spins these trends without contrasting against the weak performance of their disgraced former CEO and Chairman.

I’ll cover the earnings report Wednesday evening on Twitter, @BrandonThurston. The call is at 5 pm ET, live on corporate.wwe.com.

I’ll be talking about the report with John Pollock of POST Wrestling on Thursday at 1 pm ET. It streams live on POST Wrestling’s YouTube channel and will be in both the Wrestlenomics Radio and POST Wrestling podcast feeds afterward.

My full WWE financial model and outlook are available to subscribers.

My latest estimates for WWE’s Q3 2022:

Revenue: $293.7 million
Operating income: $37.7 million
Adjusted OIBDA: $55.3 million
Net income: $24.5 million

For full-year 2022:

Revenue: $1.302 billion
Operating income: $291.3 million
Adjusted OIBDA: $369.4 million
Net income: $206.8 million

Brandon Thurston
brandon@wrestlenomics.com

Net Promoter Score: March 2021

Patrons got early access to this article on March 28 at patreon.com/wrestlenomics.

I collected responses for another survey that measures Net Promoter Score.

The results from the study done in late December to early January were published in the Wrestlenomics Pro Wrestling Industry Report (available via Payhip and Patreon).

I obtained responses through a Facebook ad again, to hopefully obtain a more random sample. I’m considering using Google Ads too in the future.

Monetary support from patrons made this study possible. Hopefully as we continue to produce valuable research, we produce a flywheel effect that drives interest and allows further investment in surveys and other research like this.

I plan to continue to do the NPS survey, maybe every quarter, so we can collect data points over time and evaluate trends. Below you’ll see the beginning of that as we now have two data points over time (for December/January [will be referred to as “December” for shorthand] and March).

It’s notable that the wrestling companies this time were listed in random order. In the previous survey, the wrestling companies were listed in this order for all respondents: WWE Raw, WWE Smackdown, WWE NXT, AEW Dynamite, Impact Wrestling, Ring of Honor, New Japan Pro-Wrestling.

The New Japan sample small enough to not take very seriously, but it’s plausible that appearing last for all respondents in December and appearing in a random position for each respondent in March contributed to the lower scores for New Japan in December and higher scores for the company this time.

I discovered it’s probably more fair to break out regular viewers’ sentiments from those of occasional viewers, rather than combining them as I did earlier. Regular viewers, as you might expect, tend to be more positive toward the program they watch than occasional viewers. Plus, some programs’ respondents are mostly regular viewers (like WWE main roster shows and AEW) and others (like ROH and New Japan) were mostly occasional viewers. A relevant breakdown will be displayed below.

With the prospect of full capacity live events and hopefully a return to normal life on the horizon, I included in the same survey form a question about the respondent’s willingness to be vaccinated against Covid-19. Results for that are also displayed below.

Although I spent a similar amount of money on the Facebook ad this time, only about half the number of samples were collected. The sample was also adjusted for disparities in race and gender, as compared to reports of viewership data.

Instead of targeting multiple major English language countries, this time I decided to focus on the United States only. Therefore the December results were filtered to responses from the U.S. only.

NPS results for March 2021

Click to enlarge view

NPS results over time: 

Regular and occasional viewers

“Dec 2020” here refers to responses collected between December 30, 2020 and January 3, 2021.

Regular and occasional viewers

Regular viewers only

Regular viewers only

Occasional viewers only

Occasional viewers only

Lapsed viewers only

Lapsed viewers only

How willing are U.S. wrestling fans to get vaccinated?

The below chart measures responses only from U.S. adults aged 18 years or older. 

Realizing there may be other factors that consistently coincide with vaccine willingness, information about age, education level, and household income was also collected and shown below.

Click to enlarge view

These results are comparable to the general public in the U.S. According to a study by Pew Research Center in February, 69% of Americans said they would probably or definitely would get vaccinated or already had at least one dose.

Political affiliation

I anticipated political affiliation might relate to vaccine willingness, and it does among respondents to this study. Respondents who identified as Republicans were 8x more likely than Democrats to say they won’t be getting vaccinated. Nonetheless, as you can see above, I didn’t find strong differences in vaccine willingness among viewers of different wrestling programs. Nor did I find strong differences in political affiliation about viewers of different programs.

Brandon Thurston has written about wrestling business since 2015. He’s also worked as an independent wrestler and trainer.

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